Bombay High Court Rejects NSEL Accused's ₹48 Lakh Bid To Secure Property Attached Under MPID Act

The Bombay High Court has recently dismissed an appeal filed by Ramesh Satpal Nagpal, an accused in the 2013 National Spot Exchange Ltd. (NSEL) case. It refused to permit him to bid for his property attached and put to auction under the Maharashtra Protection of Interest of Depositors Act, 1999, upholding the trial court's rejection of his application.

A Division Bench of Justices A.S. Gadkari and Kamal Khata held that merely because the property remained unsold despite being put up for auction thrice, the appellant could not be permitted to bid for it.

Holding that the trial court rightly rejected the request, the court observed:

“We find no reason to permit the Appellant to bid for the said property merely because the said property remained unsold though put up for auction for three times. We find no reason to disbelieve the valuation given by Notiyal and Associates and consideration of the same by the Trial Court. Accordingly, the Trial Court was right in rejecting the Application upon the Appellant securing an amount of Rs 48 lakhs when the value was Rs.12,55,56,352/- as per the other valuation report.”

The case arises from a criminal case registered on September 30, 2013 at MRA Marg Police Station, Mumbai, alleging offences including criminal conspiracy, breach of trust and forgery against directors and trading members of NSEL, brokers and others. The investigation was later transferred to the Economic Offences Wing, which invoked provisions of the MPID Act.

Nagpal, proprietor of Shree Radhey Trading Company and an NSEL member since September 2011, was arraigned as accused No.59. He was arrested on February 26, 2016 and granted bail on March 30, 2016.

During the proceedings, Nagpal had deposited Rs. 29 lakh with the competent authority. A property attached from him under the MPID Act was subsequently put up for auction three times with a reserve price of Rs. 48 lakh but failed to attract any buyers.

In appeal, He challenged the rejection of his application seeking release of the property and expressed willingness to deposit the differential amount. However, the court noted that a separate valuation report by Notiyal and Associates assessed the property at Rs. 12.55 crore, significantly higher than the earlier valuation.

The court further held that once an order permitting auction of an attached property is passed under the MPID Act, there is no provision for its release in favour of the owner.

Finding no merit in the appeal, the court dismissed it and upheld the trial court's order.