NEW DELHI (Topmcxtips.com): India government on Tuesday said it has not issued a final order on the merger of National Spot Exchange Limited (NSEL) with Financial Technology (FTIL).
The Government has issued only a Draft Order of merger/amalgamation of National Spot Exchange Limited (NSEL) with Financial Technology (FTIL) in essential public interest under Section 396 of the Companies Act, 1956 on 21.10.2014.
The final Order, if required, will be issued after the consideration of objections/suggestions to be submitted by the stakeholders on the Draft Order for which they have been given two months’ time, Arun Jaitley, Minister of Corporate Affairs said in a written reply to a question in the Rajya Sabha. The winter session of the parliament is currently underway.
NSEL was under investigation by various agencies including the Economic Offences Wing (EOW) of Mumbai Police for alleged fraud in cheating investors to the extent of Rs 5600 cr.
An official release by Ministry of Corporate Affairs last month said the Central Government has decided on the merger of National Spot Exchange Limited with its holding company Financial Technologies (India) Ltd., in public interest under Section 396 of the Companies Act, 1956.
A draft order in this behalf has been issued. The order required the members of the two companies, its creditors to provide suggestions/objections within a period of 60 days.
The order noted that the ruling is based on excerise of powers conferred by sub-sections (1) and (2) of the section 396 of the Companies Act, 1956 (1 of 1956).
NSEL, a subsidiary company of the FTIL is having paid-up share capital of Rs 450000000 consisting of 45000000 shares of Rs 10 each.
According to the order, all the equity shares held by FTIL in NSEL would be cancelled. FTIL holds 99.99% stake in NSEL, which is in the mid of a Rs.5,574.35 crore payment crisis. It suspended trading in all contracts in August last year.