MCA To Ascertain Whether Financial Technologies Violated Norms

0
86

Mumbai: The Ministry of Corporate Affairs is looking to ascertain whether Jignesh Shah-led Financial Technologies violated laws, especially with respect to carrying out its duties as a holding company.

FTILFinancial Technologies (India) Ltd (FTIL) is the flagship company of Shah Group, whose firm National Spot Exchange Ltd (NSEL) is grappling with a Rs 5,600 crore payment crisis.

Besides these entities, the continuing crisis has also sparked off a series of regulatory interventions that has thrown spotlight on the group’s various other ventures, including MCX, MCX-SX and IEX.
Sources said the Ministry is looking to ascertain whether FTIL as a holding company mismanaged the affairs of the subsidiary.
The Ministry has found “gross violations” by FTIL board on corporate governance matters, among others.

Although the Ministry has completed its report on FTIL, it has sought views of the Law Ministry and other agencies before taking a final call.
Earlier this month, the capital market regulator Sebi ruled that FTIL is not a “fit and proper person to acquire or hold any equity share or any instrument that provides for entitlement for equity shares or rights over equity shares at any future date, in a recognised stock exchange or clearing corporation.”

The order would be applicable for both direct and indirect holdings of FTIL in stock exchanges and clearing corporations.
Meanwhile, an inspection of NSEL books by the Ministry had found that the exchange’s board failed to perform its duties towards shareholders, in violation of regulations.

The interim report of inspection, carried out by the Registrar of Companies (RoC), Mumbai, had found corporate governance failure at multiple levels, including lack of transparency, integrity, compliance and ethics.

Besides finding discrepancies in the minutes of board meetings, it was also found that the board did not discuss the exchange’s compliance with various rules such as those related to admission of new members.
The inspection of books of NSEL was ordered under Section 209 A of the Companies Act.

[PTI]

 

Comments

comments

SHARE
Previous articleJSPL, Creating Employment Through Industrialization in Odisha
Next articleGlobal CSR Summit to be held in Bali on 3-4 April
India CSR Network
India CSR Network is India's biggest and most trusted news portal in the domain of CSR & Sustainability. India CSR welcomes stories, statements, updates, reports on issues that interest you. Feedback, comments will make it more purposeful and resourceful. It is designed and maintained by India CSR Group. Contents are non-fiction. Though all efforts have been made to verify the accuracy, the same should not be construed as a statement of law or used for any legal purposes. In case of any ambiguity or doubts, readers are advised to verify with the source(s). Statement, articles, views and contributions can be sent to editor@indiacsr.in