You are here: Home » Markets » News
Business Standard

Bombay HC extends stay on NSEL-FTIL merger till Feb 4

The NSEL-FTIL merger proposal by the corporate affairs ministry was aimed at hastening the repayment to the investors

Sharleen D'Souza  |  Mumbai 

The high court here on Monday extended a stay on a merger of National Spot Exchange Ltd (NSEL) and its earstwhile parent, Financial Technologies India Ltd (FTIL), till February 4 next year. It asked the ministry of corporate affairs (MCA) to submit a reply on the matter by January 23.

Judge V M Kanade also issued a contempt of court notice to NSEL Investors Forum, which had asked him to recuse himself from the case as his son had appeared for NSEL defaulter PD Agro.

Kanade asked the counsels of the Forward Commission (FMC) and MCA whether they had any objection to his taking up the matter and offered to recuse himself. However, both the counsels said they had faith in him.

Earlier, Abhishek Manu Singhvi, the FTIL counsel, had argued the government had issued the draft order for the merger under section 396 of the Companies Act. This, he added, had been used only on four earlier occasions, to merge government companies, not private ones. He also said the merger had to be approved by the boards of both companies, as well as the central government.

The ministry’s proposal of a merger was aimed at hastening the repayment of Rs 5,600 crore to the investors. NSEL had defaulted on this sum in July last year. FTIL says it fears a merger will transfer the default by its subsidiary to its books.

The ministry’s draft order followed a recommendation in this regard by the FMC and the department of economic affairs. The ministry had sought comment on the proposal.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Mon, December 22 2014. 22:42 IST