Court quotes Bob Dylan while rejecting bail of ex-NSE chief

A Delhi court has denied bail to former National Stock Exchange (NSE) chief Chitra Ramkrishna in connection with the co-location case.

While dismissing the bail plea, special judge Sanjeev Aggarwal quoted a song by legendary singer and Nobel laureate Bob Dylan and said that prima facie, Ramkrishna was running the affairs of the stock exchange akin to that of a private club.

“It appears that accused Chitra Ramakrishna, prima facie seems to have been running the affairs of NSE akin to that of a private club. Singer-writer, Nobel Laureate Bob Dylan once said ‘money doesn’t talk, it swears’, which is a song of the 1964 song album ‘It’s Alright Ma I’m Only Bleeding’. It means that money not only has influence, but it has great influence, even a perverse influence on people,” said judge Aggarwal in an order of May 12, which was made available on Monday.

An FIR was registered in May 2018 amid allegations irregularities at the country’s largest stock exchange. The Central Bureau of Investigation (CBI) is probing the alleged improper dissemination of information from the computer servers of the market exchanges to the stock brokers.

In the co-location facility offered by NSE, brokers could place their servers within the stock exchange premises giving them faster access to the markets. It is alleged that some brokers in connivance with insiders abused the algorithm and the co-location facility to make windfall profits.

The CBI had arrested Ramkrishna on March 6, a day after her anticipatory bail application was dismissed by the court.

During the May 12 hearing, court also denied bail to group operating officer (GOO) Anand Subramaniam, who has been named as a co-accused in the case.

With respect to the affairs of NSE at the relevant time, the judge said that it would not be out of place to observe that there comes a time in a lifetime of an institution, where it finds itself at crossroads. “...then it should take a path which is a right path to restore its glory, rather than burying the skeletons, which may later turn into Frankenstein monsters.”

Ramkrishna is charged with leaking sensitive information to the co-accused and others, initially claiming that she was acting on the counsel of a Himalayan “yogi”. She has also been accused of financial misdeeds relating to fixation and frequent revision of Subramanian’s compensation in a disproportionate manner.

Subramanian was allegedly referred to as the “yogi” in the forensic audit, but the Securities and Exchange Board of India (SEBI), in its final report, had rejected the claim.

Denying the relief, the court said that present case may also impact the investment scenario in the country viz-a-viz foreign institutional investors (FIIs), who are always looking for fair, transparent and clean stock exchange to trade with.

The present case has shaken the financial conscious of every investor, whether retail, institutional or otherwise, which needs mending to restore confidence of public at large in the same, the court said.

The judge also said that since both accused were at “pole position” at the bourse, there are chances of them tampering with the evidence and influencing the witnesses.

Senior advocate N Hariharan, appearing for Ramkrishna, had contended that the investigation agency had filed a charge sheet and she had spent almost two months in custody.

The CBI had claimed that Ramkrishna was involved in a serious offence affecting the integrity and functioning of the largest stock exchange of our country and the robustness/integrity of the financial system.

The CBI had further submitted that the co-location architecture was put in place under Ramakrishna’s tenure as the managing director, and Muralidharan Natrajan, who was responsible for putting in place the co-location architecture directly reported to her.

The agency had told the court that Ramkrishna did not bring the fact that Subramanian was elevated to GOO and his nomination before the Remuneration Committee, thus granting him immense benefit.

The agency also submitted that Ramkrishna had also influenced the replies filed by the NSE to the queries posed by SEBI.