The HC is in the process of hearing of two petitions that seek a stay on the settlement of e-series products. One of the petitioner claims that as per the Brink’s Arya ledger, bullion stocks were delivered to the custodian as late as September 16, 2013, even though trading in the e-series was stopped in the first week of August.
The delivery was carried out by the Indian Bullion Market Association (IBMA), a subsidiary of the spot exchange.
The petitioners allege that NSEL may have utilised the Settlement Guarantee Fund (SGF) for buying underlying commodities like gold and silver, to ensure that e-series contracts were adequately backed by physical stocks. This allegation, however, remains unproven.
Petitioners requested FMC should be guided to order a separate forensic audit of NSEL’s e-series operations. NSEL is already mired with a R5,600-crore settlement scam due to its offering of ‘paired contracts’.
Meanwhile, NSEL’s lawyers quoted from the supplementary forensic report prepared by Grant Thornton, which looked into exchange operations in July 2013, and claimed that no part of SGF was used towards settlement of the e-series contracts.
The spot exchange said that the SGF was exhausted in meeting the shortage of pay-ins by members pertaining to ‘paired contracts’ between mid-July and July 26, 2013. It said that NSEL used its own funds to meet the subsequent settlements till July 31,2013, after which the trading in non-e-series products was suspended.
Changes in FTIL board continue
In a filing with stock exchanges, FTIL said retired IAS officer A Nagrajan has been appointed as a non-executive and independent additional director on its board. It also added Chandrakant Kamdar has resigned from the board from his position of a director.
Two weeks ago, Venkat Chary and Justice RJ Kochar were also appointed as independent directors while TC Nair who was brought on the board in mid-September this year ceased to be a director since annual general meeting of FTIL that took place on September 25.