NSEL pays out to small investors on priority

• Will be clearing pay-out of Rs. 177.23 Crs to small investors; total payout would be about Rs 190 crores

• Appoints Grant Thornton as forensic auditor

Considering the interests of small investors and in good faith, NSEL has decided to make immediate payments as below, without prejudice; these payments will be outside of the agreed settlement plan, which will continue as such.
Payments to:
1) Small investors (608 investors) who were to receive amounts up to Rs.2,00,000 (Rupees two lakhs) as of July 31, 2013, will receive 100% payment with this disbursement.
2) Investors (6380 investors) who were due to receive amounts above Rs. 2,00,000 (Rupees two lakhs) and up to Rs. 10,00,000 (Rupees ten lakhs) as of July 31, 2013, will receive 50% payment with this disbursement . These investors will receive the remaining amount proportionately as per the settlement plan.
NSEL has availed a bridge loan from FTIL, the promoter company to make these payments aggregating Rs.177.23 crores.
NSEL will also make a pay-out of Rs. 12.60 crores under the settlement plan, through the escrow account, out of the monies recovered from the members with outstanding dues.
Further, Grant Thornton has been appointed as the forensic auditors who have commenced the audit today, in addition to the internal investigation already initiated against the management team.
NSEL is actively pursuing recovery of the dues from the members with outstanding dues. This includes initiation of civil and criminal proceedings against the defaulting members besides taking actions under the Rules and Bye-laws of the NSEL. The Exchange will take similar recourse for other members who do not pay-in their dues as per schedule.

NSEL files complaint with investigation authorities against the five defaulting members

NSEL had declared its nine members as defaulters when the last pay-in was not completed by them. As per the rules and bye-laws, the Exchange has asked these defaulting members to submit their books of accounts and hand-over all the collaterals to the Exchange.
The Exchange had appointed SGS to carry out quality and quantity inspection of the commodities lying in the warehouses and their reports are being received in stages based on the inspection being done. Amongst these nine defaulting members, the exchange has initiated case for investigation against five defaulting members who did not have adequate commodities in the warehouses, which is against the mechanism specified in the Exchange circulars.
Non-delivery of commodities or its withdrawal is a breach of faith and breach of contractual arrangements. Exchange will also take similar recourse for other defaulting members who are not cooperating. As informed earlier, the NSEL board has already initiated investigation against the management team and its ex-MD&CEO. Further development in this regard will be informed in due course.

The Five defaulters against which NSEL has filed complained are:
1. ARK IMPORTS PVT. LTD.
2. LOTUS REFINERIES PVT. LTD.
3. N K PROTEINS LTD.
4. VIMLADEVI AGROTECH LIMITED
5. YATHURI ASSOCIATES

The Four other announced defaulters are:
1. LOIL OVERSEAS FOODS LTD.
2. NCS SUGARS LIMITED
3. SPIN COT TEXTILES PVT LTD.
4. TAVISHI ENTERPRISES PVT. LTD.