NSEL controversy: Delhi Police to question Jignesh Shah next week

Judge directs him to appear on Wednesday, after city police complain of non-cooperation; sets bail plea hearing for Aug 27; harassment by opponents: FTIL

A district court here has directed National Spot Exchange (NSEL) promoter Jignesh Shah in the coming week to join the investigation by the city police’s economic offences wing  (EoW).

The order came after the latter objected to Shah’s bail, citing his non-cooperation in investigation into a case filed by  Classone Exports, a city-based investor of NSEL. Classone claimed it was cheated of Rs 22.65 crore it had invested in sugar contracts.

The Delhi Police probe had faced resistance from its Mumbai counterpart, whose own EoW had objected to a separate investigation, saying its scrutiny had made significant progress in the Rs 5,600-crore payment crisis that hit NSEL in July 2013.

Tuesday’s order here from additional sessins judge Rajiv Mehra directs Shah to join the investigation on the coming Wednesday at 2 pm. He posted the bail application for August 27 and said no arrest shall be made till then.

Earlier, investigators had told the court a notice was served on Shah to join the investigation "but he is not cooperating and his custodial interrogation is mandatory”. For, the police argued, there were allegations on preparing of fake documents and these required interrogation. “The custodial interrogation is also pressed to unearth the complete conspiracy, to come to know about the government officials who are in collusion with the applicant and other accused, and the  source of documents is also required to be ascertained through applicant under custodial interrogation,” the judge's order said.

The order noted  Shah's counsel’s own argument that the Mumbai Police's EoW had filed an affidavit before the high court here that "investigation in Delhi is likely to jeopardise the prospect of investigation at Mumbai”.  Delhi Police, however, contended that the case here related to lack of stocks in sugar godowns of NSEL member Mohan India in this city and was not related to the case registered by the EoW in Mumbai.

In response to an e-mail seeking comments, a spokesperson for Financial Technologies, parent of NSEL, said: “The Mumbai office of EoW has already investigated the matter and made progress since the last two years. For very strange reasons, a fresh complaint in Delhi EoW has been filed by traders just to harass Mr Jignesh Shah, already victimised due to this crisis...these are nothing but tactics to malign the image and divert attention, knowing fully well that the privity of contract of these trading clients lies with their respective brokers.”

Despite having been fully empowered to take action against the brokers, defaulters and their respective management, the commodities regulator had not taken any concrete action against them, the spokesperson said. “Mr Shah has always been cooperative with investigating agencies and has immense faith in the judiciary system and the truth will come out,” the spokesperson said.

In a separate order, the court also rejected bail applications of Jagmohan Garg and Jaishankar Srivastava of Mohan India. On this, the NSEL spokesperson said, “We can only say that they are defaulters on NSEL exchange platform and NSEL has taken necessary action against them.”

As part of its arguments against Shah, the Delhi Police had told the court “During investigation, it transpired that there is a settlement agreement between NSEL and Mohan India to settle the liability of amount of Rs 922 crore and investigation discloses that this amount has been settled for a sum of Rs 770 crore. It is submitted that custodial interrogation is also needed to unearth the difference of Rs 152 crore.”