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JPC pressure forced CSE to dock defaulters

Kausik Datta & Sambit Saha in Kolkata

Much of the credit for getting the Calcutta Stock Exchange into filing complaints with the police against the defaulting brokers responsible for the March 2001 payment crisis should go to the Joint Parliamentary Committee probing the share scam.

Had it not been for the JPC pressure, the CSE would have limited its action to civil and criminal suits against the defaulters in the city high court with little hope of relief.

A top source in JPC said the committee found a coterie comprising a handful of CSE brokers operating within the bourse and exploiting the bourse for their gains.

In addition to reporting this finding in its draft report made public a couple of months ago, the JPC asked CSE to file complaint with the police, the source added. The JPC angle has solved the riddle puzzling Lyons Range for the last two weeks on why CSE filed a complaint with the police one-and-a-half years after the payment crisis. CSE had began fighting defaulters at court of laws immediately after it was rocked by the payment crisis.

In contrast, it filed the first information report against brokers with the city police just a month ago. Till date, CSE has filed 60 cases against defaulters who have a combined outstanding of Rs 92 crore (Rs 920 million).

Following the FIR filed by CSE, the detective department of the city police initiated an investigation nearly three weeks ago. So far, the police has put as many as 11 brokers and associates, including one of the defaulters, Harish Chandra Biyani, behind bar.

The other defaulters, Dinesh Kumar Singhania and Ashok Kumar Poddar are on the run. JPC, however, did not give similar instruction to Bombay or National Stock Exchange simply because the coterie of operations among a handful of brokers was not so prominent in the Mumbai bourses.

The source said JPC was now in the process of finalising drafting of the final report which would placed before the Parliament in the ensuing winter session.

"The Drafting Committee has started meeting from yesterday. The committee will sit till November 1 to finalise the report," he added.

The government is expected to prepare an action taken report on the basis of the JPC report.

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