HC allows FTIL to disburse salary and other expenses

In a separate case, Jignesh Shah's judicial custody extended till August 12

In a major respite for employees of Financial Technologies (India) (FTIL), the Bombay High Court on Monday ordered the release of money needed for salary and other statutory expenses from FTIL’s bank accounts that had been attached by the Economic Offences Wing (EOW) of Mumbai Police.

Investigating the case involving the Rs 5,600-crore payment default at FTIL subsidiary National Spot Exchange Ltd (NSEL), the EOW had on July 20 attached immovable properties of FTIL worth Rs 2,000 crore including its bank accounts. Following this, neither debit nor credit was allowed on these bank accounts.  

Hearing the case, the two-member bench comprising judges A S Oka and A S Syed sought the opinion of the public prosecutor standing on behalf of the EOW. The public prosecutor did not have any objection to the release of salary, statutory and legal expenses from the accounts attached by the EOW.

“Employees’ salary and other statutory expenses need to be released to continue operations at FTIL,” argued Abad Ponda, the lawyer appearing for FTIL.

Earlier, FTIL had filed an affidavit on the direction of the court praying for a partial relaxation in the court order. The Bombay HC asked FTIL to file a separate application seeking relief in terms of release of salary and other statutory expenses.

In a separate case heard in the Sessions Court on Monday, FTIL founder Jignesh Shah’s judicial custody was extended till August 12.

Shah was arrested by the Enforcement Director (ED) in a money laundering case on July 13. After spending five days under the ED custody, Shah was sent to judicial custody till August 1.

The court asked the public prosecutor to file reply on Shah’s bail plea, which would be heard on August 2.  The ED had issued summons to other 67 accused in the NSEL case including defaulters and NSEL employees. All government agencies including ED and EOW have attached immovable properties worth Rs 7,000 crore of FTIL, its promoter and other accused in this case.

“While the actual defaulters remained scot-free, Shah who uninterruptedly co-operated with all investigating agencies including ED and EOW, remained behind bars,” argued Vineet Naik, counsel for Jignesh Shah. 

According to the NSEL website, Mohan India and Tavishi Enterprises cumulatively owe Rs 1,038 crore, while N K Proteins owes Rs 938 crore to it. NSEL has already obtained permission for sale of properties worth Rs 4,516 crore.