63 Moons Tech hits upper circuit as HC provides relief
The stock gained 10 per cent to hit upper circuit as Bombay HC ruled that the assets of the company's promoters cannot be attached under the MPID Act. The attachment followed the investigation into the Rs. 5,600 crore NSEL scam.
63 Moons Technologies was formerly known as Financial Technologies-India Limited (FTIL). The company was founded and promoter by Jignesh Shah. FTIL operated the National Spot Exchange Limited (NSEL), a commodity spot exchange. In 2013, NSEL closed down after authorities found out that the company was dealing in forward commodity contracts when it was permitted to operate only as a spot exchange. Also, investigators found that goods in the warehouse fell short against contract notes issued for delivery or trading on the exchange platform.
The Economic Offences Wing (EOW) of the Mumbai police attached the promoter assets according to the Maharashtra Protection of Interest of Depositors (In Financial Establishment) Act (MPID). The Maharashtra government accused the company of cheating 13,000 investors to the tune of Rs 5,600 crore.
On Thursday, the Bombay HC ruled that NSEL was not a financial establishment and so the attachment of assets of its promoter under MPID Act was not valid. The court observed that individuals trading on the NSEL platform did not invest in the form of fixed deposits, equity or debentures, but traded commodities.
Earlier, the HC had granted the company permission to sue former Finance Minister P Chidabaram and two government officials, Ramesh Abhishek and K P Krishnan to the tune of Rs. 10,000 crore against loss to its shareholders and for causing the NSEL scam in 2013 and damaging the reputation FTIL Group.
Reacting to these positive development, the stock of 63 Moons Technologies Limited hit upper circuit with no sellers on its counter. The stock was at Rs. 115.50, up by Rs. 10.50 or 10.00 per cent. in the morning session on BSE.