CSE moves against minor defaulters

Calcutta Stock Exchange (CSE) has initiated legal action against a dozen defaulters, in addition to the three principal defaulters, for failing to cough up a combined Rs 10 crore to the bourse.

Sources said the defaulters kept promising the bourse authorities that they would pay up ever since the stock market scam rocked the exchange in March 2001. CSE was left with no alternative but to go for legal action, they said.

They added the bourse authorities were planning to initiate other measures including criminal proceedings against the defaulters.

CSE had lodged criminal complaint against the three top defaulters - D K Singhania, A K Poddar and H C Biyani - in mid 2002. Following the complaints, all of them were arrested and suffered imprisonment for 90 days. In some cases, their relatives and officials were not spared.

Sources said the exchange authorities "discovered" documents which showed a couple of defaulters (one of them was closely related to a jute industrialist) had allowed the main suspects in the scam to use trading terminals. "Since the main suspect was barred from the market, providing opportunity to him to trade was punishable under the law," they added.

However, they declined to divulge the name of the defaulter who provided trading terminal to the banned stock broker on the plea that secrecy should be maintained for the sake of investigation.

Alongside, CSE did not adopt the demutualisation scheme at its last general meeting. CSE officer-on-special duty had said he would manage to win the brokers consent in six weeks. However, nothing has been in done in the past one month.