CBI to decide fate of MCX-SX enquiry by weekend

CBI is likely to take a final call by this week-end on the enquiry initiated against former SEBI Chairman CB Bhave in connection with alleged irregularities in granting sanction for operating the new stock exchange MCX-SX.

Highly placed sources said that inquiry is in the final stages and statements of Bhave and former SEBI member K M Abraham have been recorded.

The sources said a decision on whether to convert it into a regular case for carrying out further probe or to close it will be taken by senior officials of the agency by end of this week.

According to CBI, the PE was registered on issues of alleged irregularities in granting sanction to the MCX Stock Exchange (MCX-SX) by the Securities and Exchange Board of India(SEBI) in 2008 and renewing its recognition in 2009 and 2010.

The probe by CBI is to ascertain how MCX-SX was granted permission despite opposition by SEBI when Bhave was head of the regulatory authority.

MCX-SX was set up by Shah-led Financial Technologies India Ltd (FTIL) and its commodity exchange arm MCX and began functioning as a full-fledged stock exchange last year after a prolonged battle with SEBI.

The exchange was initially granted permission for only a limited segment of currency derivatives in 2008, on the condition its license would require approval every year.

Bhave had slammed the CBI move, saying the agency was indulging in "pick and choose" while registering PE against him and Abraham.

"It is very easy to say something against someone and make humiliating allegations and malign their reputations. And if they have not found any criminal act from them, will they apologise? If CBI has not found anything against me, then I want them to publicly apologise to me," he had said.

Last year, SEBI asked MCX-SX to restructure its board and governance structure after a payment crisis broke out at the National Spot Exchange Ltd (NSEL), also promoted by FTIL.