DPIIT secretary Ramesh Abhishek
DPIIT secretary Ramesh Abhishek

63 Moons files complaint against DPIIT secretary

  • Company claims Ramesh Abhishek ‘misled’ government on its merger with NSEL
  • Former regulator FMC had written to govt recommending 63 Moons’ merger with NSEL

MUMBAI : Mumbai-based 63 Moons Technologies Ltd has filed a complaint with the Central Vigilance Commission (CVC) against Ramesh Abhishek, the secretary of the Department for Promotion of Industry and Internal Trade (DPIIT), for allegedly “misleading" the government into ordering the firm’s merger with scam-hit National Spot Exchange Ltd (NSEL).

The complaint was filed on 16 May, about a fortnight after the Supreme Court set aside the merger order. It came to light when a writ petition filed by the company in the Madras high court, seeking a CVC probe into the matter, came up for hearing on Monday.

63 Moons alleged in its complaint that Abhishek, during his tenure as chairman of the Forward Markets Commission (FMC), misled the government to issue the merger order. The company, formerly Financial Technologies India Ltd, asserted that the FMC had no locus in making such a recommendation. A copy of the complaint has been reviewed by Mint.

An email sent to the official address of the DPIIT secretary and, a subsequent reminder, remained unanswered till press time.

The court, in its order on Monday, gave the CVC three weeks to submit a status report.

The case dates back to 31 July 2013, when NSEL suspended operations, and it led to a settlement default of 5,600 crore. NSEL, a 99.99% subsidiary of 63 Moons, defaulted on a payout obligation to 13,000 investors and trading members.

Erstwhile regulator FMC, which was overlooking the settlement and recovery of dues from 22 defaulting members in August 2014, wrote to the corporate affairs ministry to merge NSEL with its parent. Under Section 396 of the Companies Act, the government can force a merger in public interest.

Abhishek, in the letter, said the merger was in the public interest as the parent company’s resources could be used to repay investors. In October 2014, the MCA had passed a draft order before passing a final order in February 2016. 63 Moons had then challenged the order in the Bombay High court, where the merger was upheld. On 30 April, the Supreme Court reversed the ruling saying it was not a fit case of public interest.

“Supreme Court verdict has pointed out in no uncertain terms that FMC’s suggestion of a merger between the two companies had nothing to do with public interest. Instead the apex court said the only reason that remained for a merger was contained in the FMC recommendation, which the court concluded was for the protection of private interest of a group of investors/traders, distinct from public interest," said 63 Moons in the complaint.

63 Moons also alleged that the conduct of Abhishek is “unbecoming of a public servant and malafide", and sought an investigation, and corrective and deterrent action.

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