The MPID (Maharashtra Protection of Interest of Depositors) court on Monday approved the settlement plan submitted by Delhi-based Mohan India, one of the biggest defaulters in the R5,600-crore settlement crisis at the National Spot Exchange (NSEL).
The court permitted Mohan India and its two group companies, Tavishi Enterprises and Brinda Commodity, to fulfil an earlier settlement plan submitted by the company in consultation with the spot exchange. Under that plan, Mohan India had proposed to pay R771 crore, including a down-payment of R11 crore. The rest of the amount is to be repaid in 13 tranches over the next one year. Mohan India owes NSEL close to R910 crore.
“Respondent No 1 to 4 shall proceed to act according to settlement bonafide,” said the court order. The referred respondents are Mohan India, its two group companies and NSEL.
The order further asked NSEL to deposit the amount received from the three Mohan India group companies into the escrow account “for the benefit of the depositors”. It guided all the four parties to submit a monthly report on the settlement’s developments to the court and the Economic Offences Wing (EOW) of the Mumbai Police on the third day of the succeeding month.
The court order, thus, may lead to sale of properties by Mohan India in order to repay its outstanding. The EoW has estimated the book value of the attached properties of the company and its promoters at around R601 crore.“ We would be overlooking the transaction to ensure that it is not an undervalued sale,” said Rajvardhan Sinha, additional commissioner of Police, EoW.
Meanwhile, in a case hearing on a petition filed by MMTC and PEC at the Bombay High Court, the role of Financial Technologies and Jignesh Shah — the promoters of FTIL — came into question.
At the hearing, MMTC counsel stated that FTIL cannot absolve itself of responsibility in the NSEL crisis, citing instances where the company has clearly acted as the promoter of the spot exchange. These instances include the bridge loan of R178 crore given by FTIL to NSEL.
MMTC counsel also argued that under the NSEL exchange by-laws, payments