Court grants bail to Jignesh Shah in MCX-SX case

A special CBI court today granted bail to Financial Technologies (India) Ltd promoter Jignesh Shah in connection with a case against him for allegedly suppressing facts to get an extension for stock exchange MCX-SX from market regulator SEBI.
Special court judge P S Tarare granted bail to Shah on a surety of Rs one lakh.
Shah was arrested on September 20 by CBI. The central agency had said that it suspected some former SEBI officials of being hand-in-glove with Shah, who may have bribed them.
MCX-SX, promoted by Shah and others, had submitted an application in 2008 to SEBI, seeking extension of its recognition as an exchange for currency futures trade.

MCX-SX promoters had entered into a share buyback arrangement with Punjab National Bank, L&FS and IFCI in violation of Securities Contract Regulation Act and Securities Contract (Regulation) (Manner of Increasing and Maintaining Public Shareholdings in Recognised Stock Exchanges) Regulation, 2006.
CBI alleged that Shah, with the connivance of SEBI officials, suppressed this fact while obtaining extension.

SEBI officials deliberately did not issue a notice to the exchange for cancellation of its recognition in the currency derivatives segment when the markets regulator had already rejected a request of MCX-SX for trading in other segments, CBI had said.
The agency named Vishaka More, the then Assistant General Manager of SEBI, Rajkumar Dangeti, then Deputy General Manager, and Muralidhar Rao, who was then the Chief General Manager at the markets regulator as accused, did not arrest them.

Claiming innocence, Shah had argued in the court that he was only a non-executive director and one of the members of the 18-member board of the exchange.