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I-T officials, who spoke on conditions of anonymity, claim Shah and his wife (Susan) got hefty royalty every year from the turnover of Nifty trading, which is 80% of the total turnover of NSE. This, they claim, is in violation of the standard industry norm, where a one-time payment is given to designers and researchers for any of the market indices.

What, claim I-T officials, is more unprecedented and stunning is that a percentage of trading on NSE and its earnings was said to have also been given as royalty to Shah and his wife, associated as professors at National Institute of Public Finance and Policy (NIPFP) and Indira Gandhi Institute of Developmental Research (IGIDR), respectively. I-T officials are also investigating whether Shah influenced FIIs and Participatory Notes (PN) activities on NSE. After all, he had profit sharing contracts with OPG Securities, Alpha Grep and Omnesys.

“What is damaging is that such a crucial piece of information was suppressed from the Red Herring prospectus of NSE’s on-hold IPO,” claim I-T officials, adding it was his proximity with a senior minister in the UPA and his obedient bureaucrats that helped Shah bag Rs 1 crore annual project for NIPFP for a decade.-from Sunday Guardian