 "Prime Broking to file claims against NSE")
A day after being declared a defaulter, Prime Broking said on Wednesday it would take legal steps against the National Stock Exchange (NSE) and National Securities Clearing Corporation Ltd (NSCCL).
“We are taking all necessary legal steps to seek justice and file our claims against NSCCL and NSE,” said the listed company in an exchange notification. NSE had declared Prime a defaulter in a circular put up on the exchange website on Tuesday.
According to Prime, NSE and NSCCL ignored its submissions on the various issues involved. “We have raised a set of bonafide claims against the NSCCL and NSE, while disputing their alleged claims. NSCCL and NSE have been unwilling to consider any of the various claims and the several grievances that we have raised,” said the company’s exchange notification.
The company said it had received a communication which said it had been declared a defaulter; however, no reason for the actions taken had been given. The exchange and clearing corporation told it a detailed order would be sent in due course.
The brokerage alleges the exchange’s actions resulted in its broking business shutting down, and ‘severely crippled’ its wealth management arm. It said this caused “great hardship and distress to over 25,000 shareholders of Prime Securities… and hundreds of our wealth management customers.”
The exchange and the clearing corporation have reportedly withheld the payouts of Prime as well as those of its clients and also invoked the bank guarantee.
The NSE had been investigating the trading activity of the brokerage and related entities, in addition to trades in the shares of jewellery giant Gitanjali Gems. It had halted payment in transactions involving Prime in June and later disabled the client codes of 26 entities in a related notification in July.
Prime had appealed against the NSE in the Securities Appellate Tribunal. The issue is due to be heard on November 11.
An NSE spokesperson declined to comment.
“We are taking all necessary legal steps to seek justice and file our claims against NSCCL and NSE,” said the listed company in an exchange notification. NSE had declared Prime a defaulter in a circular put up on the exchange website on Tuesday.
According to Prime, NSE and NSCCL ignored its submissions on the various issues involved. “We have raised a set of bonafide claims against the NSCCL and NSE, while disputing their alleged claims. NSCCL and NSE have been unwilling to consider any of the various claims and the several grievances that we have raised,” said the company’s exchange notification.
The company said it had received a communication which said it had been declared a defaulter; however, no reason for the actions taken had been given. The exchange and clearing corporation told it a detailed order would be sent in due course.
The brokerage alleges the exchange’s actions resulted in its broking business shutting down, and ‘severely crippled’ its wealth management arm. It said this caused “great hardship and distress to over 25,000 shareholders of Prime Securities… and hundreds of our wealth management customers.”
The exchange and the clearing corporation have reportedly withheld the payouts of Prime as well as those of its clients and also invoked the bank guarantee.
The NSE had been investigating the trading activity of the brokerage and related entities, in addition to trades in the shares of jewellery giant Gitanjali Gems. It had halted payment in transactions involving Prime in June and later disabled the client codes of 26 entities in a related notification in July.
Prime had appealed against the NSE in the Securities Appellate Tribunal. The issue is due to be heard on November 11.
An NSE spokesperson declined to comment.
You’ve reached your limit of {{free_limit}} free articles this month.
Subscribe now for unlimited access.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%