MPID court set ups authority to sell assets of NSEL defaulters

Written by PTI | New Delhi | Updated: Jul 20 2014, 17:30pm hrs
NSELThe authority will look into the sale proceedings of all attached assets worth Rs 5,200 cr frozen by the EOW. Reuters
To speed up the recovery of money from NSEL defaulters, Maharashtra Protection of Interest of Depositors court has appointed an authority to liquidate over Rs 5,000 crore worth of attached their assets.

National Spot Exchange Ltd - a subsidiary of the Jignesh Shah-led Financial Technologies India Ltd - has recovered about Rs 356 crore dues, out of the total outstanding amount of Rs 5,689 crore, from the defaulting members.

Out of 24 defaulters, only two members have paid fully, while the rest 22 members are still defaulting on payments.

"A competent authority has been assigned by the MPID court to look into the sale proceedings of the attached assets of defaulting members," NSEL Managing Director and CEO Saji Cherian said.

The authority, headed by deputy collector, has not been given any deadline to complete the liquidation process. However, it will work closely with the Monitoring and Auction Committee constituted by the regulator FMC for recovery of the money of defaulters at the earliest.

The authority will look into the sale proceedings of all attached assets worth Rs 5,200 crore frozen by the Economic Offences Wing (EOW) of the Mumbai police.

Mohan India, Loil group firms, N K Proteins, P D Agroprocessors and Tavishi Enterprises are major defaulters.

Concerned over slow pace of recovery of money from NSEL defaulters, FMC had recently asked the crisis-hit commodity spot exchange to strengthen its recovery team and file suits in this regard against all defaulting members.

NSEL has been grappling with a payment crisis since suspending trade in July last year following a government order. Multiple agencies are probing the NSEL's activities and assets of defaulters have also been attached.

The exchange has also sought the intervention of state governments to recover the dues from defaulters.