Observing a 'disturbing nexus' between officials of DSQ group, Calcutta Stock Exchange, Stock Holding Corporation and Unit Trust of India, the Joint Parliamentary Committee on stock scam on Thursday asked various regulators to expedite probe into the matter that led to a Rs 21.40-crore (Rs 214 million) loss to the country's largest mutual fund.
Referring to the events in CSE relating to transactions in DSQ shares, the committee said, "All these point to a close nexus between corporate promoter (Dinesh Dalmia of DSQ), defaulting broker (H C Biyani), broker directors of CSE and public officials of SHCIL and UTI."
JPC said UTI unit-holders have been subjected to a loss of Rs 21.40 crore as on June 28, 2002 on an investment of Rs 25.13 crore (Rs 251 million) made by UTI based on a decision which violated norms of prudent decision making.
"P S Subramanyam, the then chairman and late M M Kapur, executive director, approved the transaction which any prudent person could have foreseen would lead to a loss to UTI," it said in its report tabled in Parliament.
JPC recommended that Central Bureau of Investigation should expedite its inquiries and subsequent action on the complaint filed by UTI in the matter.
Referring to Sebi's inspection on SCHIL, JPC said it should be concluded without delay and suitable action taken against the concerned persons. Securities and Exchange Board of India, Department of Company Affairs and Enforcement Directorate should also expedite their inquiries on DSQ.
JPC also desired that Reserve Bank of India should inquire into the discounting of post-dated cheques issued by SCHIL to Biyani group.
"RBI's inquiry should also look at the role of IndusInd Bank in financing all the brokers responsible for the payment crisis on CSE," it said.
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