A special CBI court on Wednesday granted bail to FTIL founder Jignesh Shah in connection with a case granting a license to MCX Stock Exchange (MCX-SX). Special CBI Judge P S Tarare granted bail to Shah in the surety of Rs 1 lakh. Shah was arrested by the Central Bureau of Investigation (CBI) last month for his alleged role in securing extension for MCX-SX to offer currency futures without conforming to SEBI rules on ownership.
Notably, the CBI had registered a preliminary inquiry in March 2014 to probe the grant of a licence to MCX-SX.
The inquiry was turned into an FIR in August 2014 which named Shah, FTIL and four Sebi officials who were involved in the deal.
Senior advocate Amit Desai, appearing for Shah, pointed out that the allegation in the CBI FIR pertains to the renewal of recognition of MCX-SX by Sebi in 2010. So for a six-year-old matter, he argued, the CBI took Shah into custody all of a sudden on September 20, 2016 and that too more than two years of registration of the FIR. Shah is the only person held by the CBI in the case.
None of the accused public servants or other accused have been arrested. Desai further argued that C B Bhave, the then Chairman of Sebi, and K M Abraham, the then Whole Time Member of Sebi, who were the actual decision-makers in Sebi at the relevant time, have been given a clean chit by the CBI in the preliminary inquiry and have not even been named in the FIR. This shows that the CBI did not find any criminality in the decision of Sebi in the renewal of recognition of MCX-SX. ‘’Then, where is the question of booking Shah for allegedly influencing the same decision-making?’’
Shah was not the one who filed or signed the application for renewal of recognition of MCX-SX, Desai said, adding that there is no evidence whatsoever of Shah having ever met or spoken to any of the accused public servants in relation to MCX-SX renewal. It’s clear that Shah was falsely implicated in the matter.
After registration of the FIR by the CBI on August 25, 2014, Desai pointed out, Shah appeared before them for interrogation on April 13, 2016. The CBI did not choose to arrest him at that time. He was also in the custody in the PMLA matter from July 07, 2016 to August 6, 2016. ‘’Why did the CBI not seek his custody during that time if they really wanted his custodial interrogation,’’ he raised this point while arguing before the special CBI court.
The main allegation in the FIR is regarding alleged suppression of buy-back arrangements entered by promoters of MCX-SX from Sebi while granting renewal in 2010. This is factually incorrect because Sebi was fully aware about these buy-back arrangements even prior to the grant of renewal on August 30, 2010, said Shah’s advocate.
Moreover, the legality and validity of these buy-back arrangements was upheld by the Bombay High Court in March 2012 itself, Desai noted, adding that this fact was deliberately overlooked by