The Securities & Exchange Board of India (Sebi) today has cancelled the registration of Dinesh Kumar Singhania, a former director of Calcutta Stock Exchange (CSE), pursuant to his failure to meet his payment obligation to the bourse even six months after he was declared defaulter.
Confirming the development, Sebi chairman D R Mehta said Singhania would not be entitled to carry on the business as a stock broker in the Indian capital market for good unless he filed an appeal before the appellate authority and managed to obtain a reversal of the order.
Sebi announced the order today after its abortive attempt to give a personal hearing to Singhania. The former CSE director declined to meet Sebi officials in Mumbai on personal grounds.
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Singhania even did not meet the Joint Parliamentary Committee probing the share market scam in Delhi as well as his home city, Kolkata.
Although Singhania, in a press release issued some time ago, claimed that he would meet up his payment liabilities to CSE as soon as his financial position improved, he has not made payments thus far. Singhania along with Ashoke Poddar and Harish Biyani, who were responsible for a payment crisis at CSE, owed nearly 90 crore to the exchange.
Lyons Range sources said Singhania, arguably the biggest trader in his heydays and a close associate of a Mumbai-based bull, used his " influence" to create a huge uncovered position by taking advantage of the faulty margin collection system of CSE. The margin collection software was installed by the computer company CMC Ltd but the origin of the fault remains unclear.
The sudden market crash after the Union budget led to huge losses for Singhania and his associates. Their non-payment brought down CSE to its knees as well.
Meanwhile, CSE has reportedly claimed damage from CMC, the software system provider, for the faulty margin collection mechanism.
JPC chairman, in a press conference in the city, had earlier said the inadequate margin collection mechanism as well as operational laxity were responsible for payment crisis in March at CSE.