CBI set to question Bhave on MCX-SX

The CBI will soon examine former Sebi chairman C B Bhave as it plans to conclude its inquiry against him and ex-member K M Abraham, Jignesh Shah-founded FTIL and MCX, among others, in connection with alleged irregularities in granting sanction for operating the new Stock Exchange MCX-SX. Highly placed CBI sources said today they wanted to conclude the inquiry soon and a call on whether to convert it into a regular case or close it would be taken after examining Bhave.  

The sources said the inquiry was registered on the basis of available material which prima-facie made a case for a preliminary inquiry.

They said Bhave would be called for clarifying several points related to grant of sanction to MCX-SX to operate and renewal of licence which have emerged during the inquiry by the sleuths.

According to the CBI, the preliminary inquiry was registered on issues of alleged irregularities in granting sanction to MCX-SX by the Securities and Exchange Board of India in 2008 and renewing the recognition in 2009 and 2010.

The probe by the CBI is to ascertain how MCX-SX was granted permission despite opposition by Sebi when Bhave was head of the regulatory authority.

MCX-SX was set up by Shah-led Financial Technologies India Ltd (FTIL) and its commodity exchange arm MCX and began functioning as a full-fledged stock exchange last year after a prolonged battle with SEBI.

The exchange was initially granted permission for only a limited segment of currency derivatives in 2008, on the condition its license would require approval every year.

Bhave had slammed the CBI move saying the agency was indulging in "pick and choose" while registering PE against him and Abraham.

"It is very easy to say something against someone and make humiliating allegations and malign their reputations. And if they have not found anything criminal act from them, will they apologise? If CBI has not found anything against me, then I want them to publicly apologise to me," he has said.

Last year, SEBI asked MCX-SX to restructure its board and governance structure after a payment crisis broke out at the National Spot Exchange Ltd (NSEL), also promoted by FTIL.