The decision came a day after the firms auditors Deloitte Haskins & Sells said the accounts were no longer to be relied on following the payments problems at NSEL. The Financial Technologies stock lost 10% on Wednesday, closing at R150.25 on the BSE.
FTIL, which houses the software business of the group, holds 26% in Multi-Commodity Exchange (MCX), 99.9% in NSEL and 5% in MCX Stock Exchange (MCX-SX) and 33.5% in IEX, a power exchange.
Speaking on the sidelines of an event in Mumbai, Sebi whole-time member Rajeev Agarwal said on Wednesday the regulator will ascertain facts from FTIL on the audit report, adding it would examine the findings of other regulators and act if there is any breach of the fit and proper criteria.
Meanwhile, Joseph Massey, a close aide of Jignesh Shah and the head of MCX-SX has decided against seeking reappointment as a director of MCX. According to a stock exchange filing, Massey - will retire as director on September 30. ...Joseph Massey, retiring director, who had earlier offered himself for re-appointment, has withdrawn his consent for reappointment as a director at the ensuing annual general meeting and has expressly conveyed vacating his office as a director w.e.f. close of business hours on September 30, 2013, the filing said.
The FTIL annual general meeting held in Chennai on Wednesday turned out to be a stormy affair with shareholders questioning the board of directors on the crisis at NSEL. With only a handful of shareholders attending the much-awaited meet, chairman Jignesh Shah attempted to win shareholders support at a time when he is struggling to recover more than R5,500 crore to tide over a settlement crisis.
Asked how much time it would take to set things right, Shah replied: You have to ask Lord Balaji.
On the issue of the auditors withdrawing their report, Shah said: It will be recast based on NSELs new feedback.
Deloitte informed the company on September 23, that in accordance with the Standard on Auditing (SA) 560, the auditors report dated May 30, 2013 on the standalone and the consolidated financial statements of the company, for the year ended March 31,2013 should no longer be relied upon.
We told the shareholders that in whatever capacity we can stand by, we will stand by them. This is a listed entity with 55,000 shareholders. My only request to the investor forum is that we should work together, Shah told newspersons after the AGM.
Shareholders, however, remained unconvinced. Padmanabham, one among nearly 50 shareholders who attended the AGM, left even before the meeting got over. He said Shah started his speech with a note saying that I want to be with you during the crisis, before going on to explain how things went wrong.
I-T probing NSEL payment to FTIL
The I-T department is investigating whether NSEL violated tax rules while transferring funds to promoter company FTIL. The department is looking into the payments made by NSEL to FTIL to see the money trail and verify sources of funds transferred to its promoter, a finance ministry official told PTI. According to the NSEL balance sheet, business support charges paid to FTIL more than doubled to R33.8 crore in 2012-13 from R15.56 crore in 2011-12.