NATIONAL SECURITIES CLEARING CORPORATION LIMITED

CAPITAL MARKET SEGMENT

Circular No. 0458

Download No.: NSCCL/SEC/2010/16103 October 25, 2010

To
All Clearing Members and Custodians
In pursuance of Regulations of the Capital Market segment of National Securities Clearing
Corporation Ltd. and in replacement of all earlier circulars issued, members of the Capital
Market segment are hereby notified the following:

Sr. No. Description

Item 1 CLEARED AND NON CLEARED DEALS
Item 2 CLEARING & SETTLEMNT
Item 3 PROCEDURE FOR SETTLEMENT OF NON CLEARED DEALS
Item 4 CLEARING DAYS AND SCHEDULED TIME
Item 5 MAINTENANCE OF DEPOSITORY ACCOUNT
Item 6 PROCEDURE FOR PAY-IN /PAY-OUT OF FUNDS
Item 7 PROCEDURE FOR PAY-IN/PAY-OUT OF SECURITIES
Item 8 VALUATION PRICE
Item 9 CLOSING OUT
Item 10 LIQUID ASSETS
Item 11 MARGINS
Item 12 CHARGES AND PENALITES
Item 13 SETTLEMENT FUND
Item 14 GUIDELINES FOR GOOD / BAD DELIVERY
Item 15 FORMAT OF MEMBERS STAMP
Item 16 DELIVERY UNITS
Item 17 BAD DELIVERY CELL
Item 18 COMPANY OBJECTIONS PROCEDURES
Item 19 DOCUMENT AND REGISTRATION
Item 20 FAKE/ FORGED/STOLEN CERTIFICATES
Item 21 CERTIFICATION OF GOOD/BAD DELIVERY
Item 22 REQUEST CASES & BAD DELIVERIES
Item 23 CLEARING HOUSE PROCEDURES
Item 24 CLEARING AND OTHER FORMS
Item 25 INFORMATION VIA SMS
Item 26 ELECTRONIC REPORTING
Item 27 MUTUAL FUNDS SERVICE SYSTEM
Item 28 PRIVITY OF CONTRACT

For any further clarifications members may contact the Clearing Corporation:

Department Contact Numbers Email ID

Collaterals 022-26598263 / 65 collaterals@nse.co.in
Risk Group 022-26598266/26598168 risk_group@nse.co.in
Securities 022-26598267/68 securities_nsccl@nse.co.in

For National Securities Clearing Corporation Limited

Rana Usman
Asst. Vice President
 Item 1

CLEARED AND NON CLEARED DEALS

In pursuance of Regulation 3.3 of the NSCCL Capital Market Regulations deals

admitted on the CM clearing segment shall be distinguished as under:

1.1 Cleared Deals

Cleared Deals means the following deals executed on the Capital Market Segment of the
NSE:

1. Deals in the Normal market including deals executed in

a. Trade for Trade-Surveillance market (TFTS),
b. Inter Institutional Market (hereinafter referred to as IL Market deals),
c. Block Trade window (hereinafter referred to as BL market deals)
2. Deals executed in the Auction Market
3. Deals executed on the Limited Physical Market (hereinafter referred to as LP Market
deals).
4. Deals executed in the Retail Debt Market

1.2 Non Cleared Deals

Non Cleared Deals are deals other than cleared deals which are executed on the Capital
Market Segment of the NSE and include the following:

1. Deals executed in the Trade for Trade market (hereinafter referred to as TT Market
deals).
2. Any other deals not specified herein.
 Item 2

BASIS FOR CLEARING AND SETTLEMENT OF DEALS AND SETTLEMENT

OBLIGATIONS

In pursuance of Regulations 4.3 and 4.4 of the NSCCL Capital Market Regulations the
basis for clearing and settlement of deals and settlement obligations is specified as
under:

Trading and settlement periods shall be specified by the relevant authority from time to time.
Currently all settlements are on a T+2 day rolling basis, in accordance with SEBI Circular
Ref. No. D&CC/FITTC/CIR-20/2003 dated March 4, 2003.

2.1 Normal Market deals

Deals executed in the normal market in equity shares, warrants, dividends, bonds etc. and
including transactions in Trade for Trade, Inter-institutional and Block deal transactions.

2.1.1. Regular normal market deals

Transactions shall be executed in series ‘EQ’ and settlement type ‘N’. Settlement can be only
in dematerialised mode and on a net obligation basis. Settlement Guarantee shall be provided

2.1.2 Trade for Trade -Surveillance segment (TFT-S) Deals

As a measure of risk containment, the relevant authority may shift from time to time certain
securities from series ‘EQ’ to series ‘BE’ - Trade for Trade Surveillance Segment (TFTS)
Transactions in this segment shall be settled under settlement type ‘W’. Transactions shall be
cleared and settled on a trade for trade basis and there shall be no netting of transactions.
Settlement Guarantee shall be provided. Settlement shall be in dematerialised mode only.

2.1.3 Inter-Institutional Market (IL) Deals

Inter-Institutional Deals executed on behalf of institutional investors shall be cleared and

settled on a net obligations basis within the sub-segment. Settlement of all transactions shall
compulsorily be done in dematerialised mode only. All trades shall be settled under
settlement type ‘N’ and series ‘IL’. Settlement Guarantee shall be provided.

2.1.3.1 Eligible clients for IL deals

a) Only FIIs shall be permitted to place sell orders.

b) Buy orders can be placed by FIIs, DFIs, Banks, Mutual Funds, Insurance Companies,
Pension Funds and such other institutions as may be approved from time to time.
c) Where RBI has stipulated collective limits for FIIs, NRIs, PIOs etc in certain
securities, these entities shall be permitted to place orders on both buy and sell sides.

2.1.4 Block deals

Block Deals shall be executed in a special window and shall be cleared and settled on a net
obligations basis within the sub-segment. All trades shall be settled under settlement type ‘N’
and series ‘BL’. Settlement of all transactions shall compulsorily be done in dematerialised
mode only. Settlement Guarantee shall be provided.

2.1.5 Trade for trade (TT) market deals

TT Market deals shall be under series ‘BT’ and settlement type ‘Z’. Deals shall be settled on
a trade for trade basis directly between the parties to the transaction and reported to the
Clearing Corporation. Details for reporting are as given in Item 3. Transactions shall be
settled on a gross basis and settlement obligations shall arise out of every deal. Transactions
may be settled in dematerialised form or in physical form. There shall be no settlement
guarantee for TT transactions.

2.2 Auction market deals

Auction Market deals shall be cleared and settled on a trade for trade basis under settlement
type ‘A’. Auction Market deals shall be settled on a gross obligations basis. Settlement of all
transactions shall compulsorily be done in dematerialised mode and settlement guarantee
shall be provided.

2.3 Limited Physical Market Deals

Limited Physical (LP) Market Deals shall be settled on a trade for trade basis and settlement
obligations shall arise out of every deal. Deals shall be in series ‘BT’ and settlement type ‘O’.
Deliveries shall be only in physical form

2.4 Retail Debt Market (RDM)

RDM deals shall be in series ‘GC’ and settlement type ‘D’. Deals shall be settled on a net
obligation basis and settlement guarantee shall be provided.
 Item 3

PROCEDURE FOR SETTLEMENT OF NON CLEARED DEALS

In pursuance of Regulation 5.1 to 5.7 of the NSCCL Capital Market Regulations the
procedure for settlement of non cleared deals is specified as under:

3.1 Procedure for Settlement of TT Market Deals in the Capital Market segment

3.1.1 Settlement Obligations for TT Market deals have to be settled within 2 working days
(T + 2 day basis) from the date of deal directly between the buying and selling clearing
members.

3.1.2 The exchange of securities and funds has to take place directly between the buying and
selling clearing members

3.1.3 The selling clearing member is required to render delivery of securities to the office of
the buying clearing member in exchange for funds which may be paid by means of
Cheque/Demand Draft/Pay-order by the buying clearing member or by such other means
which enable the selling clearing member to realise the funds on the same day as the
exchange of securities.

3.1.4 Settlement details must be reported by Custodian and/or TM clearing members to the
Clearing Corporation in the formats prescribed as Form No: NSEF 07A or 07B respectively
within 24 hours of the settlement.

3.1.5 The delivery of securities in settlement of TT Market deals can be the following units
in marketable lot, or
in certificates of denomination of 1000 shares, or
certificate of the denomination of the traded quantity.

3.1.6 The choice of deciding on the denomination of certificates will rest with the delivering
clearing member.

3.1.6.1 TM Clearing members will receive a report of Settlement Obligations for TT Market
deals at the end of the day.

3.1.6.2 Custodian Clearing Members will receive a report of Settlement Obligations for the
TT Market deals executed on behalf of their clients at the end of the day.

3.1.6.3 Custodian Clearing Members are required to confirm TT Market deals executed on
behalf of their clients for settlement purpose within the settlement periods specified by the
relevant authority from time to time. In case the custodian clearing member does not confirm
the deal, the responsibility to settle the deal will shift to the TM Clearing Member who
executed the deal.
3.2 Non-settlement of TT trades

3.2.1 In case a member expresses inability to settle the trade either by paying funds or
delivering securities, then the trade will be deemed closed-out at the highest price prevailing
in the NSE in Normal Market from the trading day till the date of settlement or 20 % above
the official closing price in the Normal Market on the date of settlement of such trade,
whichever is higher.

3.2.2 In case of non rectification/replacement of any bad delivery, the trade will be deemed
closed-out at the highest price prevailing in the NSE in Normal Market from the trading day
till the date of settlement or 20% above the official closing price in Normal Market on the
date of settlement of such trade, whichever is higher.

3.2.3 The defaulting member shall pay the difference between the settlement prices and
close out price within 5 working days from the date of settlement to the counterparty failing
which the amount of difference shall be debited by Clearing Corporation to the account of the
defaulting member. On recovery of the said amount, the credit thereof shall be given to the
receiving member.

3.2.4 If the defaulting party does not pay the difference, the aggrieved party can refer the
matter to the clearing corporation for suitable actions.

3.2.5 The defaulting party shall further pay a penal charge of 0.5 % of the traded value to
Clearing Corporation. The penal charges shall be debited to the clearing accounts of the
members and will be transferred to the Settlement Guarantee Fund.

3.3 Cancellation of Trades

In case a deal executed in TT segment is cancelled by a Clearing Member, a penal charge of

Rs.1000 for each cancellation of a trade shall be levied. If a clearing member is buying as
well as selling member, Rs.2000 shall be collected as charge for cancellation of Trade. The
cancellation charges shall be levied without prejudice to any disciplinary action including
referring the matter to Disciplinary Action Committee.

3.4 Failure to report settlement of TT trades

Where a member fails to report settlement of the TT trades within 24 hours of the settlement
date, a processing fee of Rs. 500 /- per trade per day subject to maximum of 2.50 times the
value of the trade for each side with a ceiling Rs. 5000/- shall be levied for late reporting of a
trade on such a member even though the trades are settled by the settlement date.

3.5 Failure to settle TT trades on the settlement date

3.5.1 Members shall seek prior approval of the Clearing Corporation to grant extension of the
settlement date, if due to unavoidable circumstances they would be not able to settle the
trades by the settlement date. The relevant authority may, if satisfied that such circumstances
exist in its absolute discretion, approve any such extension of settlement date.
3.5.2 Where a member fails to obtain prior approval from Clearing Corporation for extension
of the settlement date of the TT trades, a processing fee of Rs. 500 /- per trade per day subject
to maximum of 2.50 times the value of the trade for each side with a ceiling Rs. 10000/- shall
be levied for late settlement of a trade.

3.5.3 Where a member establishes to the satisfaction of the relevant authority that the failure
to settle is on account of non-payment of funds or non-delivery of securities by the counter-
party member and that he has fulfilled his part of obligation in full and in time, the relevant
authority in such cases may not impose the penal charges on such a member.
 Item 4

CLEARING DAYS AND SCHEDULED TIME

In pursuance of Regulation 6.2 of the NSCCL Capital Market Regulations it is hereby

notified that the time schedule to be observed with regards to Clearing House,
Depository Clearing System and Clearing Bank is specified as under:

4.1 Settlement in Physical Deliveries through Clearing House

Delivering members shall deliver all documents to the Clearing House during its regular
business hours from 9.30 am to 10.30 am on the settlement day. Receiving members will be
allotted specific time slots on settlement day to collect the documents from the Clearing
House at Mumbai.

4.2 Settlement in Depository Clearing System

The delivering member shall complete delivery instructions for transfer of securities to CM
Clearing Pool Account on settlement day in accordance with SEBI Circular Ref No.
SMD/POLICY/Cir-6/03 dated February 6, 2003. The depositories shall facilitate transfer of
such securities to ‘NSCCL Settlement Pool account’ by 11.00 am.

The depositories shall credit the receiving members' pool account / clients beneficiary
account in accordance with the pay-out instructions received electronically from Clearing
Corporation on the settlement day.

4.3 Clearing Bank

The paying member shall have clear funds in his settlement account on settlement day, in
accordance with SEBI Circular Ref No. SMD/POLICY/Cir-6/03 dated February 6, 2003. The
Clearing Bank shall debit the paying members' account by 11.00 a.m. in accordance with
electronic instructions received from Clearing Corporation.

The Clearing Bank shall credit the receiving members' settlement account in accordance with
the pay-out instructions received electronically from the Clearing Corporation on the
settlement day.
 Item 5

MAINTENANCE OF DEPOSITORY ACCOUNT

In pursuance of Regulation 14 of the Capital Market Regulations, the provision relating

to CM clearing member's clearing account with a Depository Participant of the
specified depository is hereby specified as under:

5.1 Depository Account

The members shall operate a clearing account with a Depository Participant of the
depositories, National Securities Depository Ltd (NSDL) and Central Depository Services
Ltd (CDSL) for the purpose of settlement of depository deals or for any other purpose as the
relevant authority may specify from time to time.

5.1 Procedure for shifting of CDSL pool account

In case a clearing member wishes to shift the CDSL pool account from one depository
participant to another, then the new pool account number shall be intimated to the Clearing
Corporation as per format specified in Annexure 5.1.
 Item 6

PROCEDURE FOR PAY-IN /PAY-OUT OF FUNDS

In pursuance of Regulation 13 of the Capital Market Regulations, the provision relating

to clearing bank appointed by the Clearing Corporation, are hereby specified as under:

6.1 Funds pay-in and pay-out shall be through banks designated as Clearing Banks by the
Clearing Corporation. The list of banks currently available for settlement is provided in
Annexure 6.1.

6.2 Maintenance and operation of clearing account

6.2.1 Primary Clearing Account

• Every clearing member shall maintain and operate a separate and distinct primary
clearing account for the capital market segment with any one of the designated
clearing banks at the designated branch of the bank, as given in Annexure 6.1. The
primary clearing account shall be used exclusively for clearing operations i.e., for
settling funds obligation, payment of margins, penal charges, etc as may be specified
by the Clearing Corporation from time to time.

6.2.2 Additional Clearing Account

• Further, every clearing member shall be able to maintain and operate additional
clearing accounts with the designated clearing banks, as given in Annexure 6.1,
exclusively for the purpose of enhancement of collaterals in the form of cash and for
providing EPI of funds through CIM.

• All the credits and debits other than collateral enhancement and EPI of funds as
specified by the member shall be routed through the primary clearing account.

• Maintenance of a primary clearing account and one additional clearing account in

capital market segment shall not be chargeable. However, starting from second
additional clearing account onwards, a charge of Rs.5000 plus service tax shall be
levied for every additional clearing account activated for the clearing member.

• Clearing members are required to send a Demand Draft, favoring National Securities
Clearing Corporation Ltd for the total amount of applicable charges plus service tax,
along with the request for activation of additional clearing account.

6.3 Operation of clearing accounts

• Clearing members shall irrevocably authorize the clearing banks to access their
clearing accounts for debiting and crediting their clearing accounts as per the
instructions of the Clearing Corporation, reporting of balances and other information
as may be required by the Clearing Corporation from time to time as per the format
given in Annexure 6.2 and furnish to the Clearing Corporation an acknowledged
copy of the same along with the account particulars issued by the clearing banks.
 • Clearing members can deposit funds into these accounts in any form and can
withdraw funds from these accounts only in self-name.

• Clearing members having funds obligation to pay shall have clear balance of requisite
funds in the clearing accounts on or before the stipulated funds pay-in day and the
stipulated time.

• Clearing members shall not seek to close or de-activate the clearing accounts without
the prior written consent of the Clearing Corporation

• The clearing banks shall debit/credit the clearing accounts of the clearing members as
per instructions received from the Clearing Corporation from time to time. Any
request from the clearing members for revoking the authorization furnished by them
shall not be considered by the clearing banks. The clearing banks shall not close the
clearing accounts or permit deactivation of the same without the prior written consent
of Clearing Corporation.

• All bank confirmations received from clearing banks on behalf of the members
towards margins, funds pay-in, EPI of funds, collateral enhancements etc. shall be
given effect only after receiving a written/electronic confirmation from their
respective clearing banks.

6.4 Procedure for change in primary clearing banks

In case a clearing member wishes to shift the primary clearing account from one designated
clearing bank to another, the following procedure shall be followed:

• The clearing member shall request the primary clearing bank in writing for issuing a
No Objection Certificate (NOC) for shifting of the primary clearing account.

• The clearing member shall request the Clearing Corporation in writing seeking its
permission for shifting of the primary clearing account and enclose the NOC received
from the existing primary clearing bank in this regard or where the NOC is not
received, furnish an acknowledged copy of the NOC request along with a declaration
to the effect that no response has been received from the existing primary clearing
bank in respect of the NOC request even after a minimum waiting period of a
fortnight.

• The Clearing Corporation would thereon issue a letter of introduction to the other
designated clearing bank

• On opening the clearing account with the other designated clearing bank, the clearing
member shall submit to the Clearing Corporation the documents relating to the new
primary clearing account issued by the clearing banks and letter in the format as
mentioned in Annexure 6.2.

• The Clearing Corporation shall thereon communicate the date from which the new
primary clearing account shall be operational. The clearing members are required to
 intimate the Clearing Corporation whether they wish to continue the existing primary
clearing account as one of the additional clearing accounts or discontinue the existing
primary clearing account after the change in primary clearing bank. In the event of the
clearing members wishing to discontinue the existing primary clearing account, the
Clearing Corporation shall communicate the date after which the existing primary
clearing account may be closed by the clearing member.

• In the event of the clearing members wishing to continue the existing primary clearing
account as one of the additional clearing account, the clearing member shall be
required to provide the letter from clearing bank confirming continuance of account as
additional clearing account along with the letter in the format as mentioned in
Annexure 6.2 for such additional clearing account.

• A charge of Rs.5000 plus service tax shall be levied for every instance of change in
primary clearing account from one designated clearing bank to another. Clearing
members are required to send a Demand Draft, favoring National Securities Clearing
Corporation Ltd for the total amount of applicable charges plus service tax, along with
the request for change in primary clearing account.
 Item 7

PROCEDURE FOR PAY-IN AND PAY-OUT OF SECURITIES

7.1 Pay-in of securities

Pay-in shall be conducted on the scheduled pay-in day, in accordance with the settlement
calendar periodically issued by the Clearing Corporation in this regard. Pay-in timings shall
be fixed as declared by SEBI (refer SEBI Circular Ref No MRD/DoP/SE/Dep/Cir-18/2005
dated September 2, 2005) Members shall maintain settlement accounts at both depositories
viz NSDL and CDSL and provide specific pay-in instructions to depositories for effecting
pay-in

7.1.1 Auto Delivery Out

For pay-in through NSDL a facility has been provided to members wherein delivery-out
instructions will be generated automatically by the Clearing Corporation based on the net
delivery obligations of its Clearing Members. These instructions will be released on the T+1
day and the securities in the Clearing Members’ pool accounts will be marked for pay-in.

Clearing members desirous of availing this facility shall send a letter in the format provided
at Annexure 7.1

The features of this facility are intimated vide NSDL Circular No. NSDL/PI/2000/1240 dated
July 22, 2000.

7.1.2 Early pay-in of securities

NSCCL provides a facility to Trading Clearing Members to make early pay-in of securities
through NSDL and CDSL. Details for making early pay-in are provided in Item 11 under
point no 11.13

7. 2 Pay-out of Securities

Pay-out shall be conducted on the scheduled payout day, in accordance with the settlement
calendar issued periodically by the Clearing Corporation in this regard. Pay-out shall be
effected by 1:30 p.m in accordance with SEBI Circular Ref No SMD/POLICY/Cir-6/03 dated
February 6, 2003.

Payout shall be to the member’s pool account.

7.2.1 Direct pay-out to Beneficiary Account

A facility is provided to the members to directly credit the pay-out to investor’s beneficiary
account. Clearing members shall provide a file to Clearing Corporation for effecting pay out
to investors' accounts for a particular settlement type and settlement number. Clearing
members have to mention the beneficial owner’s account number entitled to receive the
payout of securities. The direct payout of securities can be credited to the client’s account
regardless of the depository in which the securities pay-in is received. In case of a shortage,
the quantity credited to the client account will be to the extent of net payout received by the
clearing member. Clearing members shall provide a file to Clearing Corporation for effecting
pay out to client’s accounts as detailed in Annexure 7.2

The clearing member can provide own settlement account details if the clearing member
intends to receive full or part payout of securities, which is not identified for direct client
account payout, in the settlement account with specific depository. This information can be
provided in the same file. The clearing member shall provide depository participant ID and
depository participant client ID if the settlement account is with NSDL or CM Settlement
account number if the settlement account is with CDSL.

The direct payout instructions uploaded by a clearing member will be considered for the
particular settlement day only for which the file is uploaded. Any release of payout done
subsequent to the settlement day as specified above, will be to the pool account of the
clearing member

7.3 Failure to deliver

Failure of the seller to deliver securities shall result in buy-in auction for the shares by
Clearing Corporation as per auction schedule declared periodically. Currently auction shall be
conducted on T+3 day and settled on T+4 day. The short delivering member shall not be
allowed to offer in the auction for the respective security. Auction shall not be conducted in
respect of those sub-segments where shortages are directly closed-out and where the
securities are under corporate actions.

The auction amount shall be charged to the short delivering member. Failure to procure
shares in auction shall be closed out. Details for close out are provided in Item 9.

Pay-in and payout for auction shall happen along with normal.
 Item 8

VALUATION PRICE

In pursuance of Regulations 7.15 and 9.3 of the Capital Market Regulations, valuation
price for bad deliveries and for failure to give or take delivery are hereby specified as
under:

8.1 Valuation Price for Bad Delivery

The valuation price for securities which constitute bad deliveries, shall be the closing price of
such securities, on the trading day preceding the settlement day unless prescribed otherwise
from time to time by the relevant authority. For the purpose of this clause, the closing price
shall be the price as announced by the Specified Stock Exchange and the day of valuation
shall be the day as decided by the relevant authority of the Clearing Corporation from time to
time.

8.2 Valuation Price for failure to deliver

The valuation price for securities which were not delivered on the settlement day for
securities, shall be the closing price of such securities, on the immediate trading day
preceding the pay-in day for the securities unless prescribed otherwise from time to time by
the relevant authority. For the purpose of this clause, the closing price shall be the price as
announced by the Specified Stock Exchange and the day of valuation shall be the day as
decided by the relevant authority of the Clearing Corporation from time to time.
 Item 9

CLOSING OUT

In pursuance of Regulation 10 of the NSCCL Capital Market Regulations, deemed

closing out prices (‘squaring off’) is hereby specified as under:

9.1 Closing out where securities cannot be bought-in

When the Clearing Corporation is satisfied that securities cannot be bought in the settlement,
obligation in such security shall be deemed to be closed out at the following price, or as
declared from time to time.

9.2 Closing out in the case of failure to give delivery

9.2.1 Closing out in the case of failure to give delivery for Normal Market

Any shortages in Normal Market that cannot be bought in the Auction Market shall be closed
out as specified by SEBI vide Circ. Ref No. SMD/Policy/Cir-03/2002 dated January 30,
2002. Close out shall be at the highest price prevailing in the Exchange from the day of
trading till the auction day or 20% above the official closing price on the auction day,
whichever is higher.

9.2.2 Closing out in case of failure to give delivery for ‘IL’ and ‘BL’ Market Deals

Any shortages in the ‘Inter Institutional’ – IL segment and ‘Block trades’ – BL window shall
be directly closed-out on the settlement at the highest price prevailing in the Exchange from
the day of trading till the T+1 day or 20% above the official closing price on the T+1 day,
whichever is higher, or as declared from time to time.

9.2.3 Closing out in case of failure to give delivery for Trade-for-trade – Surveillance
(TFT-S) deals

Any shortages in TFT-S shall be directly closed-out on the settlement at the highest price
prevailing in the Exchange from the day of trading till the T+1 day or 20% above the official
closing price on the T+1 day, whichever is higher, or as declared from time to time.

9.2.4 Closing out in case of failure to give delivery in Auction Market

When the auction seller fails to deliver in part or full on auction pay-in day, the deal shall be
closed out at the highest price prevailing in the Exchange from the day on which the trade
was originally executed till the day of closing out or 20% over the official closing price on
the close out day whichever is higher and will be charged to the auction seller unless
otherwise specified.

9.3 Compulsory Close-out of securities under Corporate Action

‘No delivery’ is abolished in respect of all types of corporate actions for securities traded in
the compulsory dematerialised mode.
In case a company announces any corporate action for securities in compulsory
dematerialised mode, the Clearing Corporation shall announce an ex-date and all cum-
transactions which cannot be auctioned on cum basis shall be compulsory closed out. All
cases of short deliveries where the cum basis auction pay out which would otherwise have
been after the book closure / record date shall be closed out as stipulated by SEBI vide
Circular Ref No: SMD/Policy/Cir-08/2002 dated April 16, 2002. Accordingly, shortages
shall be directly closed out at the highest price prevailing in the Exchange from the day of
trading till the day of closing out or 10% above the official closing price on the auction day,
whichever is higher, or as declared from time to time.
The no–delivery period shall continue to be applicable in case of securities deliverable in
physical form.
Members may kindly note that security in Limited Physical Market shall be withdrawn from
trading, ten days prior to book closure/record date and re-enabled for trading ten days after
the book closure/record date.

9.4 Closing out in the case of non rectification/replacement

9.4.1 Closing out in the case of non rectification/replacement for bad delivery

At the highest price prevailing in the Exchange from the day of trading till the day of the
closing out or 20% above the official closing price on the auction day, whichever is higher.

9.4.2 In the case of non rectification/replacement for objection cases

In the case of non rectification / replacement for objection cases at 20% above the official
closing price on the auction day

9.5 Rectified / Replaced bad deliveries

9.5.1 Rectified / replaced bad deliveries reported as bad delivery (Rebad delivery)

Rectified / replaced shares reported as bad delivery (Rebad delivery) shall be closed out at the
highest price prevailing in the Exchange from the day on which the trade was originally
executed till the day of the closing out or 10% above the official closing price on the auction
day whichever is higher.

9.5.2 Company objection cases reported as bad delivery

Rectified /replaced company objection reported as bad delivery shall be closed out at 10%
above the official closing price on the auction day.

9.6 Close out price for deleted security

Security for which trading has been discontinued on the Exchange (hereinafter referred to as
deleted security), close out shall be the last 26 weeks average trade price on the exchange
with a close out mark up of 20% as specified by SEBI vide Circ Ref. No SMD/POLICY/Cir-
21/02 dated September 4, 2002.
9.6.1 Deleted security on account of payment of additional call money

In the case of securities for which trading has been discontinued on the Exchange on account
of payment of additional call money (hereinafter referred to as deleted security), the security
where the respective call money has been paid (hereinafter referred to as new security) will
be considered to arrive at the closing price.

Company objections received in the 'deleted security' will be required to be reported in the
new security symbol / series. In case the 'new security' is not available for the reason of such
security not being introduced for trading on the Exchange / trading being discontinued on the
Exchange, company objections will be required to be reported in the 'deleted security' and
close out price will be at the last 26 weeks average trade price on the Exchange.

9.6.2 Deleted security on account of payment of redemption:

In the case of securities for which trading has been discontinued on the Exchange on account
of redemption (hereinafter referred to as deleted security), the security (with the new face
value after redemption) introduced for trading by the Exchange (hereinafter referred to as
new security) will be considered to arrive at the closing price.

Company objections received in the 'deleted security' will be required to be reported in the
new security symbol / series and members will be entitled to claim redemption amount as
corporate benefit.

In case the 'new security' is not available for the reason of such security not being introduced
for trading on the Exchange / trading being discontinued on the Exchange on account of full
redemption, company objections will be required to be reported in the 'deleted security' and
the close out price will be at the last 26 weeks average trade price on the exchange.

9.6.3 Deleted security on account of merger / amalgamation / hive off / scheme of

restructuring

In the case of securities for which trading has been discontinued on the Exchange on account
of merger / amalgamation/ scheme of restructuring (hereinafter referred to as 'deleted
security'), the security with which the deleted security is merged / amalgamated / hived off /
restructured into (hereinafter referred to as 'new security') will be considered to arrive at the
closing price.

Closing price for such 'deleted security' will be the official closing price of the new security
on the auction day prevalent on the Exchange.

In case where the price of the 'new security' is not available for the reason of such security
not being traded on the Exchange, the close price for such deleted security will be at the last
26 weeks average trade price on the exchange

In case, where more than one security (hereinafter referred as 'additional securities') is being
given by the company in lieu of the 'deleted security', the claim of company objection lodged
for such 'deleted security' shall be settled as follows:
(i) If such 'additional securities' are traded on the Exchange, in the ratio in which they have
been issued by the company.
(ii) If any one or more of these 'additional securities' are not traded on any Stock Exchange,
no claim shall arise, for such security not traded.
(iii) If any one or more of these 'additional securities' are not traded on the Exchange but
traded on some other Stock Exchanges, the relevant closing price of such securities shall be
the closing price on the regional exchange, to be notified by Clearing Corporation.

Members may claim such 'additional securities' as corporate benefit.

In case of securities undergoing scheme of amalgamation/ restructuring wherein the exchange

ratio agreed to by the companies are in fractions/decimals, claim of company objection shall
be settled as follows:

(a) The no. of shares (arrived at as per the exchange ratio after excluding the fraction/decimal
portion) of the new scrip

(b) The fractional part, to be claimed as corporate benefit, which will be squared up as per the
valuation given in Annexure 9.1 (rounded off to the nearest rupee).

9.7 Close out price for bonds

9.7.1 In case of failure to give delivery, non rectification/replacement of bad delivery,

rectified/replaced bad delivery subsequently reported as re-bad, auction non-delivery, and
auction delivery reported as bad delivery, closing out price will be the highest rate prevailing
on the Exchange from the first day of the relevant trading period till the day of closing out or
5% over the official closing price on the auction day, whichever is higher for bonds,
debentures assigned a credit rating of triple A and above. For the other debentures and the
bonds without the triple A credit rating, the close out mark up of 20% shall be applicable as
specified in SEBI Circ. Ref. No. SEBI/SMD/SE/Cir-26/2003/25/06dated June 25, 2003.

9.7.2 In case of non rectification / replacement of company objection and rectified/replaced

company objections reported as bad delivery, closing price will be 5% over the official
closing price on the auction day.

9.8 Compulsory closing-out of company objections reported against Suspended

Members and Surrendering Members

9.8.1 Suspended Members and Surrendering Members shall be allowed to replace the
company objection reported against them only in the dematerialised form and not in the
physical form.

9.8.2 The non-rectified/replaced shares shall be compulsorily closed out at the 19th day
closing price without any mark-up.

The 'Suspended Members/Surrendering Members' shall be intimated by the

Exchange/Clearing Corporation from time to time.
9.9 In the case of an auction bad delivery

An auction delivery reported as bad delivery shall be closed out at the highest price
prevailing in the Exchange from the day on which the trade was originally executed till the
day of closing out or 10% over the official closing price on the close out day, whichever is
higher and will be charged to the auction seller unless otherwise specified.

9.10 Closing Out for LP Deals

9.10.1 In the case of failure to give delivery

At 20% over the actual trade price

9.10.2 In the case of non rectification/replacement for bad delivery

At 10% over the actual trade price

9.10.3 In the case of non rectification/replacement for objection cases

At 20% above the official closing price in regular Market on the auction day.

9.11 Closing out in case of RDM deals

In case of short deliveries, unsettled positions shall be closed out. The close out would be
done at Zero Coupon Yield Curve (ZCYC) valuation for prices plus a 5% penalty factor. The
buyer shall be eligible for the highest traded price from the trade date to the date of close out
or closing price of the security on the close out date plus interest calculated at the rate of
overnight FIMMDA-NSE MIBOR for the close out date whichever is higher and the balance
shall be credited to the Investor Protection Fund.
 Item 10

LIQUID ASSETS

A member may deposit liquid assets in the form of cash, bank guarantees, fixed deposit
receipts and approved securities and any other form of collateral as may be prescribed from
time to time.

These liquid assets are segregated as cash component and non-cash component. Cash
component shall mean cash, bank guarantees, fixed deposit receipts, units of money market
mutual fund and Gilt funds and any other form of collateral as may be prescribed from time
to time. Non-cash component shall mean all other forms of collateral deposits like deposit of
approved list of demat securities and units of the other mutual funds and any other form of
collateral as may be prescribed from time to time.

The total liquid assets comprise of the cash component and the non cash component. As per
SEBI circular MRD/DoP/SE/Cir-07/2005 dated February 23, 2005 wherein the cash
component shall be at least 50% of liquid assets. This implies that non cash component in
excess of the total cash component would not be regarded as part of total liquid assets.

10.1 Liquid Net worth:

In pursuance of Rule 2.3 of Chapter IV of the Rules of the Clearing Corporation, details
of Security Deposit to be maintained as Liquid Net worth are specified as under:

The Member is required to meet with the liquid net worth requirements prescribed by the
Clearing Corporation at all points of time.

10.1.1 Security Deposit requirement for Members

As a part of the membership requirement every member is required to maintain a security

deposit of:

(a) Rs. 25.00 lakhs in the case of Corporates

(b) Rs. 17.50 lakhs in the case of Firms/Individuals
The same is to be maintained in any one or combination of the following forms:
i. Cash
ii. Fixed Deposit Receipts (FDRs) issued by approved banks as given in Annexure 10.1
and deposited with approved Custodians (refer to Annexure 10.2) or with the
Clearing Corporation. (Formats of letters to be submitted are prescribed in Annexure
10.3.)
iii. Bank Guarantee in favour of National Securities Clearing Corporation Ltd. from
approved banks as specified in Annexure 10.1 as per the format specified in
Annexure 10.4.
iv. Equity shares of companies and units of mutual funds in demat form deposited with
approved Custodians (refer to Annexure 10.2). Only securities specified as the
approved list of securities by the Clearing Corporation from time to time can be
pledged. A deed of pledge is required to be executed with the custodian in specified
format. The format of Deed of pledge is prescribed in Annexure 10.5.
10.1.2 Non-fulfillment of Security Deposit Requirements

Any failure on the part of a member to meet with the deposit requirements as given in 10.1.1
at any point of time, will be treated as a violation of the Rules, Bye-Laws and Regulations of
the Clearing Corporation and the Clearing Corporation may, within such time as it may deem
fit, advise the Exchange to withdraw any or all of the membership rights of such member
including withdrawal of trading facility, without any notice.

If the security deposit falls below the minimum required level at any point of time, the
clearing corporation may initiate suitable action as given below or as prescribed by the
relevant authority from time to time.

• If the security deposit shortage is equal to or greater than Rs. 5.00 lakhs, the trading
facility would be withdrawn with immediate effect.
• If the security deposit shortage is less than Rs. 5.00 lakhs, the member would be given
one calendar week’s time to replenish the shortage and if the same is not done within
this timeframe the trading facility would be withdrawn.

In addition, the outstanding positions of such member and/ or constituents, may be closed out
forthwith or any time thereafter by the Exchange, at the discretion of the Clearing
Corporation, to the extent possible, by placing at the Exchange, counter orders in respect of
the outstanding position of such member without any notice to the member and/ or
constituents, and such action shall be final and binding on the member and/ or constituents.
The Clearing Corporation may also initiate such other risk containment measures as it deems
fit with respect to the open positions of the member and / or constituents.

The Clearing Corporation may, in addition to the foregoing provisions, take additional
measures like, imposing penalties, collecting appropriate deposits, invoking bank guarantees/
fixed deposit receipts, realising money by disposing off the securities and exercising such
other risk containment measures as it deems fit and may further take such disciplinary action
as it may deem fit and appropriate in this regard.

10.2 Margin Deposits by the member

In pursuance of Byelaw 2 of Chapter VIII of the Byelaws and Regulation 3.10 of

Chapter 3 of Regulations, the following requirements are prescribed in respect of
margin deposits to be provided by the members:

Members who wish to provide any deposits at any point of time, over and above their
minimum deposit requirement as given in 10.1.1 above towards margin and/ or other
obligations, may do so in any one or combination of the following forms:
i) Cash
ii) Fixed Deposit Receipts (FDRs) issued by approved banks, as given in Annexure
10.1, and deposited with approved Custodians or with the Clearing Corporation.
(Formats of letters to be submitted are prescribed in Annexure 10.6).
iii) Bank Guarantee in favour of National Securities Clearing Corporation Ltd. from
approved banks as specified in Annexure 10.1 as per the format specified in
Annexure 10.4
iv) Equity shares of companies and units of mutual funds in demat form deposited with
approved Custodians (refer to Annexure 10.2). Only securities specified in the
approved list of securities by the Clearing Corporation can be pledged. A deed of
pledge is required to be executed with the custodian in specified format. The format
of Deed of pledge is prescribed in Annexure 10.7.
v) Government of India Securities/T-Bills as per procedure specified in 10.3.6

The Clearing Corporation may at its discretion accept fixed deposit receipts, bank guarantees,
or approved securities or such other mode as may be approved and subject to such terms and
conditions as may be imposed from Clearing Corporation from time to time.

10.3 Guidelines for Submission of Deposits

10.3.1 Cash

Members may submit deposit in the form of cash by making the required amount available in
their respective clearing bank account and sending an authorization to the Clearing
Corporation for debiting the said amount from their clearing account. The same can be
provided through a web based facility called Collateral Interface for Members (CIM) which
enables the members to log in through internet. Members shall log in through specific user-
ids and passwords into CIM. To obtain a Login User ID, members are required to send their
request to the Clearing Corporation in the format provided in Annexure 10.8.

The benefit of such cash deposit requests shall be subject to bank confirmation from the
respective clearing bank. A member who has authorised the Clearing Corporation to debit his
clearing account as above shall ensure due performance of the commitment. Non-fulfillment
of such obligation will be treated as a violation and/ or non-performance of obligations and
shall attract consequences, penalty and/ or penal charges as applicable to violations.

10.3.2 Fixed Deposit Receipt

Members may furnish deposits in the form of FDR as mentioned above, subject to inter-alia,
the compliance of the following:

1. The FDR should be issued either in favour of: "Custodian Name” (as the case may be) -
A/c MEMBER NAME" in case to be deposited with approved custodians as per
Annexure 10.2 or "NSCCL A/c MEMBER NAME" in case to be deposited with the
Clearing Corporation.

2. Members are required to issue a letter to the approved custodian/ Clearing Corporation
agreeing that the approved custodian/ Clearing Corporation has an irrevocable authority
to encash the FDR and to withdraw the FDR amount (including accrued interest) at any
time, even prior to maturity of FDR without notice to the member, for
recovery/adjustment of NSCCL/NSEIL dues. The formats of the letter are given in
Annexure 10.3 and 10.6.

3. Members are required to submit a letter from the bank issuing the FDR to the approved
custodian/Clearing Corporation in the formats given in Annexure 10.3 and 10.6.
4. The minimum value of FDR that may be accepted shall be Rs.2 lakhs. The FDR should
have validity for a minimum period of 3 months in case of margin deposit and for a
minimum period of 12 months in case of security deposit.

5. The FDR should be issued by any of the branches of approved banks and should be
payable in the cities of: Mumbai, New Delhi, Chennai, Kolkata, Ahmedabad and
Hyderabad. The list of approved banks is as per Annexure 10.1.

10.3.2.1 Shifting of FDR from F & O segment/Currency Derivatives segment to Capital

Market segment

Members who intend to release the FDR provided as margin deposit in F&O segment /
Currency Derivatives segment and add the same as margin deposit in Capital Market
segment, are required to submit a transfer request in F&O segment/ Currency Derivatives
segment through CIM

10.3.2.2 Renewal of Fixed Deposit Receipt

In case of renewal of FDRs, the members shall furnish the renewal documents strictly in the
prescribed format. The format of the letter to be given by the member is given in Annexure
10.3 and 10.6. The format for letter to be given by the Bank in case of renewal where there is
change in FDR number is given in Annexure 10.9a and the format for letter to be given by
the Bank in case of renewal where the FDR number is not changed is given in Annexure
10.9b

In case the renewed FDR/ fresh FDR is not submitted and whereby the member does not
fulfill the security deposit requirements, action as provided in 10.1.2 above shall be
applicable.

10.3.3 Bank Guarantees

The acceptance of the bank guarantees by the clearing corporation shall be subject to the
bank-wise and member-wise limits as are stipulated from time to time. The maximum value
of bank guarantees that can be given from the issuing bank per member is as provided below:

Net worth of the issuing bank * Applicable total limit per clearing member
across all segments
Rs. 100 crores <= NW < Rs.200 crores Rs 5 Crore
Rs. 200 crores <= NW < Rs.500 crores Rs 10 Crore
Rs. 500 crores <= NW < Rs.1000 crores Rs 15 Crore
Rs. 1000 crores <= NW < Rs.2000 crores Rs 25 Crore
Rs. 2000 crores <= NW < Rs.3000 crores Rs 35 Crore
>=3000 crores **

*In respect of bank guarantees issued by the designated clearing banks (Annexure 6.1), the
maximum value of bank guarantees that can be accepted from each of these designated
clearing banks shall be set at the next higher slab in which they would have ordinarily been,
compared with their net worth.
**Over Rs. 3000 crores, for each Rs.1000 crores of net worth, an incremental limit of Rs.10
crores per member is allowed.
Based on the category of the member the above limits shall be subject to a maximum amount
as mentioned below:
Rupees in Crores

Category of member Applicable total limit per

clearing member across
all segments

Professional Clearing Members / Custodian Clearing Members 200

Trading Cum Clearing Members in F&O segment 100

Other categories of the members 50

Members are advised to check their applicable limit before getting their bank guarantees
issued.

Additionally, at the time of deposit of the bank guarantee, the member is required to ensure
the following:

1. The bank guarantee is strictly as per the formats prescribed by the clearing corporation.
The formats of bank guarantee are provided in Annexure 10.4.
2. A bank guarantee for security deposit should be issued for a minimum period of 12
months with a specific claim period of at least 3 months. However, where an issuing bank
does not provide for a specific claim period beyond the expiry date in the bank guarantee,
the members shall submit a bank guarantee for a minimum period of 15 months. The
maturity period of such bank guarantee shall be reduced by 3 months, which would be
considered as the claim period of the bank guarantee.
3. A bank guarantee for margin deposit should have validity for a minimum period of 3
months. In case the issuing bank does not provide for a specific claim period beyond the
expiry date in the bank guarantee, the maturity period of such bank guarantee shall be
reduced by 7 days, which would be considered as the claim period of the bank guarantee.
4. While filling the details in a bank guarantee, members shall ensure that:
a. No relevant portion is left blank
b. All handwritten corrections and blanks are attested by the bank by affixing the
bank seal / stamp duly authorised
c. All irrelevant portions struck off on the printed format should also be
authenticated by the bank by affixing the bank seal / stamp duly authorised.
d. Each page of the bank guarantee should bear the bank guarantee number, issue
date, stamp of the bank and should be signed by at least two authorised
signatories.
e. The member should also ensure that the bank guarantee is free from any
discrepancy before the same is submitted to the Clearing Corporation.
f. The stamp paper should be issued in the name of the clearing member or the bank,
no third party stamp papers are permissible
g. The stamp paper should not be older than 6 months from the executed date of the
bank guarantee/ renewal.
In case the bank guarantee does not strictly conform to the above-mentioned conditions, the
same shall not be accepted by the Clearing Corporation and benefit for the same shall be
made available only upon the bank guarantee being strictly in conformity with the prescribed
requirements.

10.3.3.1 Shifting of the Bank Guarantee from F&O segment / Currency Derivatives
segment to CM segment

Members, who intend to release the BG provided as margin deposit in F&O segment/
Currency Derivatives and add the same as margin deposit in CM segment, are required to
submit a transfer request in F&O segment/ Currency Derivatives Segment through CIM and
submit a letter to Clearing Corporation requesting for the same. The format of the letter is
specified in Annexure 10.10. The member is further required to provide an amendment letter
executed on a Rs. 100 Stamp paper from the respective bank. The format of the amendment
letter is specified in Annexure 10.11.

10.3.3.2 Renewal of Bank guarantee

In case of renewal of bank guarantees, the members shall furnish the renewal document
strictly in the prescribed format before the date of expiry / maturity date of the bank
guarantee. The format is given at Annexure 10.12. The members may also opt to give a fresh
bank guarantee in favour of National Securities Clearing Corporation Limited instead of
renewing the expired bank guarantees.

In case the renewed bank guarantees/ fresh bank guarantees are not submitted within the
above mentioned periods whereby the member does not fulfill the security deposit
requirements, action as provided in 10.1.2 above shall be applicable.

10.3.4 Reminder Letters through extranet

Reminder letters are downloaded on a monthly basis through the extranet in respect of the
Bank Guarantees and Fixed deposits those are due for renewal in the following month.

The file naming convention for the same is:

Path: FTP/<TM CODE>/REPORTS.
BG<BG ID>_ABC/BC_<TM CODE>_DDMMYYYY.DAT
FD<FD ID>_ABC/BC_<TM CODE>_DDMMYYYY.DAT

This is being provided as an additional facility only and members are advised to submit the
renewals of the bank guarantees and fixed deposit receipts within the stipulated period to
avoid any action as provided in 10.1.2 above. The members shall be responsible for the
renewal of FDRs/ Bank guarantees expiring in the month and any penalties, applicable in
case of a security deposit FDR/ BG not getting renewed/ substitution being provided.

10.3.5 Securities

10.3.5.1 Eligible securities

Members are permitted to deposit shares of companies and units of mutual fund as
communicated to the members from time to time, in electronic form (‘demat securities’) in
the designated depository accounts maintained with the approved custodians (as mentioned in
Annexure 10.2) in this regard. These securities shall be pledged in favour of National
Securities Clearing Corporation Limited. The list of securities is available to the public at
large on the website at www.nseindia.com

The valuation of the securities shall be in accordance with the norms prescribed by the
Clearing Corporation from time to time. The securities shall be valued based on the closing
price of the security at the Exchange. The value of the securities shall be reduced by such
haircut as may be prescribed by the Clearing Corporation from time to time to arrive at the
collateral value of the security. The hair cut applicable shall be the VaR margin rate
applicable for the respective security. Only the value net of applicable haircuts shall be
considered as the value of the securities pledged. Valuation of securities shall be done by the
custodians at such periodic intervals as may be specified by the Clearing Corporation from
time to time.

The Clearing Corporation may revise the list of approved securities and, the haircuts from
time to time. Members who have deposited securities which have been discontinued from the
list of approved securities, shall be required to take due care to replace such securities.

10.3.5.2 Securities not approved for acceptance

The following securities shall not be accepted as liquid assets:

a) Partly paid securities

b) Securities subject to any lock in period, buy back scheme any charge or lien,
encumbrance of any kind, or such other limitations or title is questioned before the court
or any regulatory body.
c) Members whose company shares are acceptable as approved securities shall not be
permitted to place the same towards their liquid assets requirement.

10.3.5.3 Ownership of Securities

The securities that may be deposited shall be subject to the beneficial ownership of the
member/ spouse, any of the partners/ their spouses or any of the directors, in case of
individual, partnership or corporate members respectively, as the sole/ first joint holder,
provided no depositor of securities should be a minor as on the date of deposit thereof.

In case of reconstitution / restructuring or any change in the partners /directors of the

member, as applicable, a member shall be required to replace the securities belonging to such
outgoing partners /directors immediately and no benefit will be given by the Clearing
Corporation for such securities. The custodians shall be required to exercise due care for such
replacement of securities and reporting thereof to the Clearing Corporation.

10.3.5.4 Opening of accounts:

Members are required to open a separate depository account with the authorized Custodians
for the purpose of deposit of securities. Members who are interested in availing of this facility
may get in touch with the Custodians (list as per Annexure 10.2) to ascertain the modalities
with regard to deposit of securities.
10.3.5.5 Marking of pledge

Members may provide demat securities by marking a pledge of the securities in favour of the
Clearing Corporation. The member shall be required to submit all such documents as may be
required by the clearing corporation and the authorised custodian from time to time including
the Deed of Pledge as per the specified format as mentioned in Annexure 10.5 and 10.7.

Members shall give the necessary pledge instruction(s) to the Custodian for the securities to
be pledged in favour of the Clearing Corporation. Once the securities are accepted and duly
pledged by the Custodian, the Custodian shall inform the Clearing Corporation the valuation
of the securities after adjusting the relevant margin percentages. On the basis of the
Custodian’s advice, benefit towards securities pledged shall be provided to the member.

10.3.6 Government of India Securities as Collaterals

Securities in form of Central Government of India Securities (G-Sec) and Treasury bills (T-
bills) are also accepted as approved collaterals. The procedure for submitting G-Sec/T-Bills
as collateral shall be as under:

1. Member/Custodian desirous of providing G-Sec/T-Bills shall enter into an agreement

with the Clearing Corporation as per the format attached in Annexure 10.13

2. Clearing Corporation shall prescribe list of G-Sec/T-Bills that shall be eligible for
acceptance as collateral from time to time.

3. G-sec/T-bill shall be accepted as collateral only in electronic form. The members desirous
of providing G-Sec/T-Bills as collateral shall intimate the Clearing Corporation through
fax as per the format attached in Annexure 10.14. The member shall further be required
to enter the transaction through its custodian/bank on NDS under Settlement-Transfer
Order-Value Free Transfer Module by 3.30 pm. Clearing Corporation shall confirm the
transaction entered on the NDS, based on the information received from members
through fax.

4. The details of SGL-II account is as follows:

Name of the Account: National Securities Clearing Corporation Limited

Member ID BYA00168
SGL – II A/c No. SG020168

5. The benefit of G-Sec/T-bills provided as collaterals shall be passed on to the members on

G-Sec/T-Bills being transferred to the SGL-II account of the Clearing Corporation.

6. For release of G-Sec / T-bills, the member shall send request to the Clearing Corporation
as per the format attached in Annexure 10.15. The release of G-Sec/T-Bill shall be
processed only at end of day. The G-sec/T-bill released by the Clearing Corporation shall
be entered on NDS under Settlement-Transfer Order-Value Free Transfer Module. The
members shall ensure that such transactions are approved on NDS by their
custodian/Banks.
7. G-Sec/T-Bill shall be valued daily based on previous day’s MTM prices as specified by
CCIL.

8. A hair cut of 10% shall be applied on the value of G-Sec/T-bill provided as collateral by
the member. The value after applying the hair cut shall be added to the cash component of
the liquid assets of the member.

9. Periodic coupon / Redemption payments received on the G-Sec/T-Bills provided by the

member shall be passed on to the members by the Clearing Corporation immediately
upon receipt of relative interest from Reserve Bank of India.

10. In case the any of the approved G-Sec is in ‘SHUT PERIOD’, the members shall not be
allowed for request for addition / release of such G-Sec.

Members/ Custodians who are also banks may note that G-Sec/T-Bills provided as collaterals
should not be reckoned for SLR purpose of the banks and not be used for trading.

Cross-margining of G-sec/T-bill placed as margins by Foreign Institutional Investors (FIIs)

for their transactions shall not be allowed between the cash and derivatives segment of the
market.

10.4 Releases of Liquid Assets

Member may request the Clearing Corporation to release deposits held by the Clearing
Corporation. Such requests may be considered by the Clearing Corporation if the Clearing
Corporation chooses not to exercise its lien pursuant to the Rules, Byelaws and Regulations
and subject to availability after due adjustments for the due fulfillment of all obligations and
liabilities arising out of or incidental to any contracts entered into by such member and
subject to the bye laws, rules and regulations of the Clearing Corporation or anything done in
pursuance thereof.

The web based facility of Collaterals Interface for Members (CIM) is provided for
submission of release requests of collaterals. The members may select the desired available
collaterals for release. Release requests though CIM can also be placed using a file upload
facility. The format of file is prescribed in Annexure 10.16.

10.4.1 Collection of released collaterals submitted to NSCCL

The representative of the members coming to collect released FDR/ BG is required to carry
an authorization letter.

The released FDRs/ BGs can be collected on the next working day of the release.

10.5 Transfer of Collaterals.

An additional facility is being provided in the Collateral Interface for Member (CIM) to
enable members to transfer collaterals from one segment to other segment on an intraday
basis. Members shall be required to put a transfer request in CIM and specify the segment
where the collateral is to be transferred.

The intra-day transfer facility shall be available for margin deposits provided in form of Cash
and Fixed Deposit Receipts only. Further, as per membership circular download reference no.
NSE/MEMB/13696 dated December 16, 2009, members shall also be able to request to avail
excess Interest Free Security Deposit over the minimum amount stipulated regulatorily in the
other segments as collateral towards the margin requirements using the said facility.

The modalities of intraday transfer are mentioned below:

1. The facility of transfer of collaterals shall be available to clearing members.

2. The facility of intra day transfer shall be available for Instrument Type Cash (CHQ) and
Fixed Deposit Receipt (FDP).
3. Member shall request for transfer of collaterals in Collateral Interface for Members
(CIM) under menu option “Collateral Release – New Request/inquiry - Transfer
Request”.
4. Transfer request received from the members via CIM shall be treated as request from the
members and no separate transfer letter need to be submitted.
5. Intra day transfer shall be subject to maintenance of minimum deposits as per regulatory
requirement and current applicable parameters.
6. Member may verify the details of the request for transfer and its status in CIM under
menu option “Collateral Release – New Request/inquiry- Transfer Inquiry”.
 Item 11

MARGINS

In pursuance of Chapter VI(B) of the Bye Laws pertaining to Clearing and Settlement
of deals and Chapter VII of the Bye Laws pertaining to Margins, the following are
prescribed for members :

11.1 Overview:
SEBI vide their circular SEBI/MRD/DoP/SE/Cir-07/2005 dated February 23, 2005,
SEBI/MRD/DoP/SE/Cir06/2008 dated March 19, 2008 and SEBI/MRD/DoP/SE/Cir-08/2009
dated July 27, 2009 has stipulated the framework of risk management in the capital market
segment.
The core of the risk management system is the liquid assets deposited by members with the
Exchange/Clearing Corporation. These liquid assets shall cover the following margin
requirements:

a. MTM (Mark To Market) Losses

b. VaR Margins
c. Extreme Loss Margins
d. Base Minimum Capital: Base Minimum Capital shall be Rs.10 lakhs or such other
amount as may be specified by the relevant authority from time to time.

The liquid assets of the member at all points of time shall be adequate to cover all the above
requirements. Member shall also maintain at all points of time Interest Free Cash Deposit with
NSEIL and Interest Free Cash Deposit and Security Deposit with NSCCL at such amounts
applicable to member at the time of admission/ transfer/ up-gradation as continued admission
condition. However the said amounts will be reckoned for the purpose of ‘a to d’ above to the
extent available.
The base minimum capital shall be blocked from the interest free cash deposit placed by the
member with the Exchange/Clearing Corporation.

11.2 Liquid Assets:

The total liquid assets comprise of the cash equivalents and other liquid assets. Details as
regard the type of collaterals, mode of acceptance and release and the relevant formats are
discussed in details in Item- 10 pertaining to Liquid Assets.

11.3 Categorization of securities

11.3.1 Liquidity Categorization of Securities:

The securities shall be classified into three groups based on their liquidity:

Group Trading Frequency Impact Cost (over the

(over the previous six previous six months –
months – see Note A) see Note A)
Liquid Securities (Group I) At least 80% of the days Less than or equal to 1%
Less Liquid Securities (Group At least 80% of the days More than 1%
II)
 Illiquid Securities (Group III) Less than 80% of the Not Applicable
days

Notes:
A. For securities that have been listed for less than six months, the trading frequency and
the impact cost shall be computed using the entire trading history of the security.

11.3.2 Monthly Review

The trading frequency and impact cost shall be calculated on the 15th of each month on a rolling
basis considering the previous six months for impact cost and previous six months for trading
frequency. On the basis of the trading frequency and impact cost so calculated, the securities
shall move from one group to another group from the first of the next month.

11.3.3 Categorisation of newly listed securities

For the first month and till the time of monthly review as mentioned above, a newly listed
security shall be categorised in that Group where the market capitalization of the newly listed
security exceeds or equals the market capitalization of 80% of the securities in that particular
group. Subsequently, after one month, whenever the next monthly review is carried out, the
actual trading frequency and impact cost of the security shall be computed, to determine the
liquidity categorization of the security.
In case any corporate action results in a change in ISIN, then the securities bearing the new ISIN
shall be treated as newly listed security for group categorization.

11.3.4 Calculation of mean impact cost

The mean impact cost shall be calculated in the following manner:

a. Impact cost shall be calculated by taking four snapshots in a day from the order book in
the past six months. These four snapshots shall be randomly chosen from within four
fixed ten-minutes windows spread through the day.
b. The impact cost shall be the percentage price movement caused by an order size of Rs.1
Lakh from the average of the best bid and offer price in the order book snapshot. The
impact cost shall be calculated for both, the buy and the sell side in each order book
snapshot.
c. The methodology for computation of the impact cost adopted shall be disseminated on
the website of the exchange.

The category for each security and applicable period is disseminated to members on the extranet
server and to the public at large through the Exchange website www.nseindia.com. Format for
the category file of securities is given in Annexure 11.1

11.4 Mark to Market Losses:

Mark to market losses shall be collected in the following manner:

a. Mark to market loss shall be calculated by marking each transaction in security to the
closing price of the security at the end of trading. In case the security has not been traded
on a particular day, the latest available closing price at NSE shall be considered as the
 closing price. In case the net outstanding position in any security is nil, the difference
between the buy and sell values shall be considered as notional loss for the purpose of
calculating the mark to market margin payable.
b. The mark to market margin (MTM) shall be collected from the member before the start
of the trading of the next day.
c. The MTM margin shall be collected/adjusted from/against the cash/cash equivalent
component of the liquid net worth deposited with the Exchange.
d. The MTM margin shall be collected on the gross open position of the member. The
gross open position for this purpose would mean the gross of all net positions across all
the clients of a member including its proprietary position. For this purpose, the position
of a client would be netted across its various securities and the positions of all the clients
of a broker would be grossed.
e. There would be no netting off of the positions and setoff against MTM profits across two
rolling settlements i.e. T day and T-1 day. However, for computation of MTM
profits/losses for the day, netting or setoff against MTM profits would be permitted.
f. The methodology for computation of MTM margin is also illustrated by way of an
example which is placed in Annexure 11.2
g. In case of security in TFTS each trade shall be marked to market based on the closing
price of that security.
h. The MTM margin so collected shall be released on completion of pay-in of the
settlement.
i. The details of all margins (VAR, extreme loss margin and mark to market) as at end of
each day will be downloaded to members in their respective Extranet directory. The
format of the report has been provided in Annexure 11.3

11.5 VaR Margin:

11.5.1 Computation of VaR Margin

VaR Margin is a margin intended to cover the largest loss that can be encountered on 99% of the
days (99% Value at Risk). For liquid securities, the margin covers one-day losses while for
illiquid securities; it covers three-day losses so as to allow the Clearing Corporation to liquidate
the position over three days. This leads to a scaling factor of square root of three for illiquid
securities.

For liquid securities, the VaR margins are based only on the volatility of the security while for
other securities, the volatility of the market index is also used in the computation.

Computation of the VaR margin requires the following definitions:

• Security sigma means the volatility of the security computed as at the end of the previous
trading day. The computation uses the exponentially weighted moving average method
applied to daily returns in the same manner as in the derivatives market.
• Security VaR means higher of 7.5% or 3.5 security sigma.
• Index sigma means the daily volatility of the market index (S&P CNX Nifty or BSE
Sensex) computed as at the end of the previous trading day. The computation uses the
exponentially weighted moving average method applied to daily returns in the same manner
as in the derivatives market.
• Index VaR means higher of 5% or 3 index sigma. The higher of the Sensex VaR or Nifty
VaR would be used for this purpose.
The VaR Margins are specified as follows for different groups of securities:
Liquidity One-Day VaR Scaling factor for VaR Margin
Categorization illiquidity
Liquid Securities Security VaR 1.00 Security VaR
(Group I)
Less Liquid Securities Higher of Security 1.73 Higher of 1.73 times
(Group II) VaR and three times (square root of 3.00) Security VaR and
Index VaR 5.20 times Index VaR
Illiquid Securities Five times Index VaR 1.73 8.66 times Index VaR
(Group III) (square root of 3.00)

11.5.2 Collection of VaR Margin:

a. The VaR margin shall be collected on an upfront basis by adjusting against the total
liquid assets of the member at the time of trade.
b. The VaR margin shall be collected on the gross open position of the member. The gross
open position for this purpose would mean the gross of all net positions across all the
clients of a member including its proprietary position. Example for computation of gross
positions of a member is provided in Annexure 11.4
c. For this purpose, there would be no netting of positions across different settlements.
d. As specified by SEBI vide Cir. Ref No. MRD/DoP/SE/Cir- 6 /2006 dated June 16,
2006 Intra-day VAR files shall be generated based on the prices at 11.00 a.m., 12.30
p.m., 2.00 p.m., and 3.30 p.m. everyday. Such intra-day VAR files shall be used for
margining of intra-day member positions. In addition to the above a VAR file at end
of day and begin of day shall be provided.
e. The VaR margin rates shall be made available in the extranet server and to the public at
large through the Exchange website www.nseindia.com
f. File format for VaR based margin rates is given in Annexure 11.5.
g. The VaR margin so collected shall be released on completion of pay-in of the settlement.
h. The details of all margins (VAR, extreme loss margin and mark to market) will be
downloaded to members in their respective extranet directory. The format of the report
has been provided in Annexure 11.3.

11.6 Extreme Loss Margin:

The term Extreme Loss Margin replaces the terms “exposure limits” and “second line of
defence” that have been used hitherto. It covers the expected loss in situations that go beyond
those envisaged in the 99% value at risk estimates used in the VaR margin.

a. The Extreme Loss Margin for any security shall be higher of:
• 5 % or
• 1.5 times the standard deviation of daily logarithmic returns of the security price in
the last six months. This computation shall be done at the end of each month by
taking the price data on a rolling basis for the past six months and the resulting value
shall be applicable for the next month.
b. The Extreme Loss Margin shall be collected/ adjusted against the total liquid assets of
the member on a real time basis.
c. The Extreme Loss Margin shall be collected on the gross open position of the member.
The gross open position for this purpose would mean the gross of all net positions across
 all the clients of a member including its proprietary position. Example for computation
of gross positions of a member is provided in Annexure 11.4
d. For this purpose, there would be no netting off of positions across different settlements.
e. The Extreme Loss Margin collected shall be released on completion of pay-in of the
settlement
f. The details of all margins (VAR, extreme loss margin and mark to market) as at end of
each day will be downloaded to members in their respective extranet directory. The
format of the report has been provided in Annexure 11.3

11.7 Margins for securities in Trade for Trade-Surveillance market (TFTS)

Upfront margin rates (VaR Margin + Extreme Loss Margin) applicable for all securities in the
TFTS shall be 100%.

11.8 Capping of margins

In case of a buy transaction, the VaR margins, Extreme loss margins and mark to market losses
together shall not exceed the purchase value of the transaction. In case of a sale transaction, the
VaR margins and Extreme loss margins together shall not exceed the sale value of the
transaction and mark to market losses shall also be levied.

11.9 Exemption from Margins

a. In cases where early pay-in of securities is made prior to the securities pay-in, such positions
for which early pay-in (EPI) of securities is made shall be exempt from margins. The EPI
would be allocated to clients having net deliverable position, on a random basis. However,
members shall ensure to pass on appropriate early pay-in benefit of margin to the relevant
clients. Additionally, members can specify the clients to whom the early pay-in may be
allocated. The detailed provision of providing client level early pay-in of securities has been
mentioned in Item 11.12
b. In cases where early pay-in of funds is made such positions for which early pay-in (EPI) of
funds is made shall be exempt from margins. The procedure for providing early pay-in of
funds has been detailed in Item 11.13

11.10 Institutional Transactions

• Institutional transaction means transactions done on behalf of institutional investors.

Institutional investors shall include
a. Foreign Institutional Investors registered with SEBI. (FII)
b. Mutual Funds registered with SEBI. (MF)
c. Public Financial Institutions as defined under Section 4A of the Companies Act,
1956. (DFI)
d. Banks, i.e., a banking company as defined under Section 5(1)(c) of the Banking
Regulations Act, 1949. (BNK)
e. Insurance companies registered with IRDA. (INS)
f. Pension Funds regulated by Pension Fund Regulatory and Development Authority
(PFRDA). (PNF)
• Institutional transactions shall be identified by the use of the participant code at the time of
order entry.
• Transactions entered into on behalf of custodial participants i.e. carrying custodial
participant code shall be considered as institutional deals unless not confirmed by the
respective custodians in which case the transactions shall be considered as a normal
transactions and all applicable margins shall be levied on the members
• Members may also enter “INST” code in the custodial participant code at the time of
entering orders on behalf of the institutional clients
• Members are required to allocate the INST trades only to the above categories
• Reporting and other procedures regarding Institutional transactions, including allocation of
INST trades is provided in Item 26 ( 26.3.4)
• As specified by SEBI vide Circ. Ref No. MRD/DoP/SE/Cir- 06 /2008, March 19 2008 all
institutional transactions shall be margined in the capital market segment from T+1 day
subsequent to confirmation of the transactions by the custodians.
• In respect of institutional transactions confirmed by the custodians the margins shall be
levied on the custodians
• In respect of institutional transactions rejected/not accepted by the custodians the margins
shall be levied on the members who have executed the transactions
• The margins shall be computed and levied at a client (Custodial Participant code) level in
respect of institutional transactions and collected from the custodians/members

11.11 Retail Professional Clearing Member:

In case of transactions which are to be settled by Retail Professional Clearing Members (PCM),
all the trades with PCM code shall be included in the trading member’s positions till the same
are confirmed by the PCM. Margins shall be collected from respective trading members until
confirmation of trades by PCM.
On confirmation of trades by PCM, such trades will be reduced from the positions of trading
member and included in the positions of PCM. The PCM shall then be liable to pay margins on
the same.

11.12 Release of margins:

All margins collected for a settlement for a member/custodian shall be released on their
individual completion of full obligations of funds and securities by the respective
member/custodians after crystallization of the final obligations on T+1 day. Further, members
are provided a facility to provide confirmation from their clearing banks towards their funds
pay-in obligations on settlement day before prescribed pay-in time. The procedure for the
same is detailed in point 11.15.

11.13 Early Pay-in of Securities for Margin Exemption

As stated in point 11.9 above, in cases where early pay-in of securities is made, such
positions for which early pay-in (EPI) of securities is made are exempt from margins. The
EPI is allocated to clients having net deliverable position, on a random basis. However,
members are required to ensure to pass on appropriate early pay-in benefit of margin to the
relevant clients.
11.13.1. Procedure for making early pay-in of shares

Members can make the early pay-in of securities through either of the depositories viz NSDL
and CDSL.

In NSDL, members shall deliver the securities to their CM Pool Account and execute
irreversible delivery out instructions through their Depository Participant, for the particular
settlement.

In CDSL, members have to open separate early pay-in account with CDSL through NSCCL.
Members shall be required to send a request for opening an early pay-in account to NSCCL
in the format specified in Annexure 11.6

Members are requested to contact their respective DP’s for details on procedure to be
followed for doing early pay-in at the depository.

In addition, the following facility is being provided to all members making early pay-in of
securities.

1. Members shall receive a report on the extranet server at regular intervals through out the
day, detailing the early pay-ins made by the members and received by the Clearing
Corporation. Such details shall be provided intra-day on an incremental basis.

2. Further members may make early pay-in of securities even before execution of the trade
and provide details of clients to whom such early pay-in shall be allocated. This shall
ensure that on execution of trade the benefit of early pay-in is available to the respective
clients. However it will be subject to receipt of securities from depositories.

3. Members shall make early pay-in only in respect of settlement type ‘N’ and ‘W’.

4. Members shall provide the details of the clients to whom early pay-in benefit is to be
provided through a file upload. Members can upload of client details file during the day
through “Collateral Interface for Members (CIM)”. Members shall receive return file
providing details of successful and rejected records on the extranet server. Members can
modify the client and quantity details by uploading an incremental file. The procedure of
providing client details for early pay-in of securities to Clearing Corporation including the
file formats have been provided in Annexure 11.7

11.14 Early Pay-in of Funds for Margin Exemption

As stated in point 11.9 above, in cases where early pay-in of funds is made, such positions for
which early pay-in (EPI) of funds is made are exempt from margins.

11.14.1 Procedure for making early pay-in of funds shall be as under:

1. Members / Custodians shall make early pay-in funds through a screen-based request in
the Collateral Interface for Members (CIM). The benefit for the same shall be provided
on confirmation of funds from the respective Clearing Bank.
2. Members/Custodians may provide early pay-in of funds from any of their clearing
accounts.
3. Early pay in of funds may be allocated at client level or at client-security level. The
allocation can be revised through a screen based request or through the file upload
facility.
4. Members/Custodians can make early pay-in of funds along with details of client-security
allocation before execution of a trade and shall be able to avail the benefit of early pay-in
of funds on execution of the trade.

The detailed procedure for making early pay-in of funds is given below

1. Request for early pay-in of funds

• Members/Custodian shall provide request for early pay-in of funds in
Collateral Interface for Members (CIM)’ under the menu EMI- Funds EPI
menu
• Members/Custodians shall select the settlement type, settlement number and
Bank and enter the amount of early pay in.
• Members/Custodians shall have the option to select the bank account from any
of the settlement bank accounts of the members/custodians.
• On submission of the request the same shall be forwarded to respective bank
for confirmation
• Members/Custodians shall be able to view the status of the early pay in
requests made on the same screen. On confirmation by the Bank the status of
the request shall be changes as ‘Accepted’ and the benefit of early pay-in of
funds shall be provided.

2. Allocation of early pay-in of funds at client and security level

• Members/Custodians can add, delete or modify the allocation details.
• Allocation of early pay-in of funds is optional. The allocation can be done at a
client level or at a client security level if the early pay-in of funds are to be
allocated against a specific client-security combination.
• In case where the member wishes to avail the early pay in of funds benefit
before execution of trade (on the T day), the member shall be compulsorily
required to provide client –security level allocation in such a case.
• The existing file upload facility shall also be available with added features as
follows:

Member/Custodian can provide allocation details through the file
upload mechanism. The file structure is explained in Annexure 11.8

The details provided in the file upload shall overwrite the existing
allocation details stored in the system that could have got created either
through an earlier file or through the screen based request.

It is to be noted that a file upload is a request for allocation only and a
separate Funds EPI request has to be put for Bank confirmation for
margin benefit.

Return File will be displayed on the upload screen itself along with the
reason for rejection, if any

3. Margin exemption for early pay-in of funds

• Where the member/custodians has provided client -security allocation, benefit
for early pay-in of funds shall be allocated against the net buy position of the
specified client-symbol combination and any residual amount after such
allocation will not be utilized for other positions.
• Only client wise allocations provided will be allocated in the descending order
of the security wise net buy value under the client and any residual amount
after such allocation will not be utilized for other clients.
• Where the Members/Custodians has provided early pay in of funds and no
allocation request has been provided, the amount shall be allocated to the
clients with net buy positions value in descending order
• Benefit for early pay-in of funds shall be provided subject to confirmation of
the funds from the respective clearing bank of the member/custodian

11.15 Procedure for making full pay-in of funds on Settlement day

As stated in point 11.12 above members are provided a facility to provide confirmation from
their clearing banks towards their funds pay-in obligations on settlement day before
prescribed pay-in time. The procedure for the same is as given below:

1. Members/Custodians can request for funds pay-in confirmations from the clearing
bank on settlement day using the menu ‘EMI-Full pay-in’ provided in ‘Collateral
Interface for Members (CIM)’- an online facility provided to Members/Custodians.

2. Members/Custodians shall request for confirmation of full funds pay-in obligations

from the clearing bank for the settlement due on the current day. If the
members/custodians have already provided any early pay-in of funds prior to
settlement day then they shall request for confirmation of balance funds pay-in
obligation. The funds pay-in amount (after considering early pay-in, if any) would be
automatically populated on selection of settlement number & settlement type.

3. The clearing bank of the members shall be required to confirm the full pay-in amount.
On confirmation by the clearing bank it shall be considered as fulfillment of funds
pay-in obligation for the purpose of margin release.

4. The clearing bank shall be required to provide the amount confirmed to Clearing
Corporation towards funds pay-in at the stipulated time of funds pay-in for the
settlement.

11.16 Shortfall of Margins

In case of any shortfall in margin:

• The members shall not be permitted to trade with immediate effect.
• Penalty for violation on account of margin violation be levied on a monthly basis based
on slabs mentioned below :-
 Instances of Disablement Penalty to be levied
1st instance 0.07% per day
2nd to 5th instance of 0.07% per day +Rs.5000/- per instance from 2nd to 5th
disablement instance
6th to 10th instance of 0.07% per day+ Rs. 20000 ( for 2nd to 5th instance)
disablement +Rs.10000/- per instance from 6th to 10th instance
11th instance onwards 0.07% per day +Rs. 70,000/- (for 2nd to 10th instance)
+Rs.10000/- per instance from 11th instance onwards.
Additionally, the member will be referred to the
Disciplinary Action Committee for suitable action
Instances as mentioned above shall refer to all disablements during market hours in a calendar
month. The penal charge of 0.07% per day shall be applicable on all disablements due to margin
violation anytime during the day.

.11.17 Effect of failure to pay margins

Non-payment of either the whole or part of the margin amount due will be treated as a
violation of the Bye Laws of the Clearing Corporation and will attract penal action. Without
prejudice to the foregoing, the Clearing Corporation may, within such time as it may deem
fit, advice the Exchange to withdraw any or all of the membership rights of member
including the withdrawal of trading facilities without any notice.

In the event of withdrawal of trading facilities, the outstanding positions of the member may
be closed out forthwith or any time thereafter by the Exchange, at the discretion of Clearing
Corporation, to the extent possible, by placing at the Exchange counter orders in respect of
the outstanding position of the member without any notice to the member, and such action
shall be final and binding on the member

11.18 Maintaining Capital Cushion

As per SEBI directive the Exchange/Clearing Corporation has build an administrative

mechanism to encourage members to hold capital cushions while operating

The following methodology has been adopted by the Clearing Corporation to monitor
members who have high capital utilisations
• At the end of each calendar month, members who have exceeded 90% of utilistion of
capital towards margin utilisation during the day for more than 7 days in the current
month shall be identified
• The capital required to bring the capital utilisation to a level of 85% at the time of
violating the trigger point of 90% on each of those occassions shall be noted for the
members. The highest of such amounts for the identified members during the month
shall be called for as additional capital.
• The requirement shall be communicated to members on the first day of the subsequent
month.
• The members shall be required to provide the amount of additional capital in the
form of Cash, FDRs and Bank Guarantees within three working days
• No benefit towards margin, etc shall be available to the member on the amount of
additional capital so collected.
 • In case of non- payment of additional capital within the stipulated time limit a penalty
as applicable for funds shortage shall be levied for the period of default.
• The additional capital so collected shall be retained with the Clearing Corporation for
a period of one calendar month.
• In case a member is liable to provide additional capital in the subsequent month, the
amount of additional capital shall be recomputed and the excess /deficit shall be
refunded /called for.
• The amount of additional capital shall be informed to the members on the first day of
the subsequent month vide a letter in the extranet directory.
• The letter of intimation of additional capital shall be available to members in the
extranet directory /< TM ID>/REPORTS.
• The naming convention of the letter shall be as under.
Letter for partial release - C_CPC_PRL_<MEMCODE>_DDMMYYYY.TXT
Letter for Full release - C_CPC_FRL_<MEMCODE>_DDMMYYYY.TXT
Letter for Additional capital cushion -
C_CPC_REQ_<MEMCODE>_DDMMYYYY.TXT
• The provisional amount of additional capital to be provided along with the number of
days when the member has crossed 90% of margin utilistion shall be intimated to the
member on a daily basis vide a report in the extranet directory. The report shall be
available to members in the extranet directory /< TM ID>/REPORTS.
The naming convention of the report shall be as under.
P_C_CPC_<MEMCODE>_DDMMYYYY.TXT

11.19 Margins from the Client:

Members should have a prudent system of risk management to protect themselves from client
default. Margins are likely to be an important element of such a system. The same shall be well
documented and be made accessible to the clients and the Exchange/Clearing Corporation.
However, the quantum of these margins and the form and mode of collection are left to the
discretion of the members.

11.20 Close out of Positions

An online facility to close – out open positions of members, whose trading facility is
withdrawn for any reason, is provided. On disablement, trading members may be allowed to
place close-out orders through this facility. Only orders which result in reduction of existing
open positions at the client level shall be accepted through the close-out facility in the normal
market.
Apart from the above, members shall not be allowed to:
• Create any fresh position when in the close-out mode.
• Place close out orders with custodial participant code.
• Close out open positions of securities in trade for trade segment.

This facility does not dilute the powers of the Clearing Corporation to close-out under its
Bye-Laws, Regulations and Circulars. Further the relevant authority may require the
members to reduce/close-out open positions to such levels and for such securities as decided
by the relevant authority from time to time.
 11.21 Cross Margining

As per SEBI Circular Ref No: SEBI/DNPD/Cir- 44 /2008 dated December 02, 2008 cross
margin benefits shall be provided. The salient features of the cross margining are as under:

1. Cross margining benefit shall be available across Cash and F&O segment
2. Cross margining benefit shall be available to all categories of market participants
3. For client/entities clearing through same clearing member in Cash and F&O segments,
the clearing member shall only be required to intimate client details through a file upload
through Collateral Interface for Members (CIM)
4. For client/entities clearing through different clearing member in Cash and F&O
segments they shall be required to enter into necessary agreements for availing cross
margining benefit.

The detailed procedure in respect of cross margining is as under:

11.21.1 Positions eligible for cross-margin benefit

Cross margining shall be available across Cash and F&O segment and to all categories of
market participants. The positions of clients in both the Cash and F&O segments to the extent
they offset each other shall be considered for the purpose of cross margining as per the
following priority
a. Index futures and constituent stock futures in F&O segment
b. Index futures and constituent stock positions in Cash segment
c. Stock futures in F&O segment and stock positions in Cash segment

i. In order to extend the cross margin benefit as per (a) and (b) above, the basket of
constituent stock futures/ stock positions shall be a complete replica of the index futures.
Clearing Corporation shall specify the number of units of the constituent stocks/ stock
futures required in the basket to be considered as a complete replica of the index on the
website of the exchange www.nseindia.com from time to time.
ii. The number of units shall be changed only in case of change in share capital of the
constituent stock due to corporate action or issue of additional share capital or change in the
constituents of the index.
iii. The positions in F&O segment for the stock futures and index futures shall be in the same
expiry month to be eligible for cross margining benefit.
iv. The position in a security shall be considered only once for providing cross margining
benefit. E.g. Positions in Stock Futures of security A used to set-off against index futures
positions shall not be considered again if there is a off-setting positions in the security A in
Cash segment.
v. Positions in option contracts shall not be considered for cross margining benefit.
vi. An example of computation of offsetting positions has been provided in Annexure 11.9

11.21.2 Entities/clients eligible for cross margining

The clearing member shall inform the Clearing Corporation the details of client to whom
cross margining benefit is to be provided. The cross margining benefit shall be available only
if clearing members provide the details of clients in such manner and within such time as
specified by the Clearing Corporation from time to time.
11.21.2.1 Client/entity settling through same clearing member in both Cash and F&O
segment
i. The clearing member shall ensure that the code allotted (code used while executing
client trade) to client/entity in both Cash and F&O segment is same
ii. The clearing member shall inform the details of clients to whom cross margining
benefit is to be provided through a file upload facility provided in Collateral
Interface for Members (CIM).
iii. The details of file to be uploaded i.e file naming convention, file format has been
provided as Annexure 11.10

11.21.2.2 Client/entity settling through different clearing member in Cash and F&O
segment

i. In case a client settles in the Cash segment through a trading member / custodian
and clears and settles through a different clearing member in F&O segment, then
they shall be required to enter into necessary agreements.
ii. In case where the client/entity settles through Custodian in Cash segment, then the
client/entity, custodian and the clearing member in F&O segment shall enter into a
tri-partite agreement as per the format provided in Annexure 11.11
iii. In case where the client/entity clears and settles through a member in Cash segment,
and a different clearing member in F&O segment, then the member in Cash segment
and the clearing member in F&O segment shall enter into an agreement as per the
format provided in Annexure 11.12 A. Further, the client/entity shall enter into an
agreement with the member as per the format provided in Annexure 11.12 B.
iv. The clearing member in the F&O segment shall intimate to NSCCL the details of
the client/entity in F&O segment alongwith letter from trading member/custodian
giving details of client/entity in Cash segment who wish to avail cross margining
benefit. The details to be provided have been specified in Annexure 11.13

11.21.3 Facility of maintaining two client accounts

As specified by SEBI, a client may maintain two accounts with their respective
members to avail cross margin benefit only. The two accounts namely arbitrage
account and a non-arbitrage account may be used for converting partially replicated
portfolio into a fully replicated portfolio by taking opposite positions in two accounts.
However, for the purpose of compliance and reporting requirements, the positions
across both accounts shall be taken together and client shall continue to have unique
client code.

11.21.4 Computation of cross margining benefit

i. The computation of cross margining benefit shall be done at client level on an

online real time basis and provided to the trading member / clearing member /
custodian, as the case may be, who, in turn, shall pass on the benefit to the
respective client.
ii. For institutional investors the positions in Cash segment shall be considered only
after confirmation by the custodian on T+1 basis and on confirmation by the
clearing member in F&O segment.
 iii. The positions in the Cash and F&O segment shall be considered for cross margining
only till time the margins are levied on such positions.
iv. While reckoning the offsetting positions in the Cash segment, positions in respect of
which margin benefit has been given on account of early pay-in of securities or
funds shall not be considered.
v. The positions which are eligible for offset shall be subject to spread margins. The
spread margins shall be 25% of the applicable upfront margins on the offsetting
positions or such other amount as specified by the Clearing Corporation from time
to time.
vi. The difference in the margins on the total portfolio and on the portfolio excluding
off-setting positions considered for cross margining, less the spread margins shall be
considered as cross margining benefit.

11.21.5 Provisions in respect of default

In the event of default by a trading member / clearing member / custodian, as the case may
be, whose clients have availed cross margining benefit, Clearing Corporation may:
i. Hold the positions in the cross margin account till expiry in its own name.
ii. Liquidate the positions / collateral in either segment and use the proceeds to meet
the default obligation in the other segment.
iii. In addition to the foregoing provisions, take such other risk containment measures
or disciplinary action as it may deem fit and appropriate in this regard.

11.21.6 Additional reports

i. All existing margin reports downloaded shall have details after providing cross
margining benefit.
ii. A report providing details of cross margin benefit and off-setting positions at client
level shall be provided to members as per the format specified in Annexure 11.14

11.22 Pay-in of funds/securities prior to scheduled pay-in day

The relevant authority may require members to pay-in funds and securities prior to the
scheduled pay-in day for funds and securities. The relevant authority shall determine from
time to time, the members who shall be required to pay-in funds and securities prior to the
pay-in day. The relevant authority shall also determine securities and funds which shall be
required to be paid in and the date by which such pay-in shall be made by the respective
member.
The member would be required to make early pay-in of funds and securities within the time
specified by the relevant authority.

11.23 Imposition of additional margins

The relevant authority may require members to make payment of additional margins at any
time on such securities and at such rates as decided from time to time. This will be in addition
to the daily margins which are or may be imposed from time to time.
11.24 Dissemination of Client level Position to Member:

The Client Level Positions shall be disseminated to all members through the detail margin
report (MG02) which shall detail the client wise margin obligation.

These files will be made available for the custodians in their respective sub-directories and on
the extranet server for the members. File format for Detail Margin Report (MG02) shall be as
per Annexure 11.3
 Item 12

CHARGES AND PENALTIES

In pursuance of Regulations 7.15, 7.16, 9.3, 9.5, 9.8, 9.9A, 12.14 and 15 of the NSCCL
Capital Market Regulations the applicable penalties are hereby specified as under :

12.1. Funds Shortages

Members failing to fulfil their funds obligations (all markets including the valuation debit
raised on account of securities shortages) to Clearing Corporation shall be subjected to the
following penalty structure:-

S. Type of Non- Penalty Action

No fulfilment Charge %
per day
a) Value Rs. 5 0.07 The trading facility of the member shall be
lakhs or more withdrawn immediately & Securities pay out
shall be withheld.
b) Value less 0.07 If in the last three months, the member is short
than Rs. 5 over Rs. 2 lakhs on six or more than six
lakhs occasions, the trading facility of the member
shall be withdrawn and the securities pay out.
Shall be withheld*

*In case, the member is disabled on account of (b) above, on making good the shortage amount,
the member shall be permitted to trade subject to its providing a deposit equivalent to its
cumulative funds shortage as the 'funds shortage collateral'. Such deposit shall be kept with the
Clearing Corporation for a period of ten settlements and shall be released only if no further
funds shortages are reported for the member in next ten consecutive settlements. Members may
further note that there shall not be any margin benefit or any interest payment on the amount so
deposited as 'funds shortage collateral'. The amount may be provided by way of cash, fixed
deposit receipts, or bank guarantee, equivalent to the cumulative funds shortage.

Recovery of funds due through liquidation of securities withheld:

The funds defaulting member will be allowed such time as may be permitted by the relevant
authority depending upon the facts of the case to bring in the amount in default. If funds are
not brought at any time by the defaulting member, the Clearing Corporation at its discretion
will proceed to close out securities in the normal / auction market. If the member does not
bring in the amount by the time permitted by the relevant authority, and continues to default
thereafter, the relevant authority may proceed to declare him a defaulter.

12.2 Securities Shortages:

Members failing to fulfil their securities deliverable obligations to Clearing Corporation shall
be subjected to the following penalty structure:-
S. Type of Non- Penalty Action
No Fulfilment Charge %
per day
(a) Security 0.05 The valuation amount of the shortage will be
 Shortage considered as funds shortages where shortage
confirmation is not received from the bank and
penal action as prescribed for “Funds Shortage’'
point “12.1” above shall be applicable

12.3 Margin Shortages

Following penalty shall be levied on a monthly basis in respect of margin violations

Instances of Disablement Penalty to be levied

1st instance 0.07% per day
2nd to 5th instance of 0.07% per day +Rs.5000/- per instance from 2nd to 5th
disablement instance
6th to 10th instance of 0.07% per day+ Rs. 20000 ( for 2nd to 5th instance)
disablement +Rs.10000/- per instance from 6th to 10th instance
11th instance onwards 0.07% per day +Rs. 70,000/- (for 2nd to 10th instance)
+Rs.10000/- per instance from 11th instance onwards.
Additionally, the member will be referred to the
Disciplinary Action Committee for suitable action

Instances as mentioned above shall refer to all disablements during market hours in a
calendar month. The penal charge of 0.07% per day shall be applicable on all disablements
due to margin violation anytime during the day.

12.4. Security Deposit Shortages

Members not fulfilling the security deposit requirement for continued membership shall be
subjected to the following penalty structure:-

S. Type of Non- Penalty Action

No Fulfilment Charge
% per
day
(a) Value Rs. 5 lakhs or 0.07 The trading facility of the member shall be
more withdrawn
(b) Value less than Rs. 5 0.07 The member shall be given a week’s time to
lakhs replenish the shortfall in security deposit
failing which the trading facility of the
member shall be withdrawn.

12.5. Client Code Modification:

Penalty on account of client code modifications shall be levied as under:

Percentage of modified client codes for non- Amount (in Rs)

institutional orders beyond the first 5 orders to total
non-institutional orders (matched) on a daily basis
Less than or equal to 1% NIL
Greater than 1% but less than or equal to 5% 500/- per day
 Greater than 5% but less than or equal to 10% 1000/- per day
Greater than 10% 10000/- per day
Penalties shall be imposed in respect of client code modifications in non-institutional orders
only.

12.6. Non-allocation / rejection of institutional trades

Trades marked as ‘INST’ and not allocated to valid CP codes and institutional trades rejected
/ not-accepted by Custodians shall be subject to penalty at 0.10% of the total value or Rs.
10,000 whichever is lower.

Penalties shall not be imposed on transactions where custodial non-confirmation is for any of
the following exceptional circumstances as per SEBI Circ. Ref No MRD/DoP/SE/Cir-
17/2005 dated September 2, 2005:

• Total connectivity failure to the exchange/STP. (Specific connectivity issues of the

custodians and members shall not be considered as valid exceptions)
• International holidays that may be decided upfront by the stock exchanges in consultation
with the custodians
• Closing down of national/international centers due to calamities

12.7. Invalid IL trades:

• Penalties shall be applicable as per the provisions of the normal market.

• Additional penalties shall be imposed if trades are executed by ineligible clients as under:
o If the selling client is not eligible - the trade shall be compulsorily closed out and a
penalty of Rs.25000 shall be imposed.
o If the buying client is not eligible - a penalty at the rate of 1% of the value of the trade
or Rs 1 lakh whichever is lower shall be imposed.

12.8. Failure to give Good Delivery:

A processing fee for delayed good delivery or bad delivery will be levied on the value of
securities in bad/fake delivery. In case of bad deliveries rectified, delayed good delivery
processing charges will be at the rate of 0.09 % per day computed from the day on which
securities were originally due to be brought in up to the day on which the securities are
replaced/rectified.

In case of bad deliveries not rectified, bad delivery processing charges will be @ 0.09% per
day computed from the day on which securities were originally due to be brought in up to
(i) the day on which the securities are brought in or
(ii) till auction settlement is completed or
(iii) where auction is partially successful or not successful and the deal is deemed
closed out or
(iv) When the deal is squared off and the corresponding funds adjustments are
completed, whichever is later.
In case of auction bad deliveries and rectified / replaced objection cases which are reported
as bad delivery, the penal interest will be 0.09% per day from the rectification date till the
date of closing out.

12.9. Incorrect claim for corporate benefits:-

Type of Default Charges

Wrong claims of dividend, bonus, interest etc. Rs. 100/- per claim
Same set of shares reported twice under 10% of value of shares reported under
objection objection subject to a minimum of Rs.
5,000/- per claim

12.10. Incorrect undertaking

Incorrect undertaking on form 6-I 10% of the value of shares reported

under objection, subject to a minimum
of Rs. 5,000/- per claim.

12.11. Late withdrawal of company objection:

Processing fee for late withdrawal at the rate of Rs. 2 per share subject to a minimum of
Rs.200/- shall be levied for all withdrawals where a member has not withdrawn the
invalid/incorrect objection/corporate benefits claim on the scheduled withdrawal date, for the
following reasons:

a. The shares under objection have not been introduced by the member on the
Exchange, however he is not able to produce the delivery slip / delivery details
statement on the scheduled withdrawal day.

b. Where the IM had not approached the Clearing House on the scheduled withdrawal
date on account of oversight/mistake.

Members wanting to avail 'late' withdrawals will be required to affix pre-paid coupons for the
late withdrawal fee, at the time of reporting the same. Acceptance of such late withdrawals
shall be subject to approval only.

12.12. Trade for Trade Segment

S No Types of default Penalty Charge

a. Non settlement of trade 0.5% of the trade value
b. Cancellation of trade Rs. 1000/- per trade per side
c. Failure to settle within the Rs. 500/- per trade per day, subject to
stipulated time maximum of 2.50 times the value of the trade
for each side with a ceiling of Rs. 10000/-
d. Failure to report within the Rs. 500/- per trade per day subject to
stipulated time maximum of 2.50 times the value of the trade
for each side with a ceiling of Rs. 5000/-

In addition to the above, a penal interest at the rate of 7 basis points for each day of default
shall be levied on the members who have not paid the penalty imposed on them.
12.13. Charges for rectification of errors committed by Clearing Members

A processing fee penal charge shall be levied for rectification of error that has been
committed by the clearing member. The fee for all such error rectification that results in
credit greater than Rs. 1,000 / - to be passed on to the clearing member, would be levied on
the clearing member receiving the benefit.

Amount of credit received by the Rectification charges to be levied

clearing member (Amount in Rs.)
Rs. 1000 to Rs. 10,000 100
> 10,000 1000

The processing fee will be required to be paid in advance by the clearing member, by way of
a cheque, drawn in favour of 'National Securities Clearing Corporation Limited'.
 Item 13

SETTLEMENT FUND

In pursuance of Chapter XII of the Bye Laws administration, contributions to the CM

Settlement Fund and charges for utilisation of the same are specified herein.

13.1 CM Settlement Fund

A CM Settlement Fund shall be maintained in respect of the Capital Market segment. In

pursuance to Chapter XII section 5 of the Bye Laws, the administration and utilisation of this
fund shall be applicable to such deals as may be prescribed by the relevant authority.

13.2 Contribution towards CM Settlement Fund

Clearing members are required to provide initial deposits to the CM Settlement Fund in as
specified hereunder:

Clearing members constituted as individuals or partnership firms are required to keep a cash
deposit with the Clearing Corporation of Rs.6 lakhs and a security deposit of Rs. 17.5 lakhs
in such form and manner as may be specified by the Clearing Corporation from time to time.

Clearing members constituted as corporates are required to keep a cash deposit with the
Clearing Corporation of Rs.15 lakhs and a security deposit of Rs. 25 lakhs in such form and
manner as may be specified by the Clearing Corporation from time to time

The deposit requirements are summarised as under:

Constitution of Clearing Member Cash Deposit (Rs. Approved collaterals

Lakhs) (Rs. lakhs)
Individual or partnership firms 6 17.5
Corporates 15 25
Professional Clearing Member 25 25

13.3 Penal Charges for utilisation of Settlement Fund

In the event of a CM clearing member failing to meet his obligations to the Clearing
Corporation in respect of cases specified pursuant to Bye-Law 11(2) of Chapter VI of the Bye
Laws, the Clearing Corporation at its discretion may utilise the CM Settlement Fund to the
extent and in such manner as necessary. The amount so utilised will be subject to the
following condition:

The CM clearing member shall be required to immediately pay the amount so utilised and
also pay a penal charge at the rate of 0.07 % per day computed on the amount outstanding
from the day on which monies are due to be paid in till the day all obligation including
shortfall in deposits are fulfilled.
 Item 14

GUIDELINES FOR GOOD / BAD DELIVERY

14.1 In pursuance of Regulation 7.1 of the NSCCL Capital Market Regulations, it is

hereby notified that the Guidelines for Good/Bad Delivery as presented below shall be
used as guidelines for determining good/bad delivery.

SEBI APPROVED

GOOD/BAD DELIVERY NORMS

14.1.1 TRANSFER DEEDS

Description Good/Bad
No
1. Transfer Deeds in the prescribed form and printed with the words "For the Good
_________ Stock Exchange."
Stock Exchange emblem may or may not be printed. Month and year of
printing may or may not be put on the reverse of the Transfer Deed.
Mutilated Transfer Deed with the signatures of the transferor,
2. witness, Directors and officer of the Company/ distinctive numbers/any
material portion badly torn overwritten, or defaced
Typical Cases :

A) Material portion defined here only pertains to the material portions at the
time of delivery and not prospective one. For a buyer Consideration
column, Specimen signature column, Name, Address, Occupation will also
be the
Material portion.
Material portion includes of transferor's name and signature, company
name, folio no., certificate number, distinctive nos., number of shares, name
and signature of the transferee, specimen signature of transferee
B) Transfer Deed torn in the prospective material portion Good
· Torn and pasted with self-adhesive tape on which the required
Details can be filled in without any difficulty.
· Transfer Deed torn in non material portion and held together Good
by a transparent tape
· Transfer Deed torn end-to-end in any angle. Bad

Transfer Deeds with correction like erasure, overwriting, alteration or Good if

3. crossing out in the material portion properly
authenticated
under the full
signatures of all
the transferor
Under noted corrections / alterations are not considered as correction in
material portion :

A) Minor spelling mistake in the following fields are valid without Good
 the transferor's authentication provided the word can be properly identified :
a. Name of the Company.
b. Number of shares in words
c. Names of the Shareholders

Illustration Good Bad

Telco Teelco Tisco
Fifty Feefty Feefteen
Ramesh Rameesh Rajesh
B) Erasure, overwriting, alteration or crossing out in one or two characters Good
in folio numbers.
C) Erasure, overwriting, alteration or crossing out in one or two characters Good if
of ' Distinctive Numbers.' certificate
number does
contain any
erasure,
overwriting
alteration, or
crossing out.
D) Erasure, overwriting, alteration or crossing out in one or two characters Good if
of ' Certificate Number '. distinctive
number does
not contain
many erasure,
over writing,
alteration, or
crossing out
E) Erasure, overwriting , alteration or crossing out in Good if
Number of Shares in figures Number in
words does not
contain any
erasure,
overwriting,
alteration, or
crossing out.
F) Erasure, overwriting, alteration or crossing out in one or two characters Good if
in Number of shares in Words. Number of
Shares in
Figures does
not contain any
erasure,
overwriting,
alteration,

G) List of certificates numbers and distinctive numbers and distinctive Good

numbers attached to transfer deed signed by all the transferors

4. If the name of the transferor (s) in the share certificate & the name in the Bad
transfer deed(s) differs materially.
 A) Addition or Deletion of 1 or 2 alphabets. Good
B) Krishna Chandra Chelura - C C Krishna Bad
C) Ashok Gupta - Gupta Ashok Good
D) Corporation - Corpn/Corp. Good

5. Transfer Deeds signed as 'Choonilal' whereas in share certificate the name is Good
spelt as 'Chunilal'.
Other than any apparent difference in seller's signature must be accepted.
In case of apparent difference like S Rao signing as David. Bad
In case S Rao signing as Subhash since the first letter of the signature Good
matches with the initial.
6. Transferor's signature in English, Hindi or any one of the Scheduled Good
languages in India.Assamese, Bengali, Gujarati,Hindi, Kannada, Kashmiri,
Malayalam, Marathi, Oriya, Punjabi, Sanskrit, Tamil, Telugu and Urdu - as
per Constitution of India - English Schedule ( Articles 314 (I) and 451).
7. Signature of the Transferor is in an Indian language other than the Good
Scheduled languages of India or when the Transferor has affixed his thumb
impression.
If attested by any person authorised to attest signatures under the
Seal/Stamp off his office
8. Transfer Deeds in respect of joint holdings signed by all the joint holders in Good
any order.
Provided the signatures are against the relative names filled up in the
Transfer Deed.
9. Transfer Deeds without the name of the Company, name(s) of Bad
Transferor(s), Folio No., share certificate no., Distinctive no., and number
of shares being written.
In one lot with one Transfer Deed name on one certificate reading as Good
10. "Ramesh C Talati" and on another certificate as "Ramesh Chunilal Talati"
but Register Folios same on both.
In one lot, separate transfer deeds are required for each registered folio. Good
If the transferor's name is identical and folios are different and there is only Good
one transfer deed.
In one lot with one Transfer Deed names on different certificates reading as Good
11. Ramesh Chunilal Talati and Talati Ramesh Chunilal but Register Folio is
same.
Income Tax Authority or Collector signs as Transferor. (Number and Date Good
12. of the relative Order necessary).
Instead of Executor's signature, his Agent's signature is put on the Transfer Good
13. Deed.
(Number and Date of Registration of Power of Attorney necessary).
Executor's signature without his rubber stamp.(Number and Date of Good
14. Registration of Power of Attorney necessary).
In the case of Units transfer deed in the name of a Minor and signed by Good
15. natural Guardian. (In the case of Court Guardian, a court order is required).
Shares cannot be held in the name of a Minor unless accompanied by Court Good – If
Order granting permission for sales/purchase which is beneficial to the accompanied by
Minor. the relevant
Court Order for
 sale.
Unless the transfer deed is duly certified and countersigned Good
16. by the Official Assignee.

Transfer deeds signed under Power of Attorney where the power given is Bad
17. subject to conditions
Transfer deed signed by Director of the Company and Under Board Good
Resolution not mentioned on the front or the reverse of the transfer deed. (
Stamp of Introducing member is not required to be affixed on the reverse of
the transfer deed)
Transfer deed signed by an authorised signatory Good only if
PA stamp of the
introducing
Member is
mentioned on
the reverse of
the Transfer
Deed.
Transfer deed signed by an authorised signatory of a custodian and the PA Good
registration no. is mentioned on face or the reverse of the transfer deed.
(Stamp of Introducing member is not required to be affixed on the reverse
of the transfer deed)
Where the transfer deeds are signed by an authorised signatory under a Good
Board Resolution and the stamp UNDER BOARD RESOLUTION is
mentioned on the face or the reverse of the transfer deed. (Stamp of
introducing member is not required to be affixed on the reverse of the
transfer deed)
Transfer Deed signed by a custodian on behalf of a client · In the signature Bad
18. column the custodian does not put the stamp as 'Constituted Attorney' on
behalf of the transferor
Transfer Deed signed by a Custodian on behalf of the client and in the Good
signature column puts the stamp ' By Constituted Attorney to the transferor '
with the P/A number given on the face or reverse of the TD with the stamp
and signature of the custodian. (Stamp of introducing member is not
required to be affixed on
the reverse of the transfer deed )
Shares sold by FIIs and transfer deed signed by a Custodian on behalf of the Good
19. FII.(Copy of RBI approval is not required to be attached )
In case of GDR
20.
· Photocopies of the RBI approval attached to the deliveries ; OR Good
· If RBI approval number and date is mentioned on the transfer deed and Good
attested by the introducing member
Consideration amount and date of execution of the transfer deeds are filled Bad
21. in.
Transfer Deeds signed by or on behalf of a Company against which Bad
22. liquidation proceedings are pending.
· Unless the Transfer Deed is certified and countersigned by the Liquidators. Good
 The name of the delivering broker with his SEBI Registration number and Bad
23. date not mentioned at the back of the Transfer Deed.
In case the shares are delivered to the Clearing House by the Custodian and Good
the Transfer deed bears the stamp of Custodian along with the Clearing
Number of the Broker on whose behalf the shares are delivered.
The date should be the pay-in date/ delivery date only.
Shares held by a TRUST and Signed on the Transfer Deed as 'NAME OF Bad
24. TRUST - PROPRIETOR'.
TD signed as "NAME OF TRUST - TRUSTEE" Bad
Shares held in the name of a trust, if accompanied by a copy of the Good
resolution or the relevant portion of the trust deed authorising the trustees to
transact in securities on behalf of the trust.
If shares held are duly registered by the company in the name of the HUF Good
25 (Shares held by HUF and signed by KARTA)

26 Transferor's signature witnessed by a person but his full name not given. as Good
long as the name and address of the witness are perfectly legible.
Witness name, address and signature is in a language other than English Good
27. specified by the Ministry of Finance. Assamese, Bengali, Gujarati,
Hindi, Kannada, Kashmiri, Malayalam, Marathi, Oriya, Punjabi, Sanskrit,
Tamil, Telugu and Urdu - as per Constitution of India - English Schedule (
Articles 314 (I) and 451).
If signed in a language other than specified by the Ministry of Finance. Bad
Attestation stamp in any one of the Scheduled languages in India. Indian Good
28. languages:
Assamese, Bengali, Gujarati, Hindi, Kannada, Kashmiri, Malayalam,
Marathi, Oriya, Punjabi, Sanskrit, Tamil, Telugu and Urdu - as per
Constitution of India - English Schedule (Articles 314 (I) and 451).
Transferor's signature attested by a Bank official · only the designation Bad
29. mentioned.
· If the name, Designation of the attesting authority signing along with the Good
complete address is given.
Attestation by Gram Panchayat or a Surpanch or Village Magistrate or Good
30 Village Munsiff under his seal.
Signature attested by any person authorised to attest signatures with his full Good
31. name and address with the Official Seal/Stamp of his office.
Transferor's signature is attested by a Notary Public.(The necessary seal, Good
32. rubber stamp, adhesive stamps as prescribed for such attestation should be
affixed in cases where Notary attestation is required i.e. In cases where
Rectification of objections
is required due to signature differences).
Transfer Deed is signed by the transferor Bad
33. · Signature is clearly of a name different than the name of the transferor.

· If signature is same for two different shareholders under two different Bad
Transfer Deeds.
Marketable lot with more than five transfer deeds. Bad
34.
Upto five transfer deeds used to make a marketable lot. Good
 New shares which are issued on prorata basis and old shares standing in the Good
35. folio and name of same transferor and accompanied by one transfer deed for
a marketable lot.
(The new share dividend declared for the previous year i.e. the old new
compensatory value (ONCV) would be payable on the entire market lot).
Company's name has been changed but it has not been corrected on the Good
36 share certificate.
Abbreviated name of a Company filled up in the transfer deed.If from the Good
37 abbreviated name the identity of the company can be ascertained. The
name of the Company should be identifiable., e.g. TELCO, TISCO, L&T,
etc.
Exact position of TDs to be attached on top of the certificate.TD should be
38. placed on the top of the share certificate.
39. Transferor and witness is the same. Bad
Transfer Deeds in the prescribed form and name of a particular Stock Good
40. Exchange filled in or not.
41. Transfer Deed not in the prescribed form. Bad
42. Witness and attesting authority identical. Good
43. Transfer Deeds bearing signatures of witnesses, the address of the witness Good
being in a different city or town or Centre other than that of Transferor or
Transferee.
44. Prescribed Authority (ROC) seal overlapping and stamped twice.Even if the Good
signature of the Registrar of Companies is partly printed and the date stamp
is also partly printed but both the signature and the date should be apparent

45 The Endorsement of the Prescribed Authority (e.g. Registrar of Companies) Good

bears the same date as the date from which the Register of Members of the
Company is closed
46. If the Endorsement of the Prescribed Authority (e.g. Registrar of Good
Companies) bears a date prior to the date of issue of share certificate or the
date of allotment of shares.
Provided the Endorsement of the Prescribed Authority bears a date of or
after the date from which the Register of Members of the Company closed
last.
47 Transfer Deed endorsed by the Prescribed Authority on a date prior to Bad
closure of the Register of Members of the Company delivered after the date
of closure of Register of Members.
48 Transfer Deeds accompanying debenture certificates or any other Good
permissible listed security (other than equity) whether date-stamped by the
Prescribed Authority or not.
Provided for the convertible portion a separate date-stamped Transfer Deed
is delivered.
49 Transferor's signature on the transfer deed with the date on which he has Good
signed.
50 Witness is a Non-Resident and the address given is of a foreign country. Good
51 Distinctive numbers range "To" partly filled in the transfer deed. e.g. Good
4589201 - 300 etc.
52 In the case of mutual funds, the ROC stamp and signature are missing Good
(except in case of Schemes of Unit Trust of India).
 53 Certificates with multiple folios per market lot attached to separate transfer Good
deed (subject to guideline no. 35 above).
54. Logo of the Stock Exchange on the reverse of the transfer deed missing. Good
Attestation of the transferor's signatures is not mandatory.except in the case Good
55 where the transfer has been returned by the company due to SIGNATURE
DIFFERENCE.
56 Units issued with the terms 'either or survivor', if signed by all holders Good
If signed by any one of the holders Good
Transferor's signature on the transfer deed is facsimile signature for Good
57 Registered custodians.
Certified Transfer Deed Good
58. Provided the name and address of the Transferor the distinctive numbers of
the shares covered by the Transfer Deed and date of certification are given.
Any erasure or alteration in the Certified Transfer Deed. When Good
59. authenticated by an authorised signatory of the Company.
Certified Transfer Deeds and share certificates delivered in part for bargains Good
60. in market trading unit.
In case of shares under lock in-period, if the transfer deed date is prior to the Good
61 lock-in period last date but the date of introduction into the market is after
the last date of lock-in period.

If the transfer deed date is prior to the lock-in period last date and the date Bad
of introduction into the market is before the last date of lock-in period.
Some companies allot record numbers for shares issued by them apart from Good
62. distinctive number ranges. For these shares, if record number is filled up
along with distinctive number ranges on the transfer deed.
If only the record number has been filled up instead of distinctive number Bad
62A ranges on the transfer deed.
Transfer deeds ( dated June 01, 1997 and thereafter ) bearing rubber stamps Bad
62B on the reverse thereof other than those of members of the stock
exchanges/clearing house/clearing corporations, SEBI registered sub-
brokers and Remisiers registered with the stock exchanges.

14.1.2 SHARE CERTIFICATES

Description Good/Bad
No
63 Name of the company or emblem is not readable on the common seal or Good
there is no common seal on the share certificate.

64 The last date for payment of call has expired and the call has not been paid Bad
or if the call has been paid, the necessary Call Receipt has not been
attached.

The call payment receipt with the stamp of the Bank before or on the due Good.
date if attached to the securities good delivery for three months from the last
date of call payment or next book closure announced by the company
whichever is later.
 All call payment receipts after due date must be endorsed as ' cheque / draft Good
realised ' by the Bank / Co / Registrars.

Where the closure of the register of members fall within the period of 3 Good
months from the due for payment of call money, call money receipt valid
until the closure of Register of Members occurring after the first such
closure
65 All securities with stickers issued by the companies in lieu of endorsement Good
66 If call money paid but not endorsed on share certificate even after the book Bad
closure but transfers affected after the call payment date.
67 If the final call is endorsed but the initial or the initial and the second call Good
not endorsed. ( i.e. if marked "FULLY PAID" )
68 In case of fully convertible debentures, after the debentures have been Good
converted into equity, if the call money endorsement has been done only for
the equity portion and not for the debenture portion or vice versa.
Call paid endorsements made by the company with call amount and Good
69 signature of the Authorized Signatory with or without the Rubber stamp of
the Company and date of payment of the call.
In the case of partly paid shares, when a call has been made but not paid and Bad
70 delivery effected during the period of ten days before the last date fixed for
payment.
If the call receipts are attached to the documents Good
Application Receipts and Call money receipts not bearing bank stamps and Bad
71 payment details .
72 Any significant correction, erasure, overwriting, crossing out or alteration in Bad
the quantity of the shares, in the last registered holders name or in any
material particulars on the share certificate.
Unless the Authorised Signatory who has signed on the certificate, Good
authenticates the correction Or the correction is initialed and authenticated
by any other officer under the Company's rubber stamp.
Certificates badly torn as is not to be in a deliverable condition or share Bad
73 certificate torn through and through or badly torn as to obliterate or render
illegible or create the impression of cancelling the numbers or directors or
other signature or the date or any other particulars or if it is written upon or
damaged or mutilated by advertisements, printing, rubber stamp or
otherwise or if a material part of the certificate be torn out or cut off.
74 Share certificates defaced or mutilated in portion: Bad
The following will be considered as material portion in the case of share
certificate:
(I) Share certificate torn end to end and pasted with transparent self- Bad
adhesive tape
(ii) Where shares have been transferred to a new holder and if torn at the Good
original holders name portion

(iii) Folio number and name overwritten in one or two characters and not Good
authenticated by the authorised signatory

iv) If the share certificate is torn at the company name portion but is Good
 decipherable
(v) Corrections in transfer Number or Date of transfers, if legible and not Good
authenticated.
vi) Share Certificates with bar codes not concealing any material Good
information.
If the name of the Company has been disfigured in the body of the share Bad
75 certificate so as to affect it materially.

If the name of the company is identifiable. Good

Certificates in the case of UNITS discharged by the transferor for purpose Bad
76 of repurchase and then cancelled by him and initialed.

Share certificate contains one name but the transfer deed consists of two Bad
77 signatures.
If both the signatures on the transfer deed are identical in nature or can be Good
identified as signature of the same person. If the transferor has signed twice
but has struck off the 2nd signature

Share certificate contains name of one transferor but transfer deed contains Bad
78 two names and signatures respectively.

Preferential/promoters quota shares under lock-in period delivered which Bad

79 are not transferable.

Share certificate issued without the signature of Secretary/Authorised Bad

80 signatory. If the shares are transferred subsequently and the authorised
signatory has signed against such transfer. Good.

Signature missing in the initial column but signed by Authorised signatory Good
81 in the required column on the reverse of the certificate.
Endorsement effected on the reverse of the certificate and struck off and Good subject to
82 again endorsed. proper authenti-
cation by the
Company by
putting a round
stamp of the
Company.
Certificate with company's old registered office crossed out and new Good
83 address stamped without authentication.

Certificate without mentioning the place of issue. Good

84
Revenue stamp affixed on the certificate concealing any material portion of Good
85 the certificate.
Provided any material portion like locking period date, NRI details are not
affected
Revenue stamps affixed/impressed by the Company on the share certificate Good
86 has come off.
 Any alteration or erasure or correction without initials in the transfer Good
87 endorsement on the back of the share certificate as for example made in the
year 1960 and subsequently the shares have again been transferred by the
Company, say in 1961.
Share certificates with irrelevant or extraneous rubber stamp or writings on Good
88 the scrip.
Provided the rubber stamp or the writings does not affect any material
portion of the scrip.
Increase or decrease of the Capital and if the certificate does not carry the Good
89 endorsement on the face of the certificate.
Absence of holder's discharge on the Letter of Allotment. Good
90
Share Certificate and Transfer Deed not attached together. Bad
91
Shares standing in the name of Non-Resident Individuals. Good
92 Provided the declaration stamp as per the RBI guideline is affixed and
countersigned by the introducing member
Name of the holder printed in two lines which looks like joint holding or Good
93 one line of address printed and looking like second holder.
Lock in period mentioned in the certificate, without specific date of release Bad
94 of lock in.
Shares issued in the name of Sole Proprietor/ Partnership firm signed by the Bad
95 Proprietor/Partner.
Units/debentures issued in the name of Sole Proprietor/ partnership firm
signed by the Proprietor/partner Good
In case the shares of a company are not pari passu with the existing equity
96 shares of the company in two financial years then new share dividend
declared for the previous year i.e. the old new compensatory value(ONCV)
for two years has to be paid.
The full dividend declared will have to be paid (interim + final)

14.1.3 MISCELLANEOUS

No. Description
Validity period of Company Objection by the last buying broker to be notified to the
97 exchange/introducing broker is 12 months from the date of the objection memo.
Objections must be accompanied with Share Certificates.
98
Shares lodged for transfer after book closure (but before one year from the date of stamping
99 the transfer deed) are returned under objection can be lodged as company objection.
Where the shares have been duly transferred by the company in the name of the transferee, and
100 thereafter the company sends a letter informing transferee that the shares have been transferred
based on fraudulent documents, such cases can be lodged as company objection subject to the
following conditions and procedure :

· In cases where the company has transferred certificates which are fake and later sends a letter
informing that the shares have been transferred on fraudulent certificates, such cases will NOT
be treated as company objections and company will be responsible for the transfer.
 · In cases where the shares are under stop transfer, stay order, non transferable ( lock - in
period ) or shares are partly paid and the company has transferred the shares and later sends a
letter informing that the shares have been transferred on fraudulent documents, such cases will
NOT be treated as company objections and the company will be responsible for the transfer.

· In cases where the certificates are genuine but the transfer deed is forged ( i.e. the company
has transferred the shares in good faith ) the shares can be accepted as company objection. In
such cases the company should necessarily enclose the copies of both sides of the transfer
deeds based on which shares were transferred by the company in favour of the holder and
which later on has been found to be based on forged documents, and all subsequent transfers
thereafter alongwith the objection.

Procedure :
( In order to simplify the understanding of the procedure, the following illustration has been
used :

A-- > B -- > C -- > D -- > X -- > Y -- > Z

The shares were first sold through 'A' in the market. After passing through 'B' and 'C' the
shares were lodged by 'D' to the company for transfer. After receiving the shares duly
transferred from the company in his name 'D' sold the shares in the market. These shares after
passing through ' X' and 'Y' are finally sent by 'Z' to the company for transfer in his / her name.
After receiving the shares from the company duly transferred in his name, 'Z' has received a
letter from the company stating that the shares transferred in the name of 'D' were based on
fraudulent documents.

· 'Z' will report the objection along with the company objection against 'D'
· 'D' will rectify /replace the shares within 21 days as per the BDC procedures
· 'D' may in turn lodge the bad delivery for rectification through the BDC against 'A'

The validity period of reporting such cases will be 36 months from the date of latest transfer
by the company ( in the above example 36 months from the date the shares were transferred in
the name of 'Z' ).
The company will also furnish copies of both sides of transfer deed based on which shares
were transferred in favour of 'Z' and 'D' along with the objection memo.
In case of joint holding, and in the event of death of any of the holders, transfer can take place
101 on the basis of the death certificate accompanying the transfer deed only for a period of two
years from the date of the death or ensuing book closure, whichever is later.

The Introducing member of a recognised Stock Exchange may certify / attest copy of the death
certificate and also issue an identity certificate in case where the name of the deceased on the
share certificate is not identical with the name of the death certificate.
While rectifying objections due to signature differences, a fresh signature by the transferor
102 along with attestations is mandatory if the same transfer deed or a fresh transfer deed along
with attestation is mandatory.
Clarification : Members are required to submit fresh transfer deeds duly attested for all
signature difference cases (even in case of signature difference of authorised signatory, fresh
transfer deed signed by a different authorised signatory also needs to be attested).
In case Rights/Bonus shares tendered as corporate benefits are reported as bad delivery, if it is
103 odd lot, the value of shares based on the rate prevalent on the day of reporting bad delivery
 will be paid.
Rectification/replacement of transfer deed under objection should be in market lot only (even
104 if transfer deed under objection is submitted in non-market lot)
If Jumbo transfer deed is submitted as company objection, original transfer deeds need not be
105 returned by the receiving member
When documents are returned under signature difference, the transfer deed can be attested by
106 the introducing member. If the introducing member is a corporate, the Director or authorised
signatory can attest the transfer deed, under his company's stamp, with SEBI Registration
Number .
For reporting as company objections, the transferee portion of the transfer deed should be duly
107 filled in.
For reporting fake/forged shares as company objection, the following documents are required:
108
A. If they are returned as objection from the company due to the above reason :
· company objection memo stating that the shares are fake/forged
· copies of both sides of the transfer deeds
· copies of both sides of the share certificates
B. Otherwise one of the following documents are required :
· public notice given by the company/registrar
· notification from any stock exchange
· letter of intimation from the company to stock exchange
For reporting missing/lost/stolen shares as objection the following documents are required:
109
A. If they are returned as objection from the company due to above reason :
· company objection memo stating that the shares are missing/lost/stolen accompanied by a
copy of Court Order or FIR or copy of acknowledged police complaint
· copies of both sides of the transfer deeds
· copies of both sides of the share certificates
B. Otherwise one of the following documents are required :
· public notice given by the company / registrar
· notification from any stock exchange
· letter of intimation from the company to stock exchange.

Clarifications :
1. In cases where duplicate shares have been issued to a third party under the provisions of
Section 108 (1) A of the Companies Act, the company should also provide the name and
address of the third party to whom the duplicate shares have been issued along with the date of
request for duplicate shares by the third party.

2. In cases where the companies have issued duplicate certificates for missing/lost/stolen
shares, the receiving member is not required to submit FIR/ court order copies, while reporting
company objections.
Attestation is required where signature of transferor is in an Indian language other than the
110 Scheduled languages in India or when the transferor has affixed his thumb impression (
guideline no. 7 ). In other cases, attestation is compulsory only when shares come under
objections due to signature difference. Hence guideline Nos. 28, 29, 30, 31 & 32 apply only
to transfer deeds which come under objection due to signature difference.

In cases where the seller delivers the shares in market lots but the receiving member lodges the
shares for transfer with a jumbo transfer deed and the receiving member is not in a position to
 return all the original transfer deeds submitted with each market lot whilst reporting company
objection, the receiving member is required to give an undertaking indemnifying the
introducing member in the event of the said original transfer deed(s) being misused at any
future date in the prescribed form 6J.

14.1.4 ADDITIONAL GOOD/BAD DELIVERY NORMS

S.No. Description Good/Bad

1. Securities with transfer deeds bearing the name/rubber stamp of the Bad
defaulter/surrendering member/expelled member as an introducing
member/delivering member on the Exchange
2. Securities with transfer deeds bearing the name/rubber stamp of defaulter of Bad
some other exchange as an introducing/delivering member and notified as
bad delivery by the Exchange
3. Delivery of underlying shares of GDR/ADR in physical mode Bad
4. Delivery of shares by institutional investors viz. domestic financial Bad
institutions, banks, mutual funds, pension funds, foreign institutional
investors and overseas corporate bodies in physical mode after a specified
date
5. Delivery of shares of a scrip by any investor, falling under the list of Bad
compulsory trading and settlement in demat mode in Regular Market, after
a specified date
6. Delivery of shares by an individual/HUF in LP Market exceeding 500 Bad
shares on a trade day
7. Delivery of shares by any person other than individual/HUF in LP Market Bad

8. All share certificates bearing the stamp "surrendered for dematerialisation" Bad
9. Validity of objection where SEBI Approved Good/Bad Delivery Norm 97 is
Norm 97 and Norm 100 are applicable enforceable
 Item 15

FORMAT OF MEMBERS STAMP

In pursuance of Regulation 6.12.1 of the Capital Market Regulations, members are

required to affix a stamp bearing the name and SEBI registration number (Code) of the
clearing member and other details on the reverse of the transfer form in respect of the
securities delivered to the clearing house. Members are required to use one of the
formats specified below.

The formats of the stamp to be affixed on the reverse of the transfer form are given below:

Format 1

Member Name :

SEBI Reg. No. : Pay-in Date :

Settl.Type & No. : Client A/c. No.:

Format 2
Member Name :

SEBI Reg. No. : Pay-in Date :

Settl.Type & No. :

Delivery No. : Client A/c. No. :

The dimensions of the stamp shall not exceed 4 inches by 2 inches.

Members are required to use either Format 1 or Format 2 as given above for all securities
delivered through the clearing house. All details prescribed in Format 1 and Format 2 are
mandatory with the exception of the details pertaining to Client A/c. no. which is optional. In
case members are not using the Client A/c. no. field, the same has to be filled in as 'XXXX'.

Members proposing to use Format 2 are required to intimate the same to the clearing house in
writing failing which it shall be assumed that they shall be using Format 1.

Members are required to give seven days prior notice to the clearing house in writing in case
they propose to change from one format to another at a future date.

Any violation in the use of the above formats shall be treated as bad delivery.
 Item 16

DELIVERY UNITS

In pursuance of Regulation 7.6.1, 7.6.2 and 8.1 of the Capital Market Regulations,
delivery units are prescribed as under:

16.1 Delivery unit for Regular Market Deals

Delivery unit for Regular Market Deals in non-depository (physical) or in depository mode
shall be the lot size prescribed for each security of the Capital Market Segment of the NSE.

16.2 Delivery in prescribed units for Regular Market Deals in Non-Depository Mode

One certificate for the exact quantity of the delivery unit or two or more certificates making
up in the aggregate the delivery unit accompanied by one or more transfer deed subject to not
more than five transfer deeds for the exact delivery unit shall be delivered in settlement of
settlement obligations in securities for the Regular Market Deals.

16.3 Delivery unit for Regular Market Deals in Depository Mode

Delivery unit for Regular Market in depository mode shall be lot size one (1) for each
security of Capital Market Segment of the NSE.

16.4 Delivery unit for LP Market Deals

Delivery unit for LP Market Deals shall be equivalent to the size of the deal or 500 shares,
whichever is lower.

16.5 Delivery in prescribed units for LP Market Deals

One certificate for the exact quantity of the delivery unit or two or more certificates making
up in the aggregate the delivery unit accompanied by one or more transfer deed subject to not
more than five transfer deeds for the exact delivery unit shall be delivered in settlement of
settlement obligations in securities for the LP Market Deals.

16.6 Delivery unit for IL & BL Market Deals in Depository Mode

Delivery unit for IL Market Deals in depository mode shall be lot size one (1) for each
security of Capital Market Segment of the NSE.
 Item 17

BAD DELIVERY CELL

In pursuance of Regulation 10 and 12 of Capital Market Regulation, procedures for

handling intra exchange and inter Exchange Company objections through Bad Delivery
Cell (BDC) are given below:

Contents:

17.1: Procedure for handling Local Exchange Objections

17.1.1 Procedure to be followed by the Member for reporting Local Exchange Objections to
the BDC of the local exchange
17.1.2 Incorrect reporting of Company Objections
17.1.3 Non Rectification of Shares or Bad delivery of rectified/replaced shares submitted
Under Objection.
17.1.4 Second Time Objections.
17.1.5 Corporate Benefits

17.2: Procedure for handling Inter Exchange objections

17.2.1 Procedure to be followed by a Member for reporting Inter Exchange objections to Bad
Delivery Cell (in case the shares have been transacted on more than one exchange).
17.2.2 Incorrect reporting of Company Objections
17.2.3 Non Rectification of Shares or Bad delivery of rectified/replaced shares submitted
Under Objection.
17.2.4 Second Time Objections.
17.2.5 Corporate Benefits.

17.3: General Instructions.

Terminology:

The terms used to explain the procedure for reporting objections to Bad Delivery Cell are
defined below:
BDC Bad Delivery Cell
First Introducing The exchange where the shares were first introduced
Exchange (FIE)
Local Exchange The exchange where the shares were traded for the last time before
(LE) they were sent for transfer to the company.
First Introducing The member who has introduced the shares on the First
Member (FIM) Introducing Exchange.
Last Introducing The member who introduced the shares on the local exchange
Member (LIM)
Receiving Member The last member of the local exchange who has finally received
(RM) the shares before sending them for transfer to the company.
Previous Member The member from whom LIM purchased the shares. (i.e. the
(PM) member who has delivered the shares to the LIM)
17.1. Procedure for handling Local Exchange Objections

17.1.1 Procedure to be followed by the Member, for reporting Local Exchange (LE)
objections to the BDC, where, the RM and the FIM are of the same exchange.

1. The shares under objection are required to be lodged by the RM of the LE with the BDC in
the prescribed form BDC-1A. Claims for corporate benefits (if any) should also be made in
Form BDC- 1A. RMs will be required to report such objections to the BDC on the days
specified by the exchange (see schedule)

2. The following documents are required to be lodged:

• Form BDC - 1A in triplicate

• Original Transfer Deed
• Share Certificates
• Original Company Objection Memo or Certified copy of the memo.
• In case of fake / forged /stolen / missing shares, all documents as given in SEBI Good
/Bad Delivery guidelines no. 108 / 109. (as per Item 14)

3. All the documents as given in point 2 are required to be lodged by the RM with the BDC in
a sealed plastic pouch. Form BDC-1A is required to be submitted in triplicate, of which one
copy should be attached on the pouch, and the remaining two copies should be attached to the
documents and placed inside the pouch.

4. The BDC will give an acknowledgement to the RM on the third copy of Form BDC - 1A
which is attached outside the pouch. This acknowledgement will be given by using a rubber
stamp and will bear the words “subject to verification / counting ".

5. The BDC will retain one copy of Form BDC - 1A for its records, while the copy of Form
BDC - 1A attached to the documents will be handed over to the FIM.

6. If all the shares (pertaining to the same company), have been introduced by the same FIM,
then the RM must report this as one objection (i.e. in one form BDC-1A). On the other hand,
if the shares have been introduced in the exchange by more than one FIM, then the RM must
report the objections separately for each FIM using a separate form BDC-1A and in separate
pouches.

7. The BDC will allot a unique serial number (BDC Inward No.) to each objection case
reported by the RM.

8. The BDC will verify/count the documents enclosed by the member. If the contents of the
pouch are not in order, the same will be returned to the RM of the exchange.

9. a. In the event that the BDC is not equipped to carry out the verification/counting the BDC
will sort the documents first introducing member wise and handover the documents to the
FIM within 24 hours of receipt of such objections.
b. The FIM will count the securities on the counter and give an acknowledgement to the BDC
for the number of securities received. The verification for the correctness of the objection will
be done later. During the process of verification, if the FIM finds that the objection is
incorrect, he will return the objection to the BDC within seven days along with form BDC-
3A. The BDC will give an acknowledgement on form BDC-3A to the FIM.

c. If the BDC is satisfied with the claim of the FIM regarding the invalidity of the objection,
then the documents will be returned to the RM. If the BDC finds that the objection is valid
then the FIM will be required to accept and rectify the objection.

10. The BDC will sort all the objections received, in the order of FIM.

11. The BDC will forward the pouch containing the objections to the FIM within three days
of receipt of such objections. The FIM will acknowledge the receipt of such objections by
affixing his rubber stamp and initials on the copy of Form BDC - 1A retained by the
exchange. The BDC will stamp the date by which the shares are to be rectified or replaced by
the FIM (i.e. 21 days from the date of submitting objection to FIM). The stamp will be put on
form BDC 1A in a different colour while giving acknowledgement copy to the FIM.

12. The FIM will enclose the following documents while rectifying / replacing the shares
under objection.

• Prescribed Form BDC - 2A in triplicate

• Rectified / replaced shares
• Benefits ( if any ) due
• Copy of Form BDC - 1A
• Copy of the company objection memo
• Cheque for value of transfer stamps and/or corporate benefits

13. The FIM will hand over the documents mentioned in point 12 above in a plastic pouch
on the rectification day to the BDC. The BDC will return one copy of Form BDC - 2A to the
FIM, acknowledging the receipt of rectified shares by affixing a rubber stamp bearing the
words " subject to verification/counting ". One copy of Form BDC - 2A will be retained by
the BDC and the last copy of Form BDC - 2A along with the rectified documents will be
returned to the RM.

14. In the event of closeout, the cheque shall be in favour of the RM who has reported this
objection to the BDC for rectification.

15. The BDC will handover the rectified/replaced shares/ cheque and corporate benefits to the
RM within seven days of the rectification day.

16. If the FIM fails to rectify / replace the shares under objection by the prescribed
rectification day the exchange will auction/close out the transaction as per the closeout
procedure laid down in Para 17.3.1.
17.1.2 Incorrect reporting of Company Objections

1. If the FIM finds that the objection /corporate benefits has been reported wrongly against
him, the FIM will report such cases to the BDC by filling in form BDC - 3A and will return
the shares received under objection to the BDC along with copy of form BDC 1A.

2. If no such objection has been raised by the FIM within seven days of receiving the
objection, it will be understood that the FIM has accepted the objections / corporate benefits
reported against him and will be required to rectify / replace the shares by the rectification
day.

3. The BDC will return the shares wrongly reported as objection back to the RM.

4. In case of invalid claim for Corporate Benefits the FIM must submit only the form BDC -
3A duly authorised by the BDC official (Verification Officer) of the Exchange along with a
copy of form BDC - 1A. In such cases the FIM shall retain the shares and rectify the same
within the stipulated time. The BDC will verify the validity of claim for Corporate Benefit. If
the claim is found to be invalid, the BDC will forward one copy of form BDC-3A to the RM.

17.1.3 Non Rectification of Shares or Bad delivery of rectified/replaced shares

submitted Under Objection

1. If the RM finds that the shares received after rectification or replacement are not good
delivery, the RM will report such cases in prescribed form BDC - 4A (in triplicate) to the
BDC along with a copy of Form BDC-1A and 2A within 48 hours of receipt of such shares.

2. If the RM finds that the benefits claimed by him are not settled then the RM will accept the
rectified shares and will report only the unsettled claim to the BDC.

3. The BDC will verify the shares/benefits and if the shares/benefits are found to be bad
delivery/unsettled then the BDC will straightaway close - out such cases (without going
through auction) as per the closeout procedures laid down Para 17.3.1. The FIM will be
intimated that the deal is being closed out and that his account will be debited accordingly.

17.1.4 Second Time Objections

1. In the case where same shares are rectified and if the rectified shares are again returned
under objection by the company these shares will be deemed as "Second time objections"
and the shares will be straightaway closed out (without going through the auction process) as
per the closeout procedure in Para 17.3.1. However, in the cases where shares have been
replaced or procured under auction and these shares again come under objection, these
shares will not be considered as second time objections and will be treated as fresh
objections and dealt with accordingly.

2. The RM will report the shares under second time objection to the BDC in the form for
second time objections. Form for Second Time Objections will be the same format as BDC -
1A/1B but will be of a different colour (pink colour) and have the words “SECOND TIME
OBJECTION “written in bold on the top of the form.

3. The following documents are required for reporting second time objections.
 • Fresh copy of form for Second Time objections (in triplicate)
• Transfer deed and share certificates returned by the company
• Company objection memo
• A copy of Form BDC - 1A and 2A which have been used for reporting the first time
objection.

4. The documents mentioned in point three above are required to be submitted in a plastic
pouch.

5. All the Second Time objections will be straightaway closed out without going through the
auction process (see close out procedures in Para 17.3.1)

17.1.5 Corporate Benefits

1. Members are required to claim corporate benefits while submitting the bad delivery to
BDC in form BDC - 1A. Once the claim for benefits has been made by a member, the
member cannot refuse to accept the corporate benefits.

2. If the market rate of the corporate benefit is less than the cost of procurement of the benefit
then such benefit may not be taken up for settlement.

3. If the member is not in a position to submit the corporate benefit in the form of shares then
he should submit a cheque as per the valuation given in Annexure-17.1 along with form
BDC - 2A.

4. Rectified/replaced shares shall be accepted by the BDC only if they are accompanied with
the corporate benefits (either in the form of shares or equivalent value in the form of cheque
in favour of the receiving member) claimed as per form BDC-1A.

17.2 Procedure for handling Inter Exchange objections.

17.2.1 Procedure to be followed by a Member for reporting Inter Exchange objections

to BDC (in case the shares have been transacted on more than one exchange)

The procedure has been split into two parts:

In Part 1 the RM will approach BDC of LE and submit his objections using form BDC-1A
,which will have to be rectified by the LIM as per the procedures laid down for handling local
exchange objections.

In the Second Part, LIM may opt for any of the following two options:

Option 1: In case of Inter Exchange objections the LIM may handover the documents under
objection to the PM (who has delivered the shares to him) directly without going through the
BDC.

Option 2: LIM can approach the BDC of the LE for rectification / replacement of the shares
under company objection. In that case the BDC of LE will forward the shares to the BDC of
the FIE who will in turn forward the same to the FIM. The detailed procedure in case of
Option 2 will be as under:

1. The shares under objection are required to be lodged by the LIM with the BDC of the LE
in the prescribed Form BDC - 1B in quadruplet. Claims for corporate benefits (if any) should
also be made in Form BDC- 1B.

2. The following documents are required to be enclosed.

• Form BDC - 1B (in quadruplet)

• Original Transfer Deed
• Share Certificate
• Company Objection Memo or Certified copy of the memo.
• In case of fake / forged /stolen / missing shares, all documents as given in SEBI Good
/Bad Delivery guidelines no. 108 / 109.( as per Item 14)

3. Two sets of photo copies of the documents mentioned in point 2 above are required to be
submitted at the time of reporting of objection. One copy of this set will be retained by the
BDC of LE. The second set along with the original documents will be forwarded to BDC of
FIE.

4. All above documents are required to be lodged with the BDC of LE in a sealed plastic
pouch. The original documents along with one set of photocopies should be enclosed in one
pouch, while the second set of photocopies should be enclosed in a separate pouch. An
additional copy (fourth copy) of Form BDC - 1B will be attached outside the pouch
containing the second set of photocopies.

5. The BDC of LE will give a subject to verification/counting acknowledgement to the LIM

on the fourth copy of Form BDC - 1B by affixing a rubber stamp.

6. The BDC of the LE will retain the pouch containing one set of photocopies for its records,
while the pouch containing the original documents and one set of photocopies will be
forwarded to the BDC of the FIE after verification of the objections.

7. The members are required to report objections pertaining to shares of different

companies/different FIMs separately (i.e. each pouch shall contain one objection pertaining
to one company and one introducing member).

8. The BDC of LE will affix a unique serial number called the BDC inward number on Form
BDC-1B. The BDC inward no. will be an eight digit reference serial no. The first two digits
will be the exchange code of the LE followed by a six digit serial number. All future
communications pertaining to an objection should be done by using the BDC Inward No. as
the reference number.

9. The BDC of LE will verify/count the documents enclosed by the member. If the contents
of the pouch are not in order, the same will be returned to the LIM.

10. The BDC of the LE will sort all the objections received, in the order of the first
introducing exchange. All objections pertaining to the FIE will be sent in one parcel to the
FIE along with a list of all objections enclosed.
11. The BDC of the LE will forward the pouch containing the objections (along with original
transfer deed, share certificate, company objection memo, other documents and one set of
photocopies of all the documents ) to the BDC of the FIE within seven days of receipt of such
objections.

12. The BDC of the FIE will verify / count the contents of the pouch received from the BDC
of the LE before handing over the same to the FIM.

13. The BDC of FIE will hand over the objection to the FIM on the day specified by the
exchange (as per the objection schedule followed by the exchange). The BDC of the FIE will
retain the second set of photocopies for its reference after obtaining an acknowledgement on
the copy of Form BDC - 1B from the FIM. The FIM is required to rectify/ replace the shares
within 21 days of receipt of shares under objection. If the FIM fails to rectify/ replace the
shares within 21 days, the first exchange will auction/close-out the shares as per the
procedure laid down in Para 17.3.1.

14. The FIM will enclose the following documents while rectifying / replacing the shares
under objection.

• Prescribed Form BDC - 2B ( four copies )

• Rectified / replaced shares
• Benefits ( if any ) due
• Copy of Form BDC - 1B
• Copy of the company objection memo
• Demand draft for value of transfer stamps or benefits

15. The FIM will hand over the documents mentioned in point 14 above in a plastic pouch on
the rectification day to the BDC of the FIE. The BDC of the FIE will return one copy of
Form BDC - 2B to the FIM after giving a subject to verification/counting acknowledgement
by affixing a rubber stamp on Form BDC - 2B. One copy of Form BDC - 2B will be retained
by the BDC of FIE and the rectified documents along with third and fourth copies of Form
BDC - 2B will be returned to the BDC of the LE.

16. BDC of FIE will verify all the documents and return the rectified/replaced shares/
demand draft/pay order and corporate benefits back to BDC of LE within seven days of
rectification/replacement.

17. BDC of LE will hand over the rectified/replaced shares/demand draft for transfer stamps /
close-out amount and corporate benefits back to LIM after verification.

18. The LIM will duly acknowledge the rectified shares received by affixing the rubber stamp
on the copy of Form BDC - 2B retained by BDC of last exchange.

19. The demand draft/pay order shall be in favour of the LIM.

20. In case of close-out by the exchange, the BDC of the FIE will have to collect the demand
draft/pay order from the FIM, in favour of the LIM and forward the same to the BDC of the
LE.
17.2.2 Incorrect reporting of Company Objections

1. If the FIM finds that the objection has been wrongly reported, the member should report
the invalid objection by submitting form BDC-3B in quadruplet along with a copy of form
BDC - 1B and the shares received to BDC of FIE. This should be done within a period of
seven days from the date of receipt of such objections, failing which it will be understood that
the FIM has accepted the objections / corporate benefits reported against him and will be
required to rectify / replace the shares by the rectification day or else the exchange will
auction/close-out the shares as per the close out procedure in Para 17.3.1.

2. In case of invalid claim for Corporate Benefits the FIM must report such cases to the BDC
of the FIE by submitting form BDC - 3B in quadruplet along with a copy of form BDC - 1B
within seven days of receipt of the claims . In such cases the FIM shall retain the shares and
rectify the same within the stipulated time. The BDC of the FIE will verify whether the claim
for Corporate Benefit is invalid, before forwarding the forms BDC - 3B and BDC-1B only to
the BDC of the LE.

3. BDC of FIE will verify the validity of the objections raised by the FIM and return the
shares back to BDC of LE who in turn will verify the objections received and will hand over
the shares to the LIM along with a copy of the form BDC - 3B and BDC-1B.

17.2.3 Non Rectification of Shares or Bad delivery of rectified/replaced shares

submitted Under Objection.

1. If the LIM finds that the shares received by way of rectification or replacement are not
good delivery, the LIM will report such cases in the form BDC-4B (in quadruplet) to the
BDC of the local exchange along with a copy of Form BDC - 1B and 2B within 48 hours of
receipt of such shares.

2. If the LIM finds that the benefits claimed are not correctly settled then the LIM will accept
the rectified shares and will report only the unsettled benefits to BDC of the LE.

3. The BDC of the LE will verify these shares/benefits and if the shares/benefits are found to
be bad delivery/unsettled then the BDC of the LE will report such cases to the BDC of the
FIE within a period of seven days from reporting of such cases. The BDC of the FIE will
verify the claims and in case of valid claims, will straightaway close-out such cases (without
going through the auction process) as per close out procedures in Para 17.3.1. The FIM will
be intimated that the deal is being closed out and that his account will be debited accordingly.

17.2.4 Second Time Objections

1. In the case where same shares are rectified and if the rectified shares are again returned
under objection by the company these shares will be deemed as "Second time objections" and
the shares will be straightaway closed out (without going through the auction process) as per
the closeout procedure in Para 17.3.1. However, in the cases where shares have been replaced
or procured under auction and these shares again come under objection, these shares will not
be considered as second time objections and will be treated as fresh objections and dealt with
accordingly.
2. The LIM will report the shares under second time objection to the BDC of the LE in the
form for Second Time objections. The form for such objections will be of the same format as
that of Form BDC - 1B but the form will be of a different colour (pink colour) and the words
“Second time objection” will be written in bold on the top of the form.

3. The following documents are required for reporting second time objections.

• Transfer deed and share certificates returned by the company

• Company objection memo
• Second Time Objection form ( in quadruplet)
• A copy of Form BDC - 1B and 2B which have been used for reporting the first time
objection.

4. The documents mentioned in point three above are required to be submitted in a plastic
pouch.

5. The BDC of the LE will forward the shares under second time company objections to the
BDC of the FIE. The BDC of the FIE will, on receipt of second time company objections,
straightaway close-out such shares (without going through the auction process) as per the
close out procedures in Para 17.3.1 and forward the demand draft/closeout for the close-out
amount to the BDC of the LE who will in turn forward the same to the LIM.

17.2.5 Corporate Benefits

1. Members are required to claim corporate benefits while submitting the bad delivery in
form BDC - 1B. Once the claim for benefits has been made by a member, the member cannot
refuse to accept the corporate benefits.

2. If the market rate of the corporate benefit is less than the cost of procurement of the benefit
then such benefit may not be taken up for settlement.

3. If the member is not in a position to submit the corporate benefit in the form of shares then
he should submit a demand draft as per the valuation given in Annexure - 17.1 along with
form BDC - 2B.

4. Rectified/replaced shares shall be accepted by the BDC of the FIE only if they are
accompanied with the corporate benefits (either in the form of shares or equivalent value in
the form of demand draft/pay order in favour of the LIM) claimed as per form BDC-1B.

17.3 General Instructions

1. The exchange should arrange for well equipped and trained manpower to carry out the
activities of the BDC, further it should have a verification officer who will decide the validity
of objections. Since the quality of decision is critical, the verification officer should be a
senior qualified person.

2. The plastic pouches to be used for reporting objections should be of good quality and
transparent so that the contents can be viewed from outside.
3. The BDC forms should be placed on top of all documents inside the pouch so that the
details on the form are clearly visible from outside the pouch.

4. Members/ stock exchanges should strictly adhere to the formats of the BDC forms.

5. In case the BDC of the last Exchange does not receive the rectified/replaced shares or the
close-out amount within the specified time frame, such cases should be referred to the Inter
Exchange Arbitration Panel.

6. The Exchange should maintain a register which would contain the details pertaining to all
objections reported to the BDC. Separate register should be maintained for local and inter
exchange objections.

7. The Exchange should forward to SEBI monthly status reports giving details on the
objections received, objections resolved, objections referred for arbitration, value of
objections, reasons for objections, list of companies and Registrar and Transfer agents related
to the objections reported. The above details may be incorporated into the Register.

8. Stock exchanges should get into a contract with a reliable courier agency for couriering
objection documents from one BDC to the other.

9. Stock exchanges are also required to arrange for adequate insurance covers for the
documents which might be reported as lost in transit.

10. In cases where odd lot shares reported as objection are not rectified, such cases will be
closed as per close out procedures.

11. In case the shares reported as objection fall in the no delivery period, then such shares
will not be rectified within 21 days but will become due for rectification only on expiry of the
no delivery period.

12. The members delivering the rectified shares should ensure that the shares are good
delivery as per the Good/Bad delivery guidelines issued by SEBI. The rectified shares should
have a new transfer deed so that the party receiving the rectified shares can sell the rectified
shares in the market if he so desires, and not necessarily send the shares for transfer back to
the company.

13. BDC will verify the validity of all objections being sent for rectification or being received
after rectification in case of inter-exchange objections.

14. In case shares are lodged after Book Closure or Record Date and such shares are returned
under company objection then such objections can be reported to the BDC but no claim can
be made for Corporate Benefits accruing from such shares. Claim of corporate benefits will
be considered only as request matter.

15. In case it is not possible to attach the original objection memo, a copy of the memo duly
certified by the receiving member should be used.

16. In case where the FIM is the member of an exchange who has put first stamp on the
transfer deed, and he has entered into a trade through a member of another exchange
(meaning that the FIM has a relationship of client to the second introducing member), in such
cases the objection should be reported against the second member and not against the FIM.

17. In case of defaulters, 25 % of the total proceeds recovered from the defaulter should be
kept aside for a period of three years from the date of declaring him a defaulter to meet any
future liability arising on account of bad delivery of shares introduced by defaulting member.

18. Members may note that the relevant Objection code (as detailed below) should be stated
on BDC-1A, at the time of reporting company objections.

Objection Code Objection Reason

01 SIGNATURE MISMATCH
02 OUT-DATED TRANSFER DEED
03 FAKE/FORGED/STOLEN/MISSING SHARES
04 ATTACHED BY INCOME TAX
05 RBI APPROVAL REQUIRED
06 ALTERATIONS ON TRANSFER DEED BY IM
07 STOP TRANSFER SHARES
08 OTHERS

Members are requested to ensure that the correct objection code is stated on the BDC-1A
form (Annexure 24.11).

19. Members may also note that for objections reported with reason code '03', no
rectification/replacement/ in physical form shall be allowed. However such objection may be
replaced by the introducing member, in demat form.

17.3.1. Auction / Close Out procedures (Auction/Close Out Procedures given below shall
be subject to the relevant provisions given in item 19)

1. Local Exchange:

AUCTION: In case the FIM fails to rectify/replace the shares within 21 days, the exchange
will put up the un-rectified/ un-replaced shares in the immediate auction. The FIM will be
debited with the auction amount and the shares procured in the auction will be handed over
by the BDC to the RM. The amount equivalent to the stamp duty and benefits/claims (if any)
will also be debited to the FIM's account and will be paid to the RM by BDC directly.

CLOSEOUT: In case, the shares are not available in the auction conducted, the shares would
be closed out at 20% over the official closing price on the exchange on the day on which
auction offers are called for (and in the event of there being no such closing price on that day,
then the official closing price on the immediately preceding day on which there was an
official closing price) will be taken.

The FIM will be required to forward a cheque equivalent to the close-out amount, stamp duty
and the benefits claimed amount (if any) to the BDC in favour of the RM.
2. Inter Exchange:

AUCTION: In case the FIM fails to rectify/replace the shares within 21 days, the FIE will put
up the un-rectified/un-replaced shares in the immediate auction. The FIM will be debited with
the auction amount and the shares procured in the auction will be handed over by the BDC of
the FIE to the BDC of the LE who will in turn hand over the same to the LIM. The amount
equivalent to the stamp duty and benefits/claims (if any) will also be debited to the FIM's
account.

CLOSEOUT: In case, the shares are not available in the auction conducted, the shares would
be closed out at 20% over the official closing price on the exchange on the day on which
auction offers are called for (and in the event of there being no such closing price on that day,
then the official closing price on the immediately preceding day on which there was an
official closing price) will be taken.

The FIM is required to forward a demand draft/pay order equivalent to the close-out amount,
stamp duty and the benefits claim amount ( if any) to the BDC of the FIE in favour of the
LIM.

In case the FIM fails to forward the demand draft to the BDC, the exchange will initiate
action against the member as per rules and regulations of the exchange.

17.3.2 Auction/Close-Out procedures in case of fake/forged/stolen securities reported

under company objection

All cases of company objections pertaining to fake/forged/stolen securities reported against

the introducing member shall be closed-out by the Clearing Corporation subject to the
relevant provisions given in item 19.

17.3.3 Fee Structure for processing objections through the Bad Delivery Cell

The exchange will collect from the FIM/LIM a service charge for processing objections
through the BDC. Such service charges may be collected through pre-paid coupons attached
to the objection or through computerised billing. The service charge will be payable per
objection submitted for the member. The charges should enable the BDC to develop their
own reserve of recyclable funds over a period of time.

17.3.4 Instructions for filling of BDC forms

1. Since the processing of objections will involve stock exchanges from various parts of the
country, it is suggested that the BDC forms should be filled in English which is accepted by
all the Stock Exchanges as the common business language.

2. The BDC inward no. will be an eight digit number. The first two digits will the exchange
code of the last exchange followed by a six digit unique serial number.

3. The BDC inward no. assigned to an objection should be used as a reference number by all
the BDC's for all future communications related to that particular objection.
4. Members are required to use the relevant objection codes based on the reason for objection
as given on the reverse of the form.

17.3.5 Introducing Member being declared a defaulter

Local Exchange:

In case the FIM has been declared defaulter, the RM has to file a claim with the Defaulter's
Committee/Clearing Corporation for resolving the claim for company objection.

Inter Exchange:

In case the FIM has been declared defaulter, the RM will report the objection for rectification
to the LIM. The LIM will rectify/replace the objection and submit the same to the BDC of LE
within 21 days as is the normal practice.

The LIM will in turn report the objection for rectification to the BDC of the LE. The BDC of
the LE will forward the documents under objection to the BDC of the FIE. The BDC of the
FIE will forward the documents to the last member of the FIE for rectification within 21
days. The last member of the first exchange will then file a claim with the Defaulter's
Committee/Clearing Corporation of the first exchange for resolving the company objection.

In case LIM has been declared defaulter, the FIM will continue to be responsible for
rectification of bad deliveries.

17.3.6 Partial rectification of company objection

In case introducing members are not able to rectify the complete lot of objections reported,
they will be allowed to submit rectified objections in part provided the rectified quantity is in
a market lot.

In case an odd lot is reported as an objection, the introducing member is required to

rectify/replace either the entire odd lot or in case of partial rectification, the member is
required to rectify in a market lot.

The introducing member will settle the benefit claimed in proportion to the quantity of shares
rectified/replaced by the member.

17.3.7.1 Benefit Claims

Claims for benefits can be made in the following cases:

a) Where the book closure/record date (BC/RD) for the corporate benefit claimed has
passed before the reporting day, or

b) where BC/RD for the corporate benefit claimed falls after the reporting day but before
the rectification pay-out day, or

c) Where the BC/RD for the corporate benefit claimed falls after the rectification pay-
out day but within 15 days from rectification pay-out day.
Illustration:
Sr. No. Reporting Rectification Book Remarks
Day Pay-out Day Closure/
Record Date

a. 11/3/1996 1/4/1996 1/3/1996 Benefits can be claimed

b. 11/3/1996 1/4/1996 20/3/96 Benefits can be claimed
c. 11/3/1996 1/4/1996 15/4/96 Benefits can be claimed
d. 11/3/1996 1/4/1996 16/4/96 and Benefits cannot be claimed
later

17.3.8 Stamp Duty

In case objection quantity is replaced or in case of auction/close out, the receiving member is
entitled to claim the stamp duty already paid by him on the original document. The
introducing member will be required to pay the stamp duty amount based on the official
closing price on the last rectification day or original stamp duty paid by the receiving
member, which ever is higher. The amount of stamp duty paid will have to be specified on
the BDC form by the receiving member at the time of reporting of objections. In case
objection quantity is rectified, the introducing member will be required to pay the difference
amount of, stamp duty based on the official closing price on the last rectification day over the
original stamp duty paid by the receiving member. In case objection quantity is replaced in
demat by the introducing member, the introducing member will not be required to pay the
stamp duty to the receiving member.

17.3.9 Schedule for Reporting / Rectified Company Objection.

A typical schedule for reporting and rectification of objection is given below. The exchanges
may design their own schedule using the typical schedule.

Reporting of Objections and Claiming Wednesday

Corporate Benefits
Date of Intimation to the LIM/FIM Friday Day1
Pick up of Objections by the LIM/FIM Saturday
Reporting Invalid Objections and Corporate Thursday Day7
Benefit Claims (if any) by the LIM/FIM
Rectification/Replacement of Objections along Thursday/ Friday Day21
with corporate benefits by the LIM/FIM
Rectified Objection Pay-Out to the RM Monday
Reporting non rectified objections or objection Wednesday
bad delivery by the RM

17.3.10 Reporting of Objections by custodians to the BDC

Custodians who have received the delivery of securities through the clearing house are
entitled to report such objections for rectification directly to the BDC of the exchange without
collecting any collateral for such shares. In the alternative, if the custodians do not wish to
report objections for securities received through the clearing house to the BDC, they could
handover the securities for rectification to the members through whom the shares were
purchased, in compliance with the guidelines issued to them from time to time in this regard.

17.3.11 Resolution of disputes arising between BDC's of two exchanges

SEBI will constitute an Inter-Exchange Arbitration Panel for settlement of disputes arising
between BDC's of two exchanges. The detailed working of the panel will be intimated to the
stock exchanges in due course.
 Item 18

COMPANY OBJECTIONS PROCEDURES

In pursuance of Regulation 12 of the Capital Market Regulation, procedures for

rectification/replacement of defective documents in addition to those mentioned in item
17 are hereby specified as under:

18.1 Market / Odd lot cases

The receiving member may either report (i) full market lot as under objection or (ii) report the
odd lot portion alone as under objection.

Where the member reports the full market lot the introducing member will be required to
replace / rectify the full quantity.

18.2 Receiving Member Entitled to Benefits

The receiving member is entitled to receive from the introducing member all the corporate
benefits declared by the company during the period reckoned from the first day of the
settlement period in which he received the document in delivery till the day of receipt of
objection rectified delivery from the Introducing member.

18.3 Procedure for reporting Company Objections

1. Each objection for rectification is required to be submitted by the Receiving member (RM)
in a plastic pouch.

2. Objections are required to be submitted in Form BDC - 1A as per the format prescribed by
the Exchange, on a paper of uniform (A4) size.

3. The security symbol and series (except in cases where the call money has been paid)
should be the same as that appearing on the delivery slip received by the RM. The RM should
ensure that they are reporting the objection against the correct Introducing Member (IM).

4. Form BDC - 1A is required to be submitted in triplicate, of which two copies should be

firmly attached on the pouch, and the third copy should be attached to the lot under objection
and placed inside the pouch.

5. A copy of the delivery slip, delivery detail statement must be attached along with the
second copy of Form BDC - 1A attached on the pouch. In the event of a member not being in
a position to attach the delivery slips and delivery details statement, the member is required to
submit an undertaking to the Clearing Corporation (per each objection inward no.) in the
format enclosed (Annexure - 18). The above undertaking is to be given only in case of
fake/forged/stolen shares reported under objection and where the introducing member at the
Exchange/Clearing Corporation is other than a defaulter/surrendering/
surrendered/suspended/disabled member to be informed by the Exchange/Clearing
Corporation from time to time.
6. Form BDC-1A should be complete in all respects. Incomplete forms are liable to be
rejected.

7. Where the number of shares reported as a single objection is large, the distinctive number
ranges (DNRs) must be written on the reverse of Form BDC - 1A or on a separate paper,
which bears the stamp of the RM reporting the objection. Members are required to ensure that
the total number of shares reported as objection is clearly mentioned on the first page of each
copy of Form BDC - 1A.

8. If all the shares comprising a particular delivery have been introduced by the same
Introducing Member (IM), then the Receiving Member (RM) must report this as one
objection. On the other hand, if the shares comprising the delivery have been introduced by
more than one IM, then the RM must report the objections separately for each IM, as
illustrated below:

Illustration I

SCRI QTY OBJ.DEL.N DEL.MEM. INTRO.MEM. REPORTING

P O. NO. (IM) REC.MEM.
A TISC 500, 411,411 6511,6511 4563, 4563 6077,6077
O 500
B ACC 800, 1002,1002 8526,8526 6123,4724 6077,6077
200

In "A" above, the Receiving Member should report one objection case comprised of 1000
TISCO against IM No. 4563.
In "B" above, the Receiving Member should report two cases of objection. One case of 800
ACC against IM No 6123 and the other case of 200 should be reported against IM No.4724.

9. Members are required to attach Inward no. stickers for Company Objections which will be
printed at the Clearing House. The Inward no. stickers are required to be affixed on all the
three copies of form BDC - 1A.

10. In cases where the seller delivers the shares in market lots but the receiving member
lodges the shares for transfer with a jumbo transfer deed and the receiving member is not in a
position to return all the original transfer deeds submitted with each market lot whilst
reporting company objection, the receiving member is required to give an undertaking
indemnifying the introducing member in the event of the said original transfer deed(s) being
misused at any future date in the prescribed form 6J

11. In case where the First Introducing Member (FIM) is an NSE member and the objection
has been lodged on him by the RM, however the objection has been withdrawn by the FIM
on ground of insufficient details, the RM then has an opportunity to re-lodge the objection on
the FIM after procuring the relevant documents, within 1 (one) year from the date of first
lodging the objection on the FIM.

18.4 Procedure for Rectified Company Objections

1. IM's are required to submit rectified / replaced objections along with benefits (if any) in
plastic pouches.
2. IM's are required to ensure that the Inward no. on Form BDC - 1A is the same as the
Inward no. on both the delivery slip and the delivery detail statement.

3. The rectified / replaced objections are required to be submitted along with the following
documents:

a. Delivery Slip, Delivery detail statement each in duplicate.

b. Form BDC 2A, if benefits are attached ( in triplicate ).

c. Form BDC - 1A, along with the rectified / replaced shares.

d. Company Memo.

4. One copy of the delivery slip, delivery detail statement, Form BDC 2A is required to be
attached on the pouch while the second copy of delivery slip, delivery detail statement, Form
BDC 2A and Form BDC - 1A along with rectified / replaced shares, company memo are
required to be placed inside the pouch.

5. The rectified/replaced company objection shares and the benefits due i.e. shares (if any),
are required to be enclosed in the same pouch. The lot should be so placed in the pouch that
the delivery slip, delivery details statement, are clearly visible, without having to open the
pouch.

6. In case objections are rectified in part, it is required by the IM to follow the same
procedures as mentioned in Para 1-4 above. Partly rectified objections are required to be
submitted in a single instalment.

7. The rectified /replaced lots should be arranged in the same order as they appear on the
Final Delivery Statements (FDS).

8. Where the shares are replaced, the word “REPLACED” must be written in bold on all
copies of the delivery slip & delivery detail statement. If rectified, the words “RECTIFIED"
must be written on all copies of the delivery slip & delivery detail statement. If a lot is partly
rectified and partly replaced, then the delivery slips (clearing house and RM copies) should
be marked as illustrated below:

Illustration II

Objection 500 shares of this, 300 are replaced and 200 rectified.

The delivery slips is required to be marked as under:

"200 RECTIFIED + 300 REPLACED"

9. For rectified shares, if the IM furnishes a new TD, the old transfer deed bearing the transfer
stamps and a copy of company objection memo are required to be attached to the lot. If old
transfer deeds are not attached, then value of transfer stamps will be debited to the IM.
10. Receiving Members are required to verify and count the rectified/replaced shares to
ensure the correctness of quantity received by them, before leaving the Clearing House.

18.5 Procedure for reporting Un-rectified Company Objections

1. Un-rectified company objections are required to be reported in Form 6E.

18.6 Procedure for Reporting Second Time Company Objections

1. Members are required to fill up a fresh Form BDC - 1A (in triplicate ) for reporting Second
time objections and follow the same procedure as outlined in Para A1-A4.

2. Members are required to take fresh Inward no. stickers for second time objections.

3. "Second Time Company Objection" must be written in bold on each copy of Form BDC -
1A.

4. The share certificates, transfer deeds, company objection memo for second time objection,
in addition to original Form BDC-1A and delivery details statement pertaining to first time
objection are required to be submitted for reporting second time objection.

18.6.2 Procedure for reporting second time company objections wherein the old
transfer deed for first time objection is not present

Where securities which are lodged by receiving member as company objections for reason of
signature difference, are returned to the receiving member after rectification, and such
rectified securities are again lodged by the receiving member as company objection for the
reason of the securities being stolen securities, then in such case, the receiving member is
required to report the objection against the delivering member from whom the securities were
originally received along with documents as required under Item 18. The delivering member
would then be required to withdraw the objection as detailed in Item 18.8 along with details
of the member from whom they had received the securities and additionally enclose copy of
the delivery slip and delivery details statement.

In the event of the delivering member being unable to provide the delivery slip and delivery
details statement as proof of having received the shares on the Exchange, such delivering
member shall be treated as the introducing member for such documents, and the objection
shall be processed accordingly.

18.7 Procedure for reporting partly paid shares traded as fully paid up.
Securities which were traded as partly paid are required to be reported under objection with
symbol/series of the new security. The receiving member (RM) is required to submit
necessary documents as proof of having paid the allotment money/call money as may have
become due and payable at the time of reporting the objection. In case where the allotment/
additional call money has not been paid, the RM shall be required to enclose a demand draft
(payable at Mumbai) equivalent to the allotment/call money amount in favour of the
introducing member (IM), along with the company objection lodged against the IM with the
Clearing House. The IM shall then be required to rectify/replace the shares within the
prescribed time of 21 days, failing which, auction/close-out procedures as per the provisions
of item 9 and item 19 of this circular.
18.8 Procedure for Handling Withdrawal of Company Objections.
1. Request for withdrawal of company objection/corporate benefits is required to be made in
the prescribed Form BDC 3A along with a copy of Form BDC - 1A.

2. Withdrawals are required to be reported for the entire quantity under objection within
seven days of scheduled pick up of company objection for rectification.

3. In case of objections which have been withdrawn, the IM is required to submit the
acknowledgement copy of the withdrawn objection (Form BDC 3A) on the due date for
rectification (21st day) to the Clearing Corporation. Failure on the part of the IM to report
these cases by the due date may lead to auction of the securities against the IM.

4. The IM should mention all the reasons for withdrawal in respect of the company objection
reported at the first instance itself. All subsequent requests for withdrawal of company
objection for reasons not mentioned at the time of first withdrawal, in respect of the said case
may not be accepted by the Clearing Corporation.

18.9 Procedure for reporting Fake/Forged/Missing/Stolen shares

1. The following documents are required to be lodged in triplicate in separate pouches:

· Form BDC - 1A bearing rubber stamp - 'FAKE/FORGED/STOLEN' in bold.

· Delivery Slips and Delivery Details Statement of receipt of shares by the RM.
· Original transfer deed (photocopy where original retained by the company/share transfer
agent).
· Share Certificates (photocopy where original retained by the company/share transfer agent).
· Original Company Objection Memo or Certified copy of the memo.
· In case of fake/forged/stolen/misplaced shares, all documents as given in SEBI Good/Bad
Delivery Guidelines no. 108/109 (as per item 14)

2 Members are required to affix rubber stamp bearing words 'FAKE/FORGED/STOLEN' on

top right hand portion of form (BDC-1A) for reporting fake/forged/stolen/misplaced shares
under company objection.

3 In addition, two copies of Form BDC - 1A are required to be attached on the pouch which
contains the original documents.

18.10 Procedure for reporting company objections against Defaulters/Suspended/

Surrendering/Expelled members

1. Where the FIM has been declared a defaulter or is an expelled member, the RM has to
lodge the claim / objection within six months from the date of the objection memo or six
months from the date the member is declared a defaulter /expelled from the Exchange,
whichever is later.

2. The following documents are required to be lodged:

· Form BDC - 1A bearing rubber stamp - 'DEFAULTER/ SUSPENDED MEMBER/

SURRENDERING MEMBER/ EXPELLED MEMBER' in bold
· Delivery Slips and Delivery Details Statement of receipt of shares by the RM
· Original transfer deed (photocopy where original retained by the company/share transfer
agent).
· Share Certificates (photocopy where original retained by the company/share transfer agent ).
· Original Company Objection Memo or Certified copy of the memo.
· In case of fake/forged/stolen/misplaced shares, all documents as given in SEBI Good/Bad
Delivery guidelines no. 108/109 (as per item 14 )
· 4 sets of all above documents in case of fake/forged/stolen/misplaced shares and in triplicate
for all other cases of company objections in separate pouches.

3. Members are required to affix rubber stamp bearing words 'DEFAULTER/SUSPENDED

MEMBER/ SURRENDERING MEMBER/ EXPELLED MEMBER' on top right hand
portion of form (BDC-1A) for reporting company objections against defaulters/suspended
members/surrendering members/expelled members.

4. In addition, two copies of Form BDC - 1A are required to be attached on the pouch which
contains the original documents.

5. (i) For company objections to be reported against defaulters/ suspended members/ expelled
members, the receiving member is required to report the same against the clearing member
whose pay-in stamp appears subsequent to the defaulter/ suspended member/ expelled
member on the transfer deed attached to the shares under objection.

(ii) The subsequent member may withdraw the company objection by providing the delivery
slips and delivery details statement of receipt of these shares from the defaulter/suspended
member/expelled member through the Clearing House.

(iii) If the subsequent member withdraws the company objection by providing the required
delivery slips and delivery details statement of receipt of these shares from the
defaulter/suspended member/expelled member through the Clearing House, then the
receiving member is required to report the company objection against the defaulter/suspended
member/expelled member along with the delivery slips and delivery details statement
received from the subsequent member as per point 4 (ii) mentioned above and the documents
specified in point 1 mentioned above.

(iv) However, where the receiving member reporting the company objection, had received
these shares directly from the defaulter/suspended member/expelled member through the
Clearing House, then the receiving member can report the company objection against the
defaulter/suspended member along with the copies of delivery slips and delivery details
statement of receipt of these shares from such defaulter/suspended member/expelled member
and the documents specified in point 1 mentioned above.

(v) In case of company objections reported against Introducing Members, which are pending
close out by the Clearing Corporation, shall be withdrawn by the Clearing Corporation, when
such members are subsequently declared defaulter/suspended/expelled members. The
Receiving Members shall then be required to report the same against the member whose pay-
in stamp appears subsequent to such defaulter/suspended member/ expelled member, on the
reverse of the transfer deed. The subsequent member may withdraw the objection as per item
18.10 (5) by giving copy of the delivery details statement proving that the shares have been
received from the defaulter/suspended member/ expelled member through the Clearing
Corporation. Thereafter, the receiving member would be required to lodge the objection
against the defaulter/suspended member/ expelled member, enclosing the delivery details
statement, within 1 month of withdrawal of objection by the relevant subsequent member.

Such re-reported objections against defaulter/suspended member/ expelled members shall not
be withdrawn for the reason of "objection memo outdated", provided documents establishing
that the objection has been originally lodged against the defaulter/suspended member/
expelled members, within the stipulated time, with valid documents, are provided.

6. Upon the public notification of the surrender of the trading membership and within eight
(8) months from the date of such notification, all trading members/clearing members shall
report company objections, if any, against such surrendering trading members to the Clearing
Corporation.

18.11 Procedure for handling Corporate Benefits

1. Members are required to claim corporate benefits while submitting their shares for
company objections in the revised form BDC - 1A in triplicate. Once a claim for benefits has
been made by a receiving member, the receiving member cannot refuse to accept the
corporate benefits. ( e.g. Claim for right shares etc.)

2. All details related to benefits claimed must be correctly filled up on Form BDC - 1A
failing which the benefits claimed may not be settled. All incomplete forms are liable to be
rejected.

a. In case of claims for bonus/rights shares, the quantity claimed, ratio of benefits, rights issue
price, book closure/record date, security symbol are required to be filled up on Form BDC -
1A.
b. In case of dividend claims, details of dividend rate, financial year, type of dividend
(whether interim or final), quantity, book closure/record date, are required to be filled up on
Form BDC - 1A.

3. In case of multiple benefits being claimed against the same objection, members must
ensure that each benefit is stated separately on Form BDC - 1A. Where the value of two or
more benefits (for the same objection) has been claimed, then each benefit must be stated
separately on the same Form BDC - 1A.

Illustration I

Dividend due on 200 shares of ABC Ltd.

a. Interim - for 1992-93 @ Rs.2/- per share = Rs.400/-.
b. Final - for 1992-93 (excluding interim dividend) @ Rs.3/- per share = Rs.600/-.
In the above case, each amount should be stated separately.

4. Claims for benefits can be made in the following cases:

a. where the book closure/record date (BC/RD) for the corporate benefit claimed has passed
before the reporting day, or
b. where BC/RD for the corporate benefit claimed falls after the reporting day but before the
rectification pay-out day, or
c. where the BC/RD for the corporate benefit claimed falls after the rectification pay-out day
but within 15 days from rectification pay-out day.

Illustration II

Sr.No Reporting Rectification Book Closure Remarks

Day Pay-out Day Record Date
a. 11/03/96 01/04/96 01/03/96 Benefits can be claimed
b. 11/03/96 01/04/96 20/03/96 Benefits can be claimed
c. 11/03/96 01/04/96 15/04/96 Benefits can be claimed
d. 11/03/96 01/04/96 16/4/96 and later Benefits cannot be claimed

5. If in the view of the IM the claim is not valid, the IM should revert to the Clearing House
within seven days from the intimation day.

6. All monetary corporate benefits viz., dividend, interest and redemption amount claim on
company objections claimed by the RM while reporting objections shall be debited/credited
directly in the clearing account of the clearing members by the Clearing Corporation. The
equivalent value of the benefits (as per Annexure - 17.1) claimed by the receiving member
shall be debited by the Clearing Corporation to the account of the IM and the credit for the
same shall be given to the respective RM along with the close-out of objections for the
settlement.

7. In case of non-monetary benefit claims viz., bonus and rights, the IM may submit
corporate benefit in the form of shares along with rectified/replaced shares. In case the IM
does not submit the corporate benefit in the form of shares along with the rectified/replaced
shares, the equivalent value of the benefits (as per Annexure-17.1) claimed by the receiving
member while reporting objections, shall be debited by the Clearing Corporation to the
account of the IM and the credit for the same shall be given to the respective RM along with
the close-out of objections for the settlement. The introducing member will submit the non-
monetary benefits claimed in proportion to the quantity of shares rectified/replaced by the
member.

8. Members are required to affix a rubber stamp bearing words 'Bonus/Rights enclosed' on
the delivery slips, at the time of submitting the rectified/replaced shares, for cases where the
shares are submitted as corporate benefits.

9. Members should not enclose cheques towards payment of corporate benefits (except
cheques for non pari-passu shares) along with rectified/replaced shares. Wherever such
cheques are attached, they shall be ignored and are required to be returned by the RM for
cancellation.

10. In case of Rights (Equity, FCD, PCD-Convertible portion) if the IM gives corporate
benefits in the form of securities, the IM will make a claim for the Rights Issue amount in the
prescribed form BDC-2A in triplicate. The form BDC-2A will be submitted to the Clearing
House along with the rectified company objections on the rectification day.

11. The form BDC-2A (two copies) will be issued by the Clearing House to the RM along
with the pay-out of rectified shares. The RM is required to give a cheque (amount equal to the
Rights Issue amount as mentioned in form BDC-2A) to the Clearing House in favour of the
IM. The cheque should be attached to form BDC-2A and the cheque details should be filled
in Part-B of Form BDC-2A.

12. Where benefits in the form of securities are submitted along with rectified/replaced
shares, the members should fill up the relevant portion of Form BDC-2A. IM may submit the
total number of shares as corporate benefits. In case of part delivery of corporate benefits in
the form of securities, the delivery must necessarily be in market lots.

13. Acknowledgement for non-monetary benefits submitted in the form of securities along
with rectified/replaced shares shall be given on Form BDC-2A (IM copy).

14. Corporate benefits declared by the company after the receipt of delivery of rectified
objections are to be settled through pending corporate benefit cycle announced by the
Clearing Corporation from time to time.

18.12 Fake/forged SEBI registration rubber stamp

In case of fake/forged SEBI registration rubber stamp, members are required to give an
undertaking to the Clearing Corporation stating that the rubber stamp impression appearing
on the reverse of the transfer deed does not belong to the member and that the said rubber
stamp is fake in the prescribed form 6I (format enclosed).

However, if it is subsequently proved that the securities have indeed been introduced by the
said member, then such cases will be reported to the Disciplinary Action Committee and the
shares will be closed out immediately without intimation to the member. The member will
not be given the mandatory period of 21 days to rectify the said shares, once the undertaking
is given by him.

18.13 Procedure for reporting Objection Bad / Benefit Bad Cases

1. Members are required to report Objection bad/ Benefit bad cases within 48 hours of the
scheduled pay-out of such shares.
2. Members are required to submit the following documents along with form BDC-4A for
submitting shares as objection bad or benefit bad.
a. Form BDC - 1A along with transfer deeds and share certificates.
b. Delivery slip and delivery detail statement received along with the rectified/replaced
company objection lot.
c. Company Objection memo.
d. Form BDC 2A (in triplicate) for benefit bad cases, in addition to documents mentioned
above.

18.14 Schedule for reporting and rectification of objection

The following schedule for reporting and rectification of objection will be effective with
immediate effect:

Reporting of Objections and Claiming Corporate Tuesday

Benefits /Wednesday
Date of Intimation Friday Day 1
Pick up of Objections Saturday
Reporting Invalid Benefit Claims (if any) Thursday Day 7
Price for valuation Day 19
Rectification/Replacement of Objections along with Thursday/ Day 21
corporate benefits Friday
Rectified Objection Pay-Out Monday

The provision for computation of equivalent value is given in Annexure -17.1.

18.15 Transfer of debit for company objection cases falling under clause 100 of
Uniform Good/Bad guidelines of SEBI, where the introducing member on the previous
transfer deed is also an NSE member

In case of a company objection as per clause 100 of SEBI good/bad delivery norms, where
the first introducing member on the previous transfer deed is also an NSE member, the debit
borne by the intermediate introducing member on account of the close-out of processes, shall
be transferred to the first introducing member, on the previous transfer deed.
Members are required to submit details of the objection reported against them earlier along
with share certificates, copy of transfer deed where client is the transferee, copy of old
transfer deed where their client is the transferor, original company objection memo, original
form BDC - 1A pertaining to the objection lodged on them, delivery details statement
pertaining to first time objection, delivery details statement of the shares having been
received by them, auction square-up debit statement, to enable NSCCL to transfer the debit
borne by the intermediate introducing member to the first introducing member.

18.16 Valuation of un-rectified company objections pending close-out against disabled

member, subsequently declared defaulter/expelled

In cases wherein the company objections reported against a disabled member have not been
closed-out and the member is subsequently declared a defaulter/expelled, all objections
pending close-out are referred to the Defaulters' Committee.

All company objections reported against defaulters/expelled members shall be valued at

either of

a) The closing price as on the date of declaration of default/expulsion, or

b) The closing price as on the date on which the objection was reported to the Clearing
House, Whichever is later.

18.17 Company Objections reported against Surrendering members

1. All the surrendering members shall co-ordinate and obtain information from the Clearing
Corporation on a weekly basis, any instance of company objection(s) reported against them
by other trading members.

2. The company objections reported against such surrendering members will be initially
valued by the Clearing Corporation based on the notional price. The surrendering member
shall be required to remit the notional amount so calculated, by the prescribed date and such
objections shall be closed out as per procedures. Any negative difference arising between the
close-out price and the notional price shall be payable by such surrendering member to the
Clearing Corporation, and where such difference is positive, surrendering member shall be
given due credit by the Clearing Corporation.

3. The notional price in all such matters will be closing price of the relative securities as on
the date of reporting of the company objection or the closing price on the day last traded of
the relevant security.

4. The respective surrendering member shall meet all such obligations by remitting the
relevant amount to the Clearing Corporation within the stipulated 21 days from the date of
reporting of such company objections, or within 10 days of intimation, of the notional amount
payable, given to such surrendering member by the Clearing Corporation, whichever is
earlier.

5. In the event of the surrendering member not meeting their obligations, such company
objections would be met out of the deposits of the surrendering member. Consequently, if
85% of the value of the interest free cash security deposits and the available security deposit
gets utilised, and if the member does not bring in funds to meet the balance company
objections, then such surrendering member shall render himself liable for the
Exchange/Clearing Corporation initiating the process of declaring such surrendering member
a defaulter.

6. Upon such surrendering member being declared a defaulter, all the process and procedures
applicable to that of a surrendering member shall cease forthwith and the relevant process
pertaining to a defaulter shall ipso facto commence/apply.

18.18 Company Objections valued at more than Rs. 20 lakhs

In cases wherein the value of company objection reported against the introducing member
(IM) is greater than Rs. 20 lakhs, the company objection documents shall be withheld by the
Clearing Corporation. The withheld documents would be released if the IM complies with
either of the following:
1. Deposits an amount with the Clearing Corporation, equivalent to the value of company
objection reported against them
2. rectifies/replaces the securities reported under company objection
 Item 19

DOCUMENT AND REGISTRATION

In pursuance of Regulation 12 of the Capital Market Regulation, procedures for

rectification/replacement of defective documents in addition to those mentioned in item
17 are hereby specified as under:

The original selling member (referred to as the 'introducing member') who is the first to
deliver defective documents in NSE is responsible for rectifying defective documents
('objection cases') to the receiving member.

19.1 Market / Odd lot cases

Where the member reports an odd lot as under objection, if the same is not rectified/replaced
within the required period, it will be squared-up as per Regulations regarding squaring up.

19.2 Un-rectified Objection Cases

19.2.1 Valuation of Un-rectified Objection Cases

At the end of the 21 day period (as per the schedule given in item 18), all objection cases
which have not been rectified/replaced (un-rectified objections) shall be valued at the relevant
valuation price.

If the value of the un-rectified objections is more than Rs.5 lakhs, the introducing member
shall be required to pay-in the full value of the un-rectified objections (valuation debit) on the
day following the objection rectification day.

19.2.2 Failure to Pay Valuation Debit

If the introducing member fails to pay-in funds on the due date of valuation debit, the limits
of the member may be reduced by the relevant authority in such manner and to such extent as
it may deem fit.

19.2.3 Limits

If the value of objections (after adjusting for objection withdrawals) is more than 50% of the
net cash component of base capital available as defined below, then the limit for the
introducing member shall stand reduced by 8.5 times the value of objection cases.

Where the value of objections (after allowing for withdrawals) is more than 50% of the net
cash component of base capital available then the member may replace/rectify cases before
the 21 day period. To the extent objection cases are replaced/rectified, the limits may be
adjusted proportionately.

Members may deposit additional margins in the form of cash, bank guarantees or eligible
securities towards objection cases. Limits may be adjusted proportionately. Such margin
deposits are required to be kept with the Clearing Corporation for a minimum period of 1
month.
19.2.4 Un-rectified objections

If the defective documents are not rectified/replaced on or before the 21st day and the
introducing member fails to pay-in funds on the due date of the above valuation debit, then
the Clearing Corporation shall close-out the un-rectified part of the defective documents as
given below:

The Clearing Corporation shall close-out the value of un-rectified objections only up to 85%
of the net base capital of the member. The member is required to bring in funds towards the
objections which are closed-out by the Clearing Corporation by the prescribed (funds pay-in)
date. In the event where the value of un-rectified objections exceeds 85% of the net base
capital and the introducing member fails to bring in additional funds to replenish the deposits
depleted, such objections shall not be closed-out and such member shall be liable to be
declared a defaulter by the Exchange/Clearing Corporation.

Net Cash Component of Base Capital

For the purpose of this item, the net cash component of base capital shall mean the base
capital of the clearing member which is in the form of cash deposits after adjusting for any
funds due from the member to the Clearing Corporation or Exchange.

Net Base Capital

For the purpose of this item, the net base capital shall mean the base capital of the clearing
member after adjusting for any funds due from the member to the Exchange or the Clearing
Corporation.

19.3 Rectified / Replaced Objections Cases which are Bad Delivery

Rectified / replaced objections cases which are reported as bad delivery will be squared up as
per Regulations regarding the same.

19.4 Rectified Objection Cases which are under Objection

19.4.1 Close out

Objection cases rectified which are again reported as under objection will be immediately
closed out between the original introducing member and the original receiving member as per
Regulations regarding the same. In the case of corporate benefits the original introducing
member shall be responsible for the corporate benefits to the original receiving member.
 Item 20

FAKE/ FORGED/STOLEN CERTIFICATES

In pursuance of Chapter VI-B of the Byelaws and Regulation 12.7.1 and 12.14 of the
Capital Market, the clearing members are required to comply with the following
procedures in case where fake/ forged/ stolen securities are reported against clearing
members:

20.1 Once a fake/ forged/ stolen case is reported as a company objection, the introducing
member shall not any further deal with the client who delivered the fake/ forged/ stolen
securities as directed earlier. Any contravention of this shall be viewed as a serious violation
and the Clearing Corporation may initiate such action as it may deem fit in this regard which
may inter alia include withdrawal of the trading facility provided to the member.

20.2 The introducing clearing member shall provide to the Clearing Corporation, complete
details of all securities received from the client (whose securities have been reported as fake/
forged/ stolen securities) delivered through the clearing house together with full details of the
client including name, address, photograph, copy of client agreement, name and address of
the person who introduced the client delivering the fake/ forged/ stolen securities to the
clearing member and bank account details of the client within 14 days of date of intimation of
the company objection.

20.3 The three-month period referred to hereinafter shall start from April 1998 and end on
June 30, 1998 and thereafter the three-month periods shall be computed every three months.
For example, July 1, 1998 to September 30, 1998, October 1, 1998 to December 31, 1998 and
January 1, 1999 to March 31, 1999 and so on.

20.4 Fake/ forged/ stolen securities equal to or exceeding Rs. 5 lakhs

20.4.1 If, within a three-month period as prescribed in clause (3) above, the cumulative value
of fake/ forged/ stolen securities reported against the clearing member hereinafter referred to
as ‘reported value' exceeds Rs. 5 lakhs, then such clearing member shall, within 14 days from
the date of intimation of the company objection, report to the Clearing Corporation, details of
all securities delivered by the member on behalf of the clients who delivered fake/ forged/
stolen securities.

20.4.2 If, within a three-month period as prescribed in clause (3) above, the 'reported value'
exceeds Rs. 5 lakhs, then such clearing member shall, within 14 days from the date of
intimation of the company objection, deposit an amount equal to the 'reported value' in the
form of cash, bank guarantee or FDR. For such clearing member, the base capital shall stand
reduced by the 'reported value' and the limits shall stand reduced accordingly till such deposit
is brought in. Further the members may be called by the Sub-Committee of the Executive
Committee of the Exchange and asked to explain the incidence of fake/ forged/stolen
securities in a personal hearing. If the explanation given by such clearing member is
unsatisfactory, the trading facility may be withdrawn.

20.4.3 Irrespective of the amount of fake /forged /stolen securities reported against the
member, the Clearing Corporation may independently assess the value of fake/ forged/ stolen
securities likely to have been delivered through the members hereinafter referred to as
'estimated value', in respect of any member as it may deem fit. The assessment of the
Clearing Corporation of the 'estimated value' shall be final for this purpose.

20.4.4 If the 'estimated value' exceeds Rs. 5 lakhs, then such clearing member shall, within 14
days from the date of intimation of the same, deposit an amount equal to the 'estimated value'
in the form of cash, bank guarantee or FDR. For such clearing member, the base capital shall
stand reduced by the 'estimated value' and the limits shall stand reduced accordingly till such
deposit is brought in.

20.5 The deposit shall be released/ the base capital may be restored, at the end of the
subsequent two 'three-month periods' (six month period), provided the 'reported value' in the
subsequent two 'three-month periods' does not exceed Rs. 5 lakhs.

20.6 Introducing clearing members shall file a police complaint/ FIR against the client who
delivered the fake/ forged/ stolen securities to the clearing member, within 30 days from the
date of intimation of company objection for fake/ forged/ stolen securities and produce proof
thereof to the Clearing Corporation. Where introducing clearing members have not filed a
police complaint/ FIR against the client who delivered the fake/ forged/ stolen securities to
the clearing member within such period and (a) the 'reported value/ estimated value' exceeds
Rs. 5 lakhs and (b) individual claim is more than Rs. 1 lakh, trading facility which has been
given by the Exchange to such trading/ clearing members may be withdrawn and the Clearing
Corporation may initiate disciplinary action as it may deem fit

20.7 If the 'estimated value' or 'reported value' within any three-month period (a) exceeds
Rs. 2.5 lakhs, and 1% of average delivery values of the clearing member for the preceding
two three-month periods, or (b) Rs. 12.5 lakhs, then the member shall be disabled from
participating in any auction till the last date of the subsequent three-month period.

20.8 Deliveries received from other stock exchanges

In respect of securities received from other stock exchanges and delivered on NSE which are
subsequently reported as fake/ forged/ stolen securities, the introducing member on NSE shall
furnish evidence of having received the delivery from a recognised member of the other stock
exchange to the satisfaction of the Clearing Corporation. Such deliveries may be excluded
from the computation of value of fake/ forged/ stolen securities for such clearing member.
Deliveries arising out of a spot transaction between the members shall not be excluded for
such computation.

Further, the original introducing member on NSE shall provide following details to the
Clearing Corporation:
Objection details
Objection Inward No. (On NSE)
Security symbol
Series
Quantity

Other Exchange details

Stock Exchange from where securities were received

Name and SEBI registration code of delivering member
of other Exchange from whom securities were received
Settlement Number and Date of receipt of securities on other Exchange

Security details

Certificate no.
DNR (from)
DNR (to)

In addition, the clearing member shall submit copies of following documents:

· Form BDC-1A ( Annexure 24.11) pertaining to the said objection inward number
· Receipt statement from the stock exchange showing above details certified by the Stock
exchange concerned.

Clearing Corporation may exclude such deliveries from other Exchanges from the
computation of value of fake/ forged/ stolen securities for such clearing member provided
they are not spot transactions between members but have been received through normal
exchange settlement.

20.9 The Clearing Corporation shall determine from time to time the date and prices for
valuation of the fake/ forged/ stolen securities reported against clearing members. In the
normal course, the latest closing price will be taken into consideration for the valuation.

20.10 All cases of company objections pertaining to fake/forged/stolen securities reported

against the introducing member shall be closed-out by the Clearing Corporation subject to the
provisions of clause 19.2 of item 19.

20.11 Verification of securities

Members are advised to get the securities verified by the respective company/ registrars
regarding the genuineness of the certificate before delivering the same on the Exchange. In
cases where the company/ registrar confirms that the securities are fake/ forged/ stolen,
members are required to report such cases to the Clearing Corporation along with a letter
from the company/ registrar and other relevant documents.

In case the securities received by the receiving member from the delivering member in
normal pay-out are found to be fake/ forged/ stolen, the receiving member is required to
report the same as bad delivery in the bad delivery cycle against the delivering member.

The delivering member shall be required to replace such securities by the prescribed pay-in
day for rectification of bad delivery, failing which the securities shall be closed out as per
procedures. Once the identity of the introducing member is established the auction / square
up amount debited to the delivering member shall be recovered from the introducing member
or the delivering member may subsequently report such securities as company objection
against the introducing member as per the existing procedures.
However, if the securities detected as fake/ forged/ stolen are delivered by a member who
also happens to be the introducing member on the NSE, such securities shall be marked as
short delivery and directly closed-out.

20.12 Verification of deliveries for Lost/ Misplaced/ Fake/ Forged/ Stolen shares

Members are required to provide details of all deliveries submitted to Clearing House in 3.5"
floppy diskettes in the prescribed format. In cases where shares in the said deliveries are
found to be lost/ misplaced/ fake/ forged/ stolen shares as per the system implemented by
NSCCL for this purpose, the procedure for reporting and replacement of such deliveries are
given below:

Normal Settlement
Upon detection of the share certificates through the database maintained by the Clearing
Corporation out of the data provided by the companies/STAs, the delivering member, the
introducing member and the receiving member will be informed about the said share
certificates and the introducing member and the delivering member will be advised to get a
confirmation from the company/STAs for the said shares within ten days. The share
certificates shall be sent to the company/STA for pre-verification or such pre-verification be
carried out by the authorised representative of the company/STA in the Clearing House and
objection memo, wherever such share certificates are confirmed to be defective in title, be
obtained from the company/STA.

Delivering Member and Introducing Member are same

If the delivering member does not furnish any information/ proof confirming such share
certificate(s) being good delivery within the above specified period, the same shall be closed-
out against the delivering member.

Delivering Member and Introducing Member are different

If the delivering member does not furnish any information/ proof confirming such share
certificate(s) being good delivery within the above specified period, the same shall be closed-
out against the delivering member. The close-out debit so incurred by the delivering member
will be passed onto the introducing member, within a reasonable period.

Auction, Rectified/Replaced Bad Delivery, Rectified/Replaced Company Objection

Upon detection of the share certificates as per procedures detailed above, the delivering
member and the introducing member shall be informed about the said share certificates. The
share certificates shall be sent to the company/STA for pre-verification or such pre-
verification be carried out by the authorised representative of the company/STA in the
Clearing House and objection memo, wherever such share certificates are confirmed to be
defective in title, be obtained from the company/STA.

Delivering Member and Introducing Member are same

The shares shall be closed-out against the delivering member

Delivering Member and Introducing Member are different

The shares shall be closed-out against the delivering member. The close-out debit so incurred
by the delivering member will be passed onto the introducing member, within a reasonable
period.
 Item 21

CERTIFICATION OF GOOD/BAD DELIVERY

In pursuance of Regulation 7 and 12 of the Capital Market Regulation procedures for

certification of good/bad delivery are hereby specified as under:

21.1 Procedure to be followed for Good/Bad delivery certification.

Members against whom bad deliveries are reported and who require certification from the
Clearing Corporation regarding the good/bad delivery of the said documents are required to
affix good/bad delivery memo coupon for Rs 30/-. Members are required to affix such
coupons only in cases which need certification from the Clearing Corporation.

The deliveries which have originated from a different Regional Clearing Centre (i.e. where
the delivering centre and the receiving centre is not the same); the receiving member shall be
required to report the bad deliveries at Mumbai - Clearing Centre. The certification of good/
bad deliveries for these deliveries shall also be done at Mumbai - Clearing Centre only.
However in cases where the delivering centre and the receiving centre are the same, the
certification of good/bad deliveries shall be done at the respective RCC's.

In such a case, members are required to submit the following documents for good/bad
delivery certification.

1. Bad delivery memo coupon

2. Prescribed Form 6B1 (in duplicate)

3. Original transfer deed and share/debenture/bond certificate

4. One photocopy of each transfer deed and each share/debenture/bond certificate

5. Photocopies of delivery slip and delivery details statement

6. Members are required to submit documents mentioned in points 1 and 2 in a plastic pouch.
An additional copy (third copy) of form 6B-1 should be attached outside the pouch.

7. Members are required to affix a good/bad delivery memo coupon of Rs. 30/- for each
delivery. The coupon should be affixed on the duplicate copy which will be retained by the
Clearing Corporation. The documents shall be returned to the members after due certification
by the Clearing Corporation.

8. The clearing house will affix inward nos. on Form 6B-1.

9. Members are required to attach copy of form 6B-1 duly certified by the Clearing
Corporation, to the transfer deed and share certificate every time the same sets of documents
are delivered in the market.

21.2 Procurement of Bad delivery memo coupon

1. The coupons for certification of good/bad delivery will be available from the Clearing
Corporation.

2. The value of each coupon is Rs. 30/-. One coupon book contains 50 such coupons.

3. Members may procure the good/bad delivery memo coupon book from the Clearing
Corporation by submitting a demand draft for Rs. 1500/- ( per coupon book) favouring
'National Securities Clearing Corporation Limited' payable at Mumbai.

4. Any request for certification of good/bad delivery will not be entertained by the Clearing
Corporation unless the above procedures are complied with.

5. Members shall ensure that a photocopy of the certification issued by Clearing Corporation
is always attached to the certified documents whilst redelivering the documents in future
settlements, to avoid any subsequent receiving member raising bad delivery on the same
count/reason.
 Item 22

REQUEST CASES & BAD DELIVERIES

In pursuance of Regulation 7 of the Capital Market, revised procedure for reporting

and rectification of request cases are hereby specified:

22.1.1 Revised procedures for handling Request cases:

1. Members are required to report request cases to the Clearing house in plastic pouches as
per the schedule given below.

2. Members are required to report request cases with original documents (transfer deeds and
share certificates) for normal request cases and with photocopies of the relevant documents
for dividend request cases.

Notwithstanding what has been stated hereinabove regarding reporting of non pari passu
dividend request cases with photocopies of transfer deed and share certificates, the Clearing
Corporation may, on a case by case basis, waive such requirements in cases where
information regarding non pari passu dividend is made available to the Exchange at a later
date or the non pari passu dividend is modified/ cancelled by the company and consequently:

a. the Receiving Member is unable to claim non pari passu dividend/ enhanced non pari passu
dividend, subsequently declared by the company
b. the Delivering Member is unable to claim the non pari passu dividend paid by them, which
is subsequently cancelled/ reduced by the company

Copies of the delivery detail statement, whereby the members received/ delivered the shares,
are required to be enclosed, while reporting such cases.

The Clearing Corporation may at its discretion also waive coupon charges in such reported
cases.

3. Request cases should be reported and rectified in market lot only.

4. The RM should submit a copy of the delivery slip and the delivery details statement

5. Members shall report request cases in the prescribed Form 6 F (given in NSE F 6F), only
for the specific reasons as given in Annexure 22.1. The Form 6F is required to be submitted
in triplicate, of which two copies should be firmly attached on the pouch, and the third
(original) copy should be attached to the lot inside the pouch. The lot should be so placed in
the pouch that all details mentioned on Form 6F are clearly visible, without having to open
the pouch.

6. Members reporting request cases are required to affix a coupon of Rs.100/- on Form 6F.

7. Form 6F should be complete in all respects. Incomplete/incorrect forms are liable to be

rejected.
Schedule for reporting and rectification of Request cases:

Reporting of request case by the RM Thursday

Pick up of request case for rectification to the DM Monday Day 1
Pay in of rectified request case / withdrawal by the DM Monday Day 21
Pay out of the rectified request case to the RM Thursday Day 24
Reporting of Request Re-bad by the RM Friday Day 25
Pay out of Request Re-bad to the DM Saturday Day 26

22.1.2 Time period for reporting Request Cases

The time period for reporting request cases shall be up to one year from the last book closure
of the respective scrip.

22.1.3 Closing Out

Members are required to rectify request cases by the prescribed day failing which such cases
shall be closed out at the previous day’s closing price.

22.1.4 Procurement of Rs. 100/- coupon for reporting request cases

1. The coupon for reporting request cases will be issued by the Clearing Corporation.
2. The value of each coupon is Rs. 100/-. One coupon book contains 10 such coupons.
3. Members may procure the coupon from the Clearing Corporation by submitting a demand
draft for Rs. 1000/- (per coupon book) favouring 'National Securities Clearing Corporation
Limited' payable at Mumbai.

22.2.1 Revised procedures for reporting normal bad deliveries

1. The receiving member is required to report normal bad deliveries in plastic pouches.
Each delivery should be enclosed in a separate pouch.
2. The bad deliveries are required to be submitted in revised form 6B as prescribed by the
Clearing Corporation, on a paper of uniform (A4) size. (Given in Forms NSE F 6B)
3. The Form 6B is required to be submitted in triplicate, of which two copies should be
firmly attached on the pouch, and the third (original) copy should be attached to the lot
inside the pouch. The lot should be so placed in the pouch that all details mentioned on
the Form 6B are clearly visible, without having to open the pouch.
4. A copy of delivery details statement should be attached to the lot inside the pouch.
5. Members are required to report all bad deliveries pertaining to a delivery number in the
same 6B form. If details of certificate nos., etc. are given in a separate paper, as
Annexure to form 6B, the annexure should contain the details of those shares which are
to be reported as bad delivery and the same should be stamped by the receiving member.
6. If the same set of distinctive numbers are to be reported as normal bad delivery and
dividend bad delivery, then both the reasons should be mentioned on the same Form 6B.
However if the distinctive nos. reported as normal bad delivery are different from those
reported as dividend bad delivery, then separate Form 6B's should be used.
7. Form 6B should be complete in all respects. Incomplete forms or forms not conforming to
the prescribed size and format are liable to be rejected.

22.2.2 Rectified pay in of bad delivery

1. The delivering member should submit rectified bad deliveries along with the original Form
6B in the plastic pouch.
2. The delivering member should indicate on the form 6B if the shares are rectified and/or
replaced.
3. If the delivering member is rectifying either the share certificate or the transfer deed or
both, the same should be clearly indicated in the specified column in form 6B.
4. If part quantity is replaced / rectified, then a shortage letter should be attached as per the
format prescribed by the Clearing Corporation, giving the details of un-rectified deliveries.
Members are required to report un-rectified bad delivery cases in the prescribed form 6B-2.

22.3 Bad Deliveries valued at more than Rs. 20 lakhs

In cases wherein the value of bad deliveries reported against the delivering member (DM) is
greater than Rs. 20 lakhs, the bad delivery documents shall be withheld by the Clearing
Corporation. The withheld documents would be released if the DM complies with either of
the following:

1. Deposits an amount with the Clearing Corporation, equivalent to the value of bad delivery
reported against them
2. rectifies/replaces the securities reported under bad delivery
 Item 23

CLEARING HOUSE PROCEDURES

In pursuance of Regulations 15 of the Capital Market Regulations, procedure for

appointing authorised representatives and use of Clearing House is specified as under:

23.1 Authorised Clearing House Representatives/ Clearing Assistants

Each CM clearing member can appoint five authorised representatives for each clearing
house to deliver and receive securities through the Regional Clearing House and Central
Clearing House. A member should make separate applications for designating these
authorised representatives as per the revised Form No. NSE - F 8. NSCCL will issue an
Identity Card to each of these representatives. The authorised representatives shall display
this ID card on their person at all times they are in the clearing house premises. This ID card
is non-transferable and must be surrendered immediately to the clearing house upon cessation
of employment of any of the authorised representatives. Any loss or theft of this ID card
should also be promptly informed to the clearing house.

23.1.A. Charges for identity cards for authorised representatives of member

Members Clearing Custodians and other

Members Clearing with high
delivery volumes
No. of cards to be issued 5 Maximum 10
Charges NIL Nil up to 5 cards
Rs. 1000 per card for
more than 5 cards
Charges for new cards where the old Rs. 300/- Rs. 300
cards are returned (owing to change
of members representative)
Charges for duplicate cards where Rs. 300 Rs. 300
the old card is damaged and returned
for issue of fresh cards
Charges for additional cards where Rs. 1000 Rs. 1000
the old cards are lost/ misplaced or
are not returned

23.2 Delivery at the allotted time

The delivering member should deliver all his delivery lots to the clearing house on the pay-in
day for securities. The clearing house will acknowledge the delivery on a copy of the delivery
statement.

23.3 Receipt at the allotted time

The receiving member should collect the documents from the clearing house on the pay-out
day of the securities.

Receiving members will be allotted time slots for collecting documents from the clearing
house. The receiving member or his authorised representative will be required to
acknowledge receipt of the documents on the copy of the receipt statement.
23.4 Details of securities delivered to the Clearing House
Clearing members are required to submit details of securities delivered to the Clearing House
in such form, including electronic form, as per the format prescribed by the Clearing
Corporation from time to time.

Members are required to provide details of all deliveries to the respective Clearing House, in
3.5" floppy diskettes in the prescribed format. (Format given in Annexure 23.1).

In cases where floppies are not submitted and /or where the floppies are not in the required
format or where the floppies are found to be not readable, for such cases the procedures as
given in Annexure 23.2 shall be followed.

The Clearing Corporation will specify, from time to time, the settlement types for which the
clearing member should submit the above details.
 Item 24

CLEARING AND OTHER FORMS

The following Clearing Forms are specified:

Report No. Particulars Annexure

NSEF-01 Settlement Obligations Statement of Clearing Member 24.1
NSEF-01A Settlement Obligations Statement of Clearing Member - 24.2
Custodian-wise
NSEF-02 Settlement Obligations Statement of Custodian 24.3
NSEF-03 Final Delivery Statement 24.4
NSEF-04 Final Receipt Statement 24.5
NSEF-05 Delivery Slip 24.6
NSEF-06 Delivery Details Statement 24.7
NSEF-06B Bad Delivery - format for reporting 24.8
NSEF-06B1 Bad Delivery Memo 24.9
NSEF-06B2 Unrectified Bad Deliveries 24.10
BDC 1A Local Exchange Company Objections 24.11
BDC 1B Inter-Exchange Company Objections 24.12
BDC 2A Local Exchange Rectified Company Objections 24.13
BDC 2B Inter-Exchange Rectified Company Objections 24.14
BDC 3A Local Exchange Invalid Claim Of Company Objections 24.15
BDC 3B Inter-Exchange Invalid Claim Of Company Objections 24.16
BDC 4A Local Exchange Reporting Bad Delivery for Rectified Company 24.17
Objections
BDC 4B Inter Exchange Reporting Bad Delivery for Rectified Company 24.18
Objections
NSEF-06E Company Objections - Format for reporting non rectification/ non 24.19
replacement of Company Objection
NSEF-06F Request Cases - Format for reporting request cases 24.20
NSEF-6I Reporting fake/forged SEBI registration rubber stamp 24.21
NSEF-6J Undertaking in cases of Jumbo transfer deed submitted in 24.22
Company Objection
NSEF-07 Format for notice of Non-Delivery 24.23
NSEF-07A TT Market Deals (for Regular Market Deals) - Format for 24.24
reporting by Custodian Clearing Member
NSEF-07A1 TT Market Deals (for Depository Market Deals) - Format for 24.25
reporting by Custodian Clearing Member
NSEF-07B TT Market Deals (for Regular Market Deals) - Format for 24.26
reporting by TM Clearing Member
NSEF-07B1 TT Market Deals (for Depository Market Deals) - Format for 24.27
reporting by TM Clearing Member
NSEF-08 Authorised Clearing House Representative - application format 24.28
NSEF-11A Format for Reporting the settlement of Negotiated Trades as 24.29
Brokers– In regular market
NSEF-11A1 Format for Reporting the settlement of Negotiated Trades as 24.30
Brokers– In Depository market
NSEF-11B Format for reporting the settlement of Negotiated Trades effected 24.31
 as Principals - In Regular Market
NSEF-11B1 Format for reporting the settlement of Negotiated Trades effected 24.32
as Principals - In Depositary Regular Market
 Item 25

INFORMATION VIA SMS

A facility wherein information in respect of some of the activities can be received through
SMS is provided to members/ custodians..

The salient features of the new SMS Alert facility are as mentioned below:

• Members/ custodians can avail this facility in order to receive instant updates by way
of SMS in respect of certain activities / information. (List of various alert messages
which can be subscribed is provided in Annexure 25.1)
• Members/ custodians can access the SMS application through a link on the Collateral
Interface for Members (CIM).
• Members/ custodians can register multiple mobile numbers (Maximum 5 numbers per
member) for receiving SMS by registering multiple users with a flexibility to modify
or deregister users.
• Members/ custodians have the flexibility to subscribe to or unsubscribe any message
alerts.
• Subscription to multiple message alerts for single mobile number or subscription to
single message alert by multiple mobile numbers is also permitted.
• Members/ custodians can replicate the subscriptions done for one user to another user.

This alert facility is only an additional facility provided to the members/ custodians for
receiving the Alert / Information. The members/ custodians shall verify the information
received by way of alert and not rely solely on such Alerts / Information for any purpose.
Clearing Corporation shall not be liable for any delay or any other interruption which may
occur due to any reason including network (Internet) reasons or snags in the system, break
down of the system or any other equipment, server breakdown, maintenance shut down,
breakdown of communication services or inability of Clearing Corporation to send the Alert /
Information. Irrespective of whether the member has received the Alert / Information or not,
the member shall be required to adhere to all the Rules, Byelaws and Regulations and
Circulars and all other requirements laid down by Clearing Corporation from time to time.

Members/ custodians are requested to ensure that the mobile numbers of only the concerned
officials are registered and updated on regular basis in order to prevent the messages from
being sent to unconcerned people.

Further, in order to ensure continuous and uninterrupted flow of information to members /

custodians via SMS, alert messages are sent by Clearing Corporation/ Exchange through
multiple service providers.

Members/ custodians, who have subscribed for the alerts and have also activated ‘Do Not
Disturb’ facility with their mobile service provider, may receive SMS alerts on their mobile
depending on which service provider is in force when the SMS alerts are sent. Members /
custodians who have opted for the ‘Do Not Disturb’ facility and hence do not wish to receive
SMS alerts may deregister from the SMS alert facility.
 Item 26

ELECTRONIC REPORTING

26.1 Reports to members/custodians

The following reports are available to members / custodians:

26.1.1 Delivery Reports:

a) Security wise Demat Delivery Statement (DFDS)

File Name – C_DFDS_memcode_DDMMYYYY.csv
File Location - Members Folder/Reports
Header Record
Record Type (01)
File Type
Member Type
Member Code
Date (YYYYMMDD)
Total Number of Records
Total Quantity
Detailed Record
Record Type (10)
Settlement Type
Settlement No
Delivery Type
Security Symbol
Security Series
Security ISIN
Quantity Delivered
Depository
Transaction No

b) Security Wise Demat Receipt Statement

File Name – C_DFRS_memcode_DDMMYYYY.csv
File Location - Members Folder/Reports
Header Record
Record Type (01)
File Type
Member Type
Member Code
Date (YYYYMMDD)
Total Number of Records
Total Quantity
Detailed Record
Record Type (10)
Settlement Type
Settlement No
Delivery Type
Security Symbol
Security Series
Security ISIN
Quantity Received
Depository
Transaction No

c) Client Allocation Details (CADT)

File Name – C_CADT_memcode_DD-MMM-YYYY.csv
File Location - Members Folder/Reports
Header Record
Record Type (01)
File Type
Member Type
Member Code
Date (YYYYMMDD)
Total Number of Records
Total Quantity
Detailed Record (Securitywise client level allocation)
Record Type (10)
Settlement Type
Settlement No
Delivery Type
Security Symbol
Security Series
Security ISIN
Quantity Received
Depository
Transaction No
Quantity Credited to CM Pool A/c / Clearing A/c
Quantity Credited to Beneficiary A/c
Detailed Record (Details of Direct Payout to Beneficiary Account)
Record Type (20)
Settlement Type
Settlement No
Delivery Type
Security Symbol
Security Series
Security ISIN
Depository
Beneficiary Account No
Quantity Required to be in Beneficiary A/c
Quantity actually credited in Beneficiary A/c,
Transaction No

d) Member wise Withheld Securities Statement

File Name – C_DWTH_memcode_DDMMYYYY.csv
File Location - Members Folder/Reports
Header Record
Record Type (01)
File Type
Member Type
Member Code
Date (YYYYMMDD)
Total Number of Records
Total Quantity
Detailed Record
Record Type (10)
Settlement Type
Settlement No
Delivery Type
Security Symbol
Security Series
Security ISIN
Depository
Withheld Quantity
Released Quantity
Balance Quantity

e) Deliveries Report
File Name - C_memcode_DLVR_SETTYPNO_DDMMYYYY.csv
File location - Members Folder/Reports
Settlement Type
Settlement Number
Delivery Centre Code
Receiving Centre Code
Delivery Unique ID
Delivery Date
Delivery Number
Receipt Number
Delivery Trade Number
Delivery Type
Security Symbol
Security Series
Security Code
Quantity to Deliver/Quantity to receive
Quantity Delivered
Quantity Received (Electronic)
Quantity Received (Physical)
Quantity Received
Delivery Value
Number of Certificates
Delivering Custodian code
Delivering Trading Member
Delivering Trading Member Branch Number
Receiving Custodian Code
Receiving Trading Member
Receiving Trading Member Branch
Objection Number
Corporate Benefit Flag

f) Security Shortages Report

File Name - C_memcode_SHRT_SETTYPNO_D_DDMMYYYY.csv or
C_memcode_SHRT_SETTYPNO_R_DDMMYYYY.csv
File Location- Members Folder/Reports
Serial No
Settlement Type
Settlement No
Security Symbol
Security Series
Short quantity
Valuation price
Valuation Debit Amount

26.1.2 Obligation Reports:

a) Daily Obligation Report

File Name - C_memcode_DOBG_SETTYPNO_DDMMYYYY.csv
File Location- Members Folder/Reports
Settlement Type
Settlement No
Trading Member Code
Trading Member Branch Code
Custodian Participant Code
Custodian Code
Security Symbol
Security Series
Security Code
Obligation Date
No Delivery Security Flag
Daily Buy Volume
Daily Sell Volume
Daily Buy Amount
Daily Sell Amount
Cumulative Buy Volume
Cumulative Sell Volume
Cumulative Buy Amount
Cumulative Sell Amount
Final Obligation Flag

b) Final Obligation Report

File Name - C_memcode_FOBG_SETTYPNO_DDMMYYYY.csv
File Location- Members Folder/Reports
Settlement Type
Settlement No
Trading Member Code
Trading Member Branch Code
Custodian Participant Code
Custodian Code
Security Symbol
Security Series
Security Code
Obligation Date
No Delivery Security Flag
Daily Buy Volume
Daily Sell Volume
Daily Buy Amount
Daily Sell Amount
Cumulative Buy Volume
Cumulative Sell Volume
Cumulative Buy Amount
Cumulative Sell Amount
Final Obligation Flag

c) Net Daily Obligation Report

File Name - C_memcode_NDOBG_SETTYPNO_DDMMYYYY.csv
File Location- Members Folder/Reports
Security Symbol
Security Series
Cumulative Buy Quantity
Cumulative Buy Value
Cumulative Sell Quantity
Cumulative Sell Value
Net Quantity
Net Value

d) Net Final Obligation Report

File Name - C_memcode_NFOBG_SETTYPNO_DDMMYYYY.csv
File Location- Members Folder/Reports
Security Symbol
Security Series
Cumulative Buy Quantity
Cumulative Buy Value
Cumulative Sell Quantity
Cumulative Sell Value
Net Quantity
Net Value

26.1.3 Funds Reports

a) Daily Funds Statement

File Name - C_memcode_DFND_DDMMYYYYY.csv
File Location- Members Folder/Reports
Summary Txn No
Segment Indicator
Bank Txns Received Date
Transaction Code
Transaction Description
Debit/Credit
Original Amount
Due Amount
Amount Received
Short Amount

b) Bank Summary Report

File Name – C_memcode_DFNS_DDMMYYYY.csv
File Location- Members Folder/Reports
Summary Transaction Number
Description
Transaction Code
Debit/Credit
From Account Number
To Account Number
Amount

26.1.4 Auction reports

a) Auctions Square off Debit/ Credit Report

File Name - C_memcode_ASQR_SETTYPNO_D_DDMMYYYY.CSV or
C_memcode_ASQR_SETTYPNO_R_DDMMYYYY.CSV
File Location- Members Folder/Reports
Security Symbol
Security Series
Settlement Type
Settlement Number
Square off quantity
Square off Price
Square off debit/Credit Amount

b) Auction Difference Report

File Name - C_memcode_ADIF_SETTYPNO_DDMMYYYY.csv
File Location- Members Folder/Reports
Security Symbol
Security Series
Settlement Type
Settlement No
Trade Qty
Valuation Amount
Auction Amount
Auction Difference Amount
Total Funds Payable

26.1.5 Market Reports

a) Security Master
File Name - C_SEC_DDMMYYYY.csv
File location – Common Folder/Clearing
Security Symbol
Security Series
Security Description
Security Code
Security ISIN

b) Corporate Action Report

File Name - C_CORPACT_DDMMYYYY.csv
File Location- Common Folder/Clearing
Security Symbol
Security Series
Security Description
Sec Code
Record date
Book Closure start date
Book Closure end date
Ex Date
ND Start Date
ND End Date
Settlement Type
Settlement No
Corporate Action description
ISIN Code
Active/Cancelled flag

c) Settlement Calendar
File Name - C_STC_MONYYYY_DDMMYYYY.csv
File Location- Members Folder/Common
Settlement Type
Settlement No
Trade Start Date
Trade End Date
Funds Payin Date
Funds Payout Date
Security Payin Date
Security Payout Date
Final Obligation Date
Settlement Merge Number
Settlement Active (Y/N)
Settlement Special (Y/N)

26.1.6 Other Reports

a) Custodian Trades Report

File Name - C_cuscode_CUSTRD_SETTYPNO_DDMMYYYY.csv
File Location- Custodian / Download
Settlement Type
Settlement No
Custodian Code
Custodian Participant
Security Symbol
Security Series
Trade Date
Order number/OTR number
Buy/Sell Flag
Quantity
Price
Value
Confirmation flag

b) Order Confirmation Report

File Name - C_cuscode_ORDC_DDMMYYYY.csv
File Location- Custodian / Download
Settlement Type
Settlement Number
Security Symbol
Security Series
Order/OTR number
Buy/Sell Flag
Trade Quantity
Trade Value
Weighted Avg Price
CP Code
TM Code

c) Trades Report
File Name - C_memcode_TRD_DDMMYYYY.csv
File Location- Members Folder/Reports
Trade Number
Trade Date
Trade Time
Security Symbol
Security Series
Security Code
Security Type
Buy Trading Member
Trade Buy Dealer
Sell Trading Member
Trade Sell Dealer
Trade Price
Trade Quantity
Buy Order Number
Sell Order Number
Buy Custodial Participant Code
Sell Custodial Participant Code
Buy Custodian Code
Sell Custodian Code
Buy Account
Sell Account
ISIN Code
Market Type
No-Delivery flag
Buy Confirmation Flag
Sell Confirmation Flag
Auction Number
Act Type
Buy TM Branch
Sell TM Branch
Old Buy Custodial Participant Code
Old Sell Custodial Participant Code
Old Buy Custodian Code
Old Sell Custodian Code

d) No-Delivery Trades Report

File Name - C_memcode_NODEL_SETTYP_DDMMYYYY.csv
File location - Members Folder/Reports
Settlement Type
Settlement No
Trade Date
Security Symbol
Security Series
Trade No
Order number/OTR No
Buy/Sell Flag
Trade Quantity
Trade Value
Custodian Participant Code
Custodian Code

e) Securities Transaction Tax (STT) Report

File Name – MWST_memcode_DDMMYYYY.csv
File Location- Members Folder/Reports
Header Record
Record Type (10)
STT date
Due date of payment
Member type
Member Code
Total STT
Detailed Record (Client level STT information)
Record type(20)
STT date
Client code
Total STT
Detailed Record (Client Securities level STT information)
Record Type (30)
STT date
Trading Client code
Settlement Type
Settlement Number
Security Symbol
Security Series
Total Buy Quantity
Total Sell Quantity
Total Buy Value
Total Sell Value
Volume Weighted Average Price
Purchase Quantity – delivery
Sale Quantity – delivery
Sale Quantity – other than delivery
Purchase value – delivery
Sale Value – delivery
Sale Value – other than delivery
STT purchase delivery
STT sale delivery
STT sale other than delivery
Total STT

26.2. NSCCL Clearing Management System (NCMS):

NSCCL has provided an interface – NSCCL Clearing Management System (NCMS) to

members which facilitates modification of custodian participant (CP) and client codes during
trading hours. Members can allocate institutional trades marked with the generic CP code
‘INST’ (OTR), through this interface and also view the confirmation status of OTR
transactions marked for confirmation by custodians. The extranet file upload facility for
uploading the files for CP and client code modifications and OTR allocations is discontinued
and the same has to be done through NCMS only. The extranet facility is available for
uploading RC (CP modification) files on the T+1 day.

Members may refer circular NSE/CMPT/15102 dated June 29, 2010, in order to familiarise
themselves with the operations of this interface. For activation of the user for NCMS,
members may provide a request as per format specified in Annexure 26.1

26.3 Timelines for activities in NSCCL Clearing Management System (NCMS) and
upload / download of files

26.3.1 Cut off timings for modifications/allocations through NCMS

Process File Day Timings

Modification of CP code CP T Upto 4.15 p.m.
Modification of client code CLD T Upto 4.15 p.m.
Obligation Transfer Request – OTR T+1 Upto 9.30 p.m.
INST allocation
26.3.2 Timelines for upload and download of files

Process File Day Timings

Status of custodial confirmations to members. RC T+1 8.15 a.m.
File for modification of CP codes by members RC T+1 Upto 9:30
a.m.
Return of CP modification files to trading RC T+1 10.00 a.m
members
T 6:00 p.m.
Daily Obligation report to members and Custodians

26.4 Details of files uploaded/ downloaded by members through NCMS:

Instructions for files uploaded through NCMS
1. Members may directly upload the CP, CLD and OTR files in NCMS or do screen based
modifications and allocations through the same.
2. The screen based modifications and files uploaded by the members would generate
response messages in NCMS. In case of file upload a return file would be generated with
the indication of the success/rejection of the file and the individual records as given
hereunder.
• In case any or all the detail records are successful a return file would be provided with
an indicator ‘S’ confirming that the file was successfully uploaded. At the detail
record level an indicator S / R would be provided indicating whether the detail record
was successful or rejected respectively. In case a detail record is rejected then an error
code would be appended.
• In case of an error in the file name or the control record, the uploading of the file will
fail.
• In case a file is rejected because all the detail records are rejected then the return file
would be provided with an indicator ‘R’ confirming that the file has been rejected and
hence has not been uploaded. In the detail records an indicator R would be provided
indicating an error in the detail record and an error code would be appended.
• Members are requested to save the response messages generated in NCMS and check
the same.
• The return files would be generated in the specified path at the member’s end.
• Members may refer to Annexure 26.2 for the list of rejection codes in NCMS.

3. All files/ screen based modification or allocation entries shall have to be submitted before
the cut off time as specified by Clearing Corporation.

4. The members shall be responsible for all data provided to the Exchange/Clearing
Corporation.

26.4.1 Client Code Modification

Members are required to enter the Client Code at the time of order entry in the NEAT system.

Members, who desire to correct the client codes subsequently, shall be provided with a facility
to modify client codes at order level (not at trade level) on the trade date, during market hours
up to cut off time as stipulated by the Clearing Corporation/Exchange from time to time. .
Currently the cut-off time for Client code modification has been stipulated as 4:15 p.m on the
respective trade date
Proprietary trades shall not be allowed to be modified to client trade and vice-versa. Such
modifications of a client code will be at the order level, hence all trades in respect of that order
shall be modified with the client code provided against the order. Client code modification shall
not be permitted in respect of trades in auction market.

26.4.1.1 File structure for modification of client code by Members:

File naming convention:

XXXXX_CLDYYYYMMDD.Tnn

Where,
XXXXX - Member code
CLD - file type
YYYYMMDD - date in YYYYMMDD format (trade date)
T- file indicator
nn - Batch number of file

The file format should be comma separated variables (csv). The file shall be loaded in
NCMS through the menu ‘View> File Upload’ by selecting the file type as ‘Client code
modifications’.

File format shall be as under:

Control Record Format:
Field Description Data Length Remarks
Type
Record Type Header record Number 2 Value = 10
Member Type Member Type CHAR 1 Value = M
Member Code Member code CHAR 5
Format : Should be same as that in the
Batch Date DDMMYYYY CHAR 8 file name.
The batch number
of Should be the same as that in
Batch number the file sent Number 2 the file name.
Number of Total number of Should be equal to the number
records records in the file Number 6 of detail records

Detail record Format:

Field Description Data Length Remarks
type
Record Type Detailed Record Number 2 Value = 20
Unique client code. Mandatory.
Client Code Mandatory CHAR 10 Cannot start with blank space
Buy /Sell order Mandatory Values B– Buy
Buy/Sell flag CHAR 1 order S – Sell order
Field Description Data Length Remarks
type
Order Number Order number Number 16 Mandatory

Members may please note that all blank spaces in the client code field shall be ignored, Client
codes input in lower case shall be read as upper case and records with client codes having
special characters (other than alpha or numeric) shall be rejected.

26.4.1.2 File structure of the return file for client code modification

On loading of the file, a return file shall be generated in either ‘Success’ or ‘Failure’ folder in
the following path in the member’s local computer:

C:\NCMSData\Upload\ (in case the set up drive is C drive).

File naming convention:

In case of success – XXXXX _CLDYYYYMMDD,DDMONYYYY,HH-MM-SS.Snn

In case of failure - XXXXX _CLDYYYYMMDD,DDMONYYYY,HH- MM-SS.Rnn

Where
XXXXX - Member code
YYYYMMDD – Trade Date
CLD – File Type
T - File Indicator
DDMONYYYY – Date-Month-Year
HH-MM-SS – Hrs-Mins-Sec
R - File is Rejected
S - File is successful
nn - Batch no.

A success (S) or reject (R) indicator is appended at the end of each record in the case of a
return file. In case of rejected records a rejection code shall be appended.

26.4.2 CP code modification

Members can modify CP codes on the trade day during trading hours up to up to cut off time
as stipulated by the Clearing Corporation/Exchange from time to time. Currently the cut-off
time for CP code modification has been stipulated as 4:15 p.m on the respective trade date.
CP code modification is not permitted in respect of trades in Auction market.

26.4.2.1 File structure for modification of CP code by Members:

File naming convention:

XXXXX_YYYYMMDD.Tnn

Where
XXXXX - Member code
YYYYMMDD - date in YYYYMMDD format (trade date)
T - file indicator
nn - batch number of file

The file format should be comma separated variables (csv). The file shall be loaded in
NCMS through the menu ‘View> File Upload’ by selecting the file type as ‘CP Code
Modifications’.

File format shall be as under:

Control Record Format:

Field Description Data Length Remarks
Type
Record Type Header record NUMBER 2 Value = 01
Member Type Member Type CHAR 1 Value = M
Member Code Member code CHAR 5
Format :
DDMMYYYY Should be same as that in
Batch Date CHAR 8 the file name.
The batch number of Should be the same as
Batch number the file sent Number 7 that in the file name.
Number of Total number of Should be equal to the
records records in the file Number 6 number of detail records

Detail record Format:

Field Description Data Length Remarks

type
Record Type Detailed Record Number 2 Value = 20
CP Code, INST
(institutional order) or blank
CP Code CP code CHAR 12 (Member’s own trade)
Warehouse
code Warehouse code CHAR 1 To be left blank
Mandatory Values B– Buy
Buy/Sell flag Buy/Sell order CHAR 1 order S – Sell order
Trade Number Trade Number Number 16 To be left blank
Order Number Order Number Number 16 Buy or Sell order number

26.4.2.2 File structure of the return file for CP code modification

On loading of the file, a return file shall be generated in either ‘Success’ or ‘Failure’ folder in
the following path in the member’s local computer:

C:\NCMSData\Upload\ (in case the set up drive is C drive).

File naming convention:

In case of success – XXXXX _YYYYMMDD,DDMONYYYY,HH MM-SS.Snn

In case of failure - XXXXX _YYYYMMDD,DDMONYYYY,HH-MM-SS.Rnn
Where
XXXXX - Member code
YYYYMMDD – Trade Date
T - File Indicator
DDMONYYYY – Date-Month-Year
HH-MM-SS – Hrs-Mins-Sec
R - File is Rejected
S - File is successful
nn - Batch no.

A success (S) or reject (R) indicator is appended at the end of each record in the case of a
return file. In case of rejected records a rejection code shall be appended.

26.4.3 Obligation Transfer Request – OTR files

This facility allows members to execute institutional orders with a single code ‘INST’. For
all orders executed on a given trade day (T day), members may give a break-up of obligations
by different institutional clients latest by the T+1 day as per defined time lines as given in
Item 26.3.1 above. If the members fail to furnish the breakup of the obligations by the cut-off
time margins shall be applicable on such trades and such obligations shall be reverted to the
member. In respect of trades in the Trade for Trade (Surveillance) segment (BE series)
allocation of ‘INST’ transactions shall not be permitted.

1. Members must identify all such orders by a specifically designated CP code - 'INST'.
Members may place this designated CP code either at the time of order entry or during
modification of CP code through the file upload and screen based facilities provided in
NCMS.
2. This designated CP code shall be used by members only for institutional clients and
members are advised to ensure strict compliance with the same.
3. Members who have executed trades using ‘INST’ code should generate the data file
through NCMS during the time stipulated by the Clearing Corporation. This file shall
contain settlement wise, security wise, obligation data based on the designated CP code
placed by members.
4. Members may allocate the OTR transactions to valid CP codes by way of screen based
allocations or file upload in NCMS. It is mandatory to provide the contract note number in
respect of each allocation.
5. Members shall first download OTR in NCMS and then generate the OTR file from their
local database during the time provided by the Clearing Corporation.
6. All screen based allocations/un-allocations and files uploaded by members will generate
response messages in NCMS stating the success/reject status of each record along with the
rejection code.
7. Members are requested to note the following procedure in case members are desirous of
modifying the allocated CP code at a later point of time. Members may upload OTR files
sending the original record quoting the ‘OTR’ number, quantity as 0 and value as 0. In
case of screen based un-allocation members have to select the allocated record and send
the same instruction. This shall indicate the nullification of the previous allocation.
Modification requests not adhering to the above procedure will be rejected. Subsequently
members can send in fresh records for allocation quoting the new CP code, obligation
quantity and value. Members may either choose to send in fresh allocations in the same
 file or in a separate file or do screen based allocations. Members may note that changes to
the CP code are permissible only if the custodian has not already confirmed acceptance of
the same.
8. The allocation information is communicated to the respective custodians at the end of each
day for the purpose of confirming such requests. The custodian confirmation/rejection
information is disseminated as an information record to the members.
9. At the end of the time limit stipulated for custodial confirmations, records that have not
been allocated to institutions, records that are rejected by custodians and records that are
not responded by custodians shall be reverted to member obligations for settlement. All
such cases shall also be subjected to margins/penalties etc. as per procedure. Records that
are confirmed by custodians shall be custodians' obligations for settlement.

26.4.3.1 OTR file generated from NCMS database by members:

Members shall first download the OTR files using ‘OTR Modification Screen’ in NCMS.
Post download of OTR file can be generated by members from their NCMS local database
through the menu ‘View> File generation’ by selecting the file type as ‘OTR’ file. The name
of the file can be defined by the user.

File format shall be as under:

Control Record Format:

Sr. No. Control Record Field Values
1 Control Record Type 01
2 File Indicator OTR
3 Member Type Value – M
4 Member Code Value – TM code
5 Batch Date Trade date in format YYYYMMDD
6 Batch No Value – 01
7 No of Records Total no of records in the file

Detail Record Format:

Sr. No Field
1 Record Type
2 Buy/Sell flag
3 Settlement Type
4 Settlement Number
5 Security Symbol
6 Security series
7 CP code
8 Obligation Quantity
9 Obligation Value
Contract Note
10 Number
11 OTR No
Values
Value = 10 records for which action is to be taken by
members Value = 20,30 indicates for information only
Value B- Buy side, S – Sell side
Settlement Type
Settlement Number
Security Symbol
Security series
for record type 10 – the value will be INST for record
type 20,30 the value will be CP code , INST
respectively
Total Obligation quantity
Total Obligation value
Contact Note Number as given by TM (will be given
for record type 20 only and where the member has
allocated to a CP code)
A unique OTR no. generated ( will be given for record
 type 20 only)
value = ‘Y’/’N’ or null ( will be given for record type
20 only) This indicates the status of the record for
which allocation is completed. Y indicates custodian
confirmation, N indicates custodian reject, blank
12 Confirmation flag indicates no action taken by custodian as yet

26.4.3.2 OTR (INST) allocation file to be uploaded by trading members in NCMS

Members are required to upload records in the following file format for the purpose of
allocating ‘INST’ transactions to respective CP codes.

File naming convention:

XXXXX_OTYYYYMMDD.Nnn

Where
XXXXX - Member code
OT- File type
YYYYMMDD – Trade Date
N - File Indicator
nn- Batch number

The file format should be comma separated variables (csv). The file shall be loaded in
NCMS through the menu ‘View> File Upload’ by selecting the file type as ‘OTR
Allocations’.

File format shall be as under:

Control Record Format:

Sr. Field Description Data Length Remarks
No type
1 Record type Header Record CHAR 2 Value = 01
2 File Type File Type CHAR 4 Value = OTR
3 Member Type Member Type CHAR 1 Member Type ( Value = M)
Member code for which file
generated/received (Value =
4 Member Code Member Code CHAR 5 TM Code)
Format : Should be same as that in the
5 Batch Date YYYYMMDD CHAR 8 file name
The batch
number of the Should be same as that in the
6 Batch number file sent Number 2 file name
Total number
Number of of records in Should be equal to the number
7 records the file Number 7 of detailed records

Detail Record Format:

Sr. Field Description Data Length Remarks
No type
 Detailed Value – 10 for OTR
1 Record type record CHAR 2 Allocation Record.
Buy/Sell Value B – Buy side , S –
2 Buy/Sell flag order CHAR 1 sell side
Settlement
3 Settlement type type CHAR 1 Settlement type
Settlement settlement
4 Number Number Number 7 settlement Number
Security
5 Security symbol symbol CHAR 10 Security symbol
Security
6 Security series series CHAR 2 Security series
7 CP code CP code CHAR 12 The value will be INST
Allocated Quantity to be allocated to a
8 Allocated qty qty Number 9 CP
Allocated
9 Allocated Value Value Number 15,2 Value of the allocated qty
Custodian The custodial participant
Custodian Participant code to which the qty and
10 Participant Code Code CHAR 12 value is to be allocated
This number is mandatory if
Contract note Contract the quantity, value is
11 number note number CHAR 10 allocated to a valid CP
Number in This is required to be given
the return if the TM desires to modify
12 OTR No file Char 10 a record already allocated.

26.4.3.3 OTR (INST) allocation return file

On loading of the file, a return file shall be generated in either ‘Success’ or ‘Failure’ folder in
the following path in the member’s local computer:

C:\NCMSData\Upload\ (in case the set up drive is C drive) .

OTR Output File Name (Return File):

In case of success – XXXXX _OTYYYYMMDD,DDMONYYYY,HH-MM-SS.Snn

In case of failure - XXXXX _OTYYYYMMDD,DDMONYYYY,HH-MM-SS.Rnn

Where
XXXXX - Member code
OT – File Type
YYYYMMDD - Trade Date
DDMONYYYY – Date-Month-Year
HH-MM-SS – Hrs-Mins-Sec
R - File is Rejected
S - File is successful
nn - Batch no.
A success (S) or reject (R) indicator is appended at the end of each record in the case of a
return file. In case of rejected records a rejection code shall be appended.

26.5 Details of files uploaded/ downloaded by members through extranet:

Related instructions for files uploaded through extranet

1. Members can upload the files for CP code modification on the T+1 day i.e. RC files
through the extranet in the specified path as per the timelines specified in 26.3.2
2. The files placed by the members shall be uploaded by the Clearing Corporation and a return
file would be provided to the members with the indication of the success/rejection of the file
and the individual records as given hereunder.
• In case any or all the detail records are successful a return file would be provided with
an indicator ‘S’ confirming that the file was successfully uploaded. At the detail
record level an indicator S / R would be provided indicating whether the detail record
was successful or rejected respectively. In case a detail record is rejected then an error
code would be appended.
• In case a file is rejected due to an error in the control record then the return file would be
provided with an indicator ‘R’ confirming that the file has been rejected and hence has
not been uploaded. In the control record an indicator R would be provided indicating an
error in the control record and an error code would be appended.
• In case a file is rejected because all the detail records are rejected then the return file
would be provided with an indicator ‘R’ confirming that the file has been rejected and
hence has not been uploaded. In the detail records an indicator R would be provided
indicating an error in the detail record and an error code would be appended.
• Such confirmation shall be purely a validation of the correctness of the file and record
formats.
• The return files would be placed in the Extranet Server in the specified path.

3. All files shall have to be submitted before the cut off time as specified by the Clearing
Corporation. Only files submitted before such time would be considered for upload.

4. Members shall submit all the files in a running sequence of batch numbers. Such batch
numbers shall be for each day and commence with ‘01’. If members fail to submit an earlier
batch file then the subsequent batch files shall not be processed and if an earlier file
submitted by the member has been rejected, another file has to be submitted with the same
batch number.

5. The members shall be responsible for all data provided to the Clearing Corporation.

26.5.1 RC file (CP modification on T+1 day)

26.5.1.1 Files sent to members for CP records rejected/not acted upon by custodians:

The Clearing Corporation shall download the files informing the members about the
transactions rejected/not acted upon by the custodians

The file shall be downloaded in the extranet folder \<TM FOLDER>\RC\Dnld

File naming convention:

XXXXX_RCYYYYMMDD.Dnn

Where
XXXXX - Member Code
YYYYMMDD - Current Date (T+1 day)
RC – file type
D – File indicator
Nn - Batch No.

File structure:

Control record Format:

Sr. No. Control Record Field Values
1 Control Record Type 10
2 File Indicator RC
3 Member Type M
4 Member Code MEMBER CODE
5 Batch Date YYYYMMDD
6 Batch No
7 No of Records

Detail Record Format:

Sr. No. Detail Record Field Values
1 Detail Record Type 20
2 B/S Flag B – Buy S – Sell
3 Settlement Type
4 Settlement Number
5 Security Symbol
6 Security Series
7 Order No/ OTR No
8 Custodial Participant Code
9 Traded quantity
10 Traded Value
11 Confirmation Flag

26.5.1.2 File from Trading Members for CP modification on T+1 day

Members may modify CP codes on the T+1 day in respect of trades not already accepted by
Custodians by timelines declared by the Clearing Corporation from time to time.
Modification in respect of transactions already accepted by Custodians shall be rejected with
error code ‘729’. The file has to be uploaded through the extranet folder as specified.

File naming convention:

RCYYYYMMDD.Tnn

Where
YYYYMMDD - date in YYYYMMDD format (trade date)
T - file indicator
RC – file type
nn - batch number of file

File format: The structure of the RC file would be same as the custodial participant code
(CPcode) modification file as specified in 26.4.2.1. The file must be placed in the extranet server
in the respective member directory in the path: rc\upld.

26.5.1.3 RC return file for members:

The return files would be placed in the Extranet Server in the following path: rc\dnld.

File naming convention:

RCYYYYMMDD.Ynn

Where
YYYYMMDD- date in YYYYMMDD format (trade date)
Y - file indicator
S in case of successful processing
R in case of file rejection
nn - batch number of file (same as the value in the file processed)

File format: Comma Separated Variables

The fields provided by trading members in their file would be provided and an additional field
would be appended to each of the record as follows:

Field Description Data Type Length Remarks

Process Flag Value ‘S’/’R’ CHAR 1 S – Successful
R – Rejected
If the value is R an error code would
be appended
 Item 27

PRIVITY OF CONTRACT

In pursuance of Bye Law 11(2) of Chapter VI of the Bye Laws pertaining to Clearing
and Settlement of Deals, the cases to which the said section shall apply are specified
herein :

Settlement Obligations of CM clearing members for giving and receiving delivery and paying
and receiving funds arising out of Regular Market Deals, and LP Deals as specified under
Item 2 of this circular unless specifically excluded by the relevant authority from time to
time.

Pursuant to the above the following settlement obligations are specifically excluded :

Settlement obligations arising out of any deal where in the opinion of the Clearing
Corporation or the specified Stock Exchange there are prima facie suspicion of fraud, wilful
misrepresentations, malpractice or are subject to any investigation by the relevant authority of
either the Clearing Corporation or the Specified Stock Exchange or by any statutory authority
or are deals which are not properly executed in accordance with the respective Bye Laws,
Rules and Regulations of the Specified Stock Exchange.
 Annexure 5.1
Format for intimation of CDSL pool account to the Clearing Corporation
Annexure-5.1(b)
Letter to be given to CDSL

Date:

From:
[Clearing Member Name and address]

To:
[Central Depository Services (I) Ltd. and address]

Dear Sirs,

Sub: Operation of Depository for National Securities Clearing Corporation Limited

Ref: Our Depository Account No: with [CDSL, address].

With reference to the above, we note that:

1. NSCCL has established a clearing and settlement system, whereby its members will be
able to undertake the clearing and settlement of deals admitted.

2. Central Depository Services (I) Limited (CDSL) has been appointed by NSCCL as a
Settling Depository for the purpose of settlement of securities in dematerialised form.

3. Now I/We do hereby irrevocably authorize CDSL to block/earmark the balances in

my/our Depository account and to debit/credit my/our above account as the case maybe
as per the instructions received from NSCCL. Additionally I/We authorize CDSL to
report balances and give any other information as and when required to NSCCL relating
to my/our above mentioned account. This irrevocable undertaking will be effective from
the date of commencement of operation by NSCCL.

4. I/We further hereby undertake to abide by such other or further guidelines / instructions
as may be communicated / devised by the NSCCL.

Yours faithfully

Authorised Signatory.

cc to NSCCL
cc to DP
 Annexure-5.1(b)
Account opening confirmation (to be sent duly filled to NSCCL)

T.M.Code :

T.M.Name : _________________________________________________________

__________________________________________________________

Account No.:
(by CDSL)

DP Id :

Signature: _______________________

Stamp :________________________

Date :________________________
 Annexure 6.1
Designated Clearing Banks

Clearing Bank Address Contact Person & Numbers

Axis Bank Ltd. Capital Market Division, Mr. Sunil Sharma
Jeevan Prakash Building, Asst. Vice President
Sir P.M. Road, Fort, Tel: 66107250/51
Mumbai – 400 001 Mobile: 9869663870
Fax: 66107284/85
Bank of India Ltd. Stock Exchange Branch, Mr. R. S. Jaiswal
P.J.Towers, Dy. General Manager
Dalal Street, Tel: 22722400, 22721787,
Fort, 22722395
Mumbai – 400 001 Mobile: 9820520744
Fax: 22721782, 22721788
Board:22722393/98/99

Mr Dhapodkar
Senior Manager
Tel: 22722396
Fax: 22721784/22721788
Canara Bank Ltd. NSE Branch, Mr. KRP Sarathy
Varma Chambers, 1st Floor Chief Manager
11 Homji Street, Fort, Tel: 22693157, 22633006,
Mumbai – 400 001 22651088, 22658291
Board: 22675702
Fax: 22675650, 22670033

Mr K.Y Mallya
Senior Manager
Tel: 22633006
Fax: 22675650
Citibank N.A. Citigroup Global Services, Mr. Ravi Banta
Infinity Towers, Director
1srt Floor, A Wing, Tel. No. : 4001 5669
Behind Toyota Showroom, Mobile : 98203 18351
Malad (W),
Mumbai – 400 064 Mr. KVP Satish Chandra
Vice President
Tel. No. : 4001 5192
Mobile : 98207 87010

Mr. KVP Satish Chandra

Vice President
Tel. No. : 4001 5192
Mobile : 98207 87010
HDFC Bank Ltd. 2nd Floor, Trade World Mr Shailesh Sukhthankar
"A" Wing, Kamala Mills Head - Capital & Commodity
Lower Parel (W) Market Business
 Mumbai – 400 013 Tel:24988484 Extn:3334
Mobile:9323651640

Mr Chetan A shah
Business Head -Capital Market
Business
Tel:24988484 Extn:3538
Mob:9322902935

Mr Chetan A shah
Business Head -Capital Market
Business
Tel:24988484 Extn:3538
Mob:9322902935
ICICI Bank Ltd. Capital Market Division, Harish Kotian
Mafatlal Chambers, Chief Manager
‘B’ wing, 3rd Floor, Tel No : 66672085
N.M. Joshi Marg, Board Line No: 66672000
Lower Parel (East), Mobile No:9930061805
Mumbai – 400 013 Fax:66672085
IDBI Bank Ltd. Block no 82/83 Minakshi Rathod
Road no 7, Street no 15 Manager
MIDC, Andheri East Tel:66700660
Mumbai – 400 093 Mob:9833381980
Fax:667700708

Mr.Kaushik Bagchi,
Product Head
Tel: 24908350
Mobile No: 9820080607
IndusInd Bank Ltd. Sonawalla Building Mr. Pradeep Bhave
57, Mumbai Samachar Marg VP & Branch Head
Fort Tel: 66347722
Mumbai – 400 001 Mobile No.: 9820550863
Board Nos.: 66366580-83
Fax: 66366590

Mr. Yogesh Adke

Asst. Vice President
Tel : 66366589
Fax: 66366590
Kotak Mahindra Unit no.35, 3rd Floor Parag Srivastava
Bank Ltd. Navsari Building Vice President
Dr. D.N. Road Kotak Mahindra Bank, 5th Floor ,
Fort Dani Corporate Park158,
Mumbai – 400 001 CST Road , Kalina ,
Santacruz (E), Mumbai 400098
022-67595355
9833773960
E- Mail:

Standard Chartered 5th floor, Forbes Building
Bank Charanjeet Rai Marg
Fort
Mumbai – 400 001
State Bank Of India Mumbai Main Branch
1st floor
International Banking Division
Mumbai Samachar Marg
Mumbai – 400 023
parag.srivastava@kotak.com
Rajiv Gurnani
Executive Vice President
Kotak Mahindra Bank, 5th Floor ,
Dani Corporate Park158,
CST Road , Kalina ,
Santacruz (E), Mumbai 400098
022-67595351
9820289333
Sanjay Mehta
Asst.Vice President
Kotak Mahindra Bank,
Kotak Infiniti, 6th Floor,
Building No. 21,
Infinity Park, Off Western Express
Highway,
General AK Vaidya Marg,
Malad (E), Mumbai 400097
022 6605 6658
E- Mail: sanjay.mehta@kotak.com
Dinesh Revappa
Senior Manager
Kotak Mahindra Bank,
Kotak Infiniti, 6th Floor,
Building No. 21,
Infinity Park, Off Western Express
Highway,
General AK Vaidya Marg,
Malad (E), Mumbai 400097
022 6605 6662
E- Mail:
dinesh.revappa@kotak.com
Mr Vineet Bhalla
Relationship Manager
Mob:9769671667
Mr Bhushan Khairnar
Relationship Manager
Tel:66314191
Mob:9820968344
Ms. Vidya Krishnan
Asst. General Manager
TEL NO 022-22094931
Mobile: 9821078386
Mr. Sanjay Bagwe
Manager
 Tel No 022-22094928
Mobile:.9870700435

Mr. Pramod N Raut

Dy. Manager
Tel: 22644411, 22644972
Mobile: 9870498672

Mr. R. K. Prasad
Dy. Manager
Mobile: 9870498671

Mr. R. C. Chidambaram
Asst. Manager
Mobile: 9869798039
The Hongkong & 52/60, Sarita Ferns
Shanghai Banking M G Road, Associate Vice Prsident
Corporation Ltd. Fort, Tel:22681094
Mumbai – 400 001 Mob:9820612280

Mr. Ritesh Jain

Vice President
Head- PCM- Payment Operations
Tel: 67115841
Fax : 66536004

Mr. Shaleen Mahar

Sr. Relationship Manager
Non Bank Financial Institutions
Tel: 22681175, 24980000
Mobile: 9820333047
Fax : 22734388
Union Bank of Capital Market Cell Mr. A.R. Manvi,
India Mumbai Samachar Marg Branch Dy. General Manager
66/80, Mumbai Samachar Marg Tel.: 022-22674115
Fort, Mumbai – 400 023
Mr. R.S. Majithia,
Asst. General Manager
Tel.: 022-22670107

Mr. G.M. Kashyap,

Chief Manager
Tel.: 022-22629335
Fax : 22642742
Mobile: 9820 907295

The latest list of designated clearing banks and their contact details are available on the web-
site, www.nseindia.com
 Annexure 6.2
Format of letter to be submitted by member to bank for operation of Primary /
Secondary * clearing A/c
Date:

From:
[Clearing Member name and address]

To:

[Clearing bank name and address]

Dear Sirs,

Sub: Operation of Clearing Bank for National Securities Clearing Corporation Limited
(NSCCL).

Ref: Our Clearing / Secondary * Clearing Bank Account No:______________ with [Clearing
Bank name and address]

With reference to the above, we note that:

1. National Stock Exchange of India Ltd. has formed National Securities Clearing
Corporation Limited (NSCCL) as a wholly owned subsidiary to undertake clearing and
settlement activity for its Members. NSCCL has established a clearing and settlement
system, whereby its members will be able to undertake the clearing and settlement of
deals admitted.

2. The bank has been nominated / appointed as a Clearing Bank for the purpose of Clearing
and Settlement by NSCCL.

3. As per the Byelaws, Rules and Regulations of NSCCL, the member shall authorise the
Clearing Bank to access their clearing account for debiting & crediting their accounts as
per the instructions received from NSCCL from time to time.

4. Having due regard to the above, we hereby irrevocably authorise the Clearing bank to
debit and credit our above referred clearing bank account from time to time as per the
instructions received from NSCCL. Further, we authorise the Clearing Bank to report
balances and other information relating to this account to NSCCL as may be required by
NSCCL from time to time. This irrevocable undertaking will be with immediate effect.

5. We further hereby undertake to abide by such other or further guidelines / instructions as

may be communicated / decided by NSCCL.

Yours faithfully,

Authorised Signatory
Designation
* Strike out whichever is not applicable
 Annexure 7.1
Format of letter for Auto Delivery Out

Letter format

From: [Clearing Member Name and address]

To: [NSCCL and address]

Dear Sirs,

Sub: Availing the facility of Automatic Delivery Out in NSDL

With reference to the above, we note that:

1. NSCCL is commencing a new facility for automating the delivery out instructions.

2. We wish to avail of this facility for the following settlement types. (Please mark 'Y'
against the settlement type for which this facility is desired and 'N' against the settlement
for which this facility is not required)

Settlement Type 'N', Market Type 13

Settlement Type 'A', Market Type 14

Settlement Type 'W', Market Type 22

Settlement Type ‘D’ Market type 21

3. We do hereby irrevocably authorize NSCCL to provide NSDL with the details of the
delivery obligations, including the security details and the quantities to deliver for all the
above settlement types and any other details which may have to be given to NSDL with
respect to the above subject. This irrevocable undertaking will be effective from the date
of this letter.

4. We understand that in the case of pari-passu shares and multiple ISINs, Auto DO
instructions will be generated for only the primary ISIN. We also understand that in case
an IDO is given, the Auto DO instructions for the same will be monitored by us and any
changes desired to be made in the Auto DO instructions will be done by us accordingly.

5. In case of shifting of our CM pool account in NSDL, we undertake to monitor the

delivery instructions including the Auto DO instructions generated by NSCCL. We
understand that NSCCL will be generating Auto DO instructions for a single depository
account only, even if two CM pool accounts are operating at the same time.

6. NSCCL will not be responsible for any short or excess shares being transferred from our
depository account with NSDL on account of Auto DO.
7. In case we fail to comply with the specified requirements of NSDL, resulting into short
deliveries and consequential close out, NSCCL will in no way be responsible.

8. We further hereby undertake to abide by such other or further guidelines / instructions as

may be communicated / devised by NSCCL from time to time.

Yours faithfully

Signature of
(Member/Partner of Partnership firm/Director of a Corporate Member)
 Annexure 7.2
Direct Payout to Investors Account

1. Members shall be required to provide files in a specific structure (given as under) to the
Clearing Corporation for effecting payout directly to the client’s beneficiary accounts.

2. Additionally, the clearing member can provide own settlement account details if the
clearing member intends to receive full or part payout of securities, which is not
identified for direct client account payout, in the settlement account with specific
depository. This information can be provided in the same file. The clearing member is
required to provide depository participant ID and depository participant client ID if the
settlement account is with NSDL or CM Settlement account number if the settlement
account is with CDSL.

3. The files would have to be sent by the members to the clearing corporation by 9:30 a.m
on the settlement day

4. The files shall be uploaded by Clearing Corporation in its system and returned with the
indication of the success/rejection of the file and the records. This shall be purely a
validation of the correctness of the file and record formats.

5. In case Clearing Members intend to modify the data in a file, which has been already
submitted to Clearing Corporation, the Clearing Member would be having an opportunity
to submit the full file after carrying out the modifications (before the cut off time
announced by Clearing Corporation). With the submission of this full file the file
submitted earlier shall be ignored and not considered. This would mean that the data
provided in the latest batch shall be duly considered final and complete and the file
submitted earlier shall be totally ignored.

6. Clearing Members will have to submit all the files in a running sequence of batch
numbers. If Clearing Members fail to submit an earlier batch file then the subsequent
batches will not be processed. However, if the earlier file was completely rejected, the
same batch number should be used for the subsequent corrected file.

7. The total quantity of securities to be credited to the account of various constituents shall
not exceed the net pay out by Clearing Corporation to the Clearing Member.

8. The Clearing Members shall provide the details of beneficiary account of the constituents
of the Trading Members in any one of the depositories.

9. If for any record, the quantity requested to be credited to the account of the constituent is
more than the balance available for pay out to the Clearing Member in that depository, the
quantity available in that depository shall only be directly credited to the constituent.

10. Where the Clearing Members fail to provide the details of the beneficiary account or
where the credit to the beneficiary accounts of the constituents fail, or any account
whatsoever the remaining quantity received from other depository as pay out shall be
credited to the CM Pool / Clearing account of the Clearing Member with the respective
depositories
11. The credit to the beneficiary account of the constituent shall be pursuant to the file and in
conformity with the details provided by the Clearing Member requesting Clearing
Corporation to directly credit the accounts of the constituent. Hence execution of such
electronic instructions of passing the credit to the account of the constituents shall mean
and be pay out to the Clearing Members

12. Clearing Members shall be provided a return file after completion of pay out confirming
the details of the accounts, which have been credited by the depositories (CM Pool a/c
and or Beneficiary accounts).

13. Clearing Corporation shall consider the data provided by the Clearing Members as final
and correct and shall not be responsible for any incorrect data provided by the Clearing
Members. The Clearing Members shall be fully responsible for any erroneous data
provided to Clearing Corporation.

14. The files must be placed in the extranet server in the directory, Clearing \CPD\dnld.

Members may note that this is only a facility offered to the members in terms of the SEBI
circular in this regard. However, where Members are unable to provide the data in respect of
clients to Clearing Corporation for direct credit to the account of the clients the securities
would be credited to the respective pool account of the members and the resultant guidelines
of the SEBI in respect of holdings in the pool account shall apply.

It may also be noted here that that the requirements specified by SEBI / Exchange in relation
to release of funds / securities to the respective clients is within one day of declaration of pay
-out by the respective Exchange / Clearing Corporation.

File structure for Payout to Client

File format: Comma Separated

Location: CPD\UPLD

Naming Convention of the file: CPD<SYYYYYYYD>.Xnn

CPD File type

S Settlement Type
YYYYYYY Settlement Number
D Delivery Type
X File Indicator
T File coming from the member
S Success File sent to the trading members
R Reject File sent to the trading members
nn Batch number (is a running sequence)

Control record Format:

Sr. Field Length Mandatory/Optional Description

No.
1. Record Type CHAR(2) Mandatory Value = 10
2. File Type CHAR(3) Mandatory Value = CPD
3. Member Type CHAR(1) Mandatory 'M' For Clearing
Member
'C' - For Custodians
4. Member Code CHAR(5) Mandatory Member Code

5. Settlement type CHAR(1) Mandatory

6. Settlement CHAR(7) Mandatory
number
7. Delivery Type CHAR(1) Mandatory
8. Batch Number Number(2) Mandatory Batch Number in
running sequence
9. Total No. of Number(7) Mandatory Total number of
Records records in file
10. Total quantity Number(9) Mandatory

Detail Record Format

Sr. Field Length Mandatory/Optional Description

No.
1. Record Type CHAR(2) Mandatory Value = 20
2. Depository Id CHAR(5) Mandatory Value = NSDL /
CDSL
3. ISIN CHAR(12)
4. Beneficiary CHAR(16) Mandatory In case of CDSL
Account No the Beneficiary a/c.
In case of NSDL
the 1st 8 digit shall
be the DP Id and
the next 8 digits
shall be the
beneficiary a/c, in
that order
5. Quantity Number(9) Mandatory
 Annexure - 9.1
Valuation for corporate benefit

Sr. Corporate Benefit Valuation

No.
1 Dividend/Interest/ All debit/credit for valid claims on company
Redemption amount objections lodged with Clearing House shall be done
by the Clearing Corporation.
2 Bonus IM may deliver the entire quantity of bonus shares
claimed by the RM. In case of part delivery of bonus
shares the delivery must necessarily be in market lots.
In case the IM does not deliver the shares, the
equivalent monetary value for the bonus shares shall
be debited to the IM and credited to the account of
RM by the Clearing Corporation.
3 Rights- Equity IM may deliver the entire quantity of rights shares
claimed by the RM and claim the amount for issue
price in the relevant portion of form BDC-2A. In case
of part delivery of rights shares, the delivery must
necessarily be in market lots. In case the IM does not
deliver the shares, the equivalent monetary value less
rights issue amount shall be debited to the IM and
credited to the account of RM by the Clearing
Corporation.
4 Rights FCD,PCD-convertible part (which are traded on NSE)
IM may deliver the entire quantity of rights FCD,
PCD - convertible part (which are traded on NSE)
claimed by the RM and claim the amount for issue
price in the relevant portion of form BDC-2A. In case
of part delivery of rights FCD, PCD - convertible part
(which are traded on NSE), the delivery must
necessarily be in market lots. In case the IM does not
deliver the rights shares, the equivalent monetary
value less rights issue amount shall be debited to the
IM and credited to the account of RM by the Clearing
Corporation.
5 Rights - NCD PCD- No Valuation
Non Convertible Part
6 Others Rights - Shall be handled directly between members as is the
FCD,PCD-convertible current practice
part (if not traded on
NSE)

IM : Introducing Member/First Introducing Member

RM : Receiving Member/Last Introducing Member

Computation of equivalent value : The equivalent value of a scrip will be the closing price of
Day 19. The date of intimation of objection is taken as Day 1. In case there is no trading on
Day 19, then the closing price of the day preceding Day 19 on which trading took place will
be taken as equivalent value. However, if the rectification of objection is beyond the
stipulated period of 21 days (owing to the scrip being in no delivery), the relevant valuation
price shall be the closing price of the date 2 days prior to the date of rectification.
 Annexure-10.1

List of Approved Banks for issuance of Fixed Deposits Receipts & Bank Guarantees

Sr. No Bank Name

1 ALLAHABAD BANK
2 ANDHRA BANK
3 AXIS BANK LTD
4 BANK OF AMERICA, N.A.
5 BANK OF BARODA
6 BANK OF INDIA
7 BANK OF MAHARASHTRA
8 BANK OF NOVA SCOTIA
9 BARCLAYS BANK PLC
10 BNP PARIBAS
11 CANARA BANK
12 CENTRAL BANK OF INDIA
13 CITIBANK N.A.
14 CITY UNION BANK LTD.
15 CORPORATION BANK
16 DBS BANK LTD
17 DENA BANK
18 DEUTSCHE BANK AG
19 DEVELOPMENT CREDIT BANK LTD
20 DHANALAKSHMI BANK LTD
21 FEDERAL BANK LTD
22 HDFC BANK LTD
23 HONGKONG AND SHANGHAI BANKING CORPORATION LTD
24 ICICI BANK LTD
25 IDBI BANK LIMITED
26 INDIAN BANK
27 INDIAN OVERSEAS BANK
28 INDUSIND BANK LTD
29 ING VYSYA BANK LTD
30 JAMMU & KASHMIR BANK LTD
31 JP MORGAN CHASE BANK, N.A.
32 KARNATAKA BANK LTD
Sr. No Bank Name
33 KARUR VYSYA BANK LTD
34 KOTAK MAHINDRA BANK LTD
35 LAKSHMI VILAS BANK LTD
36 ORIENTAL BANK OF COMMERCE
37 PUNJAB & SIND BANK
38 PUNJAB NATIONAL BANK
39 SOCIETE GENERALE
40 SOUTH INDIAN BANK LTD
41 STANDARD CHARTERED BANK
42 STATE BANK OF BIKANER & JAIPUR
43 STATE BANK OF HYDERABAD
44 STATE BANK OF INDIA
45 STATE BANK OF MYSORE
46 STATE BANK OF PATIALA
47 STATE BANK OF TRAVANCORE
48 SYNDICATE BANK
49 TAMILNAD MERCANTILE BANK LTD
50 THE BANK OF TOKYO-MITSUBISHI UFJ LTD
51 THE CATHOLIC SYRIAN BANK LTD
52 THE ROYAL BANK OF SCOTLAND N.V.
53 UCO BANK
54 UNION BANK OF INDIA
55 UNITED BANK OF INDIA
56 VIJAYA BANK
57 YES BANK LTD
 Annexure-10.2

List of Approved Custodians

Sr. Name of Contact Person Address Phone/Fax

No Custodian
1 HDFC Bank Ltd. Mr.Anu Khandelwal Lodha I Think Techno Phone Nos :
/ Mr.Mitesh.Mehta Campus Alpha Building, 30752877
8th Floor Office Opp Fax :
Crompton Greaves , Next 30752846
to Kanjurmarg Railway
Station ,Kanjurmarg –
East,Mumbai - 400042
2 Stock Holding Mr. Ganesh Zodge / DP Operations (Pledge - Phone Nos.:
Corporation of Mr. Vinod NSCCL Margin) 27785532
India Ltd. Plot no. P -51, T.T.C. Fax : 022 -
(SHCIL) Industrial Area, 61778533
MIDC, Mahape
Navi Mumbai 400 710

3 ICICI Bank Ltd. Mr. Nagesh Securities Market Services, Phone Nos. :
Srivastava / Empire Complex, 1st Floor 66672005 /
Mr.Yogesh Gadgill 414 Senapati Bapat Marg 66672082
Lower Parel, Mumbai 400 Fax :
013 66672740
4 IL&FS Mr. Krishnamurthy IL&FS House , Plot No. Phone Nos. :
Securities Iyer 14, Raheja 02228571645
Services Ltd. Vihar,Chandivali , /
Andheri (E), Mumbai - 400 02242493343/
072 Fax : 2857
8912
 Annexure-10.3
Format of letters for submission of FDR towards Security Deposit

Annexure-10.3a
Format of letter by member for submission of FDR to Custodian for security deposit
(To be typed on member's letter head)

To Date:

Name & Address of custodian (Capital Market Segment)

Dear Sir,

As per requirements of National Securities Clearing Corporation Limited (NSCCL) and in

compliance of prescribed norms of NSCCL, we have to furnish security deposit and
accordingly have furnished you the same in the form of FDR (FDR No.------------ ) placed
with ____________________________ Bank, issued as ”Name of Custodian” - A/c.
“Member Name” for Rs. ______/- (Rupees ___________________________ only.)

I/We hereby agree and consent that as the custodian of NSCCL, you shall have an irrevocable
authority to encash the said FDR and to withdraw the said FDR amount at any time, even
prior to maturity, without notice to me/us for recovery/adjustment of NSCCL/NSEIL dues
and we have no objections whatsoever for the same.

I/We agree that you may renew the FDR for periods of one year each time till the FDR is
released by NSCCL.

I/we agree that on the encashment of FDR, NSCCL will be entitled to the interest accrued on
the said FDR also and you are hereby authorised to pay the accrued interest to NSCCL along
with the principal amount (FDR amount) payable.

Yours faithfully,

Authorised Signatory
________ Member name and Member Code
 Annexure-10.3b
Format of letter to be provided by Bank issuing security deposit FDR to the custodian
(To be typed on bank’s letter head)

To Date:

Name & Address of the Custodian

Dear Sir,

We refer to the fixed deposit receipt (FDR) bearing no. ______________ issued for
Rs.___________ ( Rs in words) in your name A/c. “Member's name”

We hereby agree and confirm that

There is no lock in period for encashment of the said FDR.

i.) The amount under the said FDR would be paid to you on demand, at any point of time
without any reference to the ________________ (name of member).
ii.) Encashment whether premature or otherwise would not require any clearance from
any other authority / person.
iii.) On encashment of the FDR by you, the interest accrued thereon will also be released to
you.
iv.) The FDR will be renewed for such periods as may be instructed by you.
v.) The FDR is payable at Mumbai (In case FDR is issued from places other than
Mumbai, Delhi, Kolkata, Chennai, Ahmedabad and Hyderabad)

Yours faithfully,

Authorised Signatory
________ Bank Ltd.
 Annexure-10.3 c
Format of letter by member for submission of FDR to Clearing Corporation for
security deposit

(To be typed on Member’s letter head)

To Date:

National Securities Clearing Corporation Ltd (Capital Market Segment)

Exchange Plaza
Bandra Kurla Complex
Bandra (E)
Mumbai-400 051

Dear Sir,

As per requirements of National Securities Clearing Corporation Limited (NSCCL) and in

compliance of prescribed norms of NSCCL, we have to furnish you security deposit and
accordingly have furnished you the same in the form of FDR (FDR No.---------) placed with
____________________________ Bank, issued as NSCCL A/c “Member’s name “ for Rs.
______/- (Rupees _____________________ only.)

I/We hereby agree and consent that you shall have an irrevocable authority to encash the said
FDR and to withdraw the said FDR amount at any time, even prior to maturity, without
notice to me/us for recovery/adjustment of NSCCL/NSEIL dues and we have no objections
whatsoever for the same.

I/We agree that you may renew the FDR for period of one year each time till the FDR is
released by you.

I/we agree that on the encashment of FDR, you will be entitled to the interest accrued on the
said FDR and you are hereby authorised to receive the accrued interest from the Bank along
with the principal amount (FDR amount) payable.

Yours faithfully,

Authorised Signatory
________ Member name and Member Code
 Annexure-10.3d
Format of letter to be provided by Bank issuing security deposit FDR to the Clearing
Corporation
(To be typed on bank’s letter head)

To Date:

National Securities Clearing Corporation Ltd.

Exchange Plaza
Bandra Kurla Complex
Bandra (E)
Mumbai-400 051

Dear Sir,

We refer to the fixed deposit receipt (FDR) bearing no. ______________ issued for
Rs.___________ , ( Rs in words) in your name A/c “Member's name”

We hereby agree and confirm that

i.) There is no lock in period for encashment of the said FDR.

ii.) The amount under the said FDR would be paid to you on demand, at any point of time
without any reference to the ________________ (name of member).
iii.) Encashment whether premature or otherwise would not require any clearance from any
other authority / person.
iv.) On encashment of the FDR by you, the interest accrued thereon will also be released to
you.
v.) The FDR will be renewed for such periods as may be instructed by you.
vi.) The FDR is payable at Mumbai (In case FDR is issued from places other than Mumbai,
Delhi, Kolkata, Chennai, Ahmedabad and Hyderabad)

Yours faithfully,

Authorised Signatory
________ Bank Ltd.
 Annexure-10.4
Format of Bank Guarantee for Margin Deposit and Security Deposit

BG NO: __________________
Date : __________________

To:
National Securities Clearing Corporation Ltd.
Exchange Plaza, Plot C-1, G Block,
Bandra Kurla Complex,
Bandra (East),
Mumbai – 400 051.

Dear Sirs:

This guarantee bearing No. _________________________ is issued by

____________________________, a body corporate constituted under the Companies Act
1956, having its Head Office at ___________________________________________
(hereinafter referred to as the “Bank” which term shall wherever the context so permits
includes its successors and assigns) in favour of National Securities Clearing Corporation
Limited, a company incorporated under the Companies Act, 1956 and having its registered
office at Exchange Plaza, Plot C-1, G Block, Bandra Kurla Complex, Bandra (East), Mumbai
– 400 051 (hereinafter referred to as “NSCCL” which expression shall include its successors
and assigns).

Whereas

a. Mr./Ms.__________________________________________ s/o / d/o / w/o

________________________________________________,residing at
__________________________and having his/her office at
_______________________________(Complete Address), (hereinafter referred to as
the “Clearing Member”, which expression shall include his/her successors and
assigns) /* is/are a Clearing Member of NSCCL.

OR
M/s ______________________________________________, a partnership firm
registered under the Indian Partnership Act, 1932 and having their office at
_____________________________________________ (Complete Address),
(hereinafter referred to as the “Clearing Member”, which expression shall include
their successors and assigns ) /* is/are a Clearing Member of NSCCL.

OR
 BG NO: __________________
Date : __________________

M/s___________________________________________________., incorporated as
a company under the Companies Act, 1956 and having its registered office at
___________________________(Complete Address), (hereinafter referred to as the
“Clearing Member”, which expression shall include its successors and assigns ) *
is/are a Clearing Member of NSCCL.

b. One of the conditions of Clearing Membership of NSCCL is that the Clearing Member
maintains with NSCCL *security deposit/ margin deposit in the form shares and other
securities of a value not less than Rs. _______ after applying suitable margins as
prescribed by NSCCL, for Capital Market Segment

c. At the request of the Clearing Member, NSCCL has agreed to accept a bank
guarantee in lieu of such *security deposit/ margin deposit, as the case may be in
favour of NSCCL from an approved commercial bank for an equivalent amount of
Rs._________________________________________________.

d. The Clearing Member has requested the Bank to furnish to NSCCL a guarantee for
Rs._________________ ____________________________.

Therefore these presents:

1. This guarantee shall be governed by the terms and conditions of the Master
Agreement dated ________executed between the Bank and NSCCL and the same
shall form a part and parcel of this guarantee as though the same have been
incorporated in this guarantee.

2. The liability of the Bank under this guarantee shall not exceed Rs._______________.

3. This guarantee shall be valid for a period of _________ months i.e. upto ____.
However, the Bank is liable to pay the guaranteed amount if NSCCL serves upon
Bank a written claim or demand on or before ____________ (i.e. within ___ _____
after the date of expiry of the bank guarantee as mentioned in clause 3 above).

Executed this ____ day of ______________ at __________

For ________(Bank)

Authorized Signatories
Seal of the Bank
*Strike out whichever is not applicable
Instructions:
1. The above printed format is required to be used. Strike out / delete Security Deposit or
Margin deposit whichever is not applicable in clause b
2. In case of margin deposit bank guarantee strike out / delete “of a value not less than
Rs. _______” in clause b
3. The Bank Guarantee to be stamped for Rs.100/- or the value prevailing in the State
where executed, whichever is higher. Bank Guarantee to be executed on Non-Judicial
stamp paper(s) or on paper franked from Stamp Office
4. All the blanks in the format are required to be duly filled by the issuing bank along
with the signature of the authorised signatory and stamp of the bank.
5. Each page of the bank guarantee should bear the bank guarantee number and issue
date and should be signed by two authorised signatories of the bank unless the bank
has specifically intimated NSCCL that only one authorised signatory shall sign the
bank guarantees issued by them in favour of NSCCL.
 Annexure-10.5

Annexure 10.5a
Format of deed of pledge for clearing members for deposit of securities for security
deposit

To Be Executed On Non Judicial Stamp Paper Of Rs 100/- Or In Accordance With The

Prevailing Rates Applicable In The Place Of Execution, Whichever Is Higher.

This Deed of Pledge (hereinafter referred to as “the Deed”) is executed at _______________

on this ___ day of _________ 20___ by

_______________________________, S/o / d/o / w/o __________________ residing at

_____________________ and having his office at ________________________________ *

_____________________________, a partnership firm registered under the Indian

Partnership Act, 1932 and having its office at __________________________________*

________________________Ltd., incorporated as a company under the Companies Act,

1956 and having its registered office at _______________________________________*

(hereinafter referred to as “Clearing Member” which expression shall unless repugnant to the
context thereof include successors, administrators and assigns) in favour of National
Securities Clearing Corporation Limited, a company incorporated under the Companies Act,
1956 and having its registered office at Exchange Plaza, Bandra-Kurla Complex, Bandra
(East), Mumbai - 400051 (hereinafter referred to as “NSCCL” which expression shall unless
repugnant to the context thereof, include its successors and assigns).

WHEREAS

a) The Clearing Member is admitted to the Clearing Membership of NSCCL.

b) One of the requirement of the clearing Membership is that the Clearing Member shall
maintain with NSCCL security deposits in the form of cash, bank guarantees or
securities for the due performance and fulfillment by him/it of his/its engagements,
commitments, operations, obligations or liabilities as a Clearing Member including
any sums due by him/it to NSCCL or any other party as decided by NSCCL arising
out of or incidental to any contracts made, executed, undertaken, carried out or
entered into by him/it.

c) The securities to be deposited by the Clearing Member shall be securities in

dematerialised form and as may be approved by NSCCL from time to time to an
extent of Rs. ________ /- (Rupees ________________ only) or of such value as may
be specified by NSCCL from time to time.

d) The Clearing Members shall deposit the securities with such custodians acting as
depository participants as may be determined by NSCCL from time to time.
NOW THIS DEED WITNESSETH AS FOLLOWS:

1. In consideration of NSCCL having agreed to accept approved dematerialised

securities as a security deposit to an extent of Rs.____________ /- (Rupees
_______________________________ only), or of such value as may be specified by
NSCCL from time to time, the Clearing Member hereby pledges securities
(hereinafter referred to as “Said Securities”) with NSCCL as security for due
performance and fulfillment by him/it of all engagements, commitments, operations,
obligations or liabilities as a Clearing Member of NSCCL including any sums due by
him/it to NSCCL or National Stock Exchange of India Limited (hereinafter referred to
as “NSEIL”) or any other party as decided by NSCCL arising out of or incidental to
any contracts made, executed, undertaken, carried out or entered into by him/it.

2. The Clearing Member if so determined by NSCCL shall place the Said Securities in
the absolute disposition of such custodian/depository participant in such manner as
decided by NSCCL and such possession and disposition may be apparent and
indisputable notwithstanding the fact that the Clearing Member may be permitted to
have access to the Said Securities in the manner and subject to such terms and
conditions as determined by NSCCL and provided further that during such time the
Clearing Member confirms, affirms and covenants with NSCCL that he/it shall do all
such acts and things, sign such documents and pay and incur such costs, debts and
expenses as may be necessary without prejudice to any other obligations, liabilities,
duties which he/it owes as a Clearing Member.

3. For the purpose of the clauses (1) and (2), and for the purpose of this Deed, the term
“Said Securities” shall mean all the securities lying in the Depository Account No.
___________ (hereinafter referred to as “Account”) with the custodian/depository
participant and shall include all securities given in addition, substitution or
replacement of the securities in the said Account. All securities lying in the said
Account shall be deemed to have been pledged at all times with NSCCL by virtue of
this Deed.

4. The Clearing Member declares and assures that all the Said Securities are in
existence, owned by him/it and free from any prior charge, lien or encumbrance and
further that all the Said Securities over which pledge may be created in future would
be in existence and owned by him/it at the time of creation of such pledge and that all
the Said Securities to be given in future as security to NSCCL would likewise be
unencumbered, absolute and disposable property of the Clearing Member.

5. The Clearing Member agrees that he/it shall not without NSCCL’s prior written
permission create any charge, lien or encumbrance of any kind upon or over the Said
Securities hereby pledged except to NSCCL, that he/it shall not suffer any such
charge, lien or encumbrance to affect the Said Securities or any part thereof and
further that he/it shall not do or allow anything to be done that may prejudice the Said
Securities while he/it remains liable to NSCCL in any manner without the prior
written permission of NSCCL.

6. The Clearing Member agrees, declares and undertakes that he/it shall be bound and
abide by the terms and conditions of the Scheme for the Deposit of securities in
dematerialised form as formulated and determined by NSCCL, for security deposit
 either in their existing form or as modified/changed/altered /amended from time to
time pursuant to requirement/ compliance of Clearing Membership.

7. If in the opinion of NSCCL, the Clearing Member has failed to perform and / or fails
to fulfil his/its engagements, commitments, operations, obligations or liabilities as a
Clearing Member of NSCCL including any sums due by him/it to NSCCL or to
NSEIL or to any other party arising out of or incidental to any contracts made,
executed, undertaken, carried out or entered into by him/it, then the Clearing Member
agrees that NSCCL on giving one working day notice to the Clearing Member on its
own as a pledgee, shall be empowered/entitled to invoke the pledge, sell, dispose of or
otherwise effect any other transfer of the Said Securities in such manner and subject
to such terms and conditions as it may deem fit and that the money if any realised
from such pledge/sale/disposal/or other transfer shall be utilised/disbursed by NSCCL
in such manner and subject to terms and conditions as it may deem fit and further the
Clearing Member shall do all such things, deeds, acts and execute all such documents
as are necessary to enable NSCCL to effect such pledge/sale/disposal/or other
transfer. The decision of NSCCL as to the obligations or liabilities or commitments
of the Clearing Member and the amount claimed shall be final and binding on the
Clearing Member. The Clearing Member understood and agrees that one working day
notice mentioned above shall be deemed to be a reasonable notice, as this pledge of
securities is being accepted as security deposit by NSCCL in lieu of cash deposits or
bank guarantees, which can be invoked and appropriated in a days time and also due
to the nature of transactions on NSCCL.

8. The Said Securities pledged as security shall be available at the disposal of NSCCL as
a continuing security and remain available in respect of the obligations, liabilities or
commitments of the Clearing Member jointly or severally and may be utilised as such
in the discretion of NSCCL, as if each of the obligations, liabilities or commitments is
secured by the Said Securities. This Deed shall not be considered as cancelled or in
any way affected on its utilisation for meeting any specific obligation, liability or
commitment by NSCCL but shall continue and remain in operation in respect of all
subsequent obligations, liabilities or commitments of the Clearing Member.

9. The Clearing Member shall be released from his/its obligations, liabilities under this
Deed only when NSCCL, in writing, expressly provides for the release of the Said
Securities.

10. The Clearing Member agrees that NSCCL shall be entitled to sell, negotiate or
otherwise transfer the Said Securities and to execute transfer documents and/or any
other necessary documents, wherever applicable or other endorsements for this
purpose and that NSCCL shall be entitled to receive from him/it all expenses incurred
by NSCCL/Custodian for the aforesaid purposes.

11. The Clearing Member agrees to execute such further documents whether of a legal
nature or otherwise as may be required by NSCCL for the purpose of giving effect to
the provisions of this Deed and also the Scheme for the Deposit of securities in
dematerialised form.

12. The Clearing Member agrees that the deposit of the ‘Said Securities’ and the pledge
thereof shall not be affected in any manner whatsoever if NSCCL takes any action
 against the Clearing Member including suspension or expulsion or declaration of the
Clearing Member as a defaulter.

13. The Clearing Member agrees that NSCCL shall not be under any liability whatsoever
to the Clearing Member or any other person for any loss, damage, expenses, costs etc,
arising out of the deposit of the Said Securities, in any manner, due to any cause
whatsoever, irrespective of whether the Said Securities shall be in the possession of
the NSCCL or not at the time of such loss or damage or the happening of the cause
thereof. The Clearing Member shall at all times indemnify and keep indemnified
NSCCL from and against all suits, proceedings, costs, charges, claims and demands
whatsoever that may at any time arise or be brought or made by any person against
NSCCL in respect of any acts, matters and things lawfully done or caused to be done
by NSCCL in connection with the Said Securities or in pursuance of the rights and
powers of NSCCL under this Deed.

14. The Clearing Member undertakes that the deposit of the ‘Said securities’ and the
pledge thereof shall be binding on him/it as continuing and that it shall not be
prejudiced by his/its failure to comply with the Rules, Bye-laws or Regulation of
NSCCL or any other terms and conditions attendant to the Clearing membership of
NSCCL and that NSCCL shall be at liberty, without thereby affecting his/its rights
against him/it hereunder or in relation to the ‘Said securities’ or to any other security
now or hereafter held or taken at any time to vary, amend change or alter any terms or
conditions of its Rules, Bye laws or Regulations of NSCCL in general or as applicable
to him / it in particular.

Executed at _____________ on the day, month and year above mentioned.

Signed, sealed and delivered by the within named **

Clearing Member.
________________________

in the presence of witnesses

1.

2.

* strike out whichever is not applicable

** To be signed by
the Clearing member in case of individual.
all partners in case of a Partnership firm
by any two of the following persons in the case of a Company:
i. Managing Director
ii. Whole-time Director
iii. Directors
 Annexure 10.5b

Format of deed of pledge for other than clearing members for deposit of securities for
security deposit

To Be Executed On Non Judicial Stamp Paper Of Rs 100/- Or In Accordance With The

Prevailing Rates Applicable In The Place Of Execution, Whichever Is Higher.

This Deed of Pledge (hereinafter referred to as “the Deed”) is executed at _______________

on this ___ day of _________ 20___ by _______________________________, S/o / d/o /
w/o __________________ residing at _______________________________and having his
office at ______________________ (hereinafter referred to as “Pledgor” which expression
shall unless repugnant to the context thereof include successors, administrators and assigns)
in favour of National Securities Clearing Corporation Limited, a company incorporated
under the Companies Act, 1956 and having its registered office at Exchange Plaza, Bandra-
Kurla Complex, Bandra (East), Mumbai - 400051 (hereinafter referred to as “NSCCL” which
expression shall unless repugnant to the context thereof, include its successors and assigns).

WHEREAS

a) Mr/Ms _____________________ s/o / d/o / w/o ___________________ residing at

____________________________ and having his/her/their office at
________________________ (hereinafter referred to as the Clearing Member, which
expression shall include his/its successors and assigns)*

M/s ____________________________ , a partnership firm registered under the Indian

Partnership Act, 1932 and having their office at
_______________________________________ (hereinafter referred to as the Clearing
member, which expression shall include their successors and assigns)*

M/s ______________________________ Limited, incorporated as a company under the

Companies Act, 1956 and having its registered office at ____________________

(hereinafter referred to as the Clearing member, which expression shall include its
successors and assigns) * is/are a Clearing member of the NSCCL.

b) One of the requirement of the Clearing Membership is that the Clearing Member shall
maintain with NSCCL security deposits in the form of cash, bank guarantees or securities
for the due performance and fulfilment by him/it of his/its engagements, commitments,
operations, obligations or liabilities as a Clearing Member including any sums due by
him/it to NSCCL or any other party as decided by NSCCL arising out of or incidental to
any contracts made, executed, undertaken, carried on or entered into by him/it.

c) The securities to be deposited by the Clearing Member or any other person, as a security
for such Clearing member shall be securities in dematerialised form and as may be
approved by NSCCL from time to time to an extent of Rs. ___________/- (Rupees
______________________ only) or of such value as may be specified by NSCCL from
time to time.
d) At the request of the Clearing member and as permitted by NSCCL, the Pledgor has
agreed to offer securities in the dematerialised form as a security for the purpose of
security deposit requirement as aforesaid.

e) The Pledgor shall deposit the securities with such custodians acting as depository
participants as may be determined by NSCCL from time to time.

NOW IT IS HEREBY AGREED BY AND BETWEEN THE PARTIES AS FOLLOWS:

1. In consideration of the NSCCL having agreed to accept approved dematerialised

securities as a security deposit to an extent of Rs.____________ /- (Rupees
_______________________________ only), or of such value as may be specified by
NSCCL from time to time, the Pledgor hereby pledges securities (hereinafter referred
to as “Said Securities”) with NSCCL as security for due performance and fulfillment
by the Clearing Member of all his/its engagements, commitments, operations,
obligations or liabilities as a Clearing Member of NSCCL including any sums due by
him/it to NSCCL or National Stock Exchange of India Limited (hereinafter referred to
as “NSEIL”) or any other party as decided by NSCCL arising out of or incidental to
any contracts made, executed, undertaken, carried out or entered into by him/it.

2. The Pledgor if so determined by NSCCL shall place the Said Securities in the
absolute disposition of such custodian/depository participant in such manner as
decided by NSCCL and such possession and disposition may be apparent and
indisputable notwithstanding the fact that the Pledgor may be permitted to have access
to the Said Securities in the manner and subject to such terms and conditions as
determined by NSCCL and provided further that during such time the Pledgor
confirms, affirms and covenants with NSCCL that he/it shall do all such acts and
things, sign such documents and pay and incur such costs, debts and expenses as may
be necessary without prejudice to any other obligations, liabilities, duties which the
Clearing Member owes as a Clearing Member of NSCCL.

3. For the purpose of the clauses (1) and (2), and for the purpose of this Deed, the term
“Said Securities” shall mean all the securities lying in the Depository Account No.
___________ (hereinafter referred to as “Account”) with the custodian/depository
participant and shall include all securities given in addition, substitution or
replacement of the securities in the said Account. All securities lying in the said
Account shall be deemed to have been pledged at all times with NSCCL by virtue of
this Deed.

4. The Pledgor declares and assures that all the Said Securities are in existence, owned
by him/it and free from any prior charge, lien or encumbrance and further that all the
Said Securities over which pledge may be created in future would be in existence and
owned by him/it at the time of creation of such pledge and that all the Said Securities
to be given in future as security to NSCCL would likewise be unencumbered, absolute
and disposable property of the Pledgor.

5. The Pledgor agrees that he/she shall not without NSCCL’s prior written permission
create any charge, lien or encumbrance of any kind upon or over the Said Securities
hereby pledged except to NSCCL, that he/she shall not suffer any such charge, lien or
encumbrance to affect the Said Securities or any part thereof, and further that he/she
 shall not do or allow anything to be done that may prejudice the Said Securities while
he/she remains liable to NSCCL in any manner without the prior written permission
of NSCCL.

6. The Pledgor agrees, declares and undertakes that he/she shall be bound and abide by
the terms and conditions of the Scheme for the Deposit of securities in dematerialised
form as formulated and determined by NSCCL for security deposit, for its Clearing
Members.

7. If in the opinion of NSCCL, the Clearing Member has failed to perform and / or fails
to fulfil his/its engagements, commitments, operations, obligations or liabilities as a
Clearing Member of NSCCL including any sums due by him/it to NSCCL or to
NSEIL or to any other party arising out of or incidental to any contracts made,
executed, undertaken, carried out or entered into by him/it, then the Pledgor agrees
that NSCCL on giving one working day notice to the Pledgor on its own as a pledgee,
shall be empowered/entitled to invoke the pledge, sell, dispose of or otherwise effect
any other transfer of the Said Securities in such manner and subject to such terms and
conditions as it may deem fit and that the money if any realised from such
pledge/sale/disposal/or other transfer shall be utilised/disbursed by NSCCL in such
manner and subject to terms and conditions as it may deem fit and further the Pledgor
shall do all such things, deeds, acts and execute all such documents as are necessary
to enable NSCCL to effect such pledge/sale/disposal/or other transfer. The decision
of NSCCL as to the obligations or liabilities or commitments of the Clearing Member
and the amount claimed shall be final and binding on the Pledgor. The Pledgor
understood and agrees that one working day notice mentioned above shall be deemed
to be a reasonable notice, as this pledge of securities is being accepted as security
deposit by NSCCL in lieu of cash deposits or bank guarantees, which can be invoked
and appropriated in a days time and also due to the nature of transactions on NSCCL.

8. The Said Securities pledged as security shall be available at the disposal of NSCCL as
a continuing security and remain available in respect of the obligations, liabilities or
commitments of the Clearing Member jointly or severally and may be utilised as such
in the discretion of NSCCL, as if each of the obligations, liabilities or commitments is
secured by the Said Securities. This Deed shall not be considered as cancelled or in
any way affected on its utilisation for meeting any specific obligation, liability or
commitment by NSCCL but shall continue and remain in operation in respect of all
subsequent obligations, liabilities or commitments of the Clearing Member.

9. The Pledgor shall be released from his/its obligations, liabilities under this Deed only
when NSCCL, in writing, expressly provides for the release of the Said Securities.

10. The Pledgor agrees that NSCCL shall be entitled to sell, negotiate or otherwise
transfer the Said Securities and to execute transfer documents and/or any other
necessary documents, wherever applicable or other endorsements for this purpose and
that NSCCL shall be entitled to receive from him/her all expenses incurred by
NSCCL/Custodian for the aforesaid purposes.

11. The Pledgor agrees to execute such further documents whether of a legal nature or
otherwise as may be required by NSCCL for the purpose of giving effect to the
 provisions of this Deed and also the Scheme for the Deposit of securities in
dematerialised form.

12. The Pledgor agrees that the deposit of the ‘Said Securities’ and the pledge thereof
shall not be affected in any manner whatsoever if NSCCL takes any action against the
Clearing Member including suspension or expulsion or declaration of the Clearing
Member as a defaulter.

13. The Pledgor agrees that NSCCL shall not be under any liability whatsoever towards
the Pledgor or any other person for any loss, damage, expenses, costs, etc arising out
of the deposit of the Said Securities in any manner, due to any cause, whatsoever,
irrespective of whether the Said Securities shall be in the possession of the NSCCL or
not at the time of such loss or damage or the happening of the cause thereof. The
Pledgor shall at all times indemnify and keep indemnified NSCCL from and against
all suits, proceedings, costs, charges, claims and demands whatsoever that may at any
time arise or be brought or made by any person against NSCCL in respect of any acts,
matters and things lawfully done or caused to be done by NSCCL in connection with
the Said Securities or in pursuance of the rights and powers of NSCCL under this
Deed.

14. The Pledgor undertakes that the deposit of the ‘Said securities’ and the pledge thereof
shall be binding on him/her as continuing and that it shall not be prejudiced by the
Clearing Members failure to comply with the Rules, Bye-laws or Regulation of
NSCCL or any other terms and conditions attendant to the Clearing membership of
NSCCL and that NSCCL shall be at liberty, without thereby affecting its rights
against him/ her hereunder or in relation to the ‘Said securities’ or to any other
security now or hereafter held or taken at any time to vary, amend change or alter any
terms or conditions of its Rules, Bye laws or Regulations of NSCCL in general or as
applicable to him / it in particular.

Executed at _____________ on the date, month and year above mentioned.

Signed, sealed and delivered by the withinnamed

Pledgor.
________________________

in the presence of witnesses

1.
2.

* strike out whichever is not applicable

 Annexure-10.6
Format of Letters to be submitted along with FDR towards Margin Deposit

Annexure-10.6a

Format of letter by member for submission of FDR to Custodian for margin deposit

(To be typed on member's letter head)

Date:

To
Name & Address of Custodian (Capital Market Segment)

Dear Sir,

As per requirements of National Securities Clearing Corporation Limited (NSCCL) and in

compliance of prescribed norms of NSCCL, I/ we hereby furnish margin deposit with you in
the form of Fixed Deposit Receipts (FDRs) (FDR No.---------) placed with
____________________________ Bank, issued in favour of “Custodian Name” A/c.
“Member Name” for Rs. ______/- (Rupees ___________________________ only).

I/ We hereby agree and consent that as the custodian of NSCCL, you shall have an
irrevocable authority to encash the said FDR and to withdraw the said FDR amount at any
time, even prior to maturity, without notice to me/ us for recovery/ adjustment of NSCCL/
NSEIL dues and we have no objections whatsoever for the same.

I/We agree that you may renew the FDR for periods of one year each time till the FDR is
released by NSCCL.

I/we agree that on the encashment of FDR, NSCCL will also be entitled to the interest
accrued on the said FDR and you are hereby authorised to pay the accrued interest to NSCCL
alongwith the principal amount (FDR amount) payable.

Yours faithfully,

Authorised Signatory
________
Member name and Code
 Annexure-10.6b
Format of Letter to be provided by the Bank issuing the Margin Deposit FDR to the
Custodian

(Typed on the letterhead of the bank)

Date:

To
Name & Address of the Custodian

Dear Sir,

We refer to the fixed deposit receipt (FDR) bearing no. ______________ issued for
Rs.__________, (Rs in words) in your name A/c “member's name”

We hereby agree and confirm that:

i.) There is no lock in period for encashment of the said FDR.

ii.) The amount under the said FDR would be paid to you on demand, at any point of time
without any reference to the ________________ (name of member).
iii.) Encashment whether premature or otherwise would not require any clearance from any
other authority / person.
iv.) On encashment of the FDR by you, the interest accrued thereon will also be released to
you.
v.) The FDR will be renewed for such periods as may be instructed by you.
vi.) The FDR is payable at Mumbai (In case FDR is issued from places other than Mumbai;
Delhi, Kolkata, Chennai, Ahmedabad and Hyderabad )

Yours faithfully,

Authorised Signatory
For __________ Bank Ltd.
 Annexure-10.6c

Format of letter by member for submission of FDR to Clearing Corporation for

security deposit

To
National Securities Clearing Corporation Ltd (Capital Market Segment)
Exchange Plaza
Bandra Kurla Complex
Bandra (E)
Mumbai-400 051

Dear Sir,

As per requirements of National Securities Clearing Corporation Limited (NSCCL) and in

compliance of prescribed norms of NSCCL, we have to furnish you margin deposit and
accordingly have furnished you the same in the form of FDR (FDR No-_____________)
placed with ____________________________ Bank, issued as NSCCL A/c. “Member
Name” for Rs. ______/- (Rupees ______________________ only.)

I/We hereby agree and consent that you shall have an irrevocable authority to encash the said
FDR and to withdraw the said FDR amount at any time, even prior to maturity, without
notice to me/us for recovery/adjustment of NSCCL/NSEIL dues and we have no objections
whatsoever for the same.

I/We agree that you may renew the FDR for period of one year each time till the FDR is
released by you.

I/we agree that on the encashment of FDR, you will be entitled to the interest accrued on the
said FDR and you are hereby authorised to receive the accrued interest from the Bank along
with the principal amount (FDR amount) payable.

Yours faithfully,

Authorised Signatory
________
Member name and Code
 Annexure-10.6d

Format of Letter to be provided by the Bank issuing the Margin Deposit FDR to
NSCCL

(Typed on the letterhead of the bank)

Date:
To
National Securities Clearing Corporation Ltd
Exchange Plaza, Plot C-1, G Block,
Bandra-Kurla Complex, Bandra (East),
Mumbai – 400 051

Dear Sir,

We refer to the fixed deposit receipt (FDR) bearing no. ______________ issued for
Rs.___________, in the name of NSCCL - A/c “Member Name”.

We hereby agree and confirm that

i.) There is no lock in period for encashment of the said FDR.

ii.) The amount under the said FDR would be paid to you on demand, at any point of time
without any reference to the ________________ (name of member).
iii.) Encashment whether premature or otherwise would not require any clearance from any
other authority / person.
iv.) On encashment of the FDR by you, the interest accrued thereon will also be released to
you.
v.) The FDR will be renewed for such periods as may be instructed by you.
vi.) The FDR is payable at Mumbai. (In case FDR is issued from places other than Mumbai,
Delhi, Kolkata, Chennai, Ahmedabad, and Hyderabad)

Yours faithfully,

Authorised Signatory
For__________ Bank Ltd.
 Annexure 10.7

Annexure 10.7a
Format of deed of pledge for clearing members for deposit of securities for margin
deposit

To Be Executed On Non Judicial Stamp Paper Of Rs 100/- Or In Accordance With The

Prevailing Rates Applicable In The Place Of Execution, Whichever Is Higher.

This Deed of Pledge (hereinafter referred to as “the Deed”) is executed at _______________

on this ___ day of _________ 19___ by

_______________________________, S/o / d/o / w/o __________________ residing at

_____________________ and having his office at ________________________________ *

_____________________________, a partnership firm registered under the Indian

Partnership Act, 1932 and having its office at __________________________________*

________________________Ltd., incorporated as a company under the Companies Act,

1956 and having its registered office at _______________________________________*

(hereinafter referred to as “Clearing Member” which expression shall unless repugnant to the
context thereof include successors, administrators and assigns) in favour of National
Securities Clearing Corporation Limited, a company incorporated under the Companies Act,
1956 and having its registered office at Exchange Plaza, Bandra-Kurla Complex, Bandra
(East), Mumbai - 400051 (hereinafter referred to as “NSCCL” which expression shall unless
repugnant to the context thereof, include its successors and assigns).

WHEREAS

a) The Clearing Member is admitted to the Clearing Membership of NSCCL.

b) One of the requirement of the Clearing Membership is that the Clearing Member if
desirous of availing additional exposure, shall maintain with NSCCL margin deposit
in the form of cash, bank guarantees or securities for the due performance and
fulfilment by him/it of his/its engagements, commitments, operations, obligations or
liabilities as a Clearing Member including any sums due by him/it to NSCCL or any
other party as decided by NSCCL arising out of or incidental to any contracts made,
executed, undertaken, carried out or entered into by him/it.

c) The securities to be deposited by the Clearing Member shall be securities in

dematerialised form and as may be approved by NSCCL from time to time.

d) The Clearing Members shall deposit the securities with such custodians acting as
depository participants as may be determined by NSCCL from time to time.

NOW THIS DEED WITNESSETH AS FOLLOWS:

1. In consideration of NSCCL having agreed to accept approved dematerialised securities as
margin deposit to an extent of Rs._________ /- (Rupees ___________________only), the
Clearing Member hereby pledges securities (hereinafter referred to as “Said Securities”)
with NSCCL as security for due performance and fulfillment by him/it of all
engagements, commitments, operations, obligations or liabilities as a Clearing Member of
NSCCL including any sums due by him/it to NSCCL or National Stock Exchange of
India Limited (hereinafter referred to as “NSEIL”) or any other party as decided by
NSCCL arising out of or incidental to any contracts made, executed, undertaken, carried
out or entered into by him/it.

2. The Clearing Member if so determined by NSCCL shall place the Said Securities in the
absolute disposition of such custodian/depository participant in such manner as decided
by NSCCL and such possession and disposition may be apparent and indisputable
notwithstanding the fact that the Clearing Member may be permitted to have access to the
Said Securities in the manner and subject to such terms and conditions as determined by
NSCCL and provided further that during such time the Clearing Member confirms,
affirms and covenants with NSCCL that he/it shall do all such acts and things, sign such
documents and pay and incur such costs, debts and expenses as may be necessary
without prejudice to any other obligations, liabilities, duties which he/it owes as a
Clearing Member.

3. For the purpose of the clauses (1) and (2), and for the purpose of this Deed, the term
“Said Securities” shall mean all the securities lying in the Depository Account No.
_______________ (hereinafter referred to as “Account”) with the custodian/depository
participant and shall include all securities given in addition, substitution or replacement of
the securities in the said Account. All securities lying in the said Account shall be deemed
to have been pledged at all times with NSCCL by virtue of this Deed.

4. The Clearing Member declares and assures that all the Said Securities are in existence,
owned by him/it and free from any prior charge, lien or encumbrance and further that all
the Said Securities over which pledge may be created in future would be in existence and
owned by him/it at the time of creation of such pledge and that all the Said Securities to
be given in future as security to NSCCL would likewise be unencumbered, absolute and
disposable property of the Clearing Member.

5. The Clearing Member agrees that he/it shall not without NSCCL’s prior written
permission create any charge, lien or encumbrance of any kind upon or over the Said
Securities hereby pledged except to NSCCL, that he/it shall not suffer any such charge,
lien or encumbrance to affect the Said Securities or any part thereof, and further that he/it
shall not do or allow anything to be done that may prejudice the Said Securities while
he/it remains liable to NSCCL in any manner without the prior written permission of
NSCCL.

6. The Clearing Member agrees, declares and undertakes that he/it shall be bound and abide
by the terms and conditions of the Scheme for the Deposit of securities in dematerialised
form as formulated and determined by NSCCL, for margins, considered as margin
deposit, either in their existing form or as modified/changed/altered /amended from time
to time pursuant to requirement / compliance of Clearing Membership.
7. If in the opinion of NSCCL, the Clearing Member has failed to perform and / or fails to
fulfil his/its engagements, commitments, operations, obligations or liabilities as a
Clearing Member of NSCCL including any sums due by him/it to NSCCL or to NSEIL or
to any other party arising out of or incidental to any contracts made, executed,
undertaken, carried out or entered into by him/it, then the Clearing Member agrees that
NSCCL on giving one working day notice to the Clearing Member on its own as a
pledgee, shall be empowered/entitled to invoke the pledge, sell, dispose of or otherwise
effect any other transfer of the Said Securities in such manner and subject to such terms
and conditions as it may deem fit and that the money if any realised from such
pledge/sale/disposal/or other transfer shall be utilised/disbursed by NSCCL in such
manner and subject to terms and conditions as it may deem fit and further the Clearing
Member shall do all such things, deeds, acts and execute all such documents as are
necessary to enable NSCCL to effect such pledge/sale/disposal/or other transfer. The
decision of NSCCL as to the obligations or liabilities or commitments of the Clearing
Member and the amount claimed shall be final and binding on the Clearing Member. The
Clearing Member understood and agrees that one working day notice mentioned above
shall be deemed to be a reasonable notice, as this pledge of securities is being accepted as
margin deposit by NSCCL in lieu of cash deposits or bank guarantees, which can be
invoked and appropriated in a days time and also due to the nature of transactions on
NSCCL.

8. The Said Securities pledged as security shall be available at the disposal of NSCCL as a
continuing security and remain available in respect of the obligations, liabilities or
commitments of the Clearing Member jointly or severally and may be utilised as such in
the discretion of NSCCL, as if each of the obligations, liabilities or commitments is
secured by the Said Securities. This Deed shall not be considered as cancelled or in any
way affected on its utilisation for meeting any specific obligation, liability or commitment
by NSCCL but shall continue and remain in operation in respect of all subsequent
obligations, liabilities or commitments of the Clearing Member.

9. The Clearing Member shall be released from his/her obligations, liabilities under this
Deed only when NSCCL, in writing, expressly provides for the release of the Said
Securities.

10. The Clearing Member agrees that NSCCL shall be entitled to sell, negotiate or otherwise
transfer the Said Securities and to execute transfer documents and/or any other necessary
documents, wherever applicable or other endorsements for this purpose and that NSCCL
shall be entitled to receive from him/her all expenses incurred by NSCCL/Custodian for
the aforesaid purposes.

11. The Clearing Member agrees to execute such further documents whether of a legal nature
or otherwise as may be required by NSCCL for the purpose of giving effect to the
provisions of this Deed and also the Scheme for the Deposit of securities in
dematerialised form.

12. The Clearing Member agrees that the deposit of the ‘Said Securities’ and the pledge
thereof shall not be affected in any manner whatsoever if NSCCL takes any action against
the Clearing Member including suspension or expulsion or declaration of the Clearing
Member as a defaulter.
13. The Clearing Member agrees that NSCCL shall not be under any liability whatsoever to
the Clearing Member or any other person for any loss, damage, expenses, costs etc,
arising out of the deposit of the Said Securities, in any manner, due to any cause,
whatsoever, irrespective of whether the Said Securities shall be in the possession of the
NSCCL or not at the time of such loss or damage or the happening of the cause thereof.
The Clearing Member shall at all times indemnify and keep indemnified NSCCL from
and against all suits, proceedings, costs, charges, claims and demands whatsoever that
may at any time arise or be brought or made by any person against NSCCL in respect of
any acts, matters and things lawfully done or caused to be done by NSCCL in connection
with the Said Securities or in pursuance of the rights and powers of NSCCL under this
Deed.

14. The Clearing Member undertakes that the deposit of the ‘Said securities’ and the pledge
thereof shall be binding on him/them as continuing and that it shall not be prejudiced by
his/its failure to comply with the Rules, Bye-laws or Regulation of NSCCL or any other
terms and conditions attendant to the Clearing membership of NSCCL and that NSCCL
shall be at liberty, without thereby affecting its rights against him/ it hereunder or in
relation to the ‘Said securities’ or to any other security now or hereafter held or taken at
any time to vary, amend change or alter any terms or conditions of its Rules, Bye laws or
Regulations of NSCCL in general or as applicable to him / it in particular.

Executed at _____________ on the day, month and year above mentioned.

Signed, sealed and delivered by the withinnamed **

Clearing Member.
________________________

in the presence of witnesses

1.

2.

* strike out whichever is not applicable

** To be signed by
the Clearing member in case of individual.
all partners in case of a Partnership firm
by any two of the following persons in the case of a Company:
i. Managing Director
ii. Whole-time Director
iii. Directors
 Annexure 10.7b
FORMAT OF DEED OF PLEDGE FOR OTHER THAN CLEARING MEMBERS
FOR DEPOSIT OF SECURITIES FOR MARGIN DEPOSIT

To Be Executed On Non Judicial Stamp Paper Of Rs 100/- Or In Accordance With The

Prevailing Rates Applicable In The Place Of Execution, Whichever Is Higher.

This Deed of Pledge (hereinafter referred to as “the Deed”) is executed at _______________

on this ___ day of _________ 19___ by_______________________________, S/o / d/o /
w/o __________________ residing at _______________________________and having his
office at ______________________ (hereinafter referred to as “Pledgor” which expression
shall unless repugnant to the context thereof include successors, administrators and assigns)
in favour of National Securities Clearing Corporation Limited, a company incorporated
under the Companies Act, 1956 and having its registered office at Exchange Plaza, Bandra-
Kurla Complex, Bandra (East), Mumbai - 400051 (hereinafter referred to as “NSCCL” which
expression shall unless repugnant to the context thereof, include its successors and assigns).

WHEREAS

a) Mr/Ms _____________________ s/o / d/o / w/o ___________________ residing at

____________________________ and having his/her/their office at
________________________ (hereinafter referred to as the Clearing Member, which
expression shall include his successors and assigns)*

M/s ____________________________ , a partnership firm registered under the

Indian Partnership Act, 1932 and having their office at
____________________________________ (hereinafter referred to as the Clearing
member, which expression shall include their successors and assigns)*

M/s ______________________________ Limited, incorporated as a company under

the Companies Act, 1956 and having its registered office at ____________________

(hereinafter referred to as the Clearing member, which expression shall include its
successors and assigns) * is/are a Clearing member of the NSCCL.

b) One of the requirement of the Clearing Membership is that the Clearing Member if
desirous of availing additional exposure, shall maintain with NSCCL margin deposit
in the form of cash, bank guarantees or securities for the due performance and
fulfillment by him/it of his/its engagements, commitments, operations, obligations or
liabilities as a Clearing Member including any sums due by him/it to NSCCL or any
other party as decided by NSCCL arising out of or incidental to any contracts made,
executed, undertaken, carried on or entered into by him/it.

c) The securities to be deposited by the Clearing Member or any other person, as a

security for such Clearing member shall be securities in dematerialised form and as
may be approved by NSCCL from time to time.

d) At the request of the Clearing member and as permitted by NSCCL, the Pledgor has
agreed to offer securities in the dematerialised form as a security for the purpose of
margin deposit as aforesaid.
 e) The Pledgor shall deposit the securities with such custodians acting as depository
participants as may be determined by NSCCL from time to time.

NOW THIS DEED WITNESSETH AS FOLLOWS:

1. In consideration of the NSCCL having agreed to accept approved dematerialised

securities as margin deposit to an extent of Rs._______ /- (Rupees
____________________ only), the Pledgor hereby pledges securities (hereinafter referred
to as “Said Securities”) with NSCCL as security for due performance and fulfilment by
the Clearing Member of all his/its engagements, commitments, operations, obligations or
liabilities as a Clearing Member of NSCCL including any sums due by him/it to NSCCL
or National Stock Exchange of India Limited (hereinafter referred to as “NSEIL”) or any
other party as decided by NSCCL arising out of or incidental to any contracts made,
executed, undertaken, carried out or entered into by him/it.

2. The Pledgor if so determined by NSCCL shall place the Said Securities in the absolute
disposition of such custodian/depository participant in such manner as decided by
NSCCL and such possession and disposition may be apparent and indisputable
notwithstanding the fact that the Pledgor may be permitted to have access to the Said
Securities in the manner and subject to such terms and conditions as determined by
NSCCL and provided further that during such time the Pledgor confirms, affirms and
covenants with NSCCL that he/she shall do all such acts and things, sign such documents
and pay and incur such costs, debts and expenses as may be necessary without prejudice
to any other obligations, liabilities, duties which the Clearing Member owes as a Clearing
Member of NSCCL.

3. For the purpose of the clauses (1) and (2), and for the purpose of this Deed, the term
“Said Securities” shall mean all the securities lying in the Depository Account No.
___________ (hereinafter referred to as “Account”) with the custodian/depository
participant and shall include all securities given in addition, substitution or replacement of
the securities in the said Account. All securities lying in the said Account shall be deemed
to have been pledged at all times with NSCCL by virtue of this Deed.

4. The Pledgor declares and assures that all the Said Securities are in existence, owned by
him/it and free from any prior charge, lien or encumbrance and further that all the Said
Securities over which pledge may be created in future would be in existence and owned
by him/her at the time of creation of such pledge and that all the Said Securities to be
given in future as security to NSCCL would likewise be unencumbered, absolute and
disposable property of the Pledgor.

5. The Pledgor agrees that he/she shall not without NSCCL’s prior written permission create
any charge, lien or encumbrance of any kind upon or over the Said Securities hereby
pledged except to NSCCL, that he/she shall not suffer any such charge, lien or
encumbrance to affect the Said Securities or any part thereof, and further that he/she shall
not do or allow anything to be done that may prejudice the Said Securities while he/she
remains liable to NSCCL in any manner without the prior written permission of NSCCL.

6. The Pledgor agrees, declares and undertakes that he/she shall be bound and abide by the
terms and conditions of the Scheme for the Deposit of securities in dematerialised form as
 formulated and determined by NSCCL, for margin deposit, considered as margin deposit,
for its Clearing members.

7. If in the opinion of NSCCL, the Clearing Member has failed to perform and / or fails to
fulfil his engagements, commitments, operations, obligations or liabilities as a Clearing
Member of NSCCL including any sums due by him/it to NSCCL or to NSEIL or to any
other party arising out of or incidental to any contracts made, executed, undertaken,
carried out or entered into by him/it, then the Pledgor agrees that NSCCL on giving one
working day notice to the Pledgor on its own as a pledgee, shall be empowered/entitled to
invoke the pledge, sell, dispose of or otherwise effect any other transfer of the Said
Securities in such manner and subject to such terms and conditions as it may deem fit and
that the money if any realised from such pledge/sale/disposal/or other transfer shall be
utilised/disbursed by NSCCL in such manner and subject to terms and conditions as it
may deem fit and further the Pledgor shall do all such things, deeds, acts and execute all
such documents as are necessary to enable NSCCL to effect such pledge/sale/disposal/or
other transfer. The decision of NSCCL as to the obligations or liabilities or commitments
of the Clearing Member and the amount claimed shall be final and binding on the
Pledgor. The Pledgor understood and agrees that one working day notice mentioned
above shall be deemed to be a reasonable notice, as this pledge of securities is being
accepted as margin deposit by NSCCL in lieu of cash deposits or bank guarantees, which
can be invoked and appropriated in a days time and also due to the nature of transactions
on NSCCL.

8. The Said Securities pledged as security shall be available at the disposal of NSCCL as a
continuing security and remain available in respect of the obligations, liabilities or
commitments of the Clearing Member severally and may be utilised as such in the
discretion of NSCCL, as if each of the obligations, liabilities or commitments is secured
by the Said Securities. This Deed shall not be considered as cancelled or in any way
affected on its utilisation for meeting any specific obligation, liability or commitment by
NSCCL but shall continue and remain in operation in respect of all subsequent
obligations, liabilities or commitments of the Clearing Member.

9. The Pledgor shall be released from his/her obligations, liabilities under this Deed only
when NSCCL, in writing, expressly provides for the release of the Said Securities.

10. The Pledgor agrees that NSCCL shall be entitled to sell, negotiate or otherwise transfer
the Said Securities and to execute transfer documents and/or any other necessary
documents, wherever applicable or other endorsements for this purpose and that NSCCL
shall be entitled to receive from him/her all expenses incurred by NSCCL/Custodian for
the aforesaid purposes.

11. The Pledgor agrees to execute such further documents whether of a legal nature or
otherwise as may be required by NSCCL for the purpose of giving effect to the provisions
of this Deed and also the Scheme for the Deposit of securities in dematerialised form.

12. The Pledgor agrees that the deposit of the ‘Said Securities’ and the pledge thereof shall
not be affected in any manner whatsoever if NSCCL takes any action against the Clearing
Member including suspension or expulsion or declaration of the Clearing Member as a
defaulter.
13. The Pledgor agrees that NSCCL shall not be under any liability whatsoever to the Pledgor
or any other person for any loss, damage, expenses, costs etc arising out of the deposit of
the Said Securities, in any manner, due to any cause whatsoever, irrespective of whether
the Said Securities shall be in the possession of the NSCCL or not at the time of such loss
or damage or the happening of the cause thereof. The Pledgor shall at all times indemnify
and keep indemnified NSCCL from and against all suits, proceedings, costs, charges,
claims and demands whatsoever that may at any time arise or be brought or made by any
person against NSCCL in respect of any acts, matters and things lawfully done or caused
to be done by NSCCL in connection with the Said Securities or in pursuance of the rights
and powers of NSCCL under this Deed.

14. The Pledgor undertakes that the deposit of the ‘Said securities’ and the pledge thereof
shall be binding on him/it as continuing and that it shall not be prejudiced by the Clearing
Members failure to comply with the Rules, Bye-laws or Regulation of NSCCL or any
other terms and conditions attendant to the Clearing membership of NSCCL and that
NSCCL shall be at liberty, without thereby affecting its rights against him/ it hereunder or
in relation to the ‘Said securities’ or to any other security now or hereafter held or taken
at any time to vary, amend change or alter any terms or conditions of its Rules, Bye laws
or Regulations of NSCCL in general or as applicable to him / it in particular.

Executed at _____________ on the day, month and year above mentioned.

Signed, sealed and delivered by the withinnamed

Pledgor.
_______________________
in the presence of witnesses

1.

2.

* strike out whichever is not applicable

 Annexure-10.8
Format of letter requesting activation of account in Collateral Interface for Members

Date:

The Manager
Collaterals Department
NSCCL

Dear Sir/ Madam,

Sub: Application for activation of account in Collateral Interface for Members

We are interested in availing the facilities provided through the Collateral Interface for
Member (CIM). We therefore request you to activate our account and provide us necessary
access in the said interface.

Please find below the necessary details as required:

S No Particulars To be filled by the Member

1. Trading Member Code
2. Member Name
3. Segment for which application is being
made (Cash/F&O/CDS/All 3 segments)
4. Contact Person (The account details will be
sent to this person)
5. Address for Communication with Pin Code
6. Phone Number with STD Code
7. Mobile number of contact person
8. Fax Number with STD Code
9. Email id for correspondence in matters
related to the interface ( preferably a
corporate mail id)
10. No of User Ids required
We hereby authorize NSCCL to act upon the instructions sent through the interface and we
shall be solely responsible for any errors pertaining to data entry from our end.

We would request you to advise us the account details allotted to us for this purpose at the
above mentioned address.

Yours sincerely,

Authorized Signatory
Name:
Designation:
Note:

1. Since the CIM application is common for the CM, CDS and F&O segments, user
accounts shall be common for members across the segments. Hence once enabled in a
segment, member need not request for an account in other segment.
2. With respect to cash deposits, the rejected records, if any, that have not been received by
the Clearing Corporation will be visible to the member at the front end application.
3. The benefit to /release of the total liquid assets shall be carried out subject to successful
receipt of the request at the clearing corporation and the relevant policies as applicable
from time to time.
 Annexure-10.9
Format of Letters in case of auto renewal of FDR
Annexure-10.9a
Format of letter to be provided by Bank for Auto renewal of FDR - when there is
change in FDR number

(To be typed on Bank’s letter head)

To Date:

National Securities Clearing Corporation Ltd

Exchange Plaza,C-1, Block G,
Bandra Kurla Complex,
Bandra (East)
Mumbai 400 51

Dear Sir,

We refer to the fixed deposit receipt (FDR) issued, in the name of NSCCL - A/c “Member
Name”. Details are as under.

FDR No Issue Date Amount (in Rs.) Maturity Date

The above FDR has been renewed for further period of _____months under the auto-renewal
facility on the request of the member. Details are as follows.
New FDR No Issue Date New Maturity Amount
Date (in Rs.)

We hereby agree and confirm that

i. There is no lock in period for encashment of the said FDR.

ii. The amount under the said FDR would be paid to you on demand, at any point of time
without any reference to the ________________ (name of member).
iii. Encashment whether premature or otherwise would not require any clearance from any
other authority / person.
iv. On encashment of the FDR by you, the interest accrued thereon will also be released to
you.
v. The FDR will be renewed for such periods as may be instructed by you.
vi. The FDR is payable at Mumbai. (In case FDR is issued from places other than Mumbai,
Delhi, Kolkata, Chennai, Ahmedabad, and Hyderabad)
vii. Old instrument will remain valid and no new instrument with new FDR No._____ is
issued.

Yours faithfully,
Authorised Signatory
__________ Bank Ltd
 Annexure-10.9b
Format of letter to be provided by Bank for Auto renewal of FDR - when there is no
change in FDR number

(To be typed on Bank’s letter head)

To Date:
National Securities Clearing Corporation Ltd
Exchange Plaza, C-1, Block G,
Bandra Kurla Complex,
Bandra (East)
Mumbai 400 51

Dear Sir,

We refer to the fixed deposit receipt (FDR) issued, in the name of NSCCL - A/c “Member's
Name”. Details are as under.

FDR No Issue Date Amount (in Rs.) Maturity Date

The above FDR has been renewed for further period of _____months under the auto-renewal
facility on the request of the member. Details are as follows.

Renewal Date Amount (in Rs.) New Maturity Date

We hereby agree and confirm that

i.) There is no lock in period for encashment of the said FDR.

ii.) The amount under the said FDR would be paid to you on demand, at any point of time
without any reference to the ________________ (name of member).
iii.) Encashment whether premature or otherwise would not require any clearance from any
other authority / person.
iv.) On encashment of the FDR by you, the interest accrued thereon will also be released to
you.
v.) The FDR will be renewed for such periods as may be instructed by you.
vi.) The FDR is payable at Mumbai. (In case FDR is issued from places other than Mumbai,
Delhi, Kolkata, Chennai, Ahmedabad, and Hyderabad)
vii.) Old instrument will remain valid.

Yours faithfully,

Authorised Signatory
__________ Bank Ltd
 Annexure-10.10
Format of Member Letter for shifting Bank Guarantee from F&O segment/ Currency
Derivatives Segment to Capital Market Segment
(To be typed on Member's letter head)
To Date:
National Securities Clearing Corporation Ltd.
Collaterals Department,
Exchange Plaza, Plot C-1, G Block,
Bandra Kurla Complex,
Bandra (East),
Mumbai - 400 051.

Dear Sir,

Re: Bank Guarantee for Rs. ____vide BG No.____for Capital Market Segment

Member Code : ______________

Bank Name : ______________
Bank Branch : ______________
City : ______________
Bank Guarantee No : ______________
Bank Guarantee Amount : ______________
Issue Date : ______________
Maturity Date : ______________
Last Claim date : ______________
NSCCL Reference No : ______________

We refer to the above Guarantee issued on our behalf in your favour towards the margin
deposit of the *F&O segment/ Currency Derivatives Segment of National Securities
Clearing Corporation Ltd. (NSCCL). As we intend to make the said bank guarantee available
towards our margin deposit in the Capital Market segment, we have instructed the bank
vide our letter dated ________ to make the said guarantee available as a security for meeting,
satisfying, discharging or fulfilling all or any of our obligation or liability arising in the
Capital Market segment as directed and decided by NSCCL with no reference to us.

Pursuant to our request the bank has issued to you an amendment letter dated ______
agreeing and confirming to make the said guarantee available as a security for meeting,
satisfying, discharging or fulfilling all or any of our obligation or liability arising in the
Capital Market segment as directed and decided by NSCCL with no reference to us.
Hence the above bank guarantee may be treated as if issued on our behalf towards the margin
deposit of the Capital Market segment of NSCCL.

Yours faithfully,
Authorised Signatory
(Authorised only by Director/ Partner/ Proprietor)
* strike out whichever is not applicable
 Annexure-10.11
Format of Bank amendment letter for shifting Bank Guarantee from F&O segment/
Currency Derivatives Segment to Capital Market Segment

(ON STAMP PAPER OF THE SAME VALUE AS THE ORIGINAL BANK GUARANTEE OR RS.
100/= WHICHEVER IS HIGHER)

Date : ___________
To,
National Securities Clearing Corporation Limited
Exchange Plaza,
Plot C-1, G Block,
Bandra Kurla Complex, Bandra (East),
Mumbai - 400 051.

We, ______________________________________ having our registered office

at______________________________ refer to the Bank Guarantee number: _________
executed by us on the ________day of _______ at _______ (hereinafter referred to as "Said
Guarantee") on account of __________________________________________having its
registered office at ________________________________________________ (hereinafter
referred to as 'Clearing Member') for a sum of Rs ______________Rupees
___________________________________________________only) in your favour.

We, now at the request and desire of the Clearing Member, do hereby irrevocably and
unconditionally guarantee to pay a sum of Rs. ___________/-, (Rupees
________________________ only) to National Securities Clearing Corporation Limited.
(hereinafter referred to as NSCCL) as a security for due performance and fulfilment by the
Clearing Member of his/her/its engagements, commitments, obligations or liabilities as a
Clearing Member of NSCCL including any sums due by the Clearing Member to NSCCL or
any other person as decided by NSCCL arising out of or incidental to any contracts made,
executed, undertaken, carried on or entered into or purported so to be, by the Clearing
Member in the Capital Market Segment. The Bank agrees and confirms that the said
guarantee shall be available as a security for meeting, satisfying, discharging or fulfilling all
or any obligation or liability of the Clearing Member arising out of or incidental to any
contracts made, executed, undertaken, carried on or entered into or purported so to be, by the
Clearing Member in the Capital Market Segment.

We hereby affirm and confirm that save and except to the extent as provided for herein
above, the Said Guarantee together with all other terms and conditions therein shall remain
operational and in full force and effect.

Signed for and on behalf of __________________________________ on this ____________

day of _____________________ at ___________________.
FOR ________________________________(BANK)
________________________________(BRANCH)

AUTHORIZED SIGNATORIES
SEAL OF THE BANK
 Annexure 10.12
Format for Renewal of Bank Guarantee towards Margin Deposit and Security Deposit
Date: ___________
To,
National Securities Clearing Corporation Ltd.
Exchange Plaza, Plot C-1, G Block,
Bandra Kurla Complex,
Bandra (East),
Mumbai – 400 051.

We, ____________________________________________ (Bank) having our registered

office at _____________________________________________________________and our
branch office at ______________________________________________________
_______________________________ refer to the Bank Guarantee number : _________
executed by us on the ___________ day of _______________ 199_/200_ at __________
(hereinafter referred to as “said guarantee”) on account of Mr. / Ms./ M/s. ____________
________________________ having his/her/ its/registered office at ________________
_______________________________________________________________________
(hereinafter referred to as a ‘Clearing Member’) for a sum of Rs ______________ (Rupees
_________________________________________only) in your favour.

The validity of the said guarantee was upto ____________________________.

With reference to the same we state as hereunder:

At the request of the Clearing Member, we extend the period of the validity of the said
guarantee upto __________________.

The said guarantee may be invoked by NSCCL in part(s) without affecting its rights to
invoke the said guarantee for any liabilities that may devolve later.

Notwithstanding anything mentioned herein above,

a) the liability of the Bank under this guarantee shall not exceed Rs. _______________
(Rupees ________________________________________ only)
b) This guarantee shall be valid for a period of _____months i.e. upto _____________.
c) The bank is liable to pay the guaranteed amount only if NSCCL serves upon the Bank a
written claim or demand on or before ________________(i.e. within ___ months after the
date of expiry of the bank guarantee as mentioned in clause b above).

We hereby affirm and confirm that save and except to the extent as provided for herein
above, the said guarantee together with all other terms and conditions therein shall remain
operational and in full force and effect till _________________________.

Executed this ____day of____________ at _____________ (place).

FOR ________________________________(BANK)
________________________________(BRANCH)

AUTHORIZED SIGNATORIES
SEAL OF THE BANK

*Strike out whichever is not applicable

Instructions:
1) The above printed format is required to be used.
2) The Bank Guarantee to be stamped for Rs.100/- or the value prevailing in the State where
executed, whichever is higher. Bank Guarantee to be executed on Non-Judicial stamp
paper(s) or on paper franked from Stamp Office
3) All the blanks in the format are required to be duly filled by the issuing bank along with the
signature of the authorised signatory and seal of the bank.
4) Each page of the bank guarantee should bear the bank guarantee number and issue date
and should be signed by two authorised signatories of the bank unless the bank has
specifically intimated NSCCL that only one authorised signatory shall sign the bank
guarantees issued by them in favour of NSCCL.
 Annexure 10.13

Format of agreement for providing G-sec/T-bill as collaterals

This Agreement is made and executed at Mumbai on this ___ day of ____ 2010.

Between:

National Securities Clearing Corporation Limited, a company incorporated under the

provisions of the Companies Act, 1956, having its registered office
at____________________, hereinafter referred to as “NSCCL” (which expression shall
unless repugnant to the context or meaning thereof be deemed to mean and include its
successors and assigns) of the One Part;

And

Mr./Ms./M/s. ______________________, an individual/ a partnership firm / a body

corporate, registered/ incorporated under the provisions of the Indian Partnership Act, 1932 /
Companies Act, 1956, having his /her / its office / registered office at
________________________, hereinafter referred to as “Constituent” (which expression
shall, unless repugnant to the context or meaning thereof, be deemed to mean and include
his/her heirs, executors and administrators / the partners of the said firm for the time being,
the survivor or survivors of them and the heirs, executors and administrators of such last
survivor / its successors and legal representatives, as the case may be) of the Other Part.

WHEREAS:

1. Reserve Bank of India (RBI) has allowed NSCCL to open Constituent Subsidiary General
Ledger Account (SGL Account) with it which NSCCL shall use for the benefit of its
constituents by opening sub-accounts (SGL Sub Account) in the name of its constituents
in its books of accounts.

2. The Constituent being a Clearing Member of NSCCL, has requested NSCCL to open a
SGL Sub Account in its books of accounts for the purpose of transferring government
securities to the SGL Account as collateral towards margin/security deposit and NSCCL
has agreed to open a SGL Sub Account in the name of the Constituent in the SGL Account
maintained by it with RBI subject to the terms and conditions as mentioned herein and
terms and conditions specified by NSCCL in its Circulars issued from time to time.

3. The parties hereto are desirous of recording the terms and conditions subject to which
NSCCL shall open and maintain a SGL Sub Account of the Constituent.
NOW THERFORE, IT IS HEREBY MUTUALLY AGREED UPON BETWEEN THE
PARTIES HERETO AS FOLLOWS:

1. Opening of the SGL Sub Account:

1.1 NSCCL shall open a SGL Sub Account in the name of the Constituent in its SGL
Account with RBI.

1.2 Only government securities in electronic form shall be permitted to be transferred to

the SGL Account.

1.3 The government securities transferred to the said SGL Account as collateral shall not
be permitted by NSCCL to be used by the Constituent for any purpose other than as
collateral towards margin/security deposit and therefore the Constituent is barred from
creating any encumbrance with respect to the government securities transferred in any
manner whatsoever including by way of pledge, hypothecation or lien.

1.4 The government securities transferred to the said SGL Account shall be dealt with by
NSCCL as a Clearing Corporation in accordance with the Rules, Byelaws,
Regulations and the Circulars issued there under from time to time.

1.5 The Constituent agrees and consents that NSCCL shall have an irrevocable authority
to sell the government securities through its designated brokers at any time, even prior
to maturity without notice to the constituent for recovery/adjustment of
NSCCL/NSEIL dues, in case of default of the Constituent in meeting its obligations
as a member/ custodian of NSCCL.

1.6 The Constituent agrees to abide by the Business Rules laid down by the NSCCL from
time to time regarding the SGL Sub Account and as specified by NSCCL in its
Circulars issued from time to time.

1.7 If RBI deducts any income tax at source (TDS) on the interest payable at the rate
applicable to NSCCL the same will be passed on to the constituent, who may have a
different tax rate. In case the Constituent desires to avail of any concession from TDS
it will have to submit all requisite forms/documents to NSCCL within such time as
required by NSCCL/RBI for the purpose. In such cases, NSCCL will try on a best
effort basis to get the interest payment without the deduction.

1.8 Operation of the SGL Sub Account will be carried out on the written instructions
received from the authorised signatories of the Constituents received by NSCCL at its
designated office(s) as may be intimated by NSCCL. A facsimile received by NSCCL
for this purpose shall also be considered a conclusive evidence of instruction.

1.9 NSCCL shall issue daily statements to the Constituent from time to time with respect
to the security balances of the Constituent. The Constituent agrees to point out any
discrepancies to NSCCL within 2 days of the receipt of the statement or else NSCCL
shall assume the balances to be correct.
1.10 The Constituent shall pay the charges as may be intimated to the Constituent by
NSCCL from time to time for the opening and maintenance of the SGL Sub Account.

1.11 On the failure of the Constituent to pay the charges within the prescribed time
NSCCL shall debit the same from Constituent’s Clearing Bank account.

1.12 NSCCL shall be bound by any instruction or direction it receives with regard to
operation of the SGL Account or SGL Sub Account from any regulatory, judicial or
any other competent authority (s) and the opening and maintenance of the SGL
Account shall be subject to the provisions of the Government Securities Act, 2006 and
the Regulations made thereunder.

1.13 NSCCL shall have the right to give any information to any regulatory, judicial and/or
any other competent authority whenever so required in respect of the dealings and the
SGL Sub Account of the Constituent.

1.14 The Constituent authorises NSCCL to execute/submit all deeds /agreements/drafts

/forms etc which NSCCL may have to enter into/submit on behalf of the Constituent
for the proper functioning of the SGL Account or SGL Sub Account.

1.15 The Constituent hereby requests and fully authorises NSCCL to execute any
indemnity, declarations, undertakings and any other deed or documents as desired by
RBI or any other competent authority in respect of dematerialisation,
rematerialisation, settlement, corporate action or any other action in connection with
the SGL Sub Account.

1.16 The Constituent shall execute in favour of NSCCL such declarations, undertakings
and any deeds including power of attorney as may be required by NSCCL from time
to time.

1.17 Incase of any dispute/difference between NSCCL and the Constituent with respect to
this agreement, the same shall be settled as per the procedure prescribed by NSCCL in
its Circulars issued from time to time.

1.18 In case a Constituent maintains an account with any bank designated as a Clearing
Bank by NSCCL, then the Constituent shall authorise NSCCL to debit and/or it’s
funds account maintained with the designated Clearing Banks(s) from time to time for
the operations in the SGL Sub Account or recovery or any other amounts due to it as
and when required.

1.19 While handling, corporate actions, NSCCL shall provide credit for government
securities / funds to the Constituent, as the case may be only after the same has been
provided by RBI in the SGL Account of NSCCL.

2. Liabilities and Indemnities

2.1 The Constituent shall indemnify and keep NSCCL indemnified and save harmless at
all times from and against all claims, actions, demands, proceedings, costs, charges,
expenses whatsoever which may be caused or caused to be incurred, suffered or paid
by the NSCCL for any act of commission or omission by Constituent pursuant to this
agreement.

2.2 NSCCL shall have a lien or charge on all the government securities in the SGL Sub
Account of the Constituent for all the monies payable and due to NSCCL under this
agreement.

3. Termination of the Agreement:

3.1 This Agreement will terminate automatically if the NSCCL or the Constituent are
declared insolvent or any order of the court like liquidation, execution, distress or any
other orders results in the assets/property of the NSCCL or the Constituent being
attached or any Receiver appointed for the assets.

3.2 This Agreement will terminate automatically if any arrangement is made by either
party with their creditors.

3.3 This Agreement may be terminated if either party fails to comply with or deviates
from any of the declarations, representations, undertakings which they had originally
agreed to do so. Either party shall give the other party 15 days written notice for
termination of this agreement. However if the breach/default can be rectified then the
non breaching party should give the other party atleast 30 days to rectify the same.

3.4 The Agreement can be terminated by any of the parties giving a notice in writing for
any reason/s other than the reasons stated above. Such notice needs to be given atleast
2 months in advance.

3.5 Upon termination of the agreement and subject to the constituent paying all sum dues
from it to the NSCCL, NSCCL may arrange for transfer of government securities
belonging to the Constituent, if the Constituent makes alternative arrangements for
holding its government securities or in such other manner as may be specified by
NSCCL in its Circulars issued from time to time.

4. Notice:

Any notice or communication to be given by either party to the other party shall be
given by personal delivery, courier, registered post, fax to the designated address
mentioned in this agreement.

5. Jurisdiction and Governing Law:

Both the parties agree that the disputes if any shall be subject to the exclusive
jurisdiction of the Civil Courts of Mumbai. This agreement shall be subject to the
 laws of India and in particular to the Government Securities Act 2006 and the
Regulations made thereunder from time to time.

6. Counterparts:

This agreement may be entered into in two counterparts and by each party hereto on
separate counterparts, each of which when so executed and delivered, shall be an
original, but all the counterparts shall together constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as
of the day and year first above written, in two counterparts, one such counterpart to be
retained by the Constituent and the other by NSCCL.

Signed and Delivered by

The Constituent represented by their authorised officials as authorised under Board resolution
dated ______

Authorised signatories
1.
2.

Witnesses
1.
2.

Signed and Delivered by

National Securities Clearing Corporation Limited represented by their authorised signatories.

Authorised signatories
1.
2.

Witnesses
1.
2.

Note:-

1. To be executed on a non-judicial stamp paper of Rs.100/- or the value as applicable in the

state where executed
2. Page no.1 to be retyped on the stamp paper as above
3. Page no. 2 –6 should be attached to the stamp paper
 Annexure 10.14

Format of letter to be given by Member / Custodian for placing G-Sec / T-bills as

collaterals
(To be typed on Member’s / Custodian’s letter head)

Date:

To,
National Securities Clearing Corporation Limited
Exchange Plaza, Bandra Kurla Complex,
Bandra (E)
Mumbai – 400 051

Dear Sir / Madam, Member Code: _________

Re: Request for Addition of Securities (G-Sec / T-bills) as Collaterals

As per your circular no.__________dated ____________ we would like to deposit below

mentioned G-Sec / T-bill as margin/security deposit in Capital Market Segment:

Details are as under:

Member Member Source Source Instrument ISIN Maturity Quantity
Code Name SGL A/c SGL A/c details No. Date of
No. Holder (Nomenclatur Securities
Name e) (Rs. in
face
value)

Further we have initiated transfer of securities to SGL-II account of NSCCL vide Settlement-
Transfer Order-Clearing Agency Contribution through Negotiated Dealing System (NDS).
You are requested to confirm the same and consider the above G-Sec / T-bills towards our
margin/security deposit.

Thanking You,

Yours Faithfully,

Authorised Signatory
 Annexure 10.15

Format of letter to be given by the Member / Custodian for release of G-Sec / T-bills
placed as collateral
(To be typed on Member’s / Custodian’s letter head)

Date:

To,
National Securities Clearing Corporation Limited
Exchange Plaza, Bandra Kurla Complex,
Bandra (E)
Mumbai – 400 051

Dear Sir / Madam, Member Code: _________

Re: Request for release of Securities (G-Sec / T-bills)

Please release the below mentioned G-Sec / T-bills provided as margin/security deposit in
Capital Market Segment.

Details are as under:

Member Member ISIN Instrument Quantity of Maturity Target Target

Code Name No. details Securities Date SGL SGL
(Nomenclature) (Rs in face A/c A/c
value) No. Holder
Name

The G-Sec / T-bills may be transferred to our above mentioned SGL account.

Thanking You,

Yours Faithfully,

Authorised Signatory
 Annexure 10.17
File Format for Requesting Collateral Releases

File name: C_RRQ_DDMMYYYY_NN.CSV

Where C is Segment indicator

RRQ is release request
DDMMYYYY is the request date which should be current date
NN is sequential file batch number

The file should be CSV file with the following columns

Segment Indicator C
Member Code Member Code
Type of Collateral BC/ABC
Instrument Type CSH/BGN/FDP/SDP/NMF/CMF
Instrument ID Applicable only for BGN/FDP
Custodian Code To be provided only in case of SDP/CNF/NMF
Security Symbol To be provided only in case of SDP/CMF/NMF
Requested Quantity To be provided only in case of SDP/CMF/NMF
Requested Amount To be provided only in case of BGN/FDP/CSH in Rs. In case of
SDP/CMF/NMF it should be typed as NA

Notes:
1. Member code stands for the trading member code
2. CSH stands for cash, BGN for bank guarantee, FDP for Fixed deposit receipt, SDP
for securities, NMF for non cash component mutual funds and CMF for cash
component mutual funds
3. Instrument ID stands for the NSCCL Ref no as is available in the latest MG05 report.
For eg the instrument id for NSCCL.Ref no ABC/BG/39288 will be 39288
4. Non Applicable fields should be blank.
5. The return files giving the status of the acceptance/rejection of the release request will
be available through the collateral interface for members (CIM) at the following path
Collateral Release > Download Return File. The file naming convention for the same
will be C_RRR_Member Code_DDMMYYYY_NN.csv.
6. The details of the releases for the day will be available as an annexure to MG05
report.
 Annexure 11.1
File Format for Category of Securities
File location
This file would be generated and disseminated on the extranet server

Naming convention:

<C_CATG_<MONYYYY>.Tnn

where,
MONYYYY - is the applicable month and year for which the file is generated
T - is the file indicator
nn - is the batch number

The file will be CSV file.

Control Record

Sr. Field Length Mandatory/ Description

No. Optional
1. Record Type Number(2) Mandatory Record Type – Value is 10
2. Applicable Month Char(3) Mandatory Applicable Month -
MON
3. Applicable Year Char(4) Mandatory Applicable Year- YYYY
4. Total Number of Number(6) Mandatory Total Number of Detail
detail records Records in the file

Detail Record Format

Sr. Field Length Mandatory / Description

No. Optional
1. Record Type Number(2) Mandatory Record Type – Value is 20
2. Security Symbol Char(10) Mandatory Security Symbol
3. Security Series Char(2) Mandatory Security Series
4. ISIN Char(12) Mandatory ISIN of that security
5. Security Char(1) Mandatory Security Category applicable
Category on that security in the
following month.
6. Security Impact Number(5,2) Mandatory Security Impact Cost
Cost
 Annexure 11.2

Methodology for computation of MTM Margin

For a Client A, his MTM profit/ loss would be calculated separately for his positions on T-1
and T day (two different rolling settlements). For the same day positions of the client, his
losses in some securities can be set off/netted against profits of some other securities. Thus,
we would arrive at the MTM loss/profit figures of the two different days T and T-1. These
two figures cannot be netted. Any loss will have to be collected and same will not be setoff
against profit arising out of positions of the other day.

Thus, as stated above MTM profits / losses would be computed for each of the clients; Client
A, Client B, Client C etc. As regards collection of margin from the broker, the MTM would
be grossed across all the clients i.e. no setoff of loss of one client with the profit of another
client. In other words, only the losses will be added to give the total MTM loss that the
broker has to deposit with the exchange.

Total MTM
T-1 profit/loss for
Client Security day T day of Client broker
Client A Security X 800 300
Security Y -500 -1200
Total 300 -900 -900

Client B Security Z 700 -400

Security
W -1000 800
Total -300 400 -300

Client C Security X 1000 500

Security Z -1500 -800
Total -500 -300 -800

Client D Security Y 700 -200

Security R -300 800
Total 400 600 1000

Member -2000

In this example, the broker has to deposit MTM Margin of Rs 2000.

 Annexure 11.3
File Format for Detail Margin Report

File location

This file would be generated and disseminated everyday on the extranet server in the member’s
report directory

Naming convention:
C_MG02_<mem_cd>_DDMMYYYY.csv.gz.

Where DDMMYYYY - Is the report date

The file will be CSV file.

Client wise, security wise margin record
Record Type – Value will be 10
Client Code
Security Symbol
Security Series
Settlement Type
Settlement Number
Buy Qty
Buy Value
Sell Qty
Sell Value
Net Open Qty
Net Open value
MTM Price
MTM Profit/Loss
Margin Amount
Client wise, mark to market record
Record Type – Value will be 20
Client Code
Settlement type
Settlement Number
MTM Profit/ Loss
Client wise, total margin record
Record Type – Value will be 30
Client Code
Margins
MTM Loss
Total Margins
Security wise, margin record
Record Type – Value will be 40
Security Symbol
Security Series
Open Qty
Open value
Margin %
Margin
 Member wise, total margin record
Record Type – Value will be 50
Margins
MTM Loss
Total Margins
 Annexure 11.4
Example for computation of Gross positions of a member

Value in Rs
Client Security Settlement Buy Value Sell Value Net Value
Client A Security X 2005001 1000 1100 -100
Security Y 2005002 3000 2550 450

Client B Security Z 2005001 1500 1650 -150

Security Y 2005002 3000 1650 1350

Client C Security X 2005001 4500 2400 2100

Security Z 2005002 7000 10450 -3450

Proprietary Security Y 2005001 250 1200 -950

Position
Security Z 2005002 1050 0 1050

Member’s
Gross Position
Security X 2005001 2200
Security Y 2005001 950
Security Z 2005001 150
Security X 2005002 0
Security Y 2005002 1800
Security Z 2005002 4500
 Annexure 11.5
File Format for VAR Margin File

File location

This file would be generated and disseminated everyday at the end and during the day on the
extranet server in the common/var rate directory

Naming convention:
C_VAR1_DDMMYYYY_N.DAT where
<DDMMYYYY> represents the current date,
‘N’ represents file batch number for the day.

Control Record

Field name Length Mandatory/optional Description

Record type Char(2) Mandatory Value is 10
Date Char(8) Mandatory Date on which file is
generated
Daily Index VAR Number(5,2) Mandatory
Total records Number(7) Mandatory Total no. of detail
record

Detail Record

Field name Length Mandatory/optional Description

Record type Char(2) Mandatory Value is 20.
Sec symbol Char(10) Mandatory
Sec series Char(2) Mandatory
ISIN Char(12) Mandatory
Security VAR Number(5,2) Optional
Index VAR Number(5,2) Optional
VAR margin Number(5,2) Mandatory
Extreme loss rate Number(5,2) Mandatory
Ad-hoc margin Number(5,2) Mandatory
Daily margin rate Number(5,2) Mandatory
 Annexure 11.6

Format of application form for new CDSL EPI accounts with NSCCL

Date:

The Manager
Securities Department
NSCCL

Dear Sir,

Sub: Account for early pay-in of securities through CDSL

We are interested in making early pay-in of securities through CDSL. We therefore request
you to open an early pay-in account based on the details given hereunder:

S No Description
1. Name of the Member
2. 5 digit Trading Member Code
3. SEBI Registration Number
4. Address (for Communication)
5. City
6. State
7. Country
8. Pin code
9. CDSL Clearing Account No.
10. PAN No. (Copy of PAN card should be enclosed for
verification)

We hereby authorise NSCCL to operate the above stated account on our behalf and execute
transactions as may be deemed necessary. Further, we hereby authorise NSCCL to debit our
account towards any charges that may be levied by CDSL on account of transactions in this
account.

We would request you to advise us the account number allotted to us for this purpose.

Yours Sincerely

Authorised Signatory
Name:
Designation:
 Annexure 11.7

Format for Client level early pay-in files for securities

Format of files to be uploaded by the member giving client & quantity details

The file should be in CSV format.

Naming convention:

<XXXXX>_CLNTEPI_YYYYMMDD.Ynn

where,
XXXXX - Is the member code
YYYYMMDD - Date in YYYYMMDD format
Y - The file indicator (T in this case for upload)
nn - The batch number of file to be uploaded.

Control record:
Sr. No. Field Length Mandatory/ Description
Option
1. Record Type CHAR(2) Mandatory Value = 01
2. File Type CHAR(4) Mandatory Value = CLEP
3. Member Type CHAR(1) Mandatory Member Type
4. Member Code CHAR(5) Mandatory Member code for
which file
generated/received
5. Batch Date CHAR(8) Mandatory Format :
DDMMYYYY
Should be same as that
in the file name.
6. Batch number Number(2) Mandatory The batch number of
the file sent.
7. Number of Number(7) Mandatory Total number of
records records in the file

Detail record:
Sr. No. Field Length Mandatory/ Description
Option
1. Record Type CHAR(2) Mandatory Value = 20
2. Symbol CHAR(10) Mandatory
3. Series CHAR(2) Mandatory
4. Client Code CHAR(20) Mandatory
5. Settlement Type CHAR(1) Mandatory
6. Settlement No CHAR(7) Mandatory
7. Early Payin NUMBER Mandatory
Quantity
Return file
In case the file uploaded by the member gets rejected, then the file extension ‘Tnn’ will get
replaced with ‘Rnn’ and the return file will be downloaded to the members in CEP directory.
The control record in the file will have R appended.

The naming convention for return files will be:

<XXXXX>_CLNTEPI_YYYYMMDD.Rnn

In case the file is accepted (success) then the file extension ‘Tnn’ will get replaced with ‘Snn’
and the return file will be downloaded to the members in CEP directory. The return file with
extension ‘Snn’ will have S appended for successful records and R appended for rejected
records.

The naming convention for return files will be:

<XXXXX>_CLNTEPI_YYYYMMDD.Snn

Note:
1. Member should mention the total quantity for the clients to whom EPI needs to be
allocated. If member wants to change the EPI once allocated to a client, the same needs to
be provided in the next file with the revised quantity and the old quantity will get updated
with the revised quantity. If member wants to remove the EPI benefit given earlier to a
client, a record needs to be sent in the subsequent file with the revised quantity as zero.
Where the quantity is specified for a client as zero the client will become eligible for
random allocation.
2. Wherever allocation is specified by the member for a client -security-settlement type-
settlement number, EPI will be specifically allocated to that client irrespective whether
the client has any outstanding sell position or not and such clients shall not be considered
for random allocation. Even if the client is allocated excess EPI, the excess will not be
considered in the pool for random allocation.
3. Where the member has to provide EPI for his proprietary position, he has to specify client
code as his member code, and in case he wants to specify EPI for OTR Un-allocation and
non-contraction he has to specify the client code as PRO_Memcode.
4. At the end of the day EPI allocation will be done on the same lines as intra day i.e. first
specific and then random.
5. Specific client level EPI should be given only for all open settlements
6. Members are requested to verify the benefit received in the EPI report downloaded.

EPI Allocation details downloaded to the members - File format

A file will be downloaded to the members in the CEP directory providing the following
details. The file name shall be

<XXXXX>_CEPYYYYMMDD.Dnn

XXXXX - Is the member code

YYYYMMDD - Date in YYYYMMDD format
D - The file indicator
nn - The batch number of file to be uploaded.

Report file structure is as follows:

Control record
10,DDMMYYYY, Member Code, Number of Records
Detail record (Allocated Quantity)
20, Settlement Type, Settlement Number, Symbol, Series, Client Code, Quantity Requested,
Quantity Allocated
Detail record (Balance Quantity)
30, Settlement Type, Settlement Number, Symbol, Series, Balance Quantity
 Annexure 11.8

Format of files to be uploaded by the member/custodian giving client wise details of

early pay-in of funds

The file shall be in CSV format.

Naming convention:

CLNTEPF_N_XXXXXXX_YYYYMMDD.Ynn

where,
N - Settlement type (Should be N for normal segment and W for trade for trade
segment)
XXXXXXX - Settlement number (e.g “2008001”)
YYYYMMDD - Date in YYYYMMDD format
Y - The file indicator (T in this case for upload)
nn - The batch number of file to be uploaded.

Control record:
Sr. No. Field Length Mandatory/ Description
Option
1. Record Type CHAR(2) Mandatory Value = 01
2. File Type CHAR(7) Mandatory Value = CLNTEPF
3. Member Code CHAR(5) Mandatory Member code for
which file
generated/received
4. Batch Date CHAR(8) Mandatory Format :
YYYYMMDD
Should be same as that
in the file name.
5. Batch number Number(2) Mandatory The batch number of
the file sent.
6. Settlement Type CHAR(1) Mandatory Settlement type for
which EPI is made.
Should be N for
normal segment and W
for trade for trade
segment
7. Settlement No CHAR(7) Mandatory Settlement number (e.g
“2008001”)
8. Number of Number(7) Mandatory Total number of
records records in the file
9. Total value of EPI Number (15,2) Mandatory Total amount of early
pay-in across all
clients
Detail record:
Sr. No. Field LengthMandatory/ Description
Option
1. Record Type CHAR(2) Mandatory Value = 20
2. Client Code CHAR(12) Mandatory
3. Amount of funds Number Mandatory
early pay-in (in Rs.) (15,2)

Return file

In case the file uploaded by the member gets rejected, then the file extension ‘Tnn’ will get
replaced with ‘Rnn’ and the return file will be downloaded to the members in CEP directory
in extranet. The control record in the file will have R appended.

The naming convention for return files will be:

<XXXXX>_CLNTEPF_N_XXXXXXXX_YYYYMMDD.Rnn

In case the file is accepted (success) then the file extension ‘Tnn’ will get replaced with ‘Snn’
and the return file will be downloaded to the members in CEP directory in extranet. The
return file with extension ‘Snn’ will have S appended for successful records and R appended
for rejected records.

The naming convention for return files will be:

<XXXXX>_CLNTEPF_ N_XXXXXXXX_YYYYMMDD.Snn
 Annexure 11.9
Example of computation of offsetting positions
Example: A hypothetical Index Q with constituent underlying stocks A & B have weight-
ages as stated below. Based on the weight-ages the number of units required to be considered
as a complete replica is computed as under:
Units
Underlying Weight% Required
Index Q 50
Stock A 60 30
Stock B 40 20

The portfolio will be considered as a complete replica if the client has Long 50 units of Index
Q Futures and Short positions in Stock A/Stock Futures A to extent of 30 units and short
positions in Stock B/Stock Futures B to the extent of 20 units.
Assuming a client has the following positions in his portfolio. A (+) sign indicates a long
position and (-) indicates a short position.
Expiry / Open
Underlying
Month Position
Jan 09 +50
Index Q Futures
Feb 09 -75
Jan 09 -20
Stock futures of A
Feb 09 +70
Jan 09 -60
Stock futures of B
Feb 09 +10
Position in Stock A (CM Segment) -50
Position in Stock B (CM Segment) +30
The cross margin benefit shall be provided as under:
Index Futures to Constituent Stocks/Stock Futures positions
Expiry Benefit
Underlying
Month qty
Index Q Futures Jan 09 50
Stock futures of A Jan 09 -20
Position in Stock A (CM Segment) -10
Stock futures of B Jan 09 -20

Index Q Futures Feb 09 -50

Stock futures of A Feb 09 30
Stock futures of B Feb 09 10
Position in Stock B (CM Segment) 10

Stock Futures to Stocks

Expiry Benefit
Underlying
Month qty
Stock futures of A Feb 09 40
Position in Stock A (CM Segment) -40
Stock futures of B Jan 09 -20
Position in Stock B (CM Segment) 20
 Annexure 11.10
Format of files to be uploaded by the clearing member giving client wise details

The file shall be in CSV format.

Naming convention: CMPYYYYMMDD.Tnn
where:
<YYYYMMDD> is the current date
and ‘nn’ is the batch number of the file

The files are required to be uploaded in the following path on the CIM -Home Page> Cross
Margin> File upload
Control record:
Sr. No. Field Length Description
1. Record Type CHAR(2) Value = 01
2. File Type CHAR(3) Value = CMP
3. Member Code CHAR(5) Primary Member code of the
clearing member
4. Batch Date CHAR(8) Format : YYYYMMDD
Should be same as that in the file
name
5. Number of Number(7) Total number of records in the file
records

Detail record:
Sr. No. Field Length Description
1. Record Type CHAR(2) Value :
10 for proprietary code
20 for retail client code
30 for Custodial Participant code

2. Code CHAR(12) Value :

For proprietary code it shall be
PRO_TMCODE
For retail client code it shall be
client code allotted to the client
and used during order execution
For Custodial Participant code it
shall be 12 digit alphanumeric
code allotted by NSCCL for such
custodial participant

Return files:
The files uploaded by the member shall be processed and return files shall be downloaded in
CIM. Members can check the return files at
Home Page> Cross Margin> File download
In case the file uploaded by the member gets rejected, then the file extension ‘Tnn’ will get
replaced with ‘Rnn’

The naming convention for return files will be:

<XXXXX>_CMPYYYYMMDD.Rnn
Where XXXXX shall be the Primary member code
<YYYYMMDD> is the trade date
and ‘nn’ is the batch number of the file

In case the file is accepted (success) then the file extension ‘Tnn’ will get replaced with ‘Snn’
and the return file will be downloaded to the members on CIM. The return file with extension
‘Snn’ will have S appended for successful records and F appended for rejected records.

The naming convention for return files will be:

<XXXXX>_CMPYYYYMMDD.Snn
Where XXXXX shall be the Primary member code
<YYYYMMDD> is the trade date
and ‘nn’ is the batch number of the file

Members are required to take note of following whilst uploading the client codes eligible for
cross margining-
1. Members shall upload all eligible client codes in a single file only.
2. If any modification or deletion is required in the file then the member will upload new
file with all records.
3. The latest file uploaded by the member shall be considered as final
 Annexure 11.11
FORMAT OF AGREEMENT BETWEEN MEMBER, CUSTODIAN &
CONSTITUENT

This agreement is made on this ____ day of ____ 2010

Between
______________, a company/ partnership firm/ individual having its registered
office/ office/ residence at ___________________ (hereinafter referred to as “the
Member”) which expression shall unless repugnant to the context or meaning
thereof include its successors, legal representatives and permitted assigns) of the
First Part

And

_____________, a company incorporated under the Companies Act, 1956 and having
its registered office at, _________________ and its corporate office at
_____________(hereinafter referred to as “the Custodian”) which expression shall
unless repugnant to the context or meaning thereof include its successors, legal
representatives and permitted assigns) of the Second Part

And
__________________________, a company/ partnership firm/ individual having its
registered office/ office/ residence at ___________________ (hereinafter called “the
Constituent”) which expression shall unless repugnant to the context or meaning
thereof include its successors, legal representatives and permitted assigns) of the
Third Part.

WHEREAS,
1. Securities and Exchange Board of India (hereinafter referred to as “SEBI”)
vide its Circular No. SEBI/DNPD/Cir-44/2008 dated 2nd December 2008 has
decided to extend cross margining facility across cash and derivatives
segments to all categories of market participants.
2. Pursuant to the said direction of SEBI, in order to facilitate cross margining,
the inter-se distribution of liability/responsibility in the event of default are to
be laid down in the agreements.
3. The Member is registered as a Clearing Member of National Securities
Clearing Corporation Ltd. (hereinafter referred to as “NSCCL”) and has
agreed to clear & settle the trades done by the Constituent through a trading
member or trading members of National Stock Exchange of India Ltd.
(hereinafter referred to as “NSEIL”) subject to the provisions contained in the
Rules, Bye Laws, Regulations and Circulars of NSCCL (Futures & Options
Segment) and the terms and conditions contained herein.
4. The Custodian is registered as a Clearing Member of NSCCL. The Custodian
clears and settles the trades done by the Constituent in the Capital Market
Segment as a Clearing Member of NSCCL.
5. The Constituent is desirous of availing the cross margining facility and has
approached the Member and the Custodian.
6. The Member and the Custodian has agreed to request NSCCL to provide the
benefit of cross margining to the Constituent subject to the terms and
conditions contained herein.

NOW THEREFORE THIS AGREEMENT WITNESSETH AND IT IS HEREBY

AGREED BY AND BETWEEN THE PARTIES HERETO AS UNDER

1. The Member and the Constituent entered into Custodial Participant

Agreement (hereinafter referred to as Custodial Participant Agreement) on
___________ at _______ wherein the Member at the request of the Constituent,
agreed to clear & settle the trades done by the Constituent through a trading
member or trading members of NSEIL subject to the provisions contained in
 the Rules, Bye Laws and Regulations of NSCCL (Futures & Options Segment)
and the terms and conditions contained therein.
2. The Custodian and the Constituent entered into an Custodian and Client
Agreement (hereinafter to as Custodian Agreement) on ___________ at
_______ wherein the Constituent has engaged the services of Custodian.
3. In addition to the provisions contained in the Custodial Participant
Agreement and the Custodian Agreement and notwithstanding anything
contained in the said agreements, the parties agrees to be bound by the
following provisions which are specific to cross margining.
4. Cross Margining
4.1 The Member and the Custodian have agreed to request NSCCL to
extend cross margining facility to the Constituent subject to the terms
and conditions as contained herein and the Constituent agree to avail
the same.
4.2 The parties agree to be bound by SEBI Circular No SEBI/DNPD/Cir-
44/2008 dated 2nd December, 2008 and Circulars issued by SEBI from
time to time with respect to cross margining.
4.3 The parties agree to be bound by the Rules, Byelaws, Regulations and
Circulars issued from time to time by NSEIL/NSCCL including
provisions with respect to cross margining.
4.4 The parties agree that cross margin benefit shall be for such positions
in one or more trading segments/clearing segments and shall be
subject to such terms and conditions as may be prescribed by
NSEIL/NSCCL if any from time to time.
4.5 In case of default by the Clearing Members arising out of the positions
in one or more clearing segments, the Constituent agrees and
understands that NSCCL may utilise the margins or any other monies
furnished in any clearing segment by its Clearing Members, who clears
and settles the deals pertaining to the Constituent, in order to meet the
obligations arising out of such positions.
 4.6 In case of default by the Clearing Members arising out of the positions
in one or more clearing segments, the Constituent agrees and
understands that the outstanding positions of Clearing Members, who
clears and settles the deals pertaining to the Constituent, in any or all
clearing segments may be closed out by NSCCL in accordance with
Rules, Byelaws, Regulations and Circulars issued from time to time by
NSCCL.

IN WITNESS THEREOF, the parties to agreement have caused these presents to be

executed as of the day and year first above written.

Signed for and on behalf of

MEMBER :
By :
Signature :
Title :
Witness :

Signed for and on behalf of

CUSTODIAN :
By :
Signature :
Title :
Witness :

Signed for an on behalf of

CONSTITUENT :
By :
Signature :
Title :
Witness :

Instruction
1) The agreement to be stamped for Rs.100/- or the value prevailing in the State where
executed, whichever is higher. Agreement to be executed on Non-Judicial stamp paper(s) or
on paper franked from Stamp Office
2) All the blanks in the format are required to be duly filled and signed by the signatories to
the agreement
 Annexure 11.12 A
AMENDMENT AGREEMENT TO THE CLEARING MEMBER – TRADING
MEMBER AGREEMENT

This agreement is made on this ____ day of ____ 2010

Between
______________, a company/partnership firm/individual having its registered
office/office/residence at ___________________ and having SEBI Registration No.
____________ (hereinafter called the Clearing Member) which expression shall
unless repugnant to the context or meaning thereof include its successors, legal
representatives and permitted assigns)

And
________________________, a company/partnership firm/individual having its
registered office/office/residence at ___________________ and having SEBI
Registration No. ____________ (hereinafter called the Trading Member) which
expression shall unless repugnant to the context or meaning thereof include its
successors, legal representatives and permitted assigns).

WHEREAS,
1. The Clearing Member and the Trading Member entered into Clearing
Member and Trading Member Agreement (hereinafter referred to as
“Agreement”) on ___________ at _______ ,wherein the Clearing Member has
undertaken to the total exclusion of the Trading Member, the obligation of
clearing and settlement of the deals of the Trading Member executed/done on
the Futures & Options Segment of National Stock Exchange of India Limited
(NSEIL) and to do all the acts, deeds and activities incidental to the clearing
and settlement of the deals.
2. Securities and Exchange Board of India (hereinafter referred to as “SEBI”)
vide its Circular No. SEBI/DNPD/Cir-44/2008 dated 2nd December 2008 has
decided to extend cross margining facility across cash and derivatives
segments to all categories of market participants.
3. Pursuant to the said direction of SEBI, in order to facilitate cross margining,
the inter-se distribution of liability/responsibility in the event of default are to
be laid down in the agreements. Accordingly, amendments are required to be
carried out in the Agreement entered into by the Clearing Member and the
Trading Member.
4. The Trading Member is desirous of availing the cross margining facility and
has approached the Clearing Member.
5. The Clearing Member has agreed to request NSCCL to provide the same
subject to the terms and conditions contained herein.
6. In view of the above, therefore the parties hereto are desirous of amending
the Agreement for the purpose of including certain specific provisions for the
purpose of availing cross margin benefit.

NOW THEREFORE THIS AGREEMENT WITNESSETH AND IT IS HEREBY

AGREED BY AND BETWEEN THE PARTIES HERETO AS UNDER:

1. Both the parties agree that after clause 5 the following clause shall be inserted
as clause 5A in the Agreement.

5A Cross Margining
(1) The Clearing Member agrees to request NSCCL to extend cross
margining facility to the Trading Member/constituents of the Trading
Members subject to the terms and conditions as contained herein.
(2) The Trading Member agrees to intimate to the Clearing Member from
time to time the constituents to whom the cross margin benefit shall be
provided.
(3) The parties agree to be bound by SEBI Circular No SEBI/DNPD/Cir-
44/2008 dated 2nd December, 2008 and Circulars issued by SEBI from
time to time with respect to cross margining.
(4) The parties agree to be bound by the Rules, Byelaws, Regulations and
Circulars issued from time to time by NSEIL/NSCCL including
provisions with respect to cross margining.
(5) The parties agree that cross margin benefit shall be for such positions
in one or more trading segments/clearing segments and shall be
subject to such terms and conditions as may be prescribed by
NSEIL/NSCCL if any from time to time.
(6) In case of default by the Clearing Member arising out of the positions
in one or more clearing segments, the Trading Member agrees and
understands that NSCCL may utilise the margins or any other monies
furnished in any clearing segment by its Clearing Members, in order to
meet the obligations arising out of such positions.
(7) In case of default by the Clearing Member arising out of the positions
in one or more clearing segments, the Trading Member agrees and
understands that the outstanding positions of such Clearing Members,
may be closed out by NSCCL in accordance with Rules, Byelaws,
Regulations and Circulars issued from time to time by NSCCL.
(8) In case of default by the Trading Member arising out of the positions
in one or more clearing segments, the Clearing Member shall be
entitled to utilise the margins or any other monies of the Trading
Member in any other clearing segment in order to meet the obligations
arising out of such positions.
(9) In case of default by the Trading Member arising out of the positions
in one or more clearing segments, the Clearing Member shall be
entitled to close-out the positions of the Trading Member in any or all
clearing segments in accordance with Rules, Byelaws, Regulations and
Circulars issued from time to time by NSCCL.
 (10) The parties agree that notwithstanding anything contained in the
Agreement to the contrary, the parties shall be bound by the above
provisions with respect to cross margining.

IN WITNESS THEREOF, the parties to this agreement have caused these presents to
be executed as of the day and year first above written.

Signed for and on behalf of

CLEARING MEMBER :
By :
Signature :
Title :
Witness :

Signed for an on behalf of

TRADING MEMBER :
By :
Signature :
Title :
Witness :

Instruction
1) The agreement to be stamped for Rs.100/- or the value prevailing in the State where
executed, whichever is higher. Agreement to be executed on Non-Judicial stamp paper(s) or
on paper franked from Stamp Office
2) All the blanks in the format are required to be duly filled and signed by the signatories to
the agreement
 Annexure 11.12 B

AGREEMENT BETWEEN STOCK BROKER & CLIENT

This agreement is made on this ____ day of ____ 2010

Between

Mr./Ms/M/s._________________, an individual/a sole proprietary concern/a

partnership firm/a body corporate, registered/incorporated under the provisions of
the Indian Partnership Act, 1932/the Companies Act, 1956, being a member of the
National Stock Exchange of India Limited (hereinafter called “NSEIL”), and having
his /her/its registered office at ___________ (hereinafter called “the Stock Broker”)
which expression shall, unless repugnant to the context or meaning thereof, be
deemed to mean and include himself in the capacity of a trading member while
trading in the derivatives segment, his/her heirs, executors, administrators and legal
representatives/the partners for the time being of the said firm, the survivor or
survivors of them and their respective heirs, executors, administrators and legal
representatives/its successors, as the case may be, of the One Part;

And

Mr./Ms/M/s._____________, an individual/a sole proprietary concern/a

partnership firm/a body corporate, registered/incorporated, under the provisions of
the Indian Partnership Act, 1932/the Companies Act, 1956, having his/her/its
residence/ registered office at ___________(hereinafter called “the Client”) which
expression shall, unless repugnant to the context or meaning thereof, be deemed to
mean and include his/her heirs, executors, administrators and legal
representatives/the partners for the time being of the said firm, the survivor or
survivors of them and their respective heirs, executors, administrators and legal
representatives/its successors, as the case may be, of the Other Part;
WHEREAS,
1. The Stock Broker and the Client entered into a Stock Broker and Client
Agreement (hereinafter referred to as Client Agreement) on ___________ at
_______ wherein the Client has engaged the Stock Broker to deal in securities
and/or deal in derivatives contracts and to execute the Client orders through
the Stock Broker.
2. Securities and Exchange Board of India (hereinafter referred to as “SEBI”)
vide its Circular No. SEBI/DNPD/Cir-44/2008 dated 2nd December 2008 has
decided to extend cross margining facility across cash and derivatives
segments to all categories of market participants.
3. Pursuant to the said direction of SEBI, in order to facilitate cross margining,
the inter-se distribution of liability/responsibility in the event of default are to
be laid down in the agreements. Accordingly, amendments are required to be
carried out in the Client Agreement entered into by the Stock Broker and the
Client.
4. The Client is desirous of availing the cross margining facility and has
approached the Stock Broker.
5. The Stock Broker is registered as a Clearing Member of National Securities
Clearing Corporation Ltd. (hereinafter referred to as “NSCCL”) and has
agreed to facilitate provision of the benefit of cross margining in the Capital
Market Segment as well as Futures and Options Segment and such other
segment as may be specified by SEBI and NSCCL from time to time to the
Client subject to the terms and conditions contained herein.
6. In view of the above, therefore the parties hereto are desirous of amending
the Client Agreement for the purpose of including certain specific provisions
for the purpose of availing cross margin benefit.

NOW THEREFORE THIS AGREEMENT WITNESSETH AND IT IS HEREBY

AGREED BY AND BETWEEN THE PARTIES HERETO AS UNDER
1. Both the parties agree that after clause 21 the following clause shall be inserted as
clause 21A in the Client Agreement

21A. Cross Margining

a. The Stock Broker agrees to request NSCCL to extend cross margining
facility to the Client in the Capital Market Segment subject to the terms
and conditions as contained herein and the Client agree to avail the
same.
b. The parties agree to be bound by SEBI Circular No SEBI/DNPD/Cir-
44/2008 dated 2nd December, 2008 and Circulars issued by SEBI from
time to time with respect to cross margining.
c. The parties agree to be bound by the Rules, Byelaws, Regulations and
Circulars issued from time to time by NSEIL/NSCCL including
provisions with respect to cross margining.
d. The parties agree that cross margin benefit shall be for such positions
in one or more trading segments/clearing segments and shall be
subject to such terms and conditions as may be prescribed by
NSEIL/NSCCL if any from time to time.
e. In case of default by the Stock Broker arising out of the positions in one
or more clearing segments, the Client agrees and understands that
NSCCL may utilise the margins or any other monies furnished in any
clearing segment by its Clearing Members, who are clearing and
settling the transactions pertaining to the Client, in order to meet the
obligations arising out of such positions.
f. In case of default by the Stock Broker arising out of the positions in
one or more clearing segments, the Client agrees and understands that
the outstanding positions of the Stock Broker in any or all clearing
segments may be closed out by NSCCL in accordance with Rules,
Byelaws, Regulations and Circulars issued from time to time by
NSCCL.
 g. In case where cross margin benefit is to be availed by the Client for
transactions executed in Futures and Options Segment, the Client
agrees that the Stock Broker shall request the Clearing Member of
NSCCL to avail the cross margin benefit for such transactions on
behalf of the Client and such cross margin benefit shall also be subject
to the terms and conditions mentioned in Clearing Member and
Trading Member agreement entered into between the Clearing
Member and the Stock Broker through whom transactions are cleared
and settled by the Stock Broker in Futures and Options Segment and
terms and conditions mentioned hereinabove shall be applicable for
cross margining in Futures and Options Segment also.
h. The parties agree that notwithstanding anything contained in the
Client Agreement to the contrary, the parties shall be bound by the
above provisions with respect to cross margining.

IN WITNESS THEREOF, the parties to this agreement have caused these presents to
be executed as of the day and year first above written.

Signed for and on behalf of

STOCK BROKER :
By :
Signature :
Title :
Witness :

Signed for an on behalf of

CLIENT :
By :
Signature :
Title :
Witness :

Instruction
1) The agreement to be stamped for Rs.100/- or the value prevailing in the State where
executed, whichever is higher. Agreement to be executed on Non-Judicial stamp paper(s) or
on paper franked from Stamp Office
2) All the blanks in the format are required to be duly filled and signed by the signatories to
the agreement
 Annexure 11.13
Details to be provided by F&O clearing member in case where client/entity is
clearing through different members in Cash and F&O segment

1. Format of letter to be provided by Clearing member in F&O segment for availing

cross margin benefit for their client
Date:

Manager
Risk Management Group
National Securities Clearing Corporation Limited
Exchange Plaza,
Bandra Kurla Complex,
Bandra (East), Mumbai 400 051

Dear Sir,

Sub: Details of client/entity to be made eligible for cross margining

This is with reference to your circular no.NSE/CMPT/11975 dated February 04, 2009, in
respect of cross margining. In accordance with the provisions contained in this circular you
are requested to provide cross margining for following client(s) clearing through us in F&O
Segment.

Trading Client Client Client/CP Permanent

Member/Custodian Code/CP Code/CP Name Account
Code/ Name Code in F&O Code in Number(PAN)
Segment Cash of Client
Segment

We have executed the necessary agreement as specified in the above mentioned circular with
the trading member/custodian

Thanking you,

Yours sincerely

Authorised Signatories
Clearing Member Name :
Clearing Member Code :
Name:
Designation
Encl:
1. Copy of agreement
2. Attested copy of PAN
3. Letter from trading member/Custodian
2. Format of letter to be provided by the custodian in case the client/entity clears
through custodian in Cash segment
Date:
Manager
Risk Management Group
National Securities Clearing Corporation Limited
Exchange Plaza,
Bandra Kurla Complex,
Bandra (East), Mumbai 400 051

Dear Sir,

Sub: Details of client/entity to be made eligible for cross margining

This is with reference to your circular no.NSE/CMPT/11976 dated February 04, 2009, in
respect of cross margining. In accordance with the provisions contained in this circular you
are requested to provide cross margining for following client clearing through us in Cash
Segment.

Clearing Member CP Code in Cash CP Name Permanent

Code /Name in F&O Segment Account
Segment Number(PAN)
of Client

We have executed the necessary agreement as specified in the above mentioned circular with
the clearing member and constituent

Thanking you,

Yours sincerely

Authorised Signatories

Custodian Name :
Custodian Code :

Name:
Designation
3. Format of letter to be provided by trading member for availing cross margin benefit
to client

Date:

Clearing Member Name

Clearing Member Code

Dear Sir,

Sub: Details of client/entity to be made eligible for cross margining

This is with reference to NSCCL circular no.NSE/CMPT/11975 dated February 04, 2009, in
respect of cross margining. In accordance with the provisions contained in this circular we
would like to provide cross margining for the following clients in the Cash and F&O
segment.

Client Code in F&O Client Code in Client Name Permanent

Segment Cash Segment Account
Number(PAN)
of Client

We have executed the agreement as specified by NSCCL with our clients. We request you to
intimate the details of the above clients to NSCCL for availing the cross margin facility.

Thanking you,

Yours sincerely

Authorised Signatories

TM Name :
TM Code :

Name:
Designation
 Annexure 11.14
Format of report giving details of cross margin benefit and off-setting positions

Cross margin benefit report (XM-01)

Naming convention: - C_XM01_<MEMBER CODE>_DDMMYYYY.csv

File location: Reports directory in Extranet folder
File details and format:
Client wise, security wise record
Record Type – Value will be 10
Client Code
Security Symbol
Security Series
Settlement Type
Settlement Number
Net Open Position in Qty
Off-setting Qty
Original Margins (A)
Margin Benefit (B)
Applicable Margins (A)-(B)

Client wise, cross margin record

Record Type – Value will be 20
Client Code
Original Margins (A)
Margin Benefit (B)
Applicable Margins (A)-(B)

Member wise, total margin record

Record Type – Value will be 30
Original Margins (A)
Margin Benefit (B)
Applicable Margins (A)-(B)
 Annexure - 17.1
Sr. Corporate Benefit Valuation
No.

1 Dividend/ Interest/ All debit/credit for valid claims on company objections

Redemption lodged with the Clearing House shall be done by the
amount Clearing Corporation.
2 Bonus IM may deliver the entire quantity of bonus shares claimed
by the RM. In case of part delivery of bonus shares, the
delivery must necessarily be in market lots. In case the IM
does not deliver the shares, the equivalent monetary value
for the bonus shares shall be debited to the IM and credited
to the account of RM by the Clearing Corporation.

3 Rights- Equity IM may deliver the entire quantity of rights shares claimed
by the RM and claim the amount for issue price in the
relevant portion of form BDC-2A. In case of part delivery of
rights shares, the delivery must necessarily be in market
lots. In case the IM does not deliver the shares, the
equivalent monetary value less rights issue amount shall be
debited to the IM and credited to the account of RM by the
Clearing Corporation.
4 Rights - IM may deliver the entire quantity of rights FCD, PCD -
FCD,PCD- convertible part (which are traded on NSE) claimed by the
convertible part RM and claim the amount for issue price in the relevant
(which are traded portion of form BDC-2A. In case of part delivery of rights
on NSE) FCD, PCD -convertible part (which are traded on NSE), the
delivery must necessarily be in market lots. In case the IM
does not deliver the rights shares, the equivalent monetary
value less rights issue amount shall be debited to the IM and
credited to the account of RM by the Clearing Corporation.
5 Rights - NCD No Valuation
PCD-Non
Convertible Part
6 Others Rights - Shall be handled directly between members as is the current
FCD,PCD- practice
convertible part
(if not traded on
NSE)

IM : Introducing Member/First Introducing Member

RM : Receiving Member/Last Introducing Member

Computation of equivalent value: The equivalent value of scrip will be the closing price of
Day 19. The date of intimation of objection is taken as Day 1. In case there is no trading on
Day 19, then the closing price of the day preceding Day 19 on which trading took place will
be taken as equivalent value. However, if the rectification of objection is beyond the
stipulated period of 21 days (owing to the scrip being in no delivery), the relevant valuation
price shall be the closing price of the date 2 days prior to the date of rectification.
 Annexure 18

(On the Letter Head)

UNDERTAKING

To,
National Securities Clearing Corporation Limited
Exchange Plaza, C-1 Block G
Bandra Kurla Complex
Bandra (E)

Dear Sir/s,

Pursuant to the requirement specified in COSI meeting dated February 21, 1998 and
subsequent broadcast on February 26, 1998, we are required to submit delivery details
statement and / or delivery slip alongwith the company objection memo while lodging the
document against the introducing member in support of the proof of having received such
shares through the process of Clearing House, from delivering member at NSE. While we
have been furnishing such supporting documents alongwith the company objection being
lodged by us, the relevant delivery detail statement and / or delivery slip are not available at
our end in respect of company objection detailed here below. We, therefore, request the
Clearing Corporation to accept the objection without delivery detail statement and / or
delivery slip in respect of the above shares.

We confirm that the shares, the details of which are given in Annexure 18.1 attached, have
been received by us from the Clearing House.

We undertake that in case where it is proved that the aforesaid shares were not received by us
through the process of Clearing House of National Stock Exchange of India / Clearing
Corporation from the introducing delivering member or delivering member, we agree that
such act shall be subject to same amount of penalty as provided under item no.8.5 of Circular
No: NSCC/CM/C&S/064 dated March 18, 1998 besides any other disciplinary action deemed
fit to be initiated against us by the Exchange / Clearing Corporation .

Thanking you,

Yours faithfully,

(Members Name & Official Seal)

Note: The above undertaking is to be given only incase of fake/forged/stolen shares under
objection and where the introducing member at NSE is other than a defaulter, surrendering
member, surrendered member, suspended member or a disabled member.
 Annexure 18.1

Objection Inward No. :

Details when the shares were originally received

Shares received from

Member Name : ___________________________________

Member Code : ____________

Settl. Type Settl. No. Del. No. Certificate No. Distinctive Nos.From – To
 Annexure - 22.1

Sr No Reason Reason Code To be Rectified by IM /

DM
1 Wrong Scrip Delivered. DM 02 DM
2 Overwriting in Folio No in Certificate. IM 01 IM
3 Sellers name and apparent difference in signature on TD. IM 02 IM
4 Partly paid shares delivered instead of fully paid. DM 03 DM
5 Sellers Signature Missing. IM 03 IM
6 Witness signature missing. IM 04 IM
7 Companies name wrongly written. IM 05 IM
8 New share Dividend not claimed on Non Pari Passu shares. DM 01 DM
9 Call money endorsement required. IM 06 IM
10 P.A. No required. IM 07 IM
11 ROC date not clear IM 08 IM
 Annexure-23.1

Members are also requested to furnish the following information on floppies in the format
mentioned below.

File format

The file should be in the comma delimited format i.e. the fields in the header and detail
records (discussed in items 2 and 3 resp.) should be separated by a comma (,) and should not
have
· leading zeros (in the case of numbers)
· leading and following spaces (in the case of characters and numbers)

For example:
The header record would read as:
01,09852,N,1997048,N,01,1025,09852N1997048N01,N0985201.048

The detail record would read as:

21,N,1997048,N,1234,ATLASCOPCO,EQ,10,A80482,1100000000000001,11000000000000
10

1. File Naming Convention

The file will be named as per the format XYYYYYNN.999

where X : Settlement Type
YYYYY : Member Code
NN : Batch No.
999 : Settlement Number

Generation of batch number

The batch number as described above should be generated as follows.
For a unique combination of Settlement Type, Settlement No., and Delivery Type a separate
file should be generated. For a given Settlement Type and Settlement No., each file generated
should have a unique batch no. This batch no. should increment by one each time a new file
is generated.

A maximum number of 10,000 records including the header and the delivery detail records
can be entered in one floppy. (Detail record discussed in item 3).

Consider the following examples:

Example 1:
Settlement type N
Member code 09852
Batch no. 01
Settlement no. (1997048) 048
File should be named as N0985201.048

Example 2:
Settlement type N
Member code 09852
Batch no. 02
Settlement no. (1997048) 048
File should be named as N0985202.048

2. Header Record

Each file will contain the header record in the following format:

Field Name
Record Type
Trading Member Code
Settlement Type
Settlement No.
Delivery Type
Batch Number
Total number of Records
File Name
DOS File Name

The Record type should be 01 for header record.

Consider the following example:

Record Type 01
Trading Member Code 09852
Settlement Type N
Settlement No.1997048
Delivery Type N
Batch Number 01
Total number of Records 1025
File Name 09852N1997048N01
DOS File Name N0985201.048

The above header record should appear as follows:

01,09852,N,1997048,N,01,1025,09852N1997048N01,N0985201.048

File Name in the header record

The file name in the header record should be as follows:
Member Code
Settlement Type
Settlement No.
Delivery Type
Batch Number

Consider the above example:

Corresponding to file N0985201.048, the file name in the header record should appear as
09852N1997048N01.
The DOS File Name in the header record:
The DOS file name in the header record should be as follows:
Settlement Type
Member Code
Batch No.
Settlement Number

Consider the example cited in item 1:

Corresponding to file N0985201.048, the DOS file name in the header record should appear
as N0985201.048.

3. Detail record

Please note that the format as defined earlier in NSCC/CH/3477 contained a field 'Number of
certificates' which has been deleted in the following revised format.

Field Name Length

Record type Char (2)
Settlement Type Char (1)
Settlement Number Char (7)
Delivery Type Char (1)
Delivery Number Char (6)
Symbol Char (10)
Series Char (2)
Delivered Qty Number (16)
Certificate Number Char (20)
DNR From No. Char (16)
DNR to No. Char (16)

The Record type for the detail records should be 21.

Consider the following example:

Record type 21
Settlement Type N
Settlement Number 1997048
Delivery Type N
Delivery Number 1234
Symbol ATLASCOPCO
Series EQ
Delivered Qty 10
Certificate Number A80482
DNR From 1100000000000001
DNR From 1100000000000010

The above detail record should appear as follows:

21,N,1997048,N,1234,ATLASCOPCO,EQ,10,A80482,1100000000000001,11000000000000
10
There should be a separate detail record for
· Each certificate number
· discontinuous distinctive number ranges
 Annexure-23.2

Reason Charges to be levied

Non-submision of floppy Rs. 500 per instance and Rs.2000 if non-

submission more than two consecutive
instances
Part delivery details provided/ delivery Rs.200 per settlement
details not provided
DNR/ certificate details on DDS/ floppy not Rs.200 per settlement
matching with the physical shares and being
reported as bad by the receiving members
Other minor technical mistakes Rs. 200 subject to a maximum of Rs. 500 for
more than one mistake

The members would be given an opportunity to rectify the data till 12:00 p.m. on the funds
pay-in day.

If the distinctive number ranges (DNRs) provided by the Delivering Member do not tally
with the physical shares delivered by them, and subsequently, it is confirmed that the shares
actually delivered are fake/ forged/ stolen, a fine of Rs. 5000/- or 10% of the value of shares
delivered, whichever is higher, shall be levied on such members.
 Annexure-24.1
FORM NO: NSEF 01

To Date:
National Securities Clearing Corporation Ltd.
Mumbai

Dear Sirs,

We hereby state that the Settlement Obligations for securities to deliver / receive and funds to
pay / receive as specified in our "SETTLEMENT OBLIGATION STATEMENT OF CM
CLEARING MEMBER" (Form No: NSEF - 01) for the Settlement Type:__________
No:____ as enclosed herewith is confirmed order from us for the same.

CM Clearing Member Name Signature

CM Clearing Member Code Stamp

 FORM NO: NSEF-01

To Date:
National Securities Clearing Corporation Ltd.
Mumbai

SETTLEMENT OBLIGATION STATEMENT OF CM CLEARING MEMBER

Clearing Member: 'Code' 'Name'

Trade Date: 'Date' Report Run Date: 'Date'

Settlement Type: 'Code' Settlement No: 'No'

Trading Period: 'From' 'To'

Pay-in Date: 'Date' Pay-out Date: 'Date'

Sr. Security Total Buys Total Sells

Cumulative Net
No. Code Symbol Series Quantity Value Quantity Value Qty to Del.
Qty to Rec. Funds [(-)to Del/(+)to Rec]

Total l
Funds to Pay(-)/Receive(+) Rs.____________________

I/We hereby state that the above mentioned Settlement obligation for securities to
deliver/receive and funds to pay/receive is a confirmed order from us for the same.

CM Clearing Member Name : Member Signature :

CM Clearing Member Code: Member Stamp:

 Annexure-24.2
FORM NO: NSEF 01A

To Date:
National Securities Clearing Corporation Ltd.,
Mumbai

Dear Sirs,

We hereby state that the Settlement Obligations for securities to deliver / receive and funds to
pay/receive as specified in our "SETTLEMENT OBLIGATION STATEMENT OF CM
CLEARING MEMBER - CUSTODIANWISE" (Form No: NSEF - 01A) for the
Settlement Type:__________ No:____ as enclosed herewith is confirmed order from us for
the same.

CM Clearing Member Name Signature

CM Clearing Member Code Stamp

 FORM NO:NSEF-01A

To Date:
National Securities Clearing Corporation Ltd.
Mumbai

SETTLEMENT OBLIGATION STATEMENT OF CM

CLEARING MEMBER - CUSTODIAN-WISE

Clearing Member : 'Code' 'Name'

Trade Date: 'Date' Report Run Date: 'Date'

Settlement Type: 'Code' Settlement No: 'No'

Trading Period : 'From' 'To'

Pay-in Date: 'Date' Pay-out Date: 'Date'

Sr. Security Total Buys Total Sells Cumulative Net

No Code Symbol Series Quantity Value Quantity Value Qty to Del. Qty to Rec. Funds
[(-)to
Del/(+)to Rec]

Total

Funds to Pay(-)/Receive(+) Rs.____________________

I/We hereby state that the above mentioned Settlement obligation for securities to
deliver/receive and funds to pay/receive is a confirmed order from us for the same.

CM Clearing Member Name : Member Signature :

CM Clearing Member Code: Member Stamp:

 Annexure-24.3
FORM NO: NSEF 02

To Date:
National Securities Clearing Corporation Ltd.,
Mumbai

Dear Sirs,

We hereby state that the Settlement Obligations for securities to deliver / receive and funds to
pay / receive as specified in our "SETTLEMENT OBLIGATION STATEMENT OF
CUSTODIAN CLEARING MEMBER" (Form No: NSEF - 02) for the Settlement
Type:__________ No:____ as enclosed herewith is confirmed order from us for the same.

Custodian Clearing Member Name Signature

Custodian Clearing Member Code Stamp

 FORM NO:NSEF-02

To Date:
National Securities Clearing Corporation Ltd.
Mumbai

SETTLEMENT OBLIGATION STATEMENT OF

CUSTODIAN CLEARING MEMBER

Clearing Member : 'Code' 'Name'

Trade Date: 'Date' Report Run Date: 'Date'

Settlement Type: 'Code' Settlement No: 'No'

Trading Period : 'From' 'To'

Pay-in Date: 'Date' Pay-out Date: 'Date'

Sr. Security Total Buys Total Sells Cumulative Net

No. Code Symbol Series Quantity Value Quantity Value Qty to Del. Qty to Rec.
Funds [(-)to
Del/(+)to Rec]

Total

Funds to Pay(-)/Receive(+) Rs.____________________

I/We hereby state that the above mentioned Settlement obligation for securities to
deliver/receive and funds to pay/receive is a confirmed order from us for the same.

Custodian Clearing Member Name : Member Signature :

Custodian Clearing Member Code: Member Stamp:

 Annexure-24.4
FORM NO: NSEF 03

To
National Securities Clearing Corporation Ltd.,
Mumbai

Dear Sirs,

We hereby state that we will deliver documents (Form No:NSEF-03) comprising of Delivery
No: From ___________ To ___________ in the clearing for the Settlement
Type:__________ No:____

Delivering Member Name Signature

Delivering Member Code Stamp

 FORM NO:NSEF-03

Page No.
To Report Name :
National Securities Clearing Corporation Ltd. Report Date:
Mumbai

I/We hereby agree to and will deliver the following securities in the clearing :

FINAL DELIVERY STATEMENT

Delivering Entity 'Code' 'Name'

Delivery Type : Settlement Type: 'Code' Settlement No. : 'No.'

Trading Period 'From' 'To'

Pay-in Date 'Date' Pay-out Date 'Date'

Delivery Nos. 'From' 'To' Total Deliveries 'No.'

Delivering Centre : Receiving Centre :

Sr. No. Delivery No. Security

Symbol Series Qty to Deliver Receiving
Entity Name Receipt No.

Delivering Member Name : Member Signature :

Delivering Member Code: Member Stamp:

 Annexure-24.5
FORM NO: NSEF 04

To Date:
National Securities Clearing Corporation Ltd.,
Mumbai

Dear Sirs,

We hereby state that we will receive documents (Form No:NSEF-04) comprising of Receipt
No: From __________ To _____________ in the clearing for the Settlement Type _______
No: ______.

Receiving Member Name Signature

Receiving Member Code Stamp

 FORM NO:NSEF-04

Page No.
To Report Name :
National Securities Clearing Corporation Ltd. Report Date:
Mumbai

I/We hereby agree to and will receive the following securities in the clearing :

FINAL RECEIPT STATEMENT

Receiving Entity 'Code' 'Name'

Delivery Type : Settlement Type: 'Code' Settlement No. : 'No.'

Trading Period 'From' 'To'

Pay-in Date 'Date' Pay-out Date 'Date'

Receipt Nos. 'From' 'To' Total Deliveries 'No.'

Receiving Centre : Delivering Centre :

Sr.
No. Receipt No. Security
Symbol Series Qty to Receive Delivering
Entity Name Delivery No.
Receiving Member Name : Member Signature :

Receiving Member Code: Member Stamp:

 Annexure-24.6
FORM NO:NSEF-05

DELIVERY SLIP

Settlement Type 'Code' Settlement No.'No.'

Delivering Centre Receiving Centre

Delivery No. Pay-in Date Pay-out Date Receipt No.

'No.' 'Date' 'Date' 'No.'
Delivering Entity
Security Receiving Entity

'Code' 'Code' 'Code'

'Name' 'Name' 'Name'

Qty to Deliver

Qty Delivered

Delivering Entity Stamp Qty Short

Clearing House Stamp
No. of Certificates

Delivering Entity Signature

Clearing House Signature
 Annexure-24.7
FORM NO:NSEF-06
Page No.
To Report Name :
National Securities Clearing Corporation Ltd. Report Date:
Mumbai

DELIVERY DETAILS STATEMENT

Delivering Entity : 'Code' 'Name'

Settlement Type : 'Code' Settlement No.'No'

Trading Period : 'From' 'To'

Pay-in Date : 'Date' Pay-out Date 'Date'

Delivering Centre: Receiving Centre :

Delivery Security Symbol Series Qty to Deliver Receiving Entity Receipt No. No.
of
No. 'Code' Certificates

Certificate DNR's No. of

No.(s) From To Shares

Total

Delivering Member Name : Member Signature :

Delivering Member Code: Member Stamp:
 Annexure-24.8
FORM NO: NSEF 6B

To Date :
The Clearing house,
NSCCL, Mumbai.

We hereby enclose the bad deliveries received by us as per the details mentioned below :

SETTLEMENT NO : TYPE : DELIVERING CENTRE CODE:

DELIVERY NO :

DELIVERING MEMBER NAME : DELIVERING MEMBER CODE :

____________________________

SCRIP NO OF SHARES CERTIFICATE NOS DIST NOS FROM TO NO OF CERTS

BAD
CODE

TOTAL :

REASON :
1._________________________________________________________
2._________________________________________________________
3._________________________________________________________

TOTAL QTY RECTIFIED :

SHARES REPLACED TRANSFER DEED REPLACED

Certificate Nos Distinctive Nos From To Certificate Nos Distinctive Nos From
To

STAMP & SIGN OF THE REC MEMBER RECEIVING MEMBER

CODE
 Annexure-24.9
Form NO. NSEF 6B-1
(BAD DELIVERY MEMO)

Date : NSE Inward No. :

Member's Name: Code :

Security Name ( in full) Symbol Series Delivery No Settl. Type Settl. No.

Certificate Nos. Distinctive Nos.

From To No. of Shares

Good / Bad delivery Guideline No : ____________________________________________

Reason for Bad Delivery :

___________________________________________________________________________
___________________________________________________________________________
__________________________________________________________

Documents Good for Delivery Documents Bad for Delivery

For National Securities Clearing Corporation Ltd.

( Authorised Signatory)
 Annexure-24.10
FORM NO : NSEF 6B-2
(UNRECTIFIED BAD DELIVERIES)

To
National Securities ClearingCorporation
C-1 Block G, Bandra Kurla Complex
Bandra (E)
Mumbai - 400051

I/We Have Failed To Rectify/Replace The Following Bad Deliveries On The Due Date.
I/We Therefore Instruct You To Auction/Square Off My/Our Account As Provided In
Exchange Bye-Laws And Regulations

Sr No Delivery Number Normal/ Dividend Scrip Qty Receiving Member

Code
1

Stamp And Sign Delivering Member Code :

Of Delivering Member
 Annexure-24.11
Form No. : BDC - 1A
(To be filled in triplicate for submitting Local Exchange Company Objections)

The BDC/Clearing House BDC Inward

No:_______________
National Securities Clearing Corporation Ltd.

Date of Introducing the shares on the First Introducing Exchange : ________________

We enclose the company objections received by us as per details given below :

Introducing Member/Custodian SEBI REGN. NO. ( Introducing

Member/Custodian )

______________________________________ Clearing No.

_________________

Security Name ( in full ) SECURITY CODE (SYMBOL) Series Eq./DebFace Value

Mkt. Lot

Delivering Member Name : _______________

Settl. Type Settl. & Del No. No. of Certs No. of Shares Cert Nos. Distinctive Nos.From-
To Obj. Code Stamp
Amount

TOTAL :
----------------------------------------------------------------------------------------------------------------
----------------
CLAIM FOR CORPORATE BENEFITS

BDC INWARD NO. _________________ Security Name of Benefits:

_______________________

SECURITY CODE (SYMBOL) : ________________

BC/RD Date Type of Rate / Ratio Issue price No. of shares Dividned Amt
Corporate Benefits. of Rights due as benefits
securities

CHEQUE (IF ANY) SHOULD BE ISSUED IN FAVOUR OF

:________________________________

STAMP & SIGN OF BDC STAMP AND SIGN OF RECEIVING

OF STOCK EXCHANGE MEMBER/CUSTODIAN
 SEBI REGN. NO.( Receiving Member
/Custodian)

Clearing No. _________________

Additional Details :

Buyer Custodian Name : ______________________________

Buyer Custodian Code. : _________________

Seller Custodian Name : ______________________________

Seller Custodian Code. : _________________

Obj Code Reason

1. Transferor Signature not matching with the records of the company.
Attestation required.
2. Fake/Forged/Stolen shares.
3. Alterations/Corrections on the Transfer Deed needs to be authenticated by the
Tranferor
4. Signature of the transferor not properly witnessed.
5. Stop Transfer instructions received by the Company.
6. Power of Attorney of authorised signatory not registered with the Company.
Certified true copy of Board Resolution/Power of Attorney required.
7. Memorandum & Articles of association of the Company required.
8. Others (Specify the reason on the Form BDC - 1A)
 Annexure-24.12
Form No. : BDC - 1B
(To be filled in quadruplate for submitting Inter-Exchange Company Objections)

The BDC (First Introducing Exchange) BDC Inward

No:_______________
___________________________________ Stock Exchange Code
:_______________

Date of Introducing the shares on the First Introducing Exchange : ________________

We enclose the company objections received by us as per details given below :

Introducing Member of First Exchange/Custodian SEBI REGN. NO. ( First

Introducing Member/Custodian)

______________________________________ Clearing No.

_________________

Security Name ( in full ) ISIN CODE Equity/Deb Face Value Mkt. Lot

Close Out Price ( See Note I ) :___________________

No. of Certs No. of Shares Cert Nos. Distinctive Nos. From To Obj Reason (Code)

Stamp Amt. Close-out Amt.

TOTAL :
----------------------------------------------------------------------------------------------------------------
----------------
CLAIM FOR CORPORATE BENEFITS

BDC INWARD NO. _________________ Security Name of Benefits:

_______________________

ISIN CODE : ________________

BC/RD Date Type of Corporate Benefits. Rate / Ratio Issue price of Rights securities

No. of shares due as benefits DividendAmount

Demand Draft (IF ANY) SHOULD BE ISSUED IN FAVOUR
OF:____________________________
PAYABLE AT ______________________________________

STAMP & SIGN OF BDC STAMP AND SIGN OF LAST

INTRODUCING MEMBER/CUSTODIAN
OF LAST EXCHANGE

SEBI REGN. NO.(

Last Introducing Member /Custodian)

Stock Exchange Code :_______________ Clearing No.

_________________

Note I : Indicate close out price as per close out procedure

Additional Details :

Buyer Custodian Name : ______________________________

Buyer Custodian Code. : _________________

Seller Custodian Name : ______________________________

Seller Custodian Code. : _________________

Obj Codes Reason

1. Transferor Signature not matching with the records of the company.
2. Fake/Forged/Stolen shares.
3. Alterations/Corrections on the Transfer Deed needs to be authenticated by the
Tranferor/Transferee.
4. Signature of the transferor not properly witnessed.
5. Stop Transfer instructions received by the Company.
6. Power of Attorney of authorised signatory not registered with the Company. Certified
true copy of Board Resolution/Power of Attorney required.
7. Memorandum & Articles of Association of the Company required.
8. Others (Specify the reason on the Form BDC - 1B)
 Annexure-24.13
Form No. : BDC - 2A
Part - A
( To be filled in triplicate by the Introducing Member/Custodian for submitting rectified
Company Objections)
To,
The BDC/Clearing House BDC Inward No. ______________
National Securities Clearing Corporation Ltd. (quoted by Stock Exchange on form
BDC- 1A)

Receiving Member/Custodian SEBI REGN. NO.(Receiving

Member/Custodian)

_______________________________ Clearing No.______________

We enclose herewith the following shares duly rectified/replaced including corporate benefits
(if any) as per the claim arising on company objections :

Security Name ( in full ) SECURITY CODE (SYMBOL) Series Eq./DebFace Value

Mkt. Lot

No. of TDs No. of Certs No. of Shares Cert Nos. Distinctive Nos. From -To
Cheque No.

Cheque Amount( Close- Out Amount)

Security Name of Benefits :_______________CORPORATE BENEFITS SUBMITTED (To

be filled by the Introducing Member/Custodian)

Type of Corp. Benefit No. of Shares enclosed as benefits Cheque No. Equivalent Price

(Closing Amt) Cheque Amount Distinctive Nos. Of shares enclosed From - To

For Rights (Equity, FCD's, PCD's) submitted by us as Corporate Benefits for the above BDC
Inward No., kindly issue us a Cheque for Rs. ___________________________ in favour of
: _______________________________________________________________
---------------------------------------------------------------------------------------------------------------
Part - B
(Details to be filled in by the Receiving Member/Custodian )
BDC Inward No. : ____________________

We enclose herewith a Cheque No. ____________ dated __________for Rs.

_____________________ drawn on
____________________________________________(name of bank) in favour of
_____________________________(the Introducing Member) being the amount paid for
Rights shares.

Kindly acknowledge receipt.

From : The BDC Stamp & Sign of Receiving
Member/Custodian :
(Stamp & Sign of Stock Exchange) SEBI REGN. NO.( Receiving

Member/Custodian)

Stock Exchange Code :_______________ Clearing No.

_________________
 Annexure-24.14
Form No. : BDC - 2B
Part - A
( To be filled in quadruplate by the First Introducing Member/Custodian for submitting
rectified Company Objections)
To,
The BDC(Last Exchange) BDC Inward No.
______________
_________________________________ (quoted by Last Exchange on
form BDC- 1B)

Last Introducing Member/Custodian SEBI REGN. NO.(Last

Introducing
Member/Custodian)

_______________________________ Clearing No.______________

We enclose herewith the following shares duly rectified/replaced including Corporate
Benefits (if any) as per the claim arising on company objections :

Security Name ( in full ) SECURITY CODE (SYMBOL) Series Eq./DebFace Value

Mkt. Lot

No. of Certs No. of Shares Certificate Nos. Distinctive Nos. From - To Cheque No.
Cheque
Amount
(Close- Out
Amount)

Security Name of Benefits: ________________ CORPORATE BENEFITS

SUBMITTED (To be filled by the First Introducing Member/Custodian)
Type of Corp. Benefit No. of Shares enclosed as benefits Cheque No. Equivalent Price
(Closing Amt) Cheque Amount Distinctive Nos. Of shares enclosed
From To

For Rights (Equity, FCD's, PCD's) submitted by us as Corporate Benefits for the above BDC
Inward No., kindly issue us a Demand Draft for Rs. __________________________ in
favour of : _________________________________ payable at ______________________
---------------------------------------------------------------------------------------------------------------
Part - B
(Details to be filled in by the Last Introducing Member/Custodian )
BDC Inward No. : ____________________

We enclose herewith a Demand Draft No. ____________ dated __________for Rs.

_____________________ drawn on
__________________________________________________(name of bank) in favour of
______________________________________(the First Introducing Member/ Custodian)
being the amount paid for Rights shares.

Kindly acknowledge receipt.

From : The BDC Stamp & Sign of Last
Introducing Member/Custodian :
(Stamp & Sign of Last Exchange) SEBI REGN. NO.( Last Introducing
Member/Custodian)

Stock Exchange Code :_______________ Clearing No.

_________________
 Annexure-24.15
Form No. : BDC - 3A
(To be filled in triplicate by the Receiving Member/Custodian in case of Invalid Claim of
Company Objections)

To,
The BDC /Clearing House
National Securities Clearing Corporation Ltd. DATE:
Stock Exchange Code : ____________

Receiving Member/Custodian SEBI REGN. NO. (Receiving

Member/Custodian )

___________________________ Clearing No. : _____________

Part - A
Re: INCORRECT COMPANY OBJECTION

BDC Inward No. : ____________________

(quoted by Stock Exchange on form BDC- 1A)

We are in receipt of the above company objection along with ________ Equity
share(s)/Debenture(s) of ___________________________________________Ltd. and
relative transfer deed(s), which are being returned for reason(s) marked below :
1. We have not introduced these securities.*
2. The delivering member stamp affixed on the reverse of the TD is fake. *
3. Objection reason not valid.
4. Objection due to transferee error.
5. Company memo not proper.
6. Copy of Court order /FIR required.
7.Others(specify):____________________________________________________
___________________________________________________________________
_________________________________________________________________________
----------------------------------------------------------------------------------------------------------------
----------------------
Part - B
Re : Invalid Claim for Corporate Benefits

BDC INWARD NO. _________________ Security Name of Benefits:

_______________________

BC/RD Date Type of Corporate Benefits. Rate / Ratio DividendAmount

Reason

Stamp & Sign of Intro. Member/Custodian Stamp & Sign of BDC of Stock
Exchange
____________________________
_________________________________
Clearing No. _________________ Stock Exchange Code
:_______________

* Note: In these cases, the members should submit an undertaking on form 6I.
 Annexure-24.16
Form No. : BDC - 3B
(To be filled in triplicate by the Receiving Member/Custodian in case of Invalid Claim of
Company Objections)
To,
The BDC (Last Exchange)
__________________________ DATE:
Stock Exchange Code : _______________

Last Introducing Member/Custodian SEBI REGN. NO. (Last Introducing

Member/Custodian)

___________________________ Clearing No. ______________

Part - A
Re: INCORRECT COMPANY OBJECTION

BDC Inward No. : ____________________

(quoted by Last Exchange on form BDC- 1B)

We are in receipt of the above company objection along with ________ Equity
share(s)/Debenture (s) of ___________________________________________Ltd. and
relative transfer deed(s), which are being returned for reason(s) marked below :
1. We have not introduced these securities.
2. The delivering member stamp affixed on the reverse of the TD is fake. *
3. Objection reason not valid.
4. Objection due to transferee error.
5. Company memo not proper.
6. Copy of Court order /FIR required.
7.Others(specify):_____________________________________________________
_____________________________________________________________________
_____________________________________________________________________
------------------------------------------------------------------------------------------------------
Part - B
Re : Invalid Claim of Corporate Benefits

BDC INWARD NO. _________________ Security Name of Benefits:

_______________________

BC/RD Date Type of Corporate Benefits. Rate / Ratio DividendAmount Reason

Stamp & Signature of First Intro. Member Stamp & Sign of BDC of First
/Custodian Introducing Exchange
____________________________ ___________________________
Clearing No. _________________ Stock Exchange Code
:_______________

* Note: In these cases, the members should submit an undertaking on form 6I.
 Annexure-24.17
Form No. : BDC - 4A
( To be filled in triplicate by the Receiving Member/Custodian of the Local Exchange for
reporting Bad Delivery for the rectified Company Objections shares)

To,
The BDC/Clearing House BDC Inward No. ______________
National Securities Clearing Corporation Ltd. (quoted by Stock Exchange on form
BDC- 1A)
Stock Exchange Code : ________
Introducing Member SEBI REGN. NO.(Introducing Member)

_______________________________ Clearing No. ______________

We enclose herewith the following rectified/replaced Company Objection shares which are
Bad Delivery , the details of which are as mentioned below:

Security Name (in full) ISIN Code (Symbol) Equity/Deb Face Value Mkt Lot.

No. of TDs No. of Certs No. of Shares Cert Nos. Distinctive Nos.From-To Reason for
Bad Delivery

Total :

Kindly acknowledge receipt and arrange to issue a cheque for the close-out amount in favour
of : ____________________________________________________________.

Authorised by

The BDC Stamp & Sign of Receiving

Member/Custodian:
(Stamp & Sign of Stock Exchange) SEBI REGN. NO.( Receiving
Member/Custodian)

Stock Exchange Code :_______________ Clearing No.

_________________

Note : Members must submit a photocopy of Form BDC - 1A and BDC - 2A alongwith a
copy of the Company Objection Memo while submitting shares for Bad Delivery.
 Annexure-24.18
Form No. : BDC - 4B
( To be filled in quadruplate by the Introducing Member/Custodian of the Last
Exchange for reporting Bad Delivery for the rectified Company Objections shares)

To,
The BDC (First Introducing Exchange) BDC Inward No. ______________
_______________________________ (quoted by Last Exchange on form
BDC- 1B)
Stock Exchange Code : __________
First Introducing Member of First Exchange SEBI REGN. NO.(First Introducing
Member)

_______________________________ Clearing No. _____________

We enclose herewith the following rectified/replaced Company Objection shares which are
Bad Delivery , the details of which are as mentioned below:

Security Name (in full) ISIN Code Equity/Deb Face Value Mkt Lot.

No. of TDs No. of Certs No. of Shares Cert Nos. Distinctive Nos.From -To Reason for
Bad Delivery

Total :

Kindly acknowledge receipt and arrange to issue a Demand Draft for the close-out amount in
favour of _________________________________________ payable at
______________________.

Authorised by:

The BDC Stamp & Sign of Introducing

Member/Custodian of Last Exchange:

(Stamp & Sign of Last Introducing Exchange) SEBI REGN. NO.( Introducing
Member/Custodian of Last Exchange)

Stock Exchange Code :_______________ Clearing No.

_________________

Note : Members must submit a photocopy of Form BDC - 1B and BDC - 2B alongwith a
copy of the Company Objection Memo while submitting shares for Bad Delivery.
 Annexure-24.19
FORM NO: NSEF 06E

Date:
To
The Clearing House
National Securities Clearing Corporation Ltd.

Re: NON-RECTIFICATION/REPLACEMENT OF COMPANY OBJECTIONS

I/We have failed to rectify/replace the following Company Objection cases on the due date.
I/We therefore instruct you to auction/square off my/our account for the same as provided in
the Stock Exchange Bye-laws and Regulation.

Settlement Type ___________ No :_____ Rectification date:

NSCC Objection No. Security Name Security Series Face Value Unrectified
Quantity

Introducing Member Name Signature

Introducing Member Code Stamp

 Annexure-24.20
FORM NO: NSEF 06F
(Request Cases)

DATE : INWARD No.

REC MEM CODE : DEL / INTRO. MEM CODE :

REC MEM NAME : DEL / INTRO. MEM NAME :

SETT. TYPE & No.: DEL. No.

SCRIP NAME : PREVIOUS B.C. :

SCRIP SYMBOL : SERIES :

CERT NO DISTINCTIVE NOS FROM - TO QTY NO OF CERT REASON CODE

TOTAL

REASON :

TOTAL QTY RECTIFIED :

SHARES REPLACED TRANSFER DEED REPLACED

Certificate Nos Distinctive Nos From -To Certificate Nos
Distinctive Nos From -
To
Affix Rs. 100/- Coupon here
STAMP OF RECEIVING MEMBER
 Annexure-24.21
FORM NO: NSEF 6I

(To be filled in triplicate by the introducing member in case of fake/forged member stamp or
in case the shares are not introduced by the member)

The BDC/Clearing House

National Securities Clearing Corporation Ltd.
Mumbai. Date :

Re : Fake/Forged SEBI registration rubber stamp

Shares not introduced by us on the Exchange

This is to inform you that :

1. the rubber stamp impression of ____________________

______________________________ (member name) appearing on the reverse of the
transfer deed bearing the following certificate & distinctive nos. is fake/forged.

2. we have not introduced the shares bearing the following certificate & distinctive nos.
on the Exchange.

Inward No. Security Symbol

Certificate No. Distinctive Nos.

From To No. of shares

Total :

In the event of the above information being found incorrect, we authorise you to close out the
objection immediately without the mandatory period of 21 days for rectification without
intimation to us.

Stamp & Signature of the introducing member

Note : Please tick whichever is applicable.
 Annexure-24.22
FORM NO : NSEF 6J

Undertaking in cases of Jumbo transfer deed submitted in Company Objection

The Introducing Member Date :

Re : Jumbo Transfer deeds lodged to the company

Kindly issue fresh transfer deed(s) in market lots in respect of shares of

___________________________ (name of company), bearing the below mentioned
distinctive no(s). while rectifying/replacing the shares reported under objection, in lieu of the
original transfer deed(s) which has/have been lost/destroyed.

Certificate No. Distinctive Nos. From - To No. of shares

We will indemnify the transferor against all losses, damages, costs, charges and expenses
they may sustain in the event of the said original transfer deed(s) being misused at any point
of time or otherwise in consequence of the transferor issuing us fresh transfer deed(s) to us,
as aforesaid.

Stamp & Signature of the receiving member

 Annexure-24.23
FORM NO: NSEF 7

NOTICE OF NON-DELIVERY

To
The Clearing House
National Securities Clearing Corporation Ltd.

I/we have failed to deliver this day the following securities as per the Final delivery
Statement, Delivery No: From ______ To _______ Dated _____________ in Settlement No:
___________. I/We therefore instruct you to debit my/our account with the value thereof as
provided in the Bye-laws and Regulations of National Securities Clearing Corporation Ltd.

Name of the security

Quantity
Valuation Price
Total value of securities

Delivering Member Name Signature

Delivering Member Code Stamp

cc : To National Securities Clearing Corporation Ltd.

 Annexure-24.24
FORM NO: NSEF 7A

Settlement of TT Market Deals (In Regular Market)

Format for reporting by Custodian Clearing Member

Date:

TM Clearing Member Code: TM Clearing Member Name:

Custodian Clearing Member Code: Custodian Clearing Member Name:

Settlement No.Trade Date Settle-ment Date Buy/ Sell Counter-party Security Name
Certificate Nos. Distinctive Nos. DD/Cheque /pay order Nos. Price Qty
Amt.

---------------_____________________________________________
Stamp and Signature of the Custodian Clearing Member
 Annexure-24.25
FORM NO: NSEF 7A1

Settlement of TT Market Deals (In Depository Market)

Format for reporting by Custodian Clearing Member

Date:

TM Clearing Member Code: TM Clearing Member Name:

Custodian Clearing Member Code: Custodian Clearing Member Name:

Settle-ment No. Trade Date Settle-ment Date Buy/ Sell Counter-party Security
Name DD/Cheque /pay order Nos. Price Qty Amt.

_____________________________________________
Stamp and Signature of the Custodian Clearing Member
 Annexure-24.26
FORM NO: NSEF 7B

Settlement of TT Market Deals (In Regular Market)

Format for reporting by TM Clearing Member

Date

TM Clearing Member Code: TM Clearing Member Name:

Custodian Clearing Member Code: Custodian Clearing Member Name:

Settle-ment No. Trade Date Settle-ment Date Buy/ Sell Counter-party Security
Name Certificate Nos. Distinctive Nos. DD/Cheque/pay order Nos. Price Qty
Amt.

---------------________________________________________
Stamp and Signature of the TM Clearing Member
 Annexure-24.27
FORM NO: NSEF 7B1

Settlement of TT Market Deals ( In Depository Market)

Format for reporting by TM Clearing Member

Date

TM Clearing Member Code: TM Clearing Member Name:

Custodian Clearing Member Code: Custodian Clearing Member Name:

Settle-ment No. Trade Date Settle-ment Date Buy/ Sell Counter-party

Security Name DD/Cheque/pay order Nos. Price Qty Amt.

---------------________________________________________
Stamp and Signature of the TM Clearing Member
 Annexure-24.28
FORM NO.: NSEF-08

Application for issue of Identity Card to

Authorised Representative for attending Clearing House

( separate form to be used for each representative )

I. Application for : Tick and fill appropriate box(es)

New application Replacement for damaged ID card Replacement for lost /stolen ID
card
Please mention Please mention
ID card no. ……………….
Date of issue ……………..
ID card no.……………….
Date of issue …………….

(1) If application is for replacement of damaged ID card, please attach the previous ID card.
(2) If application is for replacement of lost/stolen ID card please attach indemnity bond as per
- I, and DD/Cheque drawn in favour of NSCCL, payable at Bombay for an amount as
notified by NSCCL from time to time.

II. Particulars of the Clearing Member - applicant

(a) Name and Code No.of the

Clearing Member's firm ………………………………………………

(b) Member's SEBI registration number ………………………………………………

(c) Address of the Clearing Member ………………………………………………

.………………………………………………
………………………………………………
………………………………………………

(d) Application for authorised representative at Clearing House

(Mumbai/ Delhi/ Calcutta/ Chennai) Mention place of Clearing House: ……………

(e) Number of authorised representatives already appointed :

(Please mention identity card numbers (1)_____________________
with the date of issue) (2) _____________________
(3) _____________________
(4) _____________________
(f) Details of requests pending :
(Please mention names of persons for which (1) _____________________
applications already submitted but ID cards (2) _____________________
are yet to be issued) (3) _____________________
(4) _____________________
III. Particulars of the proposed Authorised Representative
(a) Name (First Surname) Mr./Ms._____________________________

(b) Father's name ____________________________________

(c) Date of birth (DD/MM/YY)
____________________________________

(d) Current residential address

____________________________________
____________________________________
____________________________________

(e) Permanent address

____________________________________
____________________________________
____________________________________

(f) Specimen signatures of the proposed

authorised representative
(sign within the box only)

Authorised signatory of clearing

member to attest the signature
of the proposed authorised
representative given in the box
above by signing and stamping
within the box only.
(sign and stamp within the box only)

(g) 2 Coloured photographs of authorised representative (1.5" *1.5") :-

(1)Enclose one photograph with the application duly stamped PASTE A

PHOTOGRAPH HERE
DULY STAMPED
AND SIGNED ACROSS
THE FACE OF THE
PHOTOGRAPH
(STAMP & SIGNATURE
SHOULD CROSS ONTO THE
PAPER)
and signed by the authorised signatory of the clearing member
across the face of the photograph and

(2)Paste the other photograph within the box

IV. Declaration by member applicant

I/we understand that :-

· This identity card is the property of the National Securities Clearing Corporation
Ltd.(NSCCL) and has been issued to the Authorised Representative of the Clearing Member
on the specific written application of the clearing member for the limited purpose of
recognising the Authorised Representative of the Clearing Member by NSCCL / National
Stock Exchange of India Limited (NSEIL) to facilitate his entry into the Clearing House and
to receive and/or deposit the securities and/or other documents on behalf of the Clearing
Member.

· Any loss/ theft of the card must be immediately reported in writing by the Clearing Member
to NSCCL with full details and all efforts must be made to trace the card and return it to the
Clearing Corporation. Loss/theft of ID card must be reported to police immediately.
· The card is non-transferable and must be returned to NSCCL immediately in the event of
cessation of employment/death of Authorised Representative or on cancellation of his
authorisation by the Clearing Member/NSCCL or expiry of validity whichever is earlier.

· The NSCCL is not responsible, in any manner whatsoever, for any misuse of the card by
any person with or without the knowledge of the Clearing Member or the Authorised
Representative.

· The card must be displayed by the Authorised Representative on his person at all times
while he is in the premises of the Clearing House/ NSCCL/ NSEIL and must be shown on
demand to the authorised person of the Clearing House/ Clearing Corporation or the
Exchange.

· The card must not be altered or mutilated in any way.

· NSCCL holds no responsibility if card is left behind or lost.

· This ID card should be appropriately safeguarded, and I/we understand that I/we shall be
required to give an indemnity bond in case a request is made for a duplicate ID card /
replacement of an ID card in case of loss/theft.

The information given by me/us in this form is true to my/our personal knowledge
and I/we am/are solely responsible and liable for its accuracy.

Date ____________________________
Place ___________________________
[Signature of authorised signatory]
Stamp:

Address of member (write within the box only)

Specimen signature of the proposed authorised representative

(sign within the box only)

Authorised signatory of Clearing Member to attest the signature of proposed authorised

representative given in the box above by signing and stamping in the box.
(sign and stamp within the box only)

--------------------------------------------------------------
FOR USE BY NSCCL ONLY
Card No. ………… Date of issue………… Issuing authority…………

INDEMNITY BOND FOR DUPLICATE IDENTITY CARD

(COMPANY)

To,

National Securities Clearing Corporation Limited

Exchange Plaza, C-1 Block G

Bandra Kurla Complex
Bandra (E)
Mumbai - 400 051

Identity Card No._______________

We ____________________, a Private/Public Limited Company duly incorporated under the

Companies Act, 1956 and having registered office at
___________________________________________ and principal place of business at
_____________________________________________ through our Managing Director, Shri
_________________________, S/o Shri _________________________, R/o
_________________________________________________ do hereby solemnly and
sincerely swear and affirm as under :

1. That an identity card having number _______________ was issued by National Securities
Clearing Corporation Limited (hereinafter referred to as NSCCL) on my/our application on
____________ (date) in the name of my/our authorised representative,
namely,______________________________ s/o__________________________________
r/o____________________________________________________ to facilitate his entry into
the Clearing House and to receive and/ or deposit the securities and other documents on
my/our behalf.

2. That the said Identity Card has been lost/misplaced/stolen and the same is not in my/our
possession or in the possession of my/our said authorised representative.

3. That I/we have made a request to NSCCL to issue a duplicate Identity card in the name of
my/our aforesaid authorised representative.

4. That in consideration of NSCCL issuing the said duplicate Identity Card, I/we do hereby
indemnify NSCCL and bind myself/ourself, my/our heirs, executors and administrators,
assigns and successors to pay and satisfy all claims and charges, costs, damages, demands,
expenses and losses which NSCCL may sustain, incur or be liable for in consequence of
having issued duplicate Identity Card on my/our above said request. NSCCL may realise the
said claim, charges, cost, damages from my/our property(s) or from my heirs, executors,
administrators assigns, successors, as the case may be, without demur.

5. I/We further undertake to pay or deposit any charges that may be decided by NSCCL, for
issue of duplicate identity card, from time to time and I/we hereby authorise NSCCL to
recover such charges by debiting my/our account where duplicate identity card is issued on
my/our request, whether the original identity card is surrendered or not.

6. I/We further undertake on demand by NSCCL to return or deliver such Identity Card and
without demand to surrender and return to NSCCL the original Identity Card when found or
traced and to take all actions, suits, proceedings at my/our own cost as NSCCL shall require
for the recovery thereof or otherwise in relation to the said Identity Card.

7. I/We hereby further undertake that this indemnity shall be enforceable jointly and severally
against me/us, my/our heirs, successors and assigns and the benefits of the indemnity shall
ensure for the benefit of NSCCL and successors and assigns of NSCCL and shall be
irrevocable until discharge by me/us of all obligations devolving upon hereunder.

8. This indemnity shall not be affected by any change in the constitution of NSCCL or by
reason of any merger or amalgamation of NSCCL with any other company or companies nor
shall this indemnity be in any way prejudiced by absorbing of amalgamated company,
corporation or concern.

In witness whereof I/we signed this……………………day of…………….two thousand and

_______

Date:
Place : (Authorised Signatory)

Name and Address of Clearing Member

Witness no. 1

Name in block letters:

Full Address:

Signature:

Witness No. 2

Name in block letters:

Full address:

Signature:
 INDEMNITY BOND FOR DUPLICATE IDENTITY CARD
(PARTNERSHIP FIRM)

To,

National Securities Clearing Corporation Limited

Exchange Plaza, C-1 Block G
Bandra Kurla Complex
Bandra (E)
Mumbai - 400 051

Identity Card No._______________

We, ____________________ being a registered/unregistered partnership firm having

principal office at _______________________________________________ through our
Managing Partner, Shri _________________, S/o _______________________, R/o
__________________________________________ do hereby solemnly and sincerely swear
and affirm as under :

1. That an identity card having number _______________ was issued by National Securities
Clearing Corporation Limited (hereinafter referred to as NSCCL) on my/our application on
____________ (date) in the name of my/our authorised representative,
namely,______________________________ s/o__________________________________
r/o____________________________________________________ to facilitate his entry into
the Clearing House and to receive and/ or deposit the securities and other documents on
my/our behalf.

2. That the said Identity Card has been lost/misplaced/stolen and the same is not in my/our
possession or in the possession of my/our said authorised representative.

3. That I/we have made a request to NSCCL to issue a duplicate Identity card in the name of
my/our aforesaid authorised representative.

4. That in consideration of NSCCL issuing the said duplicate Identity Card, I/we do hereby
indemnify NSCCL and bind myself/ourself, my/our heirs, executors and administrators,
assigns and successors to pay and satisfy all claims and charges, costs, damages, demands,
expenses and losses which NSCCL may sustain, incur or be liable for in consequence of
having issued duplicate Identity Card on my/our above said request. NSCCL may realise the
said claim, charges, cost, damages from my/our property(s) or from my heirs, executors,
administrators assigns, successors, as the case may be, without demur.

5. I/We further undertake to pay or deposit any charges that may be decided by NSCCL, for
issue of duplicate identity card, from time to time and I/we hereby authorise NSCCL to
recover such charges by debiting my/our account where duplicate identity card is issued on
my/our request, whether the original identity card is surrendered or not.

6. I/We further undertake on demand by NSCCL to return or deliver such Identity Card and
without demand to surrender and return to NSCCL the original Identity Card when found or
traced and to take all actions, suits, proceedings at my/our own cost as NSCCL shall require
for the recovery thereof or otherwise in relation to the said Identity Card.

7. I/We hereby further undertake that this indemnity shall be enforceable jointly and severally
against me/us, my/our heirs, successors and assigns and the benefits of the indemnity shall
ensure for the benefit of NSCCL and successors and assigns of NSCCL and shall be
irrevocable until discharge by me/us of all obligations devolving upon hereunder.

8. This indemnity shall not be affected by any change in the constitution of NSCCL or by
reason of any merger or amalgamation of NSCCL with any other company or companies nor
shall this indemnity be in any way prejudiced by absorbing of amalgamated company,
corporation or concern.

In witness whereof I/we signed this……………………day of…………….two thousand and

Date:
Place: (Authorised Signatory)

Name and Address of Clearing Member

Witness no. 1

Name in block letters:

Full Address:

Signature:

Witness No. 2

Name in block letters:

Full address:

Signature:
 INDEMNITY BOND FOR DUPLICATE IDENTITY CARD
(PROPRIETORSHIP FIRM)

To,

National Securities Clearing Corporation Limited

Exchange Plaza, C-1 Block G
Bandra Kurla Complex
Bandra (E)

Identity Card No._______________

I _____________________ Son/Daughter/Wife of ____________________ R/o

____________________________________________ being sole proprietor/proprietrix of
the firm ___________________________ having its principal office at
__________________________________________ do hereby solemnly and sincerely swear
and affirm as under :

1. That an identity card having number _______________ was issued by National Securities
Clearing Corporation Limited (hereinafter referred to as NSCCL) on my/our application on
____________ (date) in the name of my/our authorised representative,
namely,______________________________ s/o__________________________________
r/o____________________________________________________ to facilitate his entry into
the Clearing House and to receive and/ or deposit the securities and other documents on
my/our behalf.

2. That the said Identity Card has been lost/misplaced/stolen and the same is not in my/our
possession or in the possession of my/our said authorised representative.

3. That I/we have made a request to NSCCL to issue a duplicate Identity card in the name of
my/our aforesaid authorised representative.

4. That in consideration of NSCCL issuing the said duplicate Identity Card, I/we do hereby
indemnify NSCCL and bind myself/ourself, my/our heirs, executors and administrators,
assigns and successors to pay and satisfy all claims and charges, costs, damages, demands,
expenses and losses which NSCCL may sustain, incur or be liable for in consequence of
having issued duplicate Identity Card on my/our above said request. NSCCL may realise the
said claim, charges, cost, damages from my/our property(s) or from my heirs, executors,
administrators assigns, successors, as the case may be, without demur.

5. I/We further undertake to pay or deposit any charges that may be decided by NSCCL, for
issue of duplicate identity card, from time to time and I/we hereby authorise NSCCL to
recover such charges by debiting my/our account where duplicate identity card is issued on
my/our request, whether the original identity card is surrendered or not.

6. I/We further undertake on demand by NSCCL to return or deliver such Identity Card and
without demand to surrender and return to NSCCL the original Identity Card when found or
traced and to take all actions, suits, proceedings at my/our own cost as NSCCL shall require
for the recovery thereof or otherwise in relation to the said Identity Card.

7. I/We hereby further undertake that this indemnity shall be enforceable jointly and severally
against me/us, my/our heirs, successors and assigns and the benefits of the indemnity shall
ensure for the benefit of NSCCL and successors and assigns of NSCCL and shall be
irrevocable until discharge by me/us of all obligations devolving upon hereunder.

8. This indemnity shall not be affected by any change in the constitution of NSCCL or by
reason of any merger or amalgamation of NSCCL with any other company or companies nor
shall this indemnity be in any way prejudiced by absorbing of amalgamated company,
corporation or concern.

In witness whereof I/we signed this……………………day of…………….two thousand and

Date:
Place: (Authorised Signatory)

Name and Address of Clearing Member

Witness no. 1

Name in block letter:

Full Address:

Signature:

Witness No. 2

Name in block letters:

Full address:

Signature:
 Annexure 24.29

FORM NO: NSEF 11A

(Format for reporting the settlement of Negotiated Trades effected as Brokers & Agents
in securities admitted to trading on the CM segment of NSE - In Regular Market )

Date :

TM Clearing Member Name :

TM Clearing Member Code :

Name of the person reporting :

Contract No (s) and Date Bought/Sold Counter party Buyer/Seller Security Name
Settle-

ment Date Mode of Settlement Certi-ficate Nos. Distinctive Nos Cheque /pay order
Nos.

Price Qty Amt(Rs.) Brokerage(Rs.)

____________________________________
Stamp and Signature of the Clearing Member
 Annexure 24.30

FORM NO: NSEF 11A1

(Format for reporting the settlement of Negotiated Trades effected as Brokers & Agents
in securities admitted to trading on the CM segment of NSE - In Depository Market)

Date :

TM Clearing Member Name :

TM Clearing Member Code :

Name of the person reporting :

Contract No (s) and Date Bought/Sold Counter party Buyer/Seller SecurityName

Settlement
Date Mode of Settlement Cheque /pay order Nos. Price Qty Amt (Rs.) Brokerage
(Rs.)

____________________________________
Stamp and Signature of the Clearing Member
 Annexure 24.31

FORM NO: NSEF 11B

( Format for reporting the settlement of Negotiated Trades effected as Principals in

securities admitted to trading on the CM segment of NSE - In Regular Market)

Date :

TM Clearing Member Name :

TM Clearing Member Code :

Name of the person reporting :

Contract No (s) and Date Bought/Sold Counter party Buyer/Seller Security Name
Settlement Date Mode of Settlement Certi-ficate Nos. Distinctive Nos
Cheque /pay order Nos. Price Qty Amt(Rs.)

____________________________________
Stamp and Signature of the Clearing Member
 Annexure 24.32

FORM NO: NSEF 11B1

( Format for reporting the settlement of Negotiated Trades effected as Principals in

securities admitted to trading on the CM segment of NSE - In Depository Market)

Date :

TM Clearing Member Name :

TM Clearing Member Code :

Name of the person reporting :

Contract No (s) and Date Bought/Sold Counter party Buyer/Seller Security Name
Settlement
Date Mode of Settlement Cheque /pay order Nos. Price Qty Amt(Rs.)

____________________________________
Stamp and Signature of the Clearing Member
 Annexure 25.1

List of various alert messages which can be subscribed by members

Sr.no. Particulars
1. Withdrawal of trading facility
2. Enablement of trading facility
3. Intimation of letters downloaded for early pay-in of funds / additional
margins / capital cushion requirement etc
4. End of day margin shortfall requirements
5. Reminder for payment of capital cushion requirement
6. Maturity of collaterals provided towards membership deposit
requirement
7. Status on release request of collaterals
8. Status of cash debit request towards addition of collaterals
9. Release of margins on completion of settlement
10. Intimation for early pay-in of securities and funds received
 Annexure 26.1

Format of Letter requesting activation of user in NSCCLs Clearing Management

System (NCMS)
Date:

The Manager
NSCCL - Securities Department
NSE Exchange Plaza
Mumbai - 400051

Dear Sir/ Madam,

Sub: Activation of account in NSCCLs Clearing Management System (NCMS)

We are interested in availing the facilities provided through the NSCCL’s Clearing
Management System (NCMS). We therefore request you to activate our account and provide
us necessary access in the said interface.

Please find below the necessary details as required:

S Particulars To be filled by the Member
No
1. Trading Member Code
2. Member Name
3. Contact Person (The account details will be
sent to this person)
4. Address for Communication with Pin Code
5. Phone Number with STD Code
6. Mobile number of contact person
7. Fax Number with STD Code
Note: This application is only for administrator login in NCMS – CM segment.

We hereby authorize NSCCL to act upon the instructions sent through the interface and we
shall be solely responsible for any errors pertaining to data entry from our end.

We would request you to advise us the account details allotted to us for this purpose at the
above mentioned address.

Yours sincerely,

Authorized Signatory
Name:
Designation:
 Annexure 26.2

List of Error/Rejections Codes for NCMS

ERROR CODE REASON

R1 INVALID FILENAME
R2 INVALID FORMAT
R3 FILE NOT OPENING
R4 EMPTY FILE
R5 ERROR FOR NO OF RECS
R6 INCORRECT RECORD TYPE
R7 INCORRECT FILE TYPE
R8 INCORRECT BATCH NUMBER
R9 INCORRECT TRADE DATE
R10 INCORRECT ORDER NUMBER
R11 INCORRECT TRADE NUMBER
R12 INCORRECT OTR NO
R13 INCORRECT MEMBER CODE
R14 INCORRECT MEMBER TYPE
R15 INCORRECT SYMBOL
R16 INCORRECT SERIES
R17 MISMATCH IN QUANTITY
R18 MISMATCH IN VALUE
R19 ERROR IN CP CODE
R20 ERROR IN CLIENT CODE
R21 ERROR IN SPCP
R22 ERROR IN SETTLEMENT TYPE
R23 ERROR IN SETTLEMENT NUMBER
R24 ERROR IN BUY SELL FLAG
R25 ERROR IN WAREHOUSE CODE
R26 ERROR SETTLEMENT NOT FOUND
R27 ERROR CAN NOT MODIFY PRO ORDERS
R28 SETTLEMENT WINDOW CLOSED
R29 OTR SETTLEMENT WINDOW CLOSED
R30 ERROR CONTRACT NOTE NUMBER
1 MODIFY ORDER DOES NOT EXISTS IN
TRADES
2 ADMIN MODIFICATION – TRADE NO NOT
NULL
3 ORDER MODIFICATION – MEMBER
DISABLED
4 ORDER MODIFICATION – MEMBER ID
MISSMATCH
5 ADMIN MODIFY - SEQUENCE NO NOT
NULL
6 MODIFY ORDER - ALREADY CONFIRMED
7 MODIFY ORDER – INVALID NEW CUP
CODE
8 MODIFY ORDER – INVALID OLD CUP
 CODE
9 ORDER MODIFICATION WINDOW
DISABLED
11 MODIFY CP – CLIENT CODE NOT NULL
12 MODIFY CP – NOT LATEST IMAGE
13 MODIFY CP – STPW_INST
14 MODIFY CP – CUP CODE NOT ACTIVE
15 MODIFY ORDER – BUY SELL FLG
MISMATCH
16 MODIFY CP – OLD NEW CP CODE SAME
17 MODIFY CP – INCORRECT LENGTH
18 MODIFY CP – MARGIN INDICATOR
21 MODIFY CLIENT – CP CODE NOTNULL
22 MODIFY CLIENT – NOT LATEST IMAGE
25 MODIFY CLIENT – CLIENT CODE SAME
26 MOD_CLI_NULL
27 MODIFY CLIENT – INCORRECT LENGTH
28 MODIFY CLIENT – PRO TRADE
29 MODIFY CLIENT – MODIFY TO MEM CODE
51 MODIFY OTR – NOT EXIST IN TABLE
52 MODIFY OTR – TM CD MISMATCH
54 MODIFY OTR – INVALID CONTRACT NO
55 MODIFY OTR – BUY SELL FLAG
MISMATCH
56 MODIFY OTR – CUP CD MISMATCH
57 MODIFY OTR – QTY EXCEEDS TOTAL QTY
58 MODIFY OTR – VALUE EXCEEEDS TOTAL
VAL
59 MODIFY OTR – TRADE DATE MISMATCH
60 MODIFY OTR – MODIFATION TIMING
DISABLED
61 MODIFY OTR – ALREADY CONFIRMED
62 MODIFY OTR – MAX VAL QTY MISMATCH
63 MODIFY OTR – CUPCD NOT ACTIVE
64 MODIFY OTR – INVALID QTY VAL
ACTYTYPE
65 MODIFY OTR – ALLOCTION TO INST NOT
VALID
66 MODIFY OTR – SEC SYMBOL SERIES
MISMATCH
67 MODIFY OTR – SEC TOKEN MISMATCH
68 MODIFY OTR – INVALID ACTYTYPE
69 MODIFY OTR –ALREADY UNALLOCATED
70 MODIFY OTR – DB UPDATE EXCEPTION
90 INVALID CLI MOD ACTTYPE NORMAL
91 INVALID CP MOD ACTTYPE NORMAL
92 INVALID PARTIALCLI MOD ACTTYPE
NORMAL
93 INVALID PARTIAL CP MOD ACTTYPE
 NORMAL
94 INVALID PARTIAL CLICP MOD ACTTYPE
NORMAL