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The high court here is scheduled to take up the Financial Technologies India Ltd (FTIL) case on February 7. The court also shifted the case from a supplementary board to the main bench. FTIL, however, is seeking to advance the hearing, amid fear of further regulatory action. An FTIL counsel said the group would seek an early hearing.
The case, which challenged a Forward Markets Commission (FMC) order declaring FTIL wasn’t “fit and proper” to run an exchange, was filed on December 21 in the high court. After taking up the case, judge Mohit Shah transferred it to judge A S Oka, with a directive to club all public interest litigation filed by investors in the Rs 5,600-crore scam at FTIL’s subsidiary National Spot Exchange Ltd (NSEL).
In the past four-five months, NSEL parties and counterparties have filed six cases in the court. In a number of cases, hearings are yet to begin.
For FTIL, the primary concern is the stake sale ordered by FMC. The Securities and Exchange Board of India (Sebi) has also served a show-cause notice to FTIL. Sebi, which was scheduled to take up FTIL’s “fit and proper” case on Monday, will now do so on February 12.
According to the FMC order, FTIL will have to reduce its stake in Multi Commodity Exchange (MCX), promoted by it, from 26 per cent of the paid-up equity capital to two per cent. The MCX board has decided to ask FTIL to reduce its stake in MCX, according to the FMC order, by January 25. However, FTIL has asked MCX not to fix any deadline for the stake sale, as the case challenging FMC’s “fit and proper” order is pending in the high court. An FTIL official said as stake sale within such a short span was impossible, considering the negative market sentiment, an extension was the only option.
