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How Parekh could have saved skin

Calcutta, Nov. 15: It is now evident that the management of the Calcutta Stock Exchange headed by president Kamal Parekh could have staved off Harish Chandra Biyani and his firm’s default of Rs 31 crore in March 2001, had it been prudent.

The exchange authorities should have expunged the collusive deals between Biyani and Biyani Securities in the shares of DSQ Industries that were settled on March 7, and withheld Rs 34 crore that Biyani had paid towards the settlement of those trades.

In that case, Stock Holding Corporation of India Ltd (SHCIL) would have taken a major financial hit. SHCIL had a close shave, but got away unscathed, thanks to Parekh’s largesse. Had the money paid by Biyani been held back, the exchange would have been fully covered against their combined default of Rs 31 crore.

Members of the exchange are set to lose around Rs 4 lakh each on account of the payment shortfall, which had to be met out of the settlement guarantee fund (SGF) and the general reserve.

CSE brokers feel the management had dipped into these reserves without proper authorisation and are planning to take legal action against the people at the helm at the time of payment crisis.

In a related development, the five absconding defaulters of CSE — Dinesh Kumar Singhania, Ravindra Biyani, Ratanlal Poddar, Ashok Poddar and Prema Poddar — have been put in Calcutta Police’s most wanted list. The police have issued “proclamation” against the five brokers, which implies that anyone can now detain them for being handed over to the police. The police are likely to attach their properties if they still do not surrender.

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