NSEL fiasco: Finance Ministry issues show-cause notice

The Finance Ministry has issued a show-cause notice to troubled NSEL asking why exemptions granted to it in 2007 should not be withdrawn

The Finance Ministry has issued a show-cause notice to the National Spot Exchange Ltd (NSEL), which is engulfed in a Rs5,600-crore payment crisis. In the notice, the Ministry has asked why exemptions granted to NSEL in 2007 should not be withdrawn.


This is the second such notice to the spot commodity exchange promoted by Financial Technologies India Ltd. A similar notice was issued to NSEL by the Consumer Affairs Ministry in 2012.


The Consumer Affairs Ministry, which regulated spot exchanges until the NSEL crisis broke last year, had exempted the Exchange under Section 27 of the Forward Contracts (Regulation) Act and allowed it to offer one-day forward contracts provided members do not resort to short sales.


“NSEL has received this letter from the Ministry of Finance. We are examining the letter and according to the deadline given, we will respond in 15 days’ time,” an NSEL spokesperson said.


“We understand from media reports that a similar letter has been issued to other spot exchanges as well. This letter does not discard the response given by NSEL regarding the show-cause notice issued in April 2012. The letter will be placed before the board for appropriate advice and next action,” the exchange said in a statement.


NSEL was hit by a Rs5,600-crore payment crisis after suspending trading on its platform on 31 July 2013. The Government had directed it to end trading on most contracts on the NSEL platform after violations to the exemptions were found.


In August last year, NSEL proposed a payout plan but it could not stick to the schedule and has not made a single successful payment.


Currently, several investigating agencies are probing the NSEL and some former top officials of the bourse have been arrested.


RTI Act is applicable to private schools too, rules CIC

The Central Information Commission ruled that provisions of RTI Act also apply on private schools that are governed by law like Delhi Education Act or Right to Education Act

In a significant decision, the Central Information Commission (CIC) has held that provisions of the Right to Information (RTI) Act also apply on private schools, which are governed by a law such as the Delhi Education Act.


The case relates to a former employee of Jindal Public School, who filed an RTI application with the Directorate of Education, seeking a certified copy of service book and other details from her past employer.


The Directorate provided the information available with them but the school refused to furnish a reply saying that the RTI Act does not apply to it.


Directing the school to disclose information sought by its ex-employee, Information Commissioner Sridhar Acharyulu said the school is duty bound under sections 4 and 8 of Delhi Education Act, 1973 to abide by the regulatory conditions of service, payment of salaries as prescribed, for which school has to maintain records which provide an "inherent and implied" right to information to their employees.


"Under Right to Education Act 2009 also, the recognised school is under an obligation to appoint eligible teachers and provide them with prescribed wages. This also reveals that it has given inherent Right to Information to the teachers from their employers," he said.


The Commissioner said if the appellant in her capacity as ex-employee of the school has right to information under any legislation such as Delhi Education Act, that will fall under the purview of Section 2(f) of the RTI Act which gives PIO, Appellate Authority and the Information Commissioner power to enforce her right to information.


"Hence, the school is directed to discharge their obligation under law by furnishing the information sought by the appellant to the respondent authority (Directorate of Education), who in turn is directed to provide the same to the appellant," he said.


Click here to see the CIC order...


Appellant : Sadhana Dixit

Respondent : Directorate of Education, GNCTD, Delhi

Date of hearing : 19­/05/­2014

Date of decision : 29­/05/­2014

Information Commissioner : Prof M Sridhar Acharyulu (Madabhushi Sridhar)

Referred Sections : Sections 3, 19(3) of the RTI Act




Davendra Pal Singh

7 months ago

Does Privately managed Educational Engineering Institutions/Colleges run under the agies of AICTE or the other Government subsidiaries are also under RTI act.?

BN Dash

1 year ago

It is really a wonderful order passed by: Prof M Sridhar @CIC
under Sections 3, 19(3) of the RTI Act.
However, what about the Privately managed Educational Engineering Institutions/Colleges run under the agies of AICTE or the other Government subsidiaries?

Can the above decission follow suit or clubed to such colleges, needs the answer.

If yes, who is their first and second appellate authority? Central Information Commission or State Information Commission?


3 years ago

Do ISCE /ISC schools in various states of India come under RTI?

If yes, who is their second appellate authority? Central Information Commission or State Information Commission?

Sensex, Nifty struggle to move higher – Wednesday closing report

Nifty to move in a tight range

On Tuesday we had mentioned that the S&P BSE Sensex and NSE Nifty may pause for breath. Markets on Wednesday witnessed a volatile session and was indecisive for major part of the day. And they ultimately closed in the red.

Sensex opened at 24,909 while the Nifty opened at 7,418. Sensex moved in the range of 24,774 and 24,926 and closed at 24,806 (down 53 points or 0.21%) while the Nifty moved in the between 7,391 and 7,433 and closed at 7,402 (down 14 points or 0.18%). The NSE recorded a higher volume of 147.77 crore shares. India VIX fell 1.46% to close at 15.5650.

Markit Economics said on 4 June 2014, its seasonally adjusted HSBC India Composite Output index edged up to 50.7 in May from 49.5 in April to 50.7 in May, indicating growth of India's private sector output for the first time in three months. The headline HSBC Services Business Activity Index posted 50.2 in May, rising from April's reading of 48.5 and pointing to the first expansion of output in 11 months.

Fertiliser stocks will be in focus as news is making rounds that the fertiliser ministry has prepared a roadmap for rationalisation of subsidy for the sector. This roadmap will be discussed in the proposed meeting with Prime Minister Narendra Modi.

It is also being reported that Narendra Modi government could allow foreign direct investment in the e-commerce sector as early as next month, paving the way for global online retailers such as Amazon to expand their business.

The government may not implement the delayed increase in price of natural gas with retrospective effect as it would be difficult to back charge higher bills from power and CNG consumers, an official said.

SEBI on Wednesday said that state-owned firms should adhere to the mandatory 25% public shareholding norms that are applicable to private companies.

The Finance Ministry is considering a proposal to set up a National Asset Management Company that may act as a nodal agency for taking over bad loans of banks and help revive sick units.

Hero MotoCorp (3.57%), was the top gainer in the Sensex 30 pack. Hero MotoCorp sold 602,481 units of twowheelers in May 2014 - its highest-ever despatch sales for any non-festival period. The previous highest was in the preceding month, i.e., April 2014 when the company sold 571,054 units - thus highlighting HMCL's sustained volume growth since the beginning of FY'15. The sales registered in May 2014 represents a growth of 8% over the corresponding month in the previous year, when the company had sold 557,890 units.

TCS (1.92%), was the top loser among the Sensex 30 stock, was in news with reports that its chief executive received a 60% hike in salary, thereby making N Chandrasekaran the highest-paid CEO among the country's information technology companies.

Chandrasekaran earned Rs 18.7 crore for the year 2013-14, as against Rs 11.7 crore in the year-ago period, according to TCS' annual report.

IDBI Bank (15.71%), top gainer in ‘A’ group on the BSE, projects Rs 3,500 crore of capital requirement in FY15. The bank sees that it can get Rs 5,000 crore if the government divests shareholding to 58%. According to the bank the worst in terms of the asset quality is over and foresees improvement in the gross non-performing assets from June quarter onwards.

Wockhardt (3.78%) was again among the major losers today in the ‘A’ group on the BSE. The USFDA had found fault with quality control, training and staff hygiene at Wockhardt's plant in Chicago.

US indices closed marginally in the negative on Tuesday.

Except for Nikkei 225 (0.22%) all the other Asian indices trading today closed in the red. Shanghai Composite (0.66%) was the top loser.

European indices were trading in the negative. US Futures were trading marginally lower.


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