NSEL scam: Jignesh Shah faces rough ride

Jignesh Shah, chairman and chief executive officer (CEO) of Financial Technologies (India) Limited (FTIL), arrested by the Economic Offences Wing (EOW) of the Mumbai Police on Wednesday in the Rs 5,600- crore National Spot Exchange Limited (NSEL) scam, was remanded in police custody by the Maharashtra Protection of Interest of Depositors court till May 15 on Thursday.

Besides, Shreekant Javalgekar, former MD and CEO of Multi Commodity Exchange (MCX), an FTIL Group company, was remanded in police custody.

Once the king of the multi-million- dollar commodity exchange, Shah was produced in the court like a common criminal amid a frenzied media, onlookers, hundreds of investors and brokers. Mahesh Jethmalani and Abad Ponda, the counsel for Shah and Javalgekar respectively, had moved bail applications. However, Judge S. D. Surana scheduled the bail hearing for May 15.

Arguing for Shah, Jethmalani said that since his client had a non-executive position in NSEL and did not participate in the day-to-day functioning, his arrest was unwarranted. " This is an openand- shut case," said Arun Dalmia, secretary, NSEL Investors Forum ( NIF), which represents around 13,000 investors in the exchange.

"The exchange's platform was misused with the knowledge of its promoters." Dalmia now wants Shah's assets to be sold off to refund the investors. " All assets have been identified by the EOW. We do not want another enquiry commission to be constituted, which will cause delays," Dalmia added. Shah's properties, including his Juhu bungalow, have already been attached by EOW. Around 24 borrowers were given funds by NSEL allegedly in connivance with the exchange's management without any underlying commodity deposited by those borrowers. " We expect more arrests," Dalmia further added.

"We must also record utter failure of the Central government to act on various forensic audit reports and other documentary evidence that were made available.

It also became very clear that Mr. Jignesh Shah enjoyed strong political patronage whereby action against him and his companies was missing," NIF said.

Meanwhile, FTIL elevated Venkat K. Chary as the non- executive chairman of its Board. " In a hurriedly called Board meeting today evening, the company decided to appoint Venkat Chary, the company said in a statement.

Courtesy: Mail Today