SEBI Imposes ₹25 Lakh Fine on MCX for Delayed Disclosure of Software Payments

India's market regulator, the Securities and Exchange Board of India (SEBI), has slapped a ₹25 lakh fine on Multi Commodity Exchange of India (MCX) for not adequately disclosing significant payments to 63 Moons Technologies, the erstwhile promoter and trading software provider to the exchange. The fine, which was announced on May 26, 2025, follows concerns relating to transparency and timely disclosure of material financial information to investors.

Key Highlights
Nature of Lapses: MCX did not report in a timely manner that it had made payments of ₹222 crore to 63 Moons Technologies during three consecutive quarters, namely ₹60 crore for October–December 2022 and ₹81 crore for each of the next two quarters, much more than the company's three-year profit of ₹118 crore for FY 2021–22.

Background: MCX, which had originally employed 63 Moons' trading system since 2003, decided to move to a new system created by Tata Consultancy Services (TCS) in 2020. But constant delays in the implementation of the new platform pushed MCX to continue its dependence on 63 Moons at much higher costs.

Disclosure Failures: The payments did not appear in MCX's press statements or quarterly financial announcements when they took place, with the total only revealed in January 2023—long after the transactions had been completed. SEBI considered the failure to disclose promptly to be a breach of Listing Obligations and Disclosure Requirements (LODR) rules.

Regulator's Perspective: SEBI faulted MCX for failing to disclose the financial effect of these payments, which had a material influence on the profitability of the company and could have affected investor choices.

MCX's Response: The exchange owned up to the oversight, calling it an error of omission. SEBI accepted that there were operational complexities and disruptions because of the pandemic but insisted that the disclosure requirements were unambiguous.

Other Allegations: SEBI dropped certain other charges, including allegations of misleading press releases and incorrect platform migration timelines, after reviewing MCX’s explanations.

Next Steps: MCX is required to pay the ₹25 lakh penalty within 45 days.

This regulatory action underscores SEBI’s continued emphasis on transparency and timely disclosure in India’s financial markets, especially when material events can significantly impact listed companies’ financial health and investor interests.

Source: Times Of India