NSEL's ₹5,600Cr spot exchange collapsed when fake warehouse receipts were exposed

National Spot Exchange Limited was India's first commodity spot exchange, launched in 2008 and promoted by NAFED and Financial Technologies India Ltd (FTIL, now 63 Moons Technologies). It was exempted to conduct forward trading in one-day contracts under the Forward Contracts Regulation Act. By July 2013, the exchange had accumulated ₹5,600 crore in outstanding settlement obligations.

The Forward Markets Commission ordered NSEL to stop launching new contracts and settle all existing ones. NSEL suspended trading on July 31, 2013, triggering a payment default of approximately ₹5,600 crore ($700 million). The default occurred because 22 borrowing companies had hypothecated the same stocks, produced fake warehouse receipts, and siphoned the money. Approximately 13,000 trading clients were affected.

Jignesh Shah, founder of FTIL, was arrested multiple times. NSEL CEO Anjani Sinha was arrested twice. The EOW filed chargesheets against 63 entities including top brokers who had mis-sold the products. The Enforcement Directorate attached properties worth nearly ₹900 crore. The Supreme Court eventually upheld that NSEL was a financial establishment under the MPID Act, validating asset attachments. A ₹1,950 crore settlement was approved by the NCLT in November 2025.