NSEL, Mohan India ink settlement deal

Mohan India will pay Rs 771 crore in a staggered manner in one year

In what seems to be a major breakthrough in Rs 5,600 crore payment logjam in National Spot Exchange (NSEL), Delhi-based borrower Mohan India has agreed to pay most of its dues.

In a deal inked early on Wednesday after a marathon three-way meet, Jagmohan Garg, promoter and chief of Mohan India agreed to pay about Rs 771 crore in final settlement.

Mohan India will make a down payment of Rs 11 crore and the balance will be paid over the next one year. The firm's total outstanding was Rs 950 crore.

After signing the deal, Garg told Business Standard, "I am happy that settlement has been reached."

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Raja Vishwanidhi Dalmia, Delhi convenor of NSEL investor forum, who was present at the venue, said, “The Mohan India and NSEL agreement is a positive step to bring back investors’ money.”

Commenting on this development, Cherian, NSEL said:  “The relentless efforts put in by the new team at NSEL along with the NSEL Investors' Forum (NIF) over the last few weeks is expected to show some positive results in terms of recovery of monies from the members.. Mohan India has finalized its commitment to complete the pay-in obligations with NSEL within a period of one year. Some more members have also come forward for settlement of their dues and are at various stages of finalization.”

He further added: “NSEL and NIF are committed to jointly work towards a solution to recover dues, and keep various regulatory and investigating authorities informed on such developments.”

Lawyers involved in the settlement said the cases files by both groups are likely to be withdrawn.

The deal has sparked hopes that more borrowers will fall in line and agree to settle with the exchange.