Financial Technologies India Ltd (FTIL) and its chief Jignesh Shah (in pic), an accused in the National Spot Exchange Ltd (NSEL) scam, failed to get relief from the Bombay high court on Wednesday against the order of Forward Market Commission (FMC) seeking reduction of its shareholding in Multi-Commodity Exchange from 26 to 2%.
A division bench of chief justice Mohit Shah and justice MS Sanklecha did not grant status quo on the shareholding pattern. They also clubbed all the public interest litigation filed by the investors in the Rs5,500 crore scam involving NSEL and kept them for hearing on Thursday.
FTIL and its promoter have filed a petition in HC challenging the recent FMC order which ruled that both were not fit to run any stock exchange in the country and asked for reducing its shareholding in MCX to 2%.
Petitioner’s counsel Janak Dwarkadas assured the court today that FTIL will not block any board resolution so long as MCX makes a statement that it will not change its capital structure
He said as an MCX investor, FTIL had a right to oppose such a resolution on reduction of shareholding pattern of the multi-commodity exchange but it was ready to forgo this right till the matter is heard and decided by the court.
Dwarkadas argued that currently FTIL did not have a single director on the board of MCX as all the three directors had resigned before the FMC passed the impugned order.
He said the 26% shareholding of FTIL in MCX would not cause any prejudice to shareholders. Criminal cases filed against NSEL were pending and probe was in progress.
In the midst of these developments, such an order by FMC was not proper, he said.
FTIL argued that it was being targeted by FMC, though investigating agencies has not held them guilty so far.
Iqbal Chagla, counsel for FMC, said that they were not holding anyone guilty. “We are not holding them guilty, we are just saying that they are not fit to run any stock exchange. It cannot be argued by them (FTIL) that Shah was not aware of what was going on (in the scam-tainted organisation).”