HC asks chiefs of FMC, ED to be in court in NSEL case

Court wants to know why NSEL borrowers' properties attached by ED under prevention of money laundering act cannot be sold

The high court here asked the chairman of commodities derivatives regulator Forward Markets Commission, Ramesh Abhishek, to be present on Wednesday. This came up in a case filed by Modern India, a National Spot Exchange Limited (NSEL) investor.

The attention of the court was drawn to the fact that in one such case, another judge of the court had directed FMC to carry on the settlement process with NSEL borrowers. In the case of Mohan India, one of the largest NSEL borrowers, FMC had raised an objection to settlement.

The court has also asked the director, enforcement directorate (ED), to be present.

Judge S J Kathawala said “Let the FMC chairman explain to the court their status and the issues they have.” From the ED, the deputy director was present. However, the court asked the director to come on Wednesday to explain why NSEL borrowers’ properties attached by them could not be sold. The court said sale would take place with its permission.

The ED said it couldn’t liquidate the assets due to the Prevention of Money Laundering Act that put those under the Centre.

The high court asked the   economic offences wing of the city police and the ED to allow selling of attached assets of the borrowers by consent, but did not give permission to distribute the money, which has to be brought before the court.

High Court has set up a committee which has powers to pass a decree against the borrowers who have defaulted in the NSEL case. The committee will be headed by former Justice of Mumbai High court Mr Daga and will also consist of a Chartered Accountant and a lawyer whose names will be finalized shortly.

Ed has so far attached 8 provisional orders of three NSEL borrowers which are Mohan India, PD Agro processors and Aastha Group. EOW has attached 460 properties of borrowers in Rs.5574 crore NSEL scam.