The Supreme Court has dismissed an appeal by MMTC, removing the final legal hurdle for a ₹1,950 crore settlement for NSEL investors. This decision allows for a recovery of 42% on verified claims for over 5,600 creditors, ending a 13-year legal dispute.
The Supreme Court has dismissed an appeal filed by Metals and Minerals Trading Corporation (MMTC), removing the last significant legal barrier to a ₹1,950 crore settlement scheme for investors of the National Spot Exchange Limited (NSEL). This order effectively upholds the settlement plan previously approved by the National Company Law Appellate Tribunal (NCLAT), bringing a close to a decade-long legal struggle that began after the 2013 payment default.
This settlement offers a recovery of approximately 42% of the verified claims to 5,682 specified creditors. Under the approved framework, these creditors will transfer their rights to 63 moons technologies Ltd, which is tasked with facilitating the payout process. The settlement calculations are based on the outstanding dues recorded as of July 31, 2024.
To fund this payout, a special court under the Prevention of Money Laundering Act (PMLA) recently authorized the Enforcement Directorate (ED) to sell properties attached in the case. The court has identified assets valued at approximately ₹3,464 crore for monetization. While the settlement requires ₹1,950 crore for distribution, any funds generated from these assets beyond this amount will remain in the custody of the court pending further legal developments related to the original 2013 fraud case.
The Supreme Court’s decision provides much-needed clarity for the thousands of traders and investors who have been waiting for restitution since the exchange crisis broke out. For those involved, the next phase will focus on the actual execution of the asset sale and the subsequent transfer of funds.
Investors and stakeholders should monitor the pace of asset monetization by the Enforcement Directorate. The successful distribution of funds is contingent on the timely sale of these attached properties and the fulfillment of specific settlement conditions defined in the court-approved scheme. Because some assets may have complex legal status due to overlapping attachments from different authorities, the cooperation between the ED and other statutory bodies will be a key factor in how quickly the recovery process proceeds.