FTIL hearing at Sebi today

The Securities and Exchange Board of India (Sebi) has summoned Jignesh Shah-promoted Financial Technologies (FTIL) for a hearing on Tuesday. In December 2013, Sebi had issued a showcause notice to FTIL, questioning its 'fit and proper' status to run MCX-SX.

The hearing is scheduled in the evening on Tuesday, sources said. It could not be confirmed whether Jignesh Shah would personally attend the hearing along with FTIL's legal team. FTIL owns a 4.99 per cent stake in MCX-SX and also convertible warrants, along with MCX, amounting to 69 per cent stake after conversion. FTIL will have to reduce its shareholding in the stock exchange substantially if Sebi declares it is not 'fit and proper'. Both Sebi and FTIL officials couldn't be reached for comments.

In the show notice, Sebi had asked FTIL to explain why it should not be directed to divest its equity holdings and warrants in MCX-SX. Sebi's showcause notice followed an order passed by the commodities market regulator, the Forward Markets Commission (FMC), to FTIL, its chairman Jignesh Shah and former managing directors of MCX Joseph Massey and Shreekant Javalgekar, declaring them not 'fit and proper'. FTIL has moved the Bombay High Court challenging the FMC order. In its reply to the Sebi notice, FTIL has said the market regulator should wait till the matter is disposed of by the high court.