The government will probe the conflict of interest in the NSEL issue, where the exchange has defaulted on the last settlement and it’s chairman, Shankarlal Guru is the father-in-law of Nilesh K Patel, the owner of NK Proteins, a company with dues of Rs. 930 cr.
And apparently, there is not enough storage to keep all the stuff this company says it has:
“Anyone who has visited the factory will laugh on hearing that there is a stock of 84,766 tonnes of cottonseed oil in there. This is because the total storage capacity of this factory is just 5,000 tonnes, let alone two tanks which NSEL claims to be storing this stock,” one of the complaints said.
It seems all the stock can be sold in the markets. But I wonder if you can sell it if it only exists on paper…
Also, Moneycontrol says BJP Leader Kirit Somaiya has filed a complaint asking for criminal proceedings against the promoters of NSEL, the brokers, and even FMC officials for letting this happen.
FMC on its part says it will step in if NSEL doesn’t pay up by the 14th. They have stated that NSEL promoters must bear the liability of any shortfall. That can be quite tough for FT, the listed promoter of NSEL.