The government took actions against FTIL including filing a petition to replace its board of directors. The MCA raised questions about whether the government's actions were intended to prevent FTIL from opposing the merging of the company with NSEL. Meanwhile, the investigation of brokers involved in the NSEL money swindling case did not look into allegations of funding schemes or money laundering. The EOW officer asserted that brokers used fake payments and illegally accessed client accounts without permission. FTIL opposed the government's petition as an attempt to render the company ineffective in challenging the proposed NSEL merger.

1. Rough stage faced by FTIL
because of government
actions

2. Agenda
ACTIONS TAKEN BY GOVERNMENT
QUESTIONS RAISED BY MCA
CLEAN- CHIT TO CULPRITS
RESTRICTED INVESTIGATION
EOW OFFICER ASSERTED TO
MEDIA

3. ACTIONS TAKEN BY GOVERNMENT
 Company Law Board (CLB) is ready to
make judgment to take over and replace
existing Board of FTIL.
 Ministry of Corporate Affairs (MCA) filed a
petition against FTIL to replace the FTIL
Board
 Board of FTIL are also waiting for their
judgment which was postponed on May
15 to June 30.

4. QUESTIONS RAISED BY MCA
This move by MCA raised some unsettling
questions-
•Is the government trying to super cede the
company board using section 397 of the
Companies Act, 1956 so that it would not face
any opposition while merging the company with
NSEL under section 396 of the Companies
Act?
•Does the government’s argument before the
CLB that the current board of FTIL is trying to
“scuttle any attempts made to carry out
amalgamation between FTIL and NSEL” hold

5. CLEAN-CHIT TO CULPRITS
• Defaulters and Brokers involved in
money swindling commotion on NSEL
platforms.
• No investigations have been made
into the serious allegations that the
brokers ran funding schemes by
lending huge money to their trading
clients.
• Trading Clients PAN cards were

6. RESTRICTED
INVESTIGATION• Even after the arrest of three top brokerage
officials, the scope of investigation is yet to be
expanded to include issues related to money-
laundering.
Geojit
Comtrade’s
whole-time
director CP
Krishnan,
Anand Rathi
Commodities
managing
director Amit
Rathi
India InfoLine
Commodities
vice president
Chintan Modi

7. EOW OFFICER ASSERTED TO
MEDIA
• When examined, fictitious payments were
shown by brokers in book of accounts
presenting sale of commodities.
• Investigators also found large scale
market capturing practices by unique
client code modification by brokers and
illegal dealings through clients accounts
without the latter’s knowledge and
consent.
• The investigation was under Rajvardhan
Sinha, the then additional commissioner of

8. Conclusion
• On March 1, the board of FTIL passed a
resolution to strongly oppose the MCA
petition, claiming that it was a “clear attempt
by the ministry to render it ineffective and in
fact, defeat FTIL’s challenge and opposition
to the proposed amalgamation of NSEL with
FTIL.”
• Immediately, MCA moved CLB seeking
extraordinary powers under Section 397 to
supercede FTIL’s board by removing its
existing members and appointing government
nominees.
• The investigative agencies have already

9. • It should be noted that FTIL had appointed
a newly elected Board in late 2014;
promoter Jignesh Shah and some other
related members had stepped down
making way for professionals across
domains.
• Wanton government action of this sort is
appalling. The ministry has paid little or no
regard at all to the thousands of
stakeholders of FTIL. Such as blatant and
arbitrary knee jerk reaction would have a

10. Thank you