Module 2

Security Contract (Regulation) Act 1956

The securities market provides a platform for the trading of securities or transactions related to securities.
The role that a stock market plays is indispensable for leading the economic growth of any country. The
stock market of India extends a hand of help to get the funds mobilized from the small savings done by
the investors. It further helps to channelize these resources for getting the various needs of the different
sections of the economy of the country fulfilled.

The main aim of the above-mentioned legislation was to do away with all those transactions of securities
that are undesirable in nature. This is to be done by the regulation of the business dealing therein and also
provides for various other matters that are in relation to it.

Meaning Of Securities

Security is a financial method to represent ownership in a stock or publicly traded Corporation, a

Corporation bond or a relationship of the creditor with a government body or ownership right as depicted
by an option. Security can also be defined as a document of settled requisites or forms, which mirrors the
related property rights that may self- refer to the market and be the object of buying and selling and
various transaction exchanges, which is a type of money capital.

Sec 2(h) of the Securities Contract (Regulation) Act, 1956 gives an inclusive definition of securities,
which is as follows:

“securities” include— (i) shares, scrips, stocks, bonds, debentures, debenture stock or other marketable
securities of a like nature in or of any incorporated company or other bodies corporate;

[(ia) derivative; (ib) units or any other instrument issued by any collective investment scheme to the
investors in such schemes;] [(ic)security receipt as defined in clause (zg) of section 2 of the Securitisation
and reconstruction of Financial Assets and Enforcement of Security Interest Act,2002;] [(id) units or any
other such instrument issued to the investors under any mutual fund scheme;]

(ii) Government securities; (iia) such other instruments as may be declared by the Central Government to
securities; and

(iii) rights or interest in securities;

[(i) “spot delivery contract” means a contract which provides for,—

(a) actual delivery of securities and the payment of a price therefore either on the same day as the date of
the contract or on the next day, the actual period taken for the despatch of the securities or the remittance
of money therefore through the post being excluded from the computation of the period aforesaid if the
parties to the contract do not reside in the same town or locality;

(b) transfer of the securities by the depository from the account of a beneficial owner to the account of
another beneficial owner when such securities are dealt with by a depository;]
Major Provisions

The salient features of the Act are that it had provided the power to the Central Government or SEBI to
look into certain matters. Some of them are as follows:

 The matters in relation to the regulation of listing of securities.

 The power of superseding the body that governs any of the stock exchanges due to the presence of
some specific reasons
 The power of getting the business of any stock exchange suspended
 The cases where it is required to monitor the functioning and activities related to the stock exchanges
by the mode of calling for information of specific nature and periodic returns
 The power to pass directions to the stock exchanges for making or amending rules as well as bye-
laws
 The power to give approval to the rules and regulations. In addition to it, they are also vested with the
power of giving approval to the bye-laws of any of the recognized stock exchanges.
 The power to either withdraw recognition or grant recognition to any other stock exchange.

Recognition Of Stock Exchange

As per sec 3 of the Act, a specific procedure that has enabled the stock exchange to make an application
in a certain manner if it wants to get recognized by the Government. However, the procedure that has to
be followed by the government for granting the recognition to the stock exchange is laid down in sec 4.

The power to grant recognition to the stock exchanges is given to SEBI along with the Central
Government. There are certain requirements that have to be fulfilled before recognition can be granted to
the stock exchange by the Central Government such as a proper inquiry has to be undertaken by the
Central Government to check whether the stock exchange, which is applying for getting registered, has
made such rules and bye-laws that are in line with the condition prescribed for protecting the interests of
the investors as well as ensuring the fair dealing.

Salient Features Of The Act

The Act was laid down when the government had realized the ills and wrongs going on in the stock
market. Some of the salient features of the Act are as follows:

 There should be a single recognized stock exchange in the whole region in order to have a unitary
control.
 It is important for the dealers as well as the brokers to have a proper license if they are outside the
ambit covered by the recognized stock exchange.
 The Central government has been provided with the power to formulate the bye-laws and then amend
them. Any step in furtherance of this power can be taken by the Government only after consulting the
governing bodies of the recognized stock exchanges.
 No individual is allowed to enter into the transactions known as future dealings. This is so because
the future dealings have been provided the status equivalent to that of the gambling contracts.
 The recognized stock exchange is required to make a submission of the periodical returns regarding
the affairs. Further, it is also required by the stock exchanges to submit all the necessary information
to the Government from time to time.
 The Central Government is provided with the privilege of using the power to compel any company
which is a public listed company in nature to get its securities listed When a company makes an
appeal, the chance is given to the company to either set aside or vary the refusal by the stock
exchange for getting the securities listed.
 If any abnormal situation arises, it is the full-fledged right that is provided to the central government
to make a withdrawal from the recognition provided to the governing body of the exchanges.
 Once the Central Government gives the approval to any of the recognized stock exchanges, it has the
opportunity to prepare its own bye-laws for having control over the contracts as well as regulating
those contracts.

SEBI Act 1992

SEBI is a statutory regulatory body established on the 12th of April, 1992. It monitors and regulates the
Indian capital and securities market while ensuring to protect the interests of the investors formulating
regulations and guidelines to be adhered to. The head office of SEBI is in Bandra Kurla Complex,
Mumbai.

Structure of SEBI

SEBI has a corporate framework comprising various departments each managed by a department head.
There are about 20+ departments under SEBI. Some of these departments are corporation finance,
economic and policy analysis, debt and hybrid securities, enforcement, human resources, investment
management, commodity derivatives market regulation, legal affairs, and more. The hierarchical structure
of SEBI consists of the following members:

 The chairman of SEBI is nominated by the Union Government of India.

 Two officers from the Union Finance Ministry will be a part of this structure.
 One member will be appointed from the Reserve Bank of India.
 Five other members will be nominated by the Union Government of India.

Functions of SEBI

 SEBI is primarily set up to protect the interests of investors in the securities market.
 It promotes the development of the securities market and regulates the business.
 SEBI provides a platform for stockbrokers, sub-brokers, portfolio managers, investment advisers,
share transfer agents, bankers, merchant bankers, trustees of trust deeds, registrars, underwriters, and
other associated people to register and regulate work.
 It regulates the operations of depositories, participants, custodians of securities, foreign portfolio
investors, and credit rating agencies.
 It prohibits inner trades in securities, i.e. fraudulent and unfair trade practices related to the securities
market.
 It ensures that investors are educated on the intermediaries of securities markets.
 It monitors substantial acquisitions of shares and take-over of companies.
 SEBI takes care of research and development to ensure the securities market is efficient at all times.
Authority and Power of SEBI
i. Quasi-Judicial: SEBI has the authority to deliver judgements related to fraud and other unethical
practices in terms of the securities market. This helps to ensure fairness, transparency, and accountability
in the securities market.

ii. Quasi-Executive: SEBI is empowered to implement the regulations and judgements made and to take
legal action against the violators. It is also authorised to inspect Books of accounts and other documents if
it comes across any violation of the regulations.

iii. Quasi-Legislative: SEBI reserves the right to frame rules and regulations to protect the interests of the
investors. Some of its regulations consist of insider trading regulations, listing obligation, and disclosure
requirements. These have been formulated to keep malpractices at bay.

Despite the powers, the results of SEBI’s functions still have to go through the Securities Appellate
Tribunal and the Supreme Court of India.

SEBI guidelines on allotment

SEBI Guidelines for Firm Allotment

When a firm issues certain percentage of shares to the public, the remaining shares are allotted to
different categories of investors. Such an allotment is known as firm allotment.

Firm allotments are allotments made as per SEBI regulations to different categories of investors. Given
below is the percentage of shares that can be allotted to different categories of investors.

1. Foreign financial institutional investors (30%)

2. Development financial institutions (20%)

3. Indian Mutual Funds (20%)

4. Permanent regular employees (10%)

5. 5% for lead bankers.

6. 10% for employees of the promoting companies. The balance can be taken by the promoters.

All these above regulations were made by SEBI through a circular dated 11.10.1993.

SEBI Guidelines for Preferential allotment

SEBI has permitted the issuing company to allot shares on a preferential basis to certain categories of
investors, which is known as preferential allotment.

Promoters of companies can have preferential allotment after fulfilling the conditions laid down by
Companies Act.

Foreign financial institutional investors (FIIs) are allowed to have preferential allotment of shares, if they
are registered with SEBI. A single FII can have 10% preferential allotment. But all Flls put together, can
have only 30% preferential allotment. In view of this relaxation, foreign capital inflow increased and as
on date in India, the Foreign Exchange Reserves (FER) is more than 65 billion U.S. dollars (I billion =
1,000 million).

Initial Public Offering & Primary Market SEBI guidelines:

 Minimum offering of 25% of post issue capital to the public. This requirement was relaxed to 10%
first for IT sector , later it was relaxed to all sectors.
 IPO of issue size upto 5 times of pre-issue shall be allowed only to those companies having consistent
track record of making profit atleast for 5 years.
 For issue above Rs. 100 crores book building rule has been made compulsory for company making
IPO.
 Time for finalising the allotment of shares and refund has been reduced from 30 to 15 days.
 Issue shall open within 12 months from the date of issue of observation letter by SEBI.
 Should be disclosed price band atleast 2 working days before the opening of bid by announcement in
all newspapers in which pre issue advertisement was released.

Insider Trading
Insider trading is the practice of using information that has not been made public to execute trading
decisions. It gives traders an unfair advantage over others and most forms of insider trading are illegal.
Many investors are tempted to make quick returns from insider trading, but doing so can be dangerous.
Insider trading is routinely investigated by the Securities and Exchange Commission (SEC) and
prosecuted.

What Constitutes Insider Trading?

Investment markets need investors to have access to the same information in order to be effective (i.e. the
efficient market hypothesis). The point of these markets is to reward investors who can make the best
analyses of the securities they hope to invest in. However, some choose to manipulate the system by using
information that others don’t have available to them.

The most recent definition by the SEC outlines insider trading as “buying or selling a security, in breach
of a fiduciary duty or other relationship of trust and confidence, while in possession of material,
nonpublic information about the security. Insider trading violations may also include ‘tipping’ such
information, securities trading by the person ‘tipped,’ and securities trading by those who misappropriate
such information.”

Forms of Insider Trading

1. Members of an organization purchasing a security: Employees or members of publicly traded

companies are in key positions to access information that would not otherwise be available to the general
public. Some of them buy and sell securities based on this information and hope to profit from it when the
news is eventually released. Employees are given stock options so there are legal instances where they
can purchase shares. However, the rules are complicated and the line is often blurred between what is a
legal form of insider trading and what is not.
2. Professionals who do business with the corporation: Bankers, lawyers, paralegals, and brokers are
but a few of the consultants who have access to confidential documents of their corporate clients. They
may choose to abuse this privilege as an opportunity to make a quick buck through insider trading.

3. Friends, family, and acquaintances of corporate employees: Corporate employees often share
information within their own circles that is not shared with Wall Street and the general public. Sometimes
these disclosures are made innocently, but other times they are made with the intention of allowing their
friends to trade securities with an advantage that other investors would not have. Employees may give
these tips to help out a friend in a tough time or they may be asking their friends to pay them a small
incentive. Employees may trade through their friends and acquaintances since they are less likely to be
scrutinized by the SEC than the employees themselves.

4. Government officials: Officials of different government agencies can gain access to confidential
information through the execution of their duties. They may conduct insider trading with this information.

5. Hackers, corporate spies, and other thieves: Clever criminals find a number of ways to gain access
to corporate information which they can use to conduct securities fraud.

How Is Insider Trading Investigated and Prosecuted?

Insider trading is usually identified through market surveillance systems. The SEC monitors securities
markets and tracks them for abnormal trading patterns. They rarely are made through tips or complaints.

Once an abnormal pattern has been identified, the SEC vigorously pursues anyone they believe may be
involved. They obtain warrants for financial records and wiretaps, and find any other means to pursue the
evidence that comes their way. If enough evidence is found to indict someone for insider trading, those
individuals will be arrested and the case is handed over to a U.S. attorney.

Insider trading is prosecuted just like any other criminal case. Anyone convicted of insider trading can be
sentenced up to $5 million in fines and up to 20 years in prison for each act they commit. However, actual
sentences for these crimes are often much less. In New York, almost half of those sentenced didn’t have
to spend any time in prison.

Real-life Examples of Insider Trading

1. Reliance Industries: The Securities and Exchange Board of India banned RIL from the derivatives
sector for a year and levied a fine on the company. The exchange regulator charged the company with the
intention of making profits by skirting regulations on its legally permissible trading limits and lowering
the price of its stock in the cash market.

2. Raj Rajaratnam: Raj Rajaratnam made about $60 million as a billionaire hedge fund manager by
swapping tips with other traders, hedge fund managers, and key employees of IBM, Intel Corp, and
McKinsey & Co. He was found guilty of 14 counts of conspiracy and fraud in 2009 and fined $92.8
million.

3. Martha Stewart: Shares of ImClone took a sharp dive when it was found out that the FDA rejected its
new cancer drug. Even after such a fall in the share price, the family of CEO Samuel Waskal seemed to
be unaffected. After receiving advance notice of the rejection, Martha Stewart sold her holdings in the
company’s stock when the shares were trading in the $50 range, and the stock subsequently fell to $10 in
the following months. She was forced to resign as CEO of her company and Waskal was sentenced to
more than seven years in prison and fined $4.3 million in 2003.

Depositories Act 1996 including DEMAT system

A “Depository” is an institution that receives deposits and holds them in trust for the public, with the
condition that it exercises reasonable care and restores it to the person on demand. It holds securities of
investors in an electronic form, and it is of paramount importance in the current market scenario where is
has been held mandatory to hold securities in demat form. Demat (Dematerialized) format of securities
means that these are held in electronic form, and without any actual paper document involved, and the
details of trading are all entered on the electronic document. The Depositories Act was passed by the
SEBI in 1996, and it deals with the regulation of d\Depositories and incidental matters.

KEY FEATURES OF THE ACT:

 The Depository must be a company registered under the Companies Act, and a Certificate of
Registration by SEBI.
 Commencement of business only after obtaining Certificate from SEBI
 Requires “Participants” registered under the SEBI Act
 Depository and Participant must enter into an Agreement, and a person wising to avail Depository
services must enter into the necessary agreement through a Participant
 Certificate of Security to be surrendered to Issuer, and the same to be cancelled; and the Depository to
be substituted as the registered owner, in records; the person will become Beneficial Owner in the
Depository’s records
 Transfer of securities to be registered with the Depository
 Every subscriber to a security has an option to receive the Certificate or maintain it with Depository
 Rights and liabilities of demat securities also lie with the Beneficial Owner
 Securities held in Depository can be pledged or hypothecated
 Information of transfer of securities, to be communicated between the Depository and Issuer
 Beneficial Owner has option to opt out of depository
 Liability to indemnify loss to Beneficial Owner, by negligence of Depository
 SEBI has power of enquiry over securities held in Depositories, to give directions.
 Specifies Penalties to persons or companies contravening provisions of the Act
 Central Govt has the power to grant immunity from prosecution to any person, for violation of
provisions of the Act
 Provision to appeal to the Central Govt and the Securities Appellate Tribunal, and to the Supreme
Court
 Depositories can make their own bye-laws with the previous approval of the Board

BENEFITS OF DEPOSITORIES

 Less risk of loss or wear and tear

 Easier for safekeeping
 Easier transfer
 Better monitoring by SEBI
 Reduced transaction costs, etc.
Parties to a Depository:

In a depository system, the following parties are involved

 the depository,
 the beneficial owner;
 the participant;
 the issuer.

Agreement between depository and participant:

A depository shall enter into an agreement with one or more participants as its agent. Any person, through
a participant, may enter into an agreement, in such form as may be specified by the bye-laws, with any
depository for availing its services. The relationship and dealings between the depository and the
participant will be governed by an agreement and the participant is an agent of the depository vide
Section 4 (1) of the Act.

Depository Participants includes brokers, banks, insurance companies, Stock Exchange clearing cells, the
Reserve Bank of India, financial institutions, institutional managers, fund mangers etc.

Section 41 of the Companies Act lays down two modes of acquiring membership of a company and in
both an entry of the name of a person as a member in the register of the members of the company is a
condition precedent for a person to be regarded a member of the company. However to facilitate the
beneficial owner of shares, on whose behalf the depository holds the shares, to be recognized as members,
Section 41 in its new subsection 3 provides that every person holding equity share capital of a company
and whose name is entered as a beneficial owner in the records of a depository shall be deemed to be a
member of the concerned company.

Regulation 26 of the SEBI (Depositories and Participants) Regulations, 1996 states that depositories,
participants, issuers, and issuers agent, in addition to the rights and obligations laid down in the
Depositories Act and the bye laws shall have the rights and obligations arising from the agreements
entered into by them.

MAJOR CASE LAWS (INDIAN KANOON)

Probir Kumar Misra v. Ramani Ramaswamy it was held that after the Depositories Act, 1996, such
depositors who are holding equity share capital of the company and whose name is entered as beneficial
owner are also deemed to be members of the company, thus making them members under the Act.

Northern Projects Ltd. v. Blue Coast Hotels and Resorts Ltd. it was contended that only persons
holding equity shares can be members of the Company in terms of Section 41(3) of the Act. This was
rejected by Court and it was stated that Sub-section (3) of Section 41 is therefore only in addition to
Section 41(1) and Section 41(2) and not in derogation or substitution of the first two subsections. The
word ’shareholder’ and ‘member’ is used in the same connotation under the Act and the Section covers
the third category of equity shareholders who are neither subscribers as contemplated by Sub-section (1)
nor whose names are entered in the register of members as contemplated under Sub-section (2) of Section
41.

DEMAT System
Demat Account is an account that allows investors to hold shares and securities in electronic format.
Demat is an abbreviated word for dematerialisation (converted from physical to electronic shares), aimed
at facilitating easy trade for users. An online Demat account in a way is like your bank account. However,
when a bank account holds cash, the Demat account holds shares and other securities. Those indulging in
online trading, can buy shares and hold in a Demat account. The entire procedure of investing, trading,
holding, and monitoring can thus be made convenient, cost-efficient, and faster. Also, a Demat Account
can hold all the investments an individual make, be it shares, bonds, mutual funds, government securities,
or exchange-traded funds. In other words, Demat account allows the investor to buy and sell as well as
transact a whole lot of products — other than shares and stocks — conveniently under one roof, and
without the need of any sort of paperwork.

How is it mandatory?

As per the Securities and Exchange Board of India (SEBI), the Regulator for the Securities market in
India owned by Government of India, to trade in the stock market it is mandatory to hold a Demat
account. Demat account works just like your bank account. When shares are purchased money gets
deducted and vice versa. The purpose of Demat account is to eliminate the risk of holding physical share
certificates. When securities are purchased or sold it immediately gets reflected in the account, which
holds shares and securities in an electronic form. NSDL (National Securities Depository Ltd) and CDSL
(Central Depository Services Ltd), registered with SEBI, are the two depositories that facilitate the
opening of new Demat accounts through a Depository Participant (DP).

Features of DEMAT System

 With a Demat account, investors can buy and sell securities anytime and anywhere. One can easily
access details on his/her trade and make quick decisions.
 If in the pre-Demat era, transfer of shares was an elaborate time-consuming affair (it usually takes a
month or so), this is now done at the click of a mouse
 Dematerialisation of securities is made easy as the conversion of physical certificates to electronic
and vice versa can be carried out just by passing an instruction to the Depository Participant (DP)
 Demat account has made liquidity of shares to get money on the selling of securities easier, faster and
simpler
 A holder of Demat account can avail for a loan against securities
 With a simplified process and no stamp duty required for transfer of securities in electronic form, the
cost incurred is also brought down
 Demat account holders can freeze their accounts or put on hold a specific quantity of securities for a
certain period of time.
What are its benefits?

 Security Matters: Physical shareholding always includes the risk of theft, loss or damage. Demat
accounts have two-factor authentication (2FA) and hence is a safer and better option.
 Easy Access: Demat accounts are completely online, which means it can be easily accessed online
from anywhere and at any time.
 Quick Monitoring: Demat accounts facilitate easy monitoring of the holdings from the comforts of
one’s home.
 Speed Factor: With everything in digital format and conducted online, they are very convenient and
less time-consuming. One can buy, sell or transfer funds and securities in a matter of a few seconds.
 Minimal Costs: Unlike physical trading, there are no additional costs of stamp duty, handling
charges, etc. involved when you are trading with a Demat account.
 One umbrella: Your shares, equities, bonds and other securities and investments are organised in one
place, under one umbrella.
 Corporate Gains: Be it bonus issues, right shares, or stock split offered by companies are
automatically updated in the Demat accounts. This means dividends, interest, or refunds reach the
Demat account holder without any delay.

Why do we need a Demat a/c?

Be it investing, trading or holding/ maintaining of shares or stock, digitisation has brought about a
qualitative change. Demat accounts make the maximum out of this revolutionary switchover to electronic
format and are hence the necessity of the day. Essential to trade in India’s stock exchanges, Demat
accounts offer its user/ trader a seamless and smooth experience while trading at Dalal Street. To settle
trades electronically or to buy shares and store them safely, you need a Demat account number. It is
similar to a bank account in which you keep deposits, the records of which are maintained in a passbook.
Earlier, during physical shares' era, frauds were challenging to be detected as there was always a risk of
receiving fake shares, and delays in settlements were the rule of the day as issuing and transferring of
share certificates take nothing less than 15 or more days. All these are now a thing of the past with the
advent of digitisation and Demat accounts. Also, it’s not just the shares and stocks, a Demat account can
be used to retain several investment opportunities like mutual funds, equities, bonds, index and gold,
initial public offerings (IPOs), non-convertible debentures (NCDs), Exchange-traded funds (ETFs),
government securities etc.

What are its facilities?

• Conversion made easy: With a Demat account in place, the conversion of securities into different
formats happen in no time. By passing instructions to your DP (depository participant) one can initiate
dematerialisation formalities to convert the physical share certificates into electronic form. Similarly, an
investor can get his/her electronic security holding certificates converted back to the physical form via the
process of Rematerialization, wherein an RRF (Remat Request Form) is to be filled in by the DP.

• Effortless transfer of shares: A Demat account helps easy transfer of shares of an investor. By filling
in a Delivery Instruction Slip (DIS) with all the relevant investor specifics, it facilitates effortless transfer
of shares as well as various other investments /security holdings. Similarly, change in your address, or
registering a power of attorney and even signatures can be effected in Demat accounts through Depository
Participant by submitting requests along with the relevant documents.
• Collateral towards loans: Your securities can act as collateral towards a loan. The securities held in the
account can provide the investor his exact and detailed holding to enable him to apply for a loan from a
bank or financial institution.

• Lock up your Demat a/c: One can put on hold or freeze his/her Demat account for a specific period of
time or as per requirement. The freezing is mainly carried out to block unexpected activities in the
account. A particular amount of shares should be present in the investor's account for availing this
facility.

• Savings on stamp duty: With transfer/ settlement of securities or trade on exchanges or other off-
market transactions being carried out in digital mode, i.e. Demat form, there is no stamp duty involved.
Complete elimination of stamp duty for securities means substantial cost reduction for the investor, as
previously a stamp duty of 0.5 per cent was levied on each share.

• Corporate Benefits: Demat accounts assist the investor in tracking and maintaining his securities. This
will be more beneficial while monitoring split of any equity shares, bonus issues or any other dealings
carried out by companies on behalf of their shareholders. These are directly updated in the account.

• Mutual funds: A depositor can buy or hold other investments like mutual funds as well in a Demat
Account. For availing this facility, one has to give his/her Demat Account details to the Asset
Management Company (AMC) / Registrar and Transfer Agent (RTA).

How to go about with Demat a/c opening

 Firstly, choose a Depository Participant (DP) with whom you would like to open a Demat Account
with. A beneficial owner (BO) account is opened with the depository.
 Fill the account opening form with all investor details and attach a passport-sized photograph along
with photocopies of the required documents stating proof of address and identity. You should have a
PAN card unless otherwise exempted. All documents should be presented in original as well for
verification.
 The DP will give you a copy of the rules and regulations, the terms of the agreement and the
necessary charges that you need to pay. An in-person verification will be conducted by a
representative of the DP to confirm all the details and documentation provided by the investor.
 Once the application is processed, your account is operational. With the help of account number/
client ID, you have obtained from your DP you can access your Demat Account online.
 You can now proceed to pay your annual maintenance fee for maintenance of your account. You
would also be charged a transaction fee for buying and selling of shares via the Demat Account. In
case your shares are in physical form, the DP may charge you a separate fee for dematerialisation of
these shares.
 There’s no mandate to maintain a minimum balance. Also, you can open a Demat account without
possessing any shareholdings.

1. Proof of Identity: Any of these can be submitted as a proof of identity:

 PAN card having a valid photograph

 Aadhaar card / Voter ID card / Passport / driving licence
 Identity card with a valid photo issued by Central/State government and its Departments, Public
Sector Undertakings, Scheduled Commercial Banks, Statutory/Regulatory Authorities, Public
 Financial Institutions, University-affiliated Colleges, Professional Bodies such as ICAI, ICWAI,
ICSI, Bar Council, and Credit/Debit cards issued by Banks.

2. Proof of Income: Documents that can be submitted as a proof of income are:

 Salary Slip of the current month or Form 16.

 Photocopy of the Income Tax Return (ITR) acknowledgement slip submitted to the Income Tax
Department during tax filing.
 Latest statement of a bank account containing the income history of the last 6 months.
 Certificate of Net Worth or photocopy of the annual statement of accounts authenticated by a
Chartered Accountant.
 A statement of Demat Account holdings with an eligible Depository Participant.
 Any documents that prove ownership of assets through self-declaration.

3. Proof of Address: Papers you may submit as a proof of address are:

 Passport/ Voter’s Identity Card/ Ration Card/ Registered Lease document or Sale Agreement of
Residence/ Driving License/ Flat Maintenance bill/ Insurance Copy.
 Bank Passbook which is not more than three months old.
 Utility bills like landline telephone bill, electricity/ gas bill which is not more than three months old.
 Self-declaration of the new address given by judges of the High Court or Supreme Court.
 Address proof which is issued by bank managers of Scheduled Commercial Banks/ Scheduled
 Cooperative Bank/ Multinational Foreign Banks, Gazetted Officer / Notary public, Member of
Legislative Assembly, Member of Parliament.
 Identity card containing address which is issued by Central/ State Government and its Departments,
Statutory/ Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, Public
Financial Institutions, University affiliated Colleges, Professional Bodies such as ICAI, ICWAI, ICSI,
Bar Council.
 Address proof is given in the name of the spouse