DEPOSITORIES ACT, 1996

22 of 1996

An Act to provide for regulation of depositories in securities and for mutters connected therewith or incidental thereto. BE it enacted by Parliament in the Forty-seventh Year of the Republic of India as follows:-

SECTION 01: SHORT TITLE, EXTENT AND COMMENCEMENT.

(1) This Act may be called the Depositories Act, 1996.

(2) It extends to the whole of India.

(3) It shall be deemed to have come into force on the 20th day of September, 1995.

SECTION 02: DEFINITIONS.

(1) In this Act, unless the context otherwise requires,-

(a) "beneficial owner" means a person whose name is recorded as such with a depository;

(b) "Board" means the Securities and Exchange Board of India established undersection 3 of the Securities and Exchange Board of India Act, 1992 (15 of 1992)-;

(c) "bye -laws" means bye -laws made by a depository underS.26-;

(d) "Company Law Board" mean", the Board of Company Law Administration  constituted undersection 10E of the Companies Act, 1956 (1 of 1956)-;

(e) "depository" means a company formed and registered under the Compa- nies Act, 1956 (1 of 1956) and which has been granted a certificate of registration under sub -section (1A) ofsection 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992)-:

(f) "issuer" means any person making an issue of securities ;

(g) "participant" means a person registered assuch under sub-section (1A) ofsection 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992)-;

(h) "prescribed" means prescribed by rules made under this Act ;

(i) "record" includes the records maintained-in the form of books or stored in a computer or in such other form as may be determined by regulations ;

(j) "registered owner" means a depository whose name is entered as such in the register of the issuer ;

(k) "regulations" means the regulations made by the Board ;

2(k-a) "Securities Appellate Tribunal" means a Securities Appellate Tribunal established under sub-section (1) of Section 15-K of the Securities and Exchange Board of India Act, 1992 (15 of 1992);

(l) "security" means such security as may be specified by the Board ;

(m) "service" means any service connected with recording of allotment of securities or transfer of ownership of securities in the record of a depository.

(2) Words and expressions used herein and not defined but defined in the Companies Act, 1956 (1 of 1956) or the Securities Contracts (Regulation) Act, 1956 (42 of 1956) or the Securities and Exchange Board of India Act, 1992 (15 of 1992), shall have the meanings respectively assigned to them in those Acts.

SECTION 03: CERTIFICATE OF COMMENCEMENT OF BUSINESS BY DEPOSITORIES.

(1) No depository shall act as a depository unless it obtains a certificate of commencement of business from the Board.

(2) A certificate granted under sub-section (1) shall be in such form as may be specified by the regulations.

(3) The Board shall not grant a certificate under sub-section (1) unless it is satisfied that the depository has adequate systems and safeguards to prevent manipulation of records and transactions : Provided that no certificate shall be refused under this section unless the depository concerned has been given a reasonable opportunity of being heard.

SECTION 04: AGREEMENT BETWEEN DEPOSITORY AND PARTICIPANT.

(1) A depository shall enter into an agreement with one or more participants as its agent.

(2) Every agreement under sub-section (1) shall be in such form as may be specified by the bye-laws.

SECTION 05: SERVICES OF DEPOSITORY.

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.

SECTION 06: SURRENDER OF CERTIFICATE OF SECURITY

(1) Any person who has entered into an agreement underS.5-shall surrender the certificate of security, for which he seeks to avail the services of a depository, to the issuer in such manner as may be specified by the regulations.

(2) The issuer, on receipt of certificate of security under sub-section (1), shall cancel the

certificate of security and substitute in its records the name of the depository as a registered owner in respect of that security and inform the depository accordingly.

(3) A depository shall, on receipt of information under sub-section (2), enter the name of the person referred in sub-section (1) in its records, as the beneficial owner.

SECTION 07: REGISTRATION OF TRANSFER OF SECURITIES WITH DEPOSITORY

(1) Every depository shall, on receipt of intimation from a participant, register the transfer of security in the name of the transferee.

(2) If a beneficial owner or a transferee of any security seeks to have custody of such security the depository shall inform the issuer accordingly.

SECTION 08: OPTIONS TO RECEIVE SECURITY CERTIFICATE OR HOLD SECURITIES WITH DEPOSITORY

(1) Every person subscribing to securities offered by an issuer shall have the option either to receive the security certificates or hold securities with a depository.

(2) Where a person opts to hold a security with a depository, the issuer shall intimate such depository the details of allotment of the security, and on receipt of such information the depository shall enter in its records the name of the allottee as the beneficial owner of that security.

SECTION 09: SECURITIES IN DEPOSITORIES TO BE IN FUNGIBLE FORM

(1) All securities held by a depository shall be dematerialised and shall be in a fungible form.

1[(2) Nothing contained insections 153-,153A-,153B-,187B-,187C-and372 of the Companies Act, 1956 (1 of 1956)-shall apply to a depository in respect of securities held by it on behalf of the beneficial owners.]

SECTION 10: RIGHTS OF DEPOSITORIES AND BENEFICIAL OWNER

(1) Notwithstanding anything contained in any other law for the time being in force, a depository shall be deemed to be the registered owner for the purposes of effecting transfer of ownership of security on behalf of a beneficial owner.

(2) Save as otherwise provided in sub-section ( 1), the depository as a registered owner shall not have any voting rights or any other rights in respect of securities held by it.

(3) The beneficial owner shall be entitled to all the rights and benefits and be subjected to all the liabilities in respect of his securities held by a depository.

SECTION 11: REGISTER OF BENEFICIAL OWNER

Every depository shall maintain a register and an index of beneficial owners in the manner provided insections 150-,151-and152 of the Companies Act, 1956 (1 of 1956)-

SECTION 12: PLEDGE OR HYPOTHECATION OF SECURITIES HELD IN A DEPOSITORY

(1) Subject to such regulations and bye-laws, as may be made in this behalf, a beneficial owner may with the previous approval of the deposi- tory create a pledge or hypothecation in respect of a security owned by him through a depository.

(2) Every beneficial owner shall give intimation of such pledge or hypo- thecation to the depository and such depository shall thereupon make entries in its records accordingly.

(3) Any entry in the records of a depository under sub-section (2) shall be evidence of a pledge or hypothecation.

SECTION 13: FURNISHING OF INFORMATION AND RECORDS BY DEPOSITORY AND ISSUER

(1) Every depository shall furnish to the issuer information about the transfer of securities in the name of beneficial owners at such intervals and in such manner as may be specified by the byelaws.

(2) Every issuer shall make available to the depository copies of the relevant records in respect of securities held by such depository.

SECTION 14: OPTION TO OPT OUT IN RESPECT OF ANY SECURITY

(1) If a beneficial owner seeks to opt out of a depository in respect of any security he shall inform the depository accordingly.

(2) The depository shall on receipt of intimation under sub-section (1) make appropriate entries in its records and shall inform the issuer.

(3) Every issuer shall, within thirty days of the receipt of intimation from the depository and on fulfilment of such conditions and on payment of such fees as may be specified by the regulations, issue the certificate of securities to the beneficial owner or the transferee, as the case may be.

SECTION 15: ACT 18 OF 1891 TO APPLY TO DEPOSITORIES

The Bankers' Books Evidence Act, 1891 shall apply in relation to a depository as if it were a bank as defined inS.2-of that Act.

SECTION 16: DEPOSITORIES TO INDEMNIFY LOSS IN CERTAIN CASES

(1) Without prejudice to the provisions of any other law for the time being in force, any loss caused to the beneficial owner due to the negligence of the depository or the participant, the depository shall indemnify such beneficial owner.

(2) Where the loss due to the negligence of the participant under sub-section (1) is indemnified by the depository, the depository shall have the right to recover the same from such participant.

SECTION 17: RIGHTS AND OBLIGATIONS OF DEPOSITORIES, ETC

(1) Subject to the provisions of this Act the rights and obligations of the depositories, participants and the issuers whose securities are dealt with by a depository shall be specified by the regulations.

(2) The eligibility criteria for admission of securities into the depository shall be specified by the regulations.

SECTION 18: POWER OF BOARD TO CALL FOR INFORMATION AND ENQUIRY

(1) The Board, on being satisfied that it is necessary in the public interest or in the interest of investors so to do, may, by order in writing,-

(a) call upon any issuer, depository, participant or beneficial owner to furnish in writing such information relating to the securities held in a depository as it may require; or

(b) authorise any person to make an enquiry or inspection in relation to the affairs of the issuer, beneficial owner, depository or participant, who shall submit a report of such enquiry or inspection to it within such period as may be specified in the order.

(2) Every director, manager, partner, secretary, officer or employee of the depository or issuer or the participant or beneficial owner shall on demand produce before the person making the enquiry or inspection all information or such records and other documents in his custody having a bearing on the subject-matter of such enquiry or inspection.

SECTION 19: POWER OF BOARD TO GIVE DIRECTIONS IN CERTAIN CASES

Save as provided in this Act, if after making or causing to be made an enquiry or inspection, the Board is satisfied that it is necessary-

(i) in the interest of investors, or orderly development of securities market; or

(ii) to prevent the affairs of any depository or participant being conducted in the manner

detrimental to the interests of investors or securities market; it may issue such directions-

(a) to any depository or participant or any person associated with the securities market; or

(b) to any issuer, as may be appropriate in the interest of investors or the securities market.

SECTION 20: OFFENCES

Whoever contravenes or attempts to contravene or abets the contra- vention of the provisions of this Act or any regulations or bye-laws made thereunder shall be punishable with imprisonment for a term which may extend to five years, or with a fine, or with both.

SECTION 21: OFFENCES BY COMPANIES

(1) Where an offence under this Act has been committed by a company, every person who at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly : Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such. of fence.

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly."

SECTION 22: COGNIZANCE OF OFFENCES BY COURTS

(1) No Court shall take cognizance of any offence punishable under this Act or any regulations or bye-laws made thereunder, save on a complaint made by the Board.

(2) No Court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try any offence punishable under this Act.

SECTION 23: APPEALS

(1) Any person aggrieved by3["an order of the Board made before the commencement of the Securities Laws (Second Amendment) Act, 1999"]under this Act, or the regulations made thereunder may prefer an appeal to the Central Government within such time as may be prescribed.

(2) No appeal shall be admitted if it is preferred after the expiry of the period prescribed therefor:

Provided that an appeal may be admitted after the expiry of the period prescribed therefor if the appellant satisfies the Central Government that he had sufficient cause for not preferring the appeal within the prescribed period.

(3) Every appeal made under this section shall be made in such form and shall be accompanied by a copy of the order appealed against and by such fees as may be prescribed.

(4) The procedure for disposing of an appeal shall be such as may be prescribed: Provided that before disposing of an appeal, the appellant shall be given a reasonable opportunity of being heard.

SECTION 23A: APPEAL TO SECURITIES APPELLATE TRIBUNAL

4- (1) Save as provided in sub-section (2), any person aggrieved by an order of the Board made, on and after the commencement of the Securities Laws (Second Amendment) Act, 1999, under this Act, or the regulations made thereunder, may prefer an appeal to a Securities Appellate Tribunal having jurisdiction in the matter.

(2) No appeal shall lie to the Securities Appellate Tribunal from an order made by the Board with the consent of the parties.

(3) Every appeal under sub-section (1) shall be filed within a period of forty-five days from the date on which a copy of the order made by the Board is received by the person referred to in subsection

(1) and it shall be in such form and be accompanied by such fee as may be prescribed:

Provided that the Securities Appellate Tribunal may entertain an appeal after the expiry of the said period of forty-five days if it is satisfied that there was sufficient cause for not filing it within that period.

(4) On receipt of an appeal under sub-section (1), the Securities Appellate Tribunal may, after giving the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or setting aside the order appealed against.

(5) The Securities Appellate Tribunal shall send a copy of every order made by it to the Board and parties to the appeal.

(6) The appeal filed before the Securities Appellate Tribunal under sub-section (1) shall be dealt with by it as expeditiously as possible and endeavour shall be made by it to dispose of the appeal finally within six months from the date of receipt of the appeal.

SECTION 23B: PROCEDURE AND POWERS OF SECURITIES APPELLATE TRIBUNAL

(1) The Securities Appellate Tribunal shall not be bound by the procedure laid down by the Code of Civil Procedure, 1908 (5 of 1908), but shall be guided by the principles of natural justice and, subject to the other provisions of this Act and of any rules, the Securities Appellate Tribunal shall have the powers to regulate their own procedure including the places at which they shall have their sittings.

(2) The Securities Appellate Tribunal shall have, for the purpose of discharging their functions under this Act, the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (5 of 1908), while trying a suit, in respect of the following matters, namely :-

(a) summoning and enforcing the attendance of any person and examining him on oath;

(b) requiring the discovery and production of documents;

(c) receiving evidence on affidavits;

(d) issuing commissions for the examination of witnesses or documents;

(e) reviewing its decisions;

(f) dismissing an application for default or deciding it ex parte;

(g) setting aside any order of dismissal of any application for default or any order passed by it ex parte; and

(h) any other matter which may be prescribed.

(3) Every proceeding before the Securities Appellate Tribunal shall be deemed to be a judicial proceeding within the meaning of Sections 193 and 228, and for the purposes of Section 196 of the Indian Penal Code, 1860 (45 of 1860) and the Securities Appellate Tribunal shall be deemed to be a civil court for all the purposes of Section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).

SECTION 23C: RIGHT TO LEGAL REPRESENTATION

-The appellant may either appear in person or authorise one or more chartered accountants or company secretaries or cost accountants or legal practitioners or any of its officers to present his or its case before the Securities Appellate Tribunal.

Explanation.-For the purposes of this section,-

(a) "chartered accountant" means a chartered accountant as defined in clause (b) of sub-section (1) of Section 2 of the Chartered Accountants Act, 1949 and who has obtained a certificate of practice under sub -section (1) of Section 6 of that Act (38 of 1949);

(b) "company secretary" means a company secretary as defined in clause (c) of sub-section (1) of Section 2 of the Company Secretaries Act, 1980 (56 of 1980) and who has obtained a certificate of practice under sub - section (1) of Section 6 of that Act;

(c) "cost accountant" means a cost accountant as defined in clause (b) of sub-section (1) of Section 2 of the Cost and Works Accountants Act, 1959 (23 of 1959) and who has obtained a certificate of practice under sub - section (1) of Section 6 of that Act;

(d) "legal practitioner" means an advocate, vakil or an attorney of any High Court, and includes a pleader in practice.

SECTION 23D: LIMITATION

-The provisions of the Limitation Act, 1963 (36 of 1963) shall, as far as may be, apply to an appeal made to a Securities Appellate Tribunal.

SECTION 23E: CIVIL COURT NOT TO HAVE JURISDICTION

-No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which a Securities Appellate Tribunal is empowered by or under this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act.

SECTION 23F: APPEAL TO HIGH COURT

-Any person aggrieved by any decision or order of the Securities Appellate Tribunal may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the Securities Appellate Tribunal to him on any question of fact or law arising out of such order: Provided that the High Court may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days.

SECTION 24: POWER OF CENTRAL GOVERNMENT TO MAKE RULES

(1) The Central Government may, by notification in the Official Gazette, make rules for carrying out the provisions of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely :-

(a) the time within which an appeal may be preferred under sub-section (1) ofS.23-;

(b) the form in which an appeal may be preferred under sub-section (3) ofS.23-and the fees payable in respect of such appeal ;

(c) the procedure for disposing of an appeal under sub-section (4) ofS.23-.

SECTION 25: POWER OF BOARD TO MAKE REGULATIONS

(1) Without prejudice to the provisions contained insection 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992)-, the Board may, by notification in the Official Gazette, make regulations consistent with the provisions of this Act and the rules made thereunder to carry out the purposes of this Act.

(2) In particular and without prejudice to the generality of the foregoing power, such regulations may provide for-

(a) the form in which record is to be maintained under clause (i) of sub-section (1) ofS.2 -;

(b) the form in which the certificate of commencement of business shall be issued under sub-section (2) ofS.3 - ;

( c) the manner in which the certificate of security shall be surrendered under sub-section (1) ofS.6-;

(d) the manner of creating a pledge or hypothecation in respect of security owned by a beneficial owner under sub -section (1) ofS.12-;

(e) the conditions and the fees payable with respect to the issue of certificate of securities under sub-section (3) ofS.14-;

(f) the rights and obligations of the depositories, participants and the issuers under sub-section (1) ofS.17-;

(g) the eligibility criteria for admission of securities into the depository under sub-section (2) ofS.17-.

SECTION 26: POWER OF DEPOSITORIES TO MAKE BYE BYE--LAWS

(1) A depository shall, with the previous approval of the Board, make bye-laws consistent with the provisions of this Act and the regulations.

(2) In particular and without prejudice to the generality of the foregoing power, such bye-laws shall provide for-

(a) the eligibility criteria for admission and removal of securities in the depository;

(b) the conditions subject to which the securities shall be dealt with ;

(c) the eligibility criteria for admission of any person as a participant ;

(d) the manner and procedure for dematerialisation of securities ;

(e) the procedure for transactions within the depository :

(f) the manner in which securities shall be dealt with or withdrawn from a depository;

(g).the procedure for ensuring safeguards to protect the interests of participants and beneficial owners;

(h) the conditions of admission into and withdrawal from a participant by a beneficial owner;

(i) the procedure for conveying information to the participants and beneficial owners on dividend declaration, shareholder meetings and other matters of interest to the beneficial owners ;

(j) the manner of distribution of dividends, interest and monetary benefits received from the company among beneficial owners ;

(k) the manner of creating pledge or hypothecation in respect of securities held with a depository ;

(l) interse rights and obligations among the depository, issuer, participants,and beneficial owners;

(m) the manner and the periodicity of furnishing information lo the Board, issuer and other persons ;

(n) the procedure for resolving disputes involving depository, issuer, company or a beneficial owner ;

(o) the procedure for proceeding against the participant committing breach of the regulations and provisions for suspension and expulsion of participants from the depository and cancellation of agreements entered with the depository;

(p) the internal control standards including procedure for auditing, reviewing and monitoring.

(3) Where the Board considers it expedient so to do, it may, by order in writing, direct a depository to make any bye-laws or to amend or revoke any bye-laws already made within such period as it may specify in this behalf.

(4) If the depository fails or neglects to comply with such order within the specified period, the Board may make the bye-laws or amend or revoke the bye laws made either in the form specified in the order or with such modifications thereof as the Board thinks fit.

SECTION 27: RULES AND REGULATIONS TO BE LAID BEFORE PARLIAMENT

Every rule and every regulation made under this Act shall be laid, as soon as may be after it is made, before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or regulation or both Houses agree that the rule or regulation should not be made, the rule or regulation shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule or regulation.

SECTION 28: APPLICATION OF OTHER LAWS NOT BARRED

The provisions of this Act shall be in addition to, and not in derogation of,any other law for the time being in force relating to the holding and transfer of securities.

SECTION 29: REMOVAL OF DIFFICULTIES.

(1) If any difficulty arises in giving effect to the provisions of this Act, the Central Government may by order published in the Official Gazette, make such provisions not inconsistent with the provisions of this Act as appear to it to be necessary or expedient for removing the difficulty : Provided that no order shall be made under this section after the expiry of a period of two years from the commencement of this Act.

(2) Every order made under this section shall be laid, as soon as may be after it is made, before each House of Parliament.

SECTION 30: AMENDMENTS TO CERTAIN ENACTMENTS

The enactments specified in the Schedule to this Act shall be amended in the manner provided therein.

SECTION 31: REPEAL AND SAVING

(1)The Depositories (Third) Ordinance, 1996 (Ord. 28 of 1996), is hereby repealed.

(2) Notwithstanding such repeal, anything done or any action taken under the said Ordinance shall

be deemed to have been done or taken under the corresponding provisions of this Act.

SCHEDULE 01: AMENDMENTS TO CERTAIN ENACTMENTS

PART 1 AMENDMENT TO THE INDIAN STAMP ACT, 1899 (2 OF 1899)

Amendment. After section 8, the following section shall be inserted, namely :- '8A. Securities not liable to stamp duty.-Notwithstanding anything contained in this Act,- (a) an issuer, by the issue of securities to one or more depositories shall, in respect of such issue, be chargeable with duty on the total amount of security issued by it and such securities need not be stamped ; (b) where an issuer issues certificate of security under sub-section (3) of section 14 of the Depositories Act, 1996, on such certificate duty shall be payable as is payable on the issue of duplicate certificate under this Act ; (c) transfer of registered ownership of shares from a person to a depository or from a depository to a beneficial owner shall not be liable to any stamp duty ; (d) transfer of beneficial ownership of shares, such shares being shares of a company dealt with 'by a depository shall not be liable to duty under article 62 of Schedule I of this Act. PART 2AMENDMENTS TO THE COMPANIES ACT, 1956 (1 OF 1956)Amendments. 1. In section 2, after clause (45A), the following clause shall be inserted, namely:- '(45B) "Securities and Exchange Board of India" means the Securities and Exchange Board of India established undersection 3 of the Securities and Exchange Board of India Act, 1992 (15 of 1992)-.'. 2. After section 2, the following Section shall be inserted, namely :- "2A. Interpretation of certain words and expressions.-Words and expressions used and not defined in this Act but defined in the Depositories Act, 1996 shall have the same meanings respectively assigned to them in that Act.". 3. In section 41, after sub-section (2), the following sub-section shall be inserted, namely:- "(3) Every person holding equity share capital of company and whose name is entered as beneficial owner in the records of the depository shall be deemed to be a member of the concerned company.". 4. In section 49, in sub-section (5), after clause (b), the following clause shall be inserted, namely:- "(c) from holding investments in the name of a depository when such investment are in the form of securities held by the company as a beneficial owner.". 5. In section 51, the following proviso shall be inserted, namely :- "Provided that where the securities are held in a depository, the records of the beneficial ownership may be served by such depository on the company by means of electronic mode or by delivery of floppies or discs.". 6. Section 83 shall be omitted. 7. In section 108, after sub-section (2), the following sub-section shall be inserted, namely;- "(3) Nothing contained in this section shall apply to transfer of security effected by the transferor and the transferee both of whom are entered as beneficial owners in the records of a depository.". 8. In section III, after sub-section (13), the following sub-section shall be inserted, namely:- '(14) In this section "company" means a private company and includes a private company which had become a public company by virtue of section 43A of this Act.'. 9. After section 3, the following section shall be inserted, namely :- 111A. Rectification of register on transfer.-(1) In this section, unless the context otherwise requires, "company" means a company other than a company referred to in sub-section (14) of section 3 of this Act. (2) Subject to the provisions of this section, the shares or debentures and any interest therein of a company shall be freely transferable. (3) The Company Law Board may, on an application made by a depository, company, participant or investor or the Securities and Exchange Board of India within two months from the date of transfer of any shares or debentures held by a depository or from the date on which the instrument of transfer or the intimation of transmission was delivered to the company, as the case may be, after such inquiry as it thinks fit, direct any company or depository to rectify register or records if the transfer of the shares or debentures is in contravention of any of the provisions of the Securities and Exchange Board of India Act, 1992 (15 of 1992) or regulations made thereunder or the Sick Industrial Companies (Special Provisions) Act, 1985 (I of 1986). (4) The Company Law Board while acting under sub-section (3), may at its discretion make such interim order as to suspend the voting rights before making or completing such enquiry. (5) The provisions of this section shall not restrict the right of a holder of shares or debentures, to transfer such shares or debentures and any person acquiring such shares or debentures shall be entitled to voting rights unless the voting rights have been suspended by an order of the Company Law Board. (6) Notwithstanding anything contained in this section, any further transfer, during the pendency of the application with the Company Law Board, of shares or debentures shall entitle the transferee to voting rights unless the voting rights in respect of such transferee have also been suspended. (7) The provisions of sub-sections (5), (7), (9), (10) and (12) of section 3 shall, so far as may be, apply to the proceedings before the Company Law Board under this section as they apply to the proceedings under that section.'. 10. In section 113, after sub-section (3), the following sub-section shall be inserted, namely:- "(4) Notwithstanding anything contained in sub-section (1), where the securities are dealt with in a depository, the company shall intimate the details of allotment of securities to depository immediately on allotment of such securities.". 11. In section 150, in sub-section ( 1 ),in clause ( b), the words "distinguishing each share by its number" shall be omitted. 12. In section 152, in sub-section (1), in clause (&), the words "distinguishing each debenture by its number" shall be omitted. 13. After section 152, the following section shall be inserted, namely :- "152A. Register and index of beneficial owners.-The register and index of beneficial owners maintained by a depository under section 2 of the Depositories Act, 1996, shall be deemed to be an index of members and register and index of debenture holders, as the case may be, for the purposes of this Act.". 14. In Schedule II, in Part II, in clause C, after sub-clause 9, the following subclause shall be inserted, namely :- "9A. The details of opinion to subscribe for securities to be dealt with in a depository.". PART 3 AMENDMENTS TO THE SECURITIES CONTRACTS (REGULATION) ACT, 1956 (42 OF 1956) Amendments. 1. In section 2, for clause ( i), the following clause shall be substituted, namely :- "(i) spot delivery contract means a contract which provides for- (a) actual delivery of securities and the payment of a price therefor either on the same day as the date of the contract or on the next day, the actual periods taken for the despatch of the securities or the remittance of money therefor 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." 2. Section 22A shall be omitted. PART 4 AMENDMENT TO THE INCOME-TAX ACT, 1961 (43 OF 1961) Amendment. In section 45, after sub-section (2), the following sub-section shall be inserted,namely:- '(2A) Where any person has had at any time during previous year any beneficial interest in any securities, then, any profits or gains arising from transfer made by the depository or participant of such beneficial interest in respect of securities shall be chargeable to income-tax as the income of the beneficial owner of the previous year in which such transfer took place and shall not be regarded as income of the depository who is deemed to be the registered owner of securities by virtue of sub-section (1) of section 10 of the Depositories Act, 1996, and for the purposes of- (i) section 48; and (ii) proviso to clause (42A) of section 2, the cost of acquisition and the period of holding of any securities shall be determined on the basis of the first-in-first-out method. PART 5 AMENDMENT TO THE BENAMI TRANSACTIONS (PROHIBITION) ACT, 1988 (45 OF 1988) Amendment. In section 3, for sub-section (2), the following sub-section shall be substituted, namely:- '(2) Nothing in sub-section (1) shall apply to- (a) the purchase of property by any person in the name of his wife or unmarried daughter and it shall be presumed, unless the contrary is proved, that the said property had been purchased for the benefit of the wife or the unmarried daughter ; (b) the securities held by a- (i) depository as a registered owner under sub-section (1) of section 10 of the Depositories Act, 1996 ; (ii) participant as an agent of a depository. PART 6 AMENDMENTS TO THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 (15 OF 1992) Amendments. 1. In section 2, in sub-section (2), for the words, brackets and figures "the Securities Contracts (Regulation) Act, 1956", the words, brackets and figures "the Securities Contracts (Regulation) Act, 1956 (42 of 1956) or the Depositories Act, 1996" shall be substituted. 2. In section II, in sub-section (2) in clause (ba) for the words "depositories, custodians", the words "depositories, participants, custodians" shall be substituted. 3. In section 12, in sub-section (1A), for the words, "depository, custodian", at both the places where they occur, the words "depository, participant, custodian" shall be substituted. 4. In section 16, in sub-section ( 1 ), for the words "this Act", the words and figures "this Act or the Depositories Act, 1996" shall be substituted.

Footnotes:

1. Substituted by the Depositories Reluted Laws (Amendment) Act, 1997, w.e.f. 15-1-1997.

3. Substituted for "an order of the Board made ", vide THE SECURITIES LAWS (SECOND AMENDMENT) ACT, 1999 (32 Of 1999), Dt. December 16,1999 Published in Received the assent of the President on the 16th December, 1999 and was published in the Gazette of India, (Extra.), Part II Sec.1, No. 45, dated December 16,1999

4. THE SECURITIES LAWS (SECOND AMENDMENT) ACT, 1999 (32 Of 1999), Dt. December 16,1999 Published in Received the assent of the President on the 16th December, 1999 and was published in the Gazette of India, (Extra.), Part II Sec.1, No. 45, dated December 16,1999

DEPOSITORIES (APPEAL TO THE CENTRAL GOVERNMENT) RULES, 1998

G.S.R. 413(E).-In exercise of the powers conferred by

Sec. 24, read withSec. 23, of the Depositories Act, 1996 (22 of 1996), the Central Government hereby makes the following rules, namely:-

RULE 1 Short title and commencement

-

(1) These rules may be called the Depositories (Appeal to the Central Government) Rules, 1998.

(2) They shall come into force on the date of their publication in the Official Gazette.

RULE 2 Definitions

-In these rules, unless the context otherwise requires,-

(a) "Act" means theDepositories Act, 1996 (22 of 1996)-;

(b) "authorised representative" means,-

(i) in relation to an appellant, a person duly authorized by the appellant to present an appeal on his behalf to

the Central Government;

(ii) in relation to the Board, a person duly appointed by the Board by notification in the Official Gazette as

authorized representative to appear, plead and act for such authority in any such appeal and any other person

acting on behalf of the person so appointed;

(c) "Board" means the Securities and Exchange Board of India established underSec. 3 of the

Securities and Exchange Board of India Act, 1992 (15 of 1992)-;

(d) "Form" means the form appended to these rules;

(e) "regulations" means the regulations made by the Board under the Act;

(f) "rules" means the rules made under the Act.

RULE 3 Form of appeal

-Any person aggrieved by an order of the Board made under the Act or the regulations made thereunder, may prefer an appeal to the Central Government in the Form.

RULE 4 Time within which appeal is to be preferred

-

(1) An appeal shall be preferred by the aggrieved person within a period of thirty days from the

date of communication to him of the order of the board made under the Act or regulations.

(2) When the appeal is preferred after the expiry of the period of thirty days specified in sub-rule

(1), it shall be accompanied by an application supported by an affidavit setting forth the facts on

which the appellant relies to satisfy the Central Government that he has sufficient cause for not

preferring the appeal within the said period of thirty days:

Provided that if the Central Government is satisfied that the appellant had sufficient cause for not preferring

the appeal within the aforesaid period, it may, for reasons to be recorded in writing, admit the appeal after the

aforesaid period but before the expiry of forty five days from the date of communication to him of the order of

the Board.

RULE 5 Payment of fees

-

(1) Every appeal shall be accompanied by fee of rupees five thousand only.

(2) The amount of fees shall be deposited in any Government Treasury or any branch of the State

Bank of India.

(3) The amount of the fees shall be deposited under the head "065-Other Admn. Services-Other

Services-Other Receipts".

RULE 6 Contents of appeal

-Every appeal filed underRule 3-shall be written in English or Hindi and shall set forth concisely under distinct heads, the grounds of appeal without any argument or narrative and such grounds shall be numbered consecutively.

RULE 7 What to accompany Form

-Every appeal shall be filed in the Form in duplicate and shall be accompanied by two copies (at least one of which shall be a certified copy) of the order of the Board appealed against the other documents to support the grounds of objection mentioned in the appeal.

Explanation.-For the purpose of this rule "certified copy" includes the copy which was originally supplied to the appellant as well as a photocopy thereof duly authenticated by the appellant or his authorized representative as a true copy.

RULE 8 Filing of affidavits

-Where a fact which can not be borne out by, or is contrary to, the record is alleged, it shall be stated clearly and concisely and supported by a duly sworn affidavit.

RULE 9 Rights of appellant to appear before the Central Government

-

(1) Every appellant may appear before the Central Government in person or through his

authorized representative.

(2) An appellant may, by writing authorise-

(a) an advocate, or

(b) a Chartered Accountant, or

(c) a Cost and Works Accountant, or

(d) a Company Secretary, having prescribed qualifications under clause (45) ofSec. 2 of the Companies Act, 1956 (1 of 1956)to function as authorized representative of such party.

RULE 10 Authorising a representative to appear

-In an appeal any appellant, where the Form is signed by his authorised representative, the appellant shall append to the Form documents authorising the authorised representative to appear for him and the said document shall state what his relationship is with the appellant.

RULE 11 Authorisation to be filed

-An authorised representative appearing for the appellant at the hearing of an appeal shall, unless the document referred to inRule 10-has been appended, file such a document before the commencement of the hearing.

RULE 12 Procedure for filing appeal

-

(1) An appeal shall be preferred by the appellant or his authorised representative to the Central

Government in person or be sent by Registered Post addressed to the Secretary to the Government

of India, Department of Economic Affairs, Ministry of Finance, New Delhi.

(2) An appeal sent by post under sub-rule (1) shall be deemed to have been preferred to the

Central Government on the day on which it is received in the office of the Secretary to the

Government of India, Department ot Economic Affairs, Ministry of Finance, at Delhi.

RULE 13 Furnishing of information and documents

-

(1) The Central Government may, before considering the appeal, require the appellant or the

Board or both to furnish such further information and documents as it considers necessary.

(2) Parties concerned shall furnish such information and documents within thirty days of such

order.

RULE 14 Date and place of hearing of appeal to be communicated

-The Central Government shall communicate, before considering the appeal, to the appellant or the Board or both the date the place of the hearing of the appeal and may send a copy of the appeal to the Board either before or with such communication.

RULE 15 Hearing of appeal

-

(1) On the day fixed or on any other day to which the hearing may be adjourned, the appellant

shall be heard in support of the appeal. The Central Government shall, then, if necessary, hear the

Board or its authorised representative against the appeal, and in such case the appellant shall be

entitled to reply.

(2) In case the appellant does not appear in person or through an authorised representative when

the appeal is called for hearing, the Central Government may dispose of the appeal on merits:

Provided that where an appeal has been disposed of as provided above and the appellant appears afterwards

and satisfies the Central Government that there was sufficient cause for his non- appearance, when the appeal

was called for hearing, the Central Government shall make an order setting aside the order and restore the

appeal.

RULE 16 Orders by Central Government

-The Central Government shall,-

(a) after considering the appeal preferred to it underRule 3-,

(b) after considering further documentary evidence referred to inrule 13-, and

(c) after giving hearing underRule 15-, pass such orders or give such directions as may be

necessary or expedient to give effect to, or in relation to, its orders.

RULE 17 Order to be signed and dated

-The orders of the Central Government shall be in writing and shall be signed and dated.

RULE 18 Order to be communicated to the party

(1) The Central Government shall, after the order is signed, cause it to be communicated to the appellant and the Board.

(2) Any person other than appellant or the Board may obtain a copy of the order on depositing a sum of one hundred rupees under the head "065-Other Admn. Services-Other Service-Other Receipts".

FORM 1 FORM OF APPEAL

From (Mention the name and address of the appellant here) To The Secretary to the Government of India, Department of Economic Affairs, Ministry of Finance, North Block, New Delhi. Sir, The appellant named above, begs to prefer this appeal underSec. 23 of the Depositories Act, 1996 (22 of 1996)-against order No......... dated . .... passed by the Securities and Exchange Board of India under the said Act. and theSecurities and Exchange Board of India (Depositories and Participants) Regulations, 1996-on the following facts and grounds : FACTS (Mention briefly the fact of the case here. Enclose copy of the order passed by the Board and copies of letters written by the appellant to Board and copies of other relevant documents, if any).* GROUNDS (Mention here the grounds on which the appeal is made). PRAYER In the light of what is stated above, the appellant prayer that he/she/it may be granted the following relief. RELIEF SOUGHT (specify and relief sought) The amount of rupees five thousand as fees for this appeal has been deposited in .. .... vide receipt No. dated ....... (Signature of the Appellant or his authorised representative) List of documents attached: (Signature of the Appellant or his authorised representative) Indicate the relevant regulation if it is different than that mentioned above. [Noti. No. F. No. 1/32/SE/98, dt. 28.7.98-Gaz. of India. Exty.. Pt. II-Sec. 3(i) No 274, dt. 28.7.98 p. 5.]

DEPOSITORIES (APPEAL TO SECURITIES APPELLATE TRIBUNAL) RULES, 2000

G.S.R. 143(E).-In exercise of the powers conferred by Sec. 24 read with Sec. 23-A, of the Depositories Act, 1996 (22 of 1996), the Central Government hereby makes the following rules, namely:-

RULE 01: SHORT TITLE AND COMMENCEMENT

(1) These rules may be called the Depositories (Appeal to Securities Appellate Tribunal) Rules, 2000

(2) They shall come into force on the date of their publication in the Official Gazette.

RULE 02: DEFINITIONS

(1) In these rules, unless the context otherwise requires,-

(a) "Act" means the Depositories Act, 1996 (22 of 1996);

(b) "appeal" means an appeal preferred under Sec, 23-A of the Act;

(c) "Appellate Tribunal" means the Securities Appellate Tribunal established under Sec. 15 -K of the Securities and Exchange Board of India Act, 1992 (15 of 1992);

(d) "form" means the form appended to these rules;

(e) "party" means a person who prefers an appeal before the Appellate Tribunal and includes respondent;

(f) "Presiding Officer" means the Presiding Officer of the Securities Appellate Tribunal appointed under Sec. 15-L of the Securities and Exchange Board of India Act, 1992 (15 of 1992);

(g) "rules" means the rules made under the Act;

(h) "Registrar" means the Registrar of the Appellate Tribunal;

(i) "registry" means the registry of the Appellate Tribunal;

(2) words and expressions used and not defined in these rules but defined in the Depositories Act, 1996 shall have the meanings respectively assigned to them in that Act.

RULE 03: LIMITATION FOR FILING AN APPEAL

-An appeal may be preferred by the aggrieved person within a period of forty five days from the date on which a copy of the order, made by the Board under the Act or the regulations made thereunder, is received by the person. Provided that the Securities Appellate Tribunal may entertain an appeal after the expiry of the said period of forty-five days if it is satisfied that there was sufficient cause for not filing it within that period.

RULE 04: FORM AND PROCEDURE OF APPEAL

(1) A memorandum of appeal shall be presented in the Form by any aggrieved person in the registry of the Appellate Tribunal within whose jurisdiction his case falls or shall be sent by registered post addressed to the Registrar.

(2) A memorandum of appeal sent by post shall be deemed to have been presented in the registry on the day it was received in the registry.

RULE 05: SITTINGS OF APPELLATE TRIBUNAL

-The Appellate Tribunal shall hold its sitting either at a place where its office is situated or at such other place falling within its jurisdiction, as it may deem fit by the Appellate Tribunal.

RULE 06: LANGUAGE OF APPELLATE TRIBUNAL

(1) The proceedings of the Appellate Tribunal shall be conducted in English or Hindi.

(2) No appeal, application, representation, document or other matters contained in any language other than English or Hindi, shall be accepted by Appellate Tribunal, unless the same is accompanied by a true copy of translation thereof in English or Hindi.

RULE 07: APPEAL TO BE IN WRITING

(1) Every appeal, application, reply, representation or any document filed before the Appellate Tribunal shall be typewritten, cyclostyled or printed neatly and legibly on one side of the good quality paper of foolscap size in double space and separate sheets shall be stitched together and every page shall be consecutively numbered and filed in the manner provided in sub-rule (2).

(2) The appeal under sub-rule (J.) shall be presented in 3 sets in a paper book along with an empty file size envelope bearing full address of the respondent and in case the respondents are more than one, then sufficient number of extra paper books together with empty file size envelope bearing full addresses of each respondent shall be furnished by the appellant.

RULE 08: PRESENTATION AND SCRUTINY OF MEMORANDUM OF APPEAR

(1) The Registrar shall endorse on every appeal the date on which it is presented under Rule 4 or deemed to have been presented under that rule and shall sign endorsement.

(2) If, on scrutiny, the appeal is found to be in order, it shall be duly registered and given a serial number.

(3) If an appeal on scrutiny is found to be defective and the defect noticed is formal in nature, the Registrar may allow the appellant to rectify the same in his presence and if the said defect is not formal in nature, the Registrar may allow the appellant such time to rectify the defect as he may deem fit. If the appeal has been sent by post and found to be defective, the Registrar may communicate the defects to the appellant and allow the appellant such time to rectify the defect as he may deem fit.

(4) If the appellant fails to rectify the defect within the time allowed in sub-rule (3), the Registrar may by order and for reasons to be recorded in writing, decline to register such memorandum of appeal and communicate the order to the appellant within seven days thereof.

(5) An appeal against the order of the Registrar under sub-rule (4) shall be made within fifteen days of receiving of such order to the Presiding Officer concerned in his chamber, whose decision thereon shall be final.

RULE 09: PAYMENT OF FEES

(1) Every appeal shall be accompanied by a fees of rupees five thousand only.

(2) the amount of fees shall be remitted in the form of crossed demand draft drawn on a nationalised bank in favour of "the Registrar, Securities Appellate Tribunal" payable at the station where the registry is located.

RULE 10: CONTENTS OF MEMORANDUM OF APPEAL

(1) Every memorandum of appeal filed under rule 4 shall set forth concisely under distinct heads, the grounds of such appeal without any argument or narrative, and such grounds shall be numbered consecutively and shall be in the manner provided in sub-rule (1) of Rule 7.

(2) It shall not be necessary to present separate memorandum of appeal to seek interim order or direction if in the memorandum of appeal, the same is prayed for.

RULE 11: DOCUMENTS TO ACCOMPANY MEMORANDUM OF APPEAL

(1) Every memorandum of appeal shall be in triplicate and shall be accompanied with copies of the order, at least one of which shall be certified copy, against which the appeal is filed.

(2) Where a party is represented by authorised representative, a copy of the authorisation to act as authorised representative and the written consent thereto by such authorised representative, shall be appended to the appeal.

RULE 12: PLURAL REMEDIES

-A memorandum of appeal shall not seek relief or reliefs therein against more than one order unless the reliefs prayed for are consequential.

RULE 13: NOTICE OF APPEAL TO THE RESPONDENT

-A copy of the nremorandum of appeal and paper book shall be served by the Registrar on the respondent as soon as they are registered in the registry, by hand delivery, or by Registered Post or Speed Post.

RULE 14: FILING OF REPLY TO THE APPEAL AND OTHER DOCUMENTS BY THE RESPONDENT

(1) The respondent may file three complete sets containing the reply to the appeal along with documents in a paper book form with the registry within one month of the service of the notice on him of the filing of the memorandum of appeal.

(2) Every reply, application or written representation filed before the Appellate Tribunal shall be verified in the manner provided for, in the Form.

(3) A copy of every application, reply, document or written material filed by the respondent before the Appellate Tribunal shall be forthwith served on the appellant, by the respondent.

(4) The Appellate Tribunal may, in its discretion, on application by the respondent allow the filing of reply referred to in sub-rule (1) after the expiry of the period referred to therein.

RULE 15: DATE OF HEARING TO BE NOTIFIED

-The Appellate Tribunal shall notify the parties the date of hearing of the appeal in such manner as the Presiding Officer may by general or special order direct.

RULE 16: HEARING OF APPEAL

(1) On the day fixed or on any other day to which the hearing may be adjourned, the appellant shall be heard in support of the appeal. The Securities Appellate Tribunal shall, then, if necessary, hear the Board or its authorised representative against the appeal, and in such case the appellant shall be entitled to reply. During the course of the hearing of appeal the written arguments could be supplemented by time-bound oral arguments.

(2) In case the appellant does not appear in person or through an authorised representative when the appeal is called for hearing, the Securities Appellate Tribunal may dispose of the appeal on merits: Provided that where an appeal has been disposed of as provided above and the appellant appears afterwards and satisfies the Securities Appellate Tribunal that there was sufficient cause for his not appearance, when the appeal was called for hearing, the Securities Appellate Tribunal shall make an order setting aside the ex-parte order and restore the appeal.

RULE 17: DRESS REGULATIONS FOR THE PRESIDING OFFICER AND FOR THE REPRESENTATIVES OF THE PARTIES

(1) The dress for the Presiding Officer shall be white or striped or black pant with black coat over white shirt and black tie or a buttoned-up black coat. In the case of female Presiding Officer, the dress shall be black coat over white saree.

(2) Every authorised representative, other than a relative or regular employee of the party shall appear before the Appellate Tribunal in his professional dress if any, and if there is no such dress, a male, in a suit or buttoned-up coat over a pant or national dress that is a long buttoned up coat on dhoti or churridar pyjama, and a female, in a coat over white or any other sober coloured saree or in any other sober dress.

(3) All other persons appearing before the Appellate Tribunal shall be properly dressed.

RULE 18: ORDER TO BE SIGNED AND DATED

(1) Every order of the Appellate Tribunal shall be signed and dated by the Presiding Officer. The Presiding Officer will have powers to pass interim orders or injunctions, subject to reasons to be recorded in writing, which it considers necessary in the interest of justice.

(2) The order shall be pronounced in the sitting of the Appellate Tribunal.

RULE 19: PUBLICATION OF ORDERS

-The orders of the Appellate Tribunal, as are deemed fit for publication in any authoritative report or the press may be released for such publication on such terms and conditions as the Presiding Officer may lay down.

RULE 20: COMMUNICATION OF ORDERS

-A certified copy of every order passed by the Appellate Tribunal shall be communicated to the Board, the Adjudicating Officer and to the parties, as the case may be.

RULE 21: ORDERS AND DIRECTIONS IN CERTAIN CASES

-The Appellate Tribunal may make such orders or give such directions as may be necessary or expedient to give effect to its order or to prevent abuse of its process or to secure the ends ofjustice,

RULE 22: FEE FOR INSPECTION OF RECORDS AND OBTAINING COPIES THEREOF

(1) A fee of rupees twenty, for every hour or part thereof of inspection subject to a minimum of rupees one hundred shall be charged for inspecting the records of a pending appeal by a party thereto.

(2) A fee of rupees five for a folio or part thereof not involving typing and a fee of rupees ten for a folio or part thereof involving typing of statement and figures shall be charged for providing copies of the records of an appeal, to a party thereto.

RULE 23: WORKING HOURS OF THE APPELLATE TRIBUNAL

(1) The office of the Appellate Tribunal shall observe such public and other holidays as observed by the offices of the Central Government in the locality where the office of the Appellate Tribunal is situated.

(2) The Appellate Tribunal shall, subject to any other order made by the Presiding Officer, remain open on the working days from 10 AM to 6.00 PM. But no work, unless of an urgent nature, shall be admitted after 4,30 PM on any working day.

(3) The sitting hours of the Appellate Tribunal shall ordinarily be from 10.30 AM to 1.00 PM and 2.00 PM to 5.00 PM, subject to any order made by the Presiding Officer.

RULE 24: HOLIDAY

- Where the last day for doing any act falls on a day on which the office of the Appellate Tribunal is closed and by reason thereof the act cannot be done on that day, it may be done on the next day on which that office opens.

RULE 25: FUNCTIONS OF THE REGISTRAR

(1) The Registrar shall discharge his functions under general superintendence of the Presiding Officer. He shall discharge such other functions as are assigned to him under these rules or by the Presiding officer by a separate order in writing,

(2) He shall have the custody of the records of the Appellate Tribunal.

(3) The official seal of the Appellate Tribunal shall be kept in the custody of the Registrar.

(4) Subject to any general or special direction by the Presiding Officer, the official seal of the Appellate Tribunal shall not be affixed to any order, summons or other process save under the authority in writing from the Registrar,

(5) The official seal of the Appellate Tribunal shall not be affixed to any certified copy issued by the Appellate Tribunal, save under the authority in writing of the Registrar.

RULE 26: ADDITIONAL FUNCTIONS AND DUTIES OF REGISTRAR

-In addition to the functions and duties assigned in the rules, the Registrar shall have the following functions and duties subject to any general or special orders of the Presiding Officer namely:-

(1) to receive all appeals, replies and other documents;

(2) to decide all questions arising out of the scrutiny of the appeals before they are registered;

(3) to require any appeal presented to the Appellate Tribunal to be amended in accordance with the rules;

(4) subject to the directions of the Presiding Officer to fix date of hearing of the appeals or other proceedings and issue notices thereof;

(5) direct any formal amendment of records;

(6) to order grant of copies of documents to parties to proceedings;

(7) to grant leave to inspect the records of the Appellate Tribunal;

(8) dispose of all matters relating to the service of notices or other processes, application for the issue of fresh notice or of extending the time for or ordering a particular method of service on a respondent including a substituted service by publication of the notice by way of advertisement in the newspapers;

(9) to requisition records from the custody of any court or other authority.

RULE 27: SEAL AND EMBLEM

-The official seal and emblem of the Appellate Tribunal shall be such as the Central Government may specify.

RULE 28: REPEAL AND SAVING

(1) The Depositories (Appeal to the Central Government) Rules, 1998 are hereby repealed.

(2) Notwithstanding such repeal anything done or any action taken under the said rules, shall be deemed to have been done or taken under the corresponding provisions of these rules.

FORM 01: MEMORANDUM OF APPEAL

For use in Appellate Tribunal's Office Date of presentation in the registry Date of receipt by post Registration number Signature Registrar Before the Securities Appellate Tribunal In the matter of the Depositories Act, 1996 (22 of 1996) and In the matter of appeal against the order made on.................................... by........................ A.B. Appellant C.D. and other-Respondent(s) Details of appeal: 1. Particulars of the appellant: (i) Name of the appellant (ii) Address of registered office of the appellant (iii) Address of service of all notices (iv) Telephone/Fax Number and e-mail address, if any 2. Particulars of the respondents(s): (i) Name of the respondent(s). (ii) Office address of the respondents). (iii) Address of respondents) for service of all notices. (iv) Telephone/Fax Number and e-mail address, if any. 3. Jurisdiction of the Appellate Tribunal.-The appellant declares that the matter of appeal falls within the jurisdiction of the Appellate Tribunal. 4. Limitation.-The appellant further declares that the appeal is within the limitation as prescribed in Sec. 23-D of the Depositories Act, 1996 (22 of 1996). 5. Facts of the case and the details of the order against which appeal is filed: The facts of the case are given below: (give here a concise statement offacts and grounds of appeal against the specified order in a chronological order, each paragraph containing as neatly as possible as separate issue, fact or otherwise) 6. Relief(s) sought.-In view of the facts mentioned in paragraph 5 above, the appellant prays for the following reliefs) (Specify below the reliefs) sought explained the grounds for relief(s) and the legal provisions, of any, relied upon). 7. Interim order, if prayed for.-Pending final decision of the appeal the appellant seeks issue of the following interim order: (Give here the nature of the interim order prayed for with reasons) 8. Matter not pending with any other court etc.- The appellant further declares that the matter regarding with this appeal has been made is not pending before any court of law or any other authority or any other Tribunal. 9. Particulars in respect of the fee paid in terms of Rule 9 of these rules.- (1) Amount of fees (2) Name of the Bank on which Demand Draft is drawn (3) Demand draft number 10. Details of Index.-An index containing the details of the documents to be relied upon is enclosed. 470 11. List of enclosures.- (Signature of the appellant/Authorised Representative) Verification I,,....... .......... .......... (Name in block letters) son/daughter/wife of Shri ........ being the appellant/Authorised Representative of......... ............................... (Name of the appellant) do hereby verify that the contents of paras 1 to 11 are true to my personal knowledge and belief and that I have not suppressed any material facts, Signature of the appellant/Authorised Representative Place: Date: To The Registrar [Noti. No. F. No. 11691 SE 198, dt. 18.2.2000-Gaz. of India, Exty., Pt. ll-Sec. 3(i). No. 114, dt. 18.2.2000, p. 40.]

SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICI- PANTS) REGULATIONS, 1996

In exercise of the powers conferred by section 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992) read with section 25 of the Depositories Ordinance, 1996 (17 of 1996), the Securities and Exchange Board of India hereby makes the following regulations, namely:

REGULATION 01: SHORT TITLE AND COMMENCEMENT

(1) These regulations may be called the Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996.

(2) They shall come into force on the date of their publication in the Official Gazette.

REGULATION 02: DEFINITIONS

(1) In these regulations, unless the context otherwise requires,-

(a) "Act" meansthe Securities and Exchange Board of India Act, 1992 (15 of 1992)-;

(b) "Depositories Ordinance" means the Depositories Ordinance, 1996 (17 of 1996);

(c) "enquiry officer" means any person authorised by the Board underregulation 66-;

(d) "Form" means any of the forms specified in the First Schedule;

(e) "inspecting officer" means any person authorised by the Board underregulation 59-;

(f) "Schedule" means any of the Schedules annexed to these regulations;

(g) "sponsor" means any person or persons who, acting alone or in combination with another person proposes to establish a depository and undertakes to perform the obligations of a sponsor under these regulations.

(2) Words and expressions used and not defined in these regulations but defined in the Act or in the Depositories Ordinance shall have the meanings respectively assigned to them in the Act or the Depositories Ordinance.

REGULATION 03: APPLICATION FOR GRANT OF CERTIFICATE OF REGISTRATION

(1) An application for the grant of a certificate of registration as a depository shall be made to the Board by the sponsor in Form A, shall be accompanied by the fee specified in Part A of the Second Schedule and be paid in the manner specified in Part B thereof.

(2) The application shall be accompanied by draft bye-laws of the depository that is proposed to be set up.

REGULATION 04: APPLICATION TO CONFORM TO THE REQUIREMENTS

An application in Form A which is not complete in all respects and does not conform to the instructions specified therein shall be rejected: Provided that before rejecting any such application, the sponsor shall be given in writing an opportunity to remove, within thirty days of the date of communication in this regard, the objections indicated by the Board. Provided further that the Board may, on being satisfied that it is necessary to extend the period specified in the first proviso, extend such period by such further time as it thinks necessary in order to enable the applicant to remove the objections indicated by the Board.

REGULATION 05: FURNISHING OF INFORMATION, CLARIFICATION AND PERSONAL REPRESENTATION

(1) The Board may require the sponsor to furnish such further information or clarification regarding matters relevant to the activity of the depository for the purpose of consideration of the application.

(2) The sponsor or his authorised representative shall, if so required, appear before the Board for personal representation, in connection with the grant of certificate of registration.

REGULATION 06: CONSIDERATION OF APPLICATION FOR GRANT OF CERTIFICATE OF REGISTRATION

The Board shall not consider an application underregulation 3-, unless the sponsor belongs to one of the following categories, namely :-

(i) a public financial institution as defined insection 4A of the Companies Act, 1956 (1 of 1956)-;

(ii) a bank included for the time being in the Second Schedule tothe Reserve Bank of India Act, 1934 (2 of 1934)-;

(iii) a foreign bank operating in India with the approval of the Reserve Bank of India;

(iv) a recognised stock exchange within the meaning of clause (j) ofsection 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956)-;

(v) a body corporate engaged in providing financial services were not less than seventy-five per cent of the equity capital is held by way of the institutions mentioned in sub-clause (i), (ii), (iii) or

(iv) jointly or severally;

(vi) a body corporate constituted or recognised under any law for the time being in force in a foreign country for providing custodial, clearing or settlement services in the securities market and approved by the Central Government; or

(vii) an institution engaged in providing financial services established outside India and approved by the Central Government.

REGULATION 07: GRANT OF CERTIFICATE OF REGISTRATION

After considering the application underregulation 3-, with reference to the quali- fications specified inregulation 6-, if the Board is satisfied that the company established by the sponsor is eligible to act as depository, it may grant a certificate of registration in Form B to the depository subject to the following, namely :

(a) the depository shall pay the registration fee specified in Part A of the Second Schedule in the manner specified in Part B thereof, within fifteen days of receipt of intimation from the Board;

(b) the depository shall comply with the provisions of the Act, the Depositories Ordinance, the bye-laws, agreements and these regulations;

(c) the depository shall not carry on any activity other than that of a depository unless the activity is incidental to the activity of the depository;

(d) the sponsor shall, at all times, hold at least fifty-one per cent of the equity capital of the depository and the balance of the equity capital of the depository shall be held by its participants;

(e) no participant shall at any time, hold more than five per cent of the equity capital of the depository;

(f) if any information previously submitted by the depository or the sponsor to the Board is found to be false or misleading in any material particular, or if there is any change in such information, the depository shall forthwith inform the Board in writing;

(g) the depository shall redress the grievances of the participants and the beneficial owners within thirty days of the date of receipt of any complaint from a participant or a beneficial owner and keep the Board informed about the number and the nature of redressals;

(h) the depository shall make an application for commencement of business underregulation 14- within one year from the date of grant of certificate of registration under this regulation; and

(i) the depository shall amend its bye-laws from time to time as may be directed by the Board.

REGULATION 08: PAYMENT OF ANNUAL FEE

A depository who has been granted a certificate of registration underregulation 7-, shall pay annual fee specified in Part A of the Second Schedule in the manner specified in Part B thereof.

REGULATION 09: PROCEDURE WHERE CERTIFICATE OF REGISTRATION IS NOT GRANTED

(1) Where an application for the grant of certificate of registration underregulation 3-does not satisfy the requirements specified inregulation 7-, the Board shall reject the application after giving the applicant an opportunity of being heard.

(2) The decision of the Board to reject the application shall be communicated to the applicant in writing within thirty days of such decision, staling therein the grounds on which the application has been rejected.

REGULATION 10: APPLICATION FOR GRANT OF CERTIFICATE OF COMMENCEMENT OF BUSINESS

A depository which has been granted a certificate of registration underregulation 7-, shall within one year from the date of issue of such certificate make an application to the Board for commencement of business in Form C.

REGULATION 11: APPLICATION TO CONFORM TO THE REQUIREMENTS

Any application in Form C which is not complete in all respects and does not conform to instructions specified therein shall be rejected: Provided that before rejecting any such application, the applicant shall be given in writing an opportunity to remove within thirty days of the date of communication in this regard, the objections indicated by the Board. Provided further that the Board may, on being satisfied that it is necessary to extend the period specified in the first proviso, extend such period by such further time as it thinks necessary in order to enable the applicant to remove the objections indicated by the Board.

REGULATION 12: FURNISHING OF INFORMATION, CLARIFICATION, AND PERSONAL REPRESENTATION

(1) The Board may require the depository to furnish such further information or clarification regarding matters relevant for the grant of certificate of commence- ment of business.

(2) The depository or its authorised representative, if so required, shall appear before the Board for personal representation in connection with the grant of certificate of commencement of business.

REGULATION 13: CONSIDERATION OF APPLICATION FOR GRANT OF CERTIFICATE OF COMMENCEMENT OF BUSINESS

(1) The Board shall take into account for considering grant of certificate of commencement of business, all matters which are relevant to the efficient and orderly functioning of the depository and in particular, the following, namely, whether

(a) the depository has a net worth of not less than rupees one hundred crore;

(b) the bye -laws of the depository have been approved by the Board;

(c) the automatic data processing systems of the depository have been protected against unauthorised access, alteration, destruction, disclosure or dissemination of records and data;

(d) the network through which continuous electronic means of communications are established between the depository, participants, issuers and issuers' agents is secure against unauthorised entry or access;

(e) the depository has established standard transmission and encryption formats for electronic communications of data between the depository, participants, issuers and issuers' agents;

(f) the physical or electronic access to the premises, facilities, automatic data processing systems, data storage sites and facilities including back up sites and facilities and to the electronic data communication network connecting the depository, participants, issuers and issuers' agents is controlled, monitored and recorded;

(g) the depository has a detailed operations manual explaining all aspects of its functioning, including the interface and method of transmission of information between the depository-issuers, issuers' agents, participants and beneficial owners;

(h) the depository has established adequate procedures and facilities to ensure that its records are protected against loss or destruction and arrangements have been made for maintaining back up facilities at a location different from that of the depository;

(i) the depository has made adequate arrangements including insurance for indem- nifying the beneficial owners for any loss that may be caused to such beneficial owners by the wrongful act, negligence or default of the depository or its participants or of any employee of the depository or participant; and

(j) the grant of certificate of commencement of business is in the interest of investors in the securities market.

(2) The Board shall, before granting a certificate of commencement of business under this Chapter make a physical verification of the infrastructure facilities and systems established by the depository.

REGULATION 14: GRANT OF CERTIFICATE OF COMMENCEMENT OF BUSINESS

After considering the application underregulation 13-with reference to the matters specified in sub-regulation (1) ofregulation 13-and making physical verification under sub-regulation (2) of that regulation, if the Board is satisfied that the depository is eligible to commence business as a depository, shall grant a certificate of commencement of business in Form D.

REGULATION 15: PROCEDURE WHERE CERTIFICATE OF COMMENCEMENT OF BUSINESS IS NOT GRANTED

(1) If the Board, after considering the matters specified in sub-regulation (1) ofregulation 13-and making physical verification under sub-regulation (2) of that regulation, is of the opinion that the depository shall not be granted a certificate of commencement of business, if may either-

(a) direct the depository to conform to the matters specified inregulation 13-; or

(b) reject the application after giving the applicant an opportunity of being heard.

(2) The decision of the Board to reject the application shall be communicated to the depository in writing within thirty days of such decision, staling therein the grounds on which the application has been rejected.

REGULATION 16: APPLICATION FOR GRANT OF CERTIFICATE OF REGISTRATION

(1) An application for the grant of a certificate of registration as a participant shall be made to the Board in Form E, through each depository in which the applicant proposes to act as a participant, shall be accompanied by the fee specified in Part A of the Second Schedule and be paid in the manner specified in Part B thereof.

(2) The depository shall forward to the Board the application in Form E as early as possible, but not later than thirty days along with its recommendations and certifying that the participant complies with the eligibility criteria including adequate infra- structure as provided for in these regulations and the bye-laws of the depository.

REGULATION 17: APPLICATION TO CONFORM TO THE REQUIREMENTS

An application in Form E, which is not complete in all respects and does not conform to the instructions specified therein, shall be rejected: Provided that before rejecting any such application, the applicant shall be given in writing an opportunity to remove within thirty days of the date of communication in this regard, the objections indicated by the Board. Provided further that the Board may, on being satisfied that it is necessary to extend the period specified in the first proviso, extend such period by such further time as it thinks necessary in order to enable the applicant to remove the objections indicated by the Board.

REGULATION 18: FURNISHING INFORMATION, CLARIFICATION, AND PERSONAL REPRESENTATION

(1) The Board may require the applicant, or the depository to which the applicant is to be admitted as a participant, to furnish such further information or clarifica- tion as may be considered necessary for the grant of a certificate of registration to the applicant.

(2) The applicant or his authorised representative shall, if so required, appear before the Board for personal representation in connection with the grant of a certificate or registration.

REGULATION 19: CONSIDERATION OF APPLICATION FOR GRANT OF CERTIFICATE OF REGISTRATION

For the purpose of grant of certificate of registration, the Board shall take into account all matters which are relevant to or relating to the efficient and orderly functioning of a participant and in particular, whether the applicant complies with the following requirements, namely :-

(a) the applicant belongs to one of the following categories,-

(i) a public financial institution as defined insection 4A of the Companies Act, 1956 (1 of 1956)-;

(ii) a bank included for the time being in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934)-;

(iii) a foreign bank operating in India with the approval of the Reserve Bank of India;

(iv) a state financial corporation established under the provisions ofsection 3 of the State Financial Corporations Act, 1951 (63 of 1951)-;

(v) an institution engaged in providing financial services, promoted by any of the institutions mentioned in sub clauses (i), (ii), (iii), (iv), jointly or severally;

(vi) a custodian of securities who has been granted a certificate of registration by the Board under sub-section (1A) ofsection 12-of the Act;

(vii) a clearing corporation of a stock exchange;

(viii) a stock broker who has been granted a certificate of registration by the Board under sub-section (1) ofsection 12-of the Act: Provided that the stock-broker shall have a minimum net worth of rupees fifty lakhs and the aggregate value of the portfolio of securities of the beneficial owners held in dematerialised form in a depository through him shall not be more than twenty-five times the net worth of the stock broker: Provided

further that if the stock broker seeks to act as a participant in more than one depository, he shall comply with the criteria specified in the first proviso separately for each such depository; or

(ix) a non-banking finance company, having a net worth of not less than rupees fifty lakhs: Provided that such company shall act as a participant only on behalf of itself and not on behalf of any other person;

(b) the applicant is eligible to be admitted as a participant of the depository through which it has made the application to the Board;

(c) the applicant has adequate infrastructure, systems, safeguards and trained staff to carry on activity as a participant; and

(d) the grant of certificate of registration is in the interests of investors in the securities market.

REGULATION 20: GRANT OF CERTIFICATE OF REGISTRATION

(1) After considering the application underregulation 16-, with reference to the matters specified inregulation 19-, if the Board is satisfied that the applicant is eligible for grant of certificate of registration, grant a certificate in Form F.

(2) The grant of certificate of registration in Form F shall be subject to the following, namely:-

(a) the participant shall pay the registration fee specified in Part A of the Second Schedule in the manner specified in Part B thereof, within fifteen days of the receipt of intimation from the Board;

( b) the participant shall comply with the provisions of the Act, Depositories Ordinance, the bye -laws, agreements and these regulations;

(c) the depository through which an application for certificate of registration has been forwarded holds a certificate of commencement of business underregulation 14-;

(d) if any information previously submitted by the participant to the Board is found to be false or misleading in any material particular, or if there is any change in such information, the participant shall forthwith inform the Board in writing;

(e) the participant shall redress the grievances of beneficial owners within thirty days of the date of the receipt of the complaint and keep the depository informed about the number and the nature of redressals; and

(f) the participant shall pay annual fees specified in Part A of the Second Schedule in the manner specified in Part B thereof.

REGULATION 21: PERIOD OF VALIDITY OF THE CERTIFICATE OF REGISTRATION

The certificate of registration issued underregulation 20-, or renewed underregulation 22-shall be valid for a period of five years from the date of its issue or renewal, as the case may be.

REGULATION 22: RENEWAL OF CERTIFICATE OF REGISTRATION

(1) Three months before the expiry of the period of validity of a certificate of registration, the participant shall, if it so desires, make an application for renewal in Form E through the depository in which it is a participant.

(2) The application for renewal under sub-regulation (1) shall accompany the fee specified for issue of certificate of registration and shall be dealt with in the same manner as if it were a fresh application for grant of certificate of registration.

REGULATION 23: CONDITIONS OF RENEWAL OF CERTIFICATE OF REGISTRATION

The Board may renew a certificate of registration granted to a participant subject to the conditions of certificate of registration specified inregulation 22-

REGULATION 24: PROCEDURE WHERE CERTIFICATE OF REGISTRATION IS NOT GRANTED

(1) Where an application for the grant of certificate of registration underregulation 16-or for its renewal underregulation 22-does not satisfy the requirements specified inregulation 19-, the Board shall reject the application after giving the applicant an opportunity of being heard.

(2) The decision of the Board to reject the application shall be communicated to the applicant in writing within thirty days of such decision, stating therein the grounds on which the application has been rejected.

REGULATION 25: EFFECT OF REFUSAL TO RENEW A CERTIFICATE OF REGISTRATION

Any participant whose application for a certificate of registration as a participant has been rejected by the Board underregulation 24-, shall from the date of expiry of the certificate of registration sought to be renewed, cease to carry on any activity as a participant: Provided that the Board may, in the interest of the investors in the securities market permit the participant to carry on activities undertaken prior to the receipt of the intimation of refusal subject to such condition as the Board may specify.

REGULATION 26: RIGHTS AND OBLIGATIONS OF DEPOSITORIES, ETC

The depositories, participants, issuers, and issuers' agents, in addition to the rights and obligations laid down in the Depositories Ordinance and the bye-laws shall have the rights and obligations arising from the agreements entered into by them.

REGULATION 27: DEPOSITORY TO DECLARE SPECIFIC SECURITIES ELIGIBLE

Every depository shall, in its bye-laws, state the specific securities which are eligible for being held in dematerialised form in the depository.

REGULATION 28: SECURITIES ELIGIBLE FOR DEMATERIALISATION

The following securities shall be eligible for being held in dematerialised form in a depository:-

(a) shares, scrips, stocks, bonds, debentures, debenture stock or other marketable securities of a like nature in or of any incorporated company or other body corporate;

(b) units of mutual funds, rights under collective investment schemes and venture capital funds, commercial paper, certificates of deposit, securitised debt, money market instruments and unlisted securities shall also be similarly eligible for being held in dematerialised form in a depository.

REGULATION 29: AGREEMENT BETWEEN DEPOSITORY AND ISSUER

(1) Every depository shall enter into an agreement with the issuer in respect of securities that are to be declared as eligible to be held in dematerialised form.

(2) Where the issuer has appointed a Registrar to the Issue or Share Transfer Agent, who has been granted certificate of registration by the Board under sub-section (1) ofsection 12-of the Act, the depository shall enter into a tripartite agreement with the issuer and the Registrar to the Issue or Share Transfer Agent, as the case may be, in respect of the securities to be declared by the depository as eligible to be held in dematerialised form.

REGULATION 30: SYSTEMS AND PROCEDURES

Every depository shall have systems and procedures which will enable it to co- ordinate with the issuer or its agent, and the participants, to reconcile the records of ownership of securities with the issuer or its agent, as the case may be, and with participants, on a daily basis.

REGULATION 31: CONNECTIVITY

Every depository shall maintain continuous electronic means of communication with all its participants, issuers or issuers' agents, as the case may be, clearing houses and clearing corporations of the stock exchanges and with other depositories.

REGULATION 32: TRANSFER TO BE AFFECTED ONLY AFTER PAYMENT

The depository shall satisfy the Board that it has a mechanism in place to ensure that the interest of the persons buying and selling securities held in the depository are adequately protected and shall register the transfer of a security in the name of the transferee only after the depository is satisfied that payment for such transfer has been made.

REGULATION 33: WITHDRAWAL BY PARTICIPANT

Every depository shall allow any participant to withdraw or transfer its account, if the request for such withdrawal or transfer is in accordance with conditions stipulated therefor in the bye-laws of the depository.

REGULATION 34: INTERNAL MONITORING, REVIEW AND EVALUATION OF SYSTEMS AND CONTROLS

Every depository shall have adequate mechanisms for the purposes of reviewing, monitoring and evaluating the depository's controls, systems, procedures and safeguards.

REGULATION 35: EXTERNAL MONITORING, REVIEW AND EVALUATION OF SYSTEMS AND CONTROLS

Every depository shall cause an inspection of its controls, systems, procedures and safeguards to be carried out annually and forward a copy of the report to the Board.

REGULATION 36: INSURANCE AGAINST RISKS

Every depository shall take adequate measures including insurance to protect the interests of the beneficial owners against risks likely to be incurred on account of its activities as a depository.

REGULATION 37: MANNER OF KEEPING RECORDS

Where records are kept electronically by the depository, it shall ensure that the integrity of the automatic data processing systems is maintained at all times and take all precautions necessary to ensure that the records are not lost, destroyed or tampered with and in the event of loss or destruction, ensure that sufficient back up of records is available at all times at a different place.

REGULATION 38: RECORDS TO BE MAINTAINED

(1) Every depository shall maintain the following records and documents, namely:-

(a) records of securities dematerialised and rematerialised;

(b) the names of the transferor, transferee, and the dates of transfer of securities;

(c) a register and an index of beneficial owners;

(d) records of instructions received from and sent to participants, issuers, issuers' agents and beneficial owners;

(e) records of approval, notice, entry and cancellation or pledge or hypothecation, as the case may be;

(f) details of participants;

(g) details of securities declared to be eligible for dematerialisation in the depository; and

(h) such other records as may be specified by the Board for carrying on the activities as a depository.

(2) Every depository shall intimate the Board the place where the records and docu- ments are maintained.

(3) Subject to the provisions of any other law, the depository shall preserve records and documents for a minimum period of five years.

REGULATION 39: CO-OPERATION WITH OTHER ENTITIES

Every depository shall extend such co-operation to the beneficial owners, issuers, issuers' agents, custodians of securities, other depositories and clearing organiza- tions as is necessary for the effective, prompt and accurate clearance and settlement of securities transactions and conduct of business.

REGULATION 40: PROHIBITION OF ASSIGNMENT

No depository shall assign or delegate to any other person its functions as a depository, without the prior approval of the Board.

REGULATION 41: AGREEMENT BY PARTICIPANT

Every participant shall enter into an agreement with a beneficial owner before acting as a participant on his behalf, in a manner specified by the depository in its bye-laws.

REGULATION 42: SEPARATE ACCOUNTS

(1) Separate accounts shall be opened by every participant in the name of each of the beneficial owners and the securities of each beneficial owner shall be segregated, and shall not be mixed up with the securities of other beneficial owners or with the participant's own securities.

(2) A participant shall register the transfer of securities to or from a beneficial owner's account only on receipt of instructions from the beneficial owner and thereafter confirm the same to the beneficial owner in a manner as specified by the depository in its bye-laws.

(3) Every entry in the beneficial owner's account shall be supported by electronic instructions or any other mode of instruction received from the beneficial owner in accordance with the agreement with the beneficial owner.

REGULATION 43: STATEMENT OF ACCOUNTS

Every participant shall provide statements of account to the beneficial owner in such form and in such manner and at such time as provided in the agreement with the beneficial owner.

REGULATION 44: TRANSFER OR WITHDRAWAL BY BENEFICIAL OWNER

Every participant shall allow a beneficial owner to withdraw or transfer from his account in such manner as specified in the agreement with the beneficial owner.

REGULATION 45: CONNECTIVITY

Every participant shall maintain continuous electronic means of communication with each depository in which it is a participant.

REGULATION 46: MONITORING, REVIEWING AND EVALUATING INTERNAL SYSTEMS AND CONTROLS

Every participant shall have adequate mechanism for the purposes of reviewing, monitoring and evaluating the participant's internal accounting controls and systems.

REGULATION 47: RECONCILIATION

Every participant shall reconcile his records with every depository in which it is a participant on a daily basis.

REGULATION 48: RETURNS

Every participant shall submit periodic returns to the Board and to every depository in which it is a participant in the format specified by the Board or the bye-laws of the depository, as the case may be.

REGULATION 49: RECORD OF SERVICES

(1) Every participant shall maintain the following records and documents, namely:-

(a) records of all the transactions entered into with a depository and with a beneficial owner;

(b) details of securities dematerialised, rematerialised on behalf of beneficial owners with whom it has entered into an agreement;

(c) records of instructions received from beneficial owners and statements of account provided to beneficial owners; and

(d) records of approval, notice, entry and cancellation of pledge or hypothecation, as the case may be.

(2) Every participant shall make available for the inspection of the depository in which it is a participant all records referred to in sub-section (1).

(3) Every participant shall allow persons authorised by the depository in which it is a participant to enter its premises during normal office hours and inspect its records.

(4) Every participant shall intimate the Board the place where the records and docu- ments are maintained.

(5) Subject to the provisions of any other law, the participant shall preserve records and

documents for a minimum period of five years.

REGULATION 50: MANNER OF KEEPING RECORDS

Where records are kept electronically by the participant, it shall ensure that the integrity of the data processing systems is maintained at all times and take all precautions necessary to ensure that the records are not lost, destroyed or tampered with and in the event of loss or destruction, ensure that sufficient back up of records is available at all times at a different place.

REGULATION 51: RECORDS TO BE MAINTAINED DEPOSITORY-WISE

If a participant enters into an agreement with more than one depository, it shall maintain the records specified inregulation 49-separately in respect of each depository.

REGULATION 52: PROHIBITION OF ASSIGNMENT

No participant shall assign or delegate its functions as participant to any other person, without the prior approval of the depository.

REGULATION 53: AGREEMENT BY ISSUER

Every issuer whose securities have been declared as eligible to be held in dematerialised form in a depository shall enter into an agreement with the depository in accordance with the provisions ofregulation 29-

REGULATION 54: MANNER OF SURRENDER OF CERTIFICATE OF SECURITY

(1) Any beneficial owner, who has entered into an agreement with a participant, shall inform the participant of the details of the certificate of security which is to be dematerialised, and shall surrender such certificate to the participant : Provided that where a beneficial owner has appointed a custodian of securities, then he may surrender the certificates of security to the participant through his custodian of securities.

(2) The participant shall, on receipt of information under sub-regulation (1), forward such details of the certificate of security to the depository and shall confirm to the depository that an agreement has been entered into between the participant and the beneficial owner.

(3) The participant shall maintain records indicating the names of beneficial owners of the securities surrendered, the number of securities and other details of the certificate of security received.

(4) The participant shall, furnish to the issuer details specified in sub-regulation (2) along with the certificate of security referred to in sub-regulation (1).

(5) The issuer shall on receipt of the certificate of security from the participant immediately mutilate and cancel it and substitute in its records the name of the depository as the registered owner and shall send a certificate to this effect to the depository and to every stock exchange where the security is listed.

(6) Immediately upon receipt of information from the issuer under sub-regulation (5), the depository shall enter in its records the name of the person who has surrendered the certificate of security as the beneficial owner, as well as the name of the participant from whom it has received intimation under sub-regulation (2), and shall send an intimation of the same to the participant.

(7) The issuer shall maintain a record of certificates of securities which have been dematerialised.

REGULATION 55: RECONCILIATION

The issuer or its agent shall reconcile the records of dematerialised securities with all the securities issued by the issuer, on a daily basis.

REGULATION 56: CONNECTIVITY

Every issuer or its agent shall establish continuous electronic means of commu- nication with the depository with which it has entered into an agreement.

REGULATION 57: INFORMATION

Every issuer whose securities have been declared as eligible for dematerialisation in a depository shall give information to the depository about book closures, record dates, dates for the payment of interest or dividend, dates for annual general meetings and other meetings, dates for redemption of debentures, dates for conversion of debentures and warrants, call money dates and such other information at the time and in the manner as may be specified by the depository in its bye-laws or agreement.

REGULATION 58: MANNER OF CREATING PLEDGE OR HYPOTHECATION

(1) If a beneficial owner intends to create a pledge or hypothecation on a security owned by him, he shall make an application in this regard to the depository through the participant who has his account in respect of such security in the manner specified in sub-regulations (2) to (9).

(2) If the security intended to be pledged or hypothecated is unencumbered, the participant shall, after making a note its records, of the notice of pledge or hypotheca- tion, forward the application of the beneficial owner to the depository for its approval.

(3) On receipt of application of the beneficial owner through the participant, the depository shall make such investigation as it may consider, necessary and if it approves the creation of the pledge or hypothecation, it shall enter the particulars of the intended pledge or hypothecation in its records and where he does so, intimate the participant who shall also amend its records accordingly and immediately intimate the beneficial owner.

(4) On receipt of the intimation under sub-regulation (3) the beneficial owner may create a pledge or hypothecation and where he does so, he shall intimate the depository through the participant of the creation of such pledge or hypothecation.

(5) The participant, on receipt of the intimation under sub-regulation (4), shall substitute for the notice of pledge or hypothecation in its records an entry of pledge or hypothe- cation as the case may be and shall inform the pledgee, beneficial owner and the depository.

(6) On receipt of the intimation under sub-regulation (5), the depository shall make in its records the changes referred to in sub-regulation (5).

(7) Where the depository disapproves the creation of the pledge or hypothecation it shall record the reasons for such disapproval and intimate the participant, who in turn shall inform the beneficial owner and the beneficial owner shall not create a pledge or hypothecation with respect of the securities.

(8) The entry of pledge made under sub-regulation (5) shall be cancelled by the participant when the beneficial owner redeems the pledge or hypothecation and makes a request, with the concurrence of the pledgee, to the participant to cancel the entry of pledge or hypothecation, and the participant shall inform the depository accordingly.

(9) On receipt of the intimation under sub-regulation (8), the depository shall make in its records the changes referred to in sub-regulation (8).

(10) No transfer of security in respect of which a notice of pledge or entry of pledge is in force, shall be affected by a participant without the concurrence of the pledgee.

(11) Where the pledgee satisfies the depository that owing to the default of the beneficial owner, the pledgee is entitled to be registered as beneficial owner of the pledged securities or a part thereof, the depository may, after giving the beneficial owner a reasonable opportunity to make such representation as he may wish to make, direct the participant to register the pledgee as beneficial owner of such securities and amend its own records accordingly.

(12) On receipt of the direction under sub-regulation (9), the participant shall immedi- ately carry necessary corrections in its records.

REGULATION 59: BOARD'S RIGHT TO INSPECT

The Board may appoint one or more persons as inspecting officer to undertake inspection of the books of account, records, documents and infrastructure, systems and procedures, or to investigate the affairs of a depository, a participant, a beneficial owner, an issuer or its agent for any of the following purposes, namely :

(a) to ensure that the books of account are being maintained by the depository, participant, issuer or its agent in the manner specified in these regulations;

(b) to look into the complaints received from the depositories, participants, issuers, issuers' agents, beneficial owners or any other person;

(c) to ascertain whether the provisions of the Act, the Depositories Ordinance, the bye- laws, agreements and these regulations are being complied with by the depository, participant, beneficial owner, issuer or its agent;

(d) to ascertain whether the systems, procedures and safeguards being followed by a depository, participant, beneficial owner, issuer or its agent are adequate;

(e) to suo motu ensure that the affairs of a depository, participant, beneficial owner, issuer or its agent, are being conducted in a manner which are in the interest of the investors or the securities market.

REGULATION 60: NOTICE BEFORE INSPECTION AND INVESTIGATION

(1) Before ordering an inspection or investigation underregulation 59-, the Board shall give not less than 10 days notice to the depository, participant, beneficial owner, issuer or its agent, as the case may be.

(2) Notwithstanding anything contained in sub-regulation (1), where the Board is satisfied that in the interest of the investors no such notice should be given, it may, by an order in writing direct that such inspection be taken up without such notice.

(3) During the course of an inspection or investigation, the depository, a participant, a beneficial owner, an issuer or its agent against whom the inspection or investigation is being carried out shall be bound to discharge his obligation as provided inregulation 61-.

REGULATION 61: OBLIGATIONS ON INSPECTION BY THE BOARD

(1) It shall be the duty of the depository, a participant, a beneficial owner, an issuer or its agent whose affairs are being inspected or investigated, and of every director, officer and employee thereof, to produce to the inspecting officer such books, securities, accounts, records and other documents in its custody or control and furnish him with such statements and information relating to his activities as a depository, a participant, a beneficial owner, an issuer or its agent, as the inspecting officer may require, within such reasonable period as the inspecting officer may specify.

(2) The depository, a participant, a beneficial owner, an issuer or its agent shall allow the inspecting officer to have reasonable access to the premises occupied by him or by any other person on his behalf and also extend reasonable facility for examining any books, records, documents and computer data in the possession of the depository, a participant, a beneficial owner, an issuer or its agent or such other person and also provide copies of documents or other materials which, in the opinion of the inspecting officer are relevant for the purposes of the inspection.

(3) The inspecting officer, in the course of inspection of investigation, shall be entitled to examine or to record the statements of any director, officer or employee of the depository, a participant, a beneficial owner, an issuer or its agent.

(4) It shall be the duty of every director, officer or employee of the depository, a participant, a beneficial owner, an issuer or its agent to give to the inspecting officer all assistance in connection with the inspection, which the inspecting officer may reason- ably require.

REGULATION 62: SUBMISSION OF REPORT TO THE BOARD

The inspecting officer shall, as soon as possible, on completion of the inspection or investigation as the case may be, submit a report to the Board;

REGULATION 63: PROVIDED THAT IF DIRECTED TO DO SO BY THE BOARD, HE MAY SUBMIT INTERIM REPORTS. COMMUNICATION OF FINDINGS, ETC

(1) The Board shall, after consideration of the inspection report or the investigation report referred to inregulation 62-, communicate the findings of the inspecting officer to the depository, participant, issuer or its agent, as the case may be, and give him an opportunity of being heard.

(2) On receipt of the reply, if any, from the depository, participant, issuer or its agent, as the case may be, the Board may call upon him to take such measures as the Board may deem fit in the interest of the securities market and for due compliance with the provisions of the Act, the Depositories Ordinance, regulations, the bye-laws and agree- ments.

REGULATION 64: SUSPENSION OF CERTIFICATE

The Board may suspend the certificate of registration granted to a depository or a participant, if such depository or participant :

(a) contravenes any of the provisions of the Act, the Depositories Ordinance, the bye- laws, agreements and these regulations;

(b) fails to furnish any information relating to its activity as a depository or participant as required under these regulations;

(c) does not furnish the information called for by the Board under clause (a) of sub- section (1) ofsection 18-of the Depositories Ordinance or furnishes information which is false or misleading in any material particular;

(d) does not co-operate in any inspection or investigation or enquiry conducted by the Board;

(e) fails to comply with any direction of the Board issued undersection 18-of the Depositories Ordinance; or

(f) fails to pay the annual fee referred to inregulation 8-.

REGULATION 65: CANCELLATION OF CERTIFICATE

The Board may cancel the certificate of registration granted to a depository or participant if such depository or participant :

(a) is guilty of fraud, or has been convicted of an offence involving moral turpitude; or

(b) has been guilty of repeated defaults of the nature specified inregulation 64-. Explanation : In this regulation, "fraud" has the same meaning as is assigned to it insection 17 of the Indian Contract Act, 1872 (9 of 1872)-.

REGULATION 66: MANNER OF MAKING ORDER OF CANCELLATION OR SUSPENSION

(1) No order of suspension or cancellation of certificate of registration shall be issued by the Board against a depository or a participant, except after holding an enquiry by an officer of the Board, authorised in this regard in accordance with the procedure specified in sub-regulations (2) to (8).

(2) For the purpose of holding an enquiry the Board may appoint one or more enquiry officer.

(3) The enquiry officer shall issue to the depository or the participant, as the case may be, a notice as its registered office or the principal place of its business setting out the grounds on which action is proposed to be taken against him and calling upon him to show cause against such action within a period of fourteen days from the date of receipt of the notice.

(4) The depository or the participant, as the case may be, shall, within fourteen days from the date of receipt of such notice, furnish to the enquiry officer a written reply, together with copies of documentary or other evidence relied on by it or sought by the Board from the depository or participant, as the case may be.

(5) The enquiry officer shall give a reasonable opportunity of hearing to the depository or participant, as the case may be, to enable it to make submissions in support of its reply furnished under sub-regulation (4) of this regulation.

(6) Before the enquiry officer, the depository, a participant, or as the case my be, may either appear in person or through any person duly authorised by the depository or participant: Provided that no lawyer or advocate shall be permitted to represent the depository or participant, as the case may be, at the enquiry : Provided further that where a lawyer or an advocate has been appointed by the Board as a presenting officer under sub-regulation (7) it shall be lawful for the depository or participant, as the case may be, to present its case through a lawyer or advocate.

(7) The enquiry officer may, if he considers it necessary, ask the Board to appoint a presenting officer to present its case.

(8) The enquiry officer shall, after taking into account all relevant facts and submissions made by the depository or participant, as the case may be, submit a report to the Board and recommend the penal action, if any, to be taken against the depository or participant, as the case may be, as also the ground on which the proposed action is justified.

REGULATION 67: SHOW-CAUSE NOTICE AND ORDER

(1) On receipt of the report from the enquiry officer, the Board shall consider the same and issue to the depository or participant, as the case may be, a show-cause notice as to why the penal action as proposed by the enquiry officer should not be taken against it.

(2) The depository or participant, as the case may be, shall, within fourteen days of the date of the receipt of show-cause notice, send a reply to the Board.

(3) The Board, after considering the reply of the depository or participant, as the case may be, if received within a period of fourteen days shall as soon as possible but not later than thirty days from the date of receipt of the reply or the date of hearing, if any, whichever is later, pass such order as it deems fit including an order for the suspension or cancellation of the certificate.

(4) Every order passed under sub-regulation (3) shall be self-contained and shall give reasons for the conclusions stated therein including the justification for the penalty if any, imposed by that order.

(5) The Board shall send to the depository or participant, as the case may be, a copy of the order made under sub-regulation (3).

REGULATION 68: EFFECT OF SUSPENSION AND CANCELLATION OF CERTIFICATE

(1) On and from the date of the suspension of the certificate, the depository or participant, as the case may be, shall cease to carry on any activity as a depository or as a participant, during the period of suspension, and shall be subject to the directions of the Board with regard to any records, documents or securities that may be in its custody or control, relating to its activities as depository or participant.

(2) On and from the date of cancellation of the certificate, the depository or participant shall, with immediate effect, cease to carry on any activity as a depository or participant, and shall be subject to the directions of the Board with regard to the transfer of any records, documents or securities that may be in its custody or control, relaitng to its activities as depository or participant.

REGULATION 69: PUBLICATION OF ORDER OF SUSPENSION OR CANCELLATION

The order of suspension or cancellation of certificate of registration issued under sub-regulation (3) of regulation 67-shall be published by the Board in at least two daily newspapers.

SCHEDULE 01: SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICIPANTS) REGULATIONS, 1996

SCHEDULE- FORMS

FORM A Application for grant of certificate of registration as depository

Securities and Exchange Board of India Mittal Court, 'B' Wing, 1st Floor Nariman Point, Mumbai 400021-India INSTRUCTIONS i. This form is meant for use by each person acting as the sponsor of a depository. ii. The applicant should complete this form, and submit it, along with all supporting documents to the Board at its head office at Mumbai. iii. This application form should be filled in accordance with the regulations. iv. Application for grant of certificate of registration as depository, will be considered provided it is complete in all respects. v. All answers must be typed. vi Information which needs to be supplied in more detail may be given on separate sheets which should be attached to the application form. vii. The application must be signed and all signatures must be original. viii. The application must be accompanied by an application fee as specified in the Second Schedule to these regulations and by the draft bye-laws. ix. Every page of the form and every additional sheet must be initialled by the authorised signatory of the applicant. x. All copies of documents should be attested as true by an authorised notary. Items 1-6 pertain to an applicant acting as sponsor 1. Name, address of the registered office, address for correspondence, telephone number(s), fax number(s), telex number(s) and the name of the contact person of the sponsor. 2. Please indicate the name of the depository which is to be sponsored by the applicant. 3. Please indicate the names of other depositories, if any, which have been sponsored by the applicant, or in which the applicant is acting as participant. 4. Please indicate the category to which the sponsor belongs as perregulation 6- 5. Please provide the following details of each person acting as sponsor: (a) Date of incorporation or establishment, and the statute, if any, under which established (enclose certificate of incorporation, memorandum and articles of association or statutory provisions, if any). (b) Objects of the applicant. (c) Details of the nature of activities carried on by the applicant. (d) Details of affiliates and subsidiaries, and activities carried on by them. (e) Details of registration with the Securities and Exchange Board of India, the Reserve Bank of India or with any foreign regulatory authority of the applicant, its affiliates and its subsidiaries (enclose documents supporting such registration). (f) Net worth of the applicant (enclose a copy of the latest audited financial state- ments). (g) Percentage and amount of the paid-up capital of the proposed depository which the applicant is to hold. 6. Declaration statement (to be given as below) by each person acting as sponsor. We hereby agree and declare that the information supplied in the application, including the attachment sheets, is complete and true. And we further agree that, we will notify Securities and Exchange Board of India immediately any change in the information provided in the application. We further agree that we shall comply with, and be bound by theSecurities and Exchange Board of India Act, 1992-, and Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996, and such other guidelines/instruc- tions which may be announced by the Securities and Exchange Board of India from time to time. We further agree that as a condition of registration, we shall abide by such operational instructions/directives as may be issued by the Securities and Exchange Board of India from time to time. For and on behalf of............................................................ (Name of the applicant) Authorised signatory..................... ............................................ (Name) (Signature) Date: Place: Items 7-14 pertain to the depository, and should be filled in accordingly. 7. Name, address of the registered office, address for correspondence, telephone number(s), fax number(s), telex number(s) and the name of the contact person of the applicant. 8. Date of incorporation of the depository (enclose certificate of incorporation and memorandum and articles of association) (a) Objects (main and ancillary) of the depository. (b) Authorised, issued subscribed and paid-up capital of the depository. (c) Proposed networth of the depository. (d) Details of proposed shareholding of each person acting as sponsor. 9. The following details may be given for each director of the depository, and for its principal officer. (a) Name, age, nationality. (b) Details of educational and other qualifications. (c) Details of experience. (d) Details of other directorships held. (e) Details of any litigation connected with the securities market which has an adverse bearing on the business of the depository, involving the director or principal officer; and details of any conviction of the director or principle officer for a crime involving moral turpitude or of any economic office for which the director or principal officer has been found guilty. 10. Please indicate the details of staff and organisation structure that is proposed to be set up prior to commencement of business. 11. Details of infrastructure such as premises and automatic data processing, storage and back up systems and procedures, communication systems that are proposed to be set up prior to commencement of business. 12. Internal evaluation and monitoring systems that are proposed to be set up prior to the commencement of business. 13. Arrangements for indemnification of beneficial owners that are proposed to be put in place, including details of insurance cover proposed to be taken prior to the commencement of business. 14. Declaration statement (to be given as below). We hereby agree and declare that the information supplied in the application including the attachment sheets, is complete and true. And we further agree that, we will notify Securities and Exchange Board of India immediately any change in the information provided in the application. We further agree that we shall comply with, and be bound by theSecurities and Exchange Board of India Act, 1992-, and Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996, and such other guidelines/instruc- tions which may be announced by the Securities and Exchange Board of India from time to time. We further agree that as a condition of registration, we shall abide by such operational instructions/directives as may be issued by the Securities and Exchange Board of India from time to time. For and on behalf of ....................................................... (Name of the applicant) Authorised signatory ...................... (Name) Date: Place: (Signature)

FORM B SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICIPANTS) REGULATIONS, 1996

Certificate of registration as depository I. In exercise of the powers conferred by sub-section (1A) ofsection 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992)-read with the regulations made thereunder and with the Depositories Ordinance, 1996 (17 of 1996) the Board hereby grants a certificate of registration to as a Depository subject to the conditions specified in the Act, the Depositories Ordinance and the regulations made thereunder. II. Registration Number for the Depository is IN/SD/ / / Date: Place: Mumbai By Order Sd/- For and on behalf of Securities and Exchange Board of India

FORM C SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICIPANTS) REGULATIONS, 1996

Application for grant of certificate of commencement of business as depository Securities and Exchange Board of India Mittal Court, 'B' Wing, 1st Floor Nariman Point, Mumbai 400021-India INSTRUCTIONS i. This form is meant for use by a depository granted a certificate of registration by the Securities and Exchange Board of India. ii. The applicant should complete this form, and submit it, along with all supporting documents to the Board at its head office at Mumbai. iii. This application form should be filled in accordance with the regulations. iv. Application for grant of certificate of commencement of business will be consid- ered provided it is complete in all respects. v. All answers must be typed. vi. Information which needs to be supplied in more detail may be given on separate sheets which should be attached to the application form. vii. The application must be signed and all signatures must be original. viii. Every page of the form and every additional sheet must be initialled by the authorised signatory of the applicant. ix. All copies of documents should be attested as true by an authorised notary. 1. Name and registration number of the applicant. 2. Date of grant of certificate of registration to the applicant. 3. Please indicate whether bye-laws have been approved by SEBI. 4. Please indicate the details of staff and organisation structure that has been set up. 5. Please indicate the background and experience of key personnel. 6. Internal evaluation and monitoring systems including details of background and experience of personnel involved that have been set up (enclose copies of risk manage- ment and operations manuals). 7. Please provide the following details of the automatic data processing and communi- cations systems: (a) details of hardware, software and communications systems, their capability, function and location; ( b) details of data storage and back up procedures and sites, their capability, function and location; (c) details of disaster recovery systems and procedures. 8. Please indicate whether premises and automatic data processing and communica- tions systems are owned, leased or rented (enclose copies of title lease or rental agreements). 9. Please indicate arrangements that have been put in place in order to indemnify beneficial owners. 10. Please enclose copy of insurance cover that has been taken. 11. Please enclose a copy of the participation agreement to be entered into with different categories of participants. 12. Please enclose a copy of the agreement to be entered into with the issuer, or with the issuer and his registrar. 13. Please enclose a copy of the agreement to be entered into between the participant, as the depository's agent, and the beneficial owners. 14. Declaration statement (to be given as below) : We hereby agree and declare that the information supplied in the application, including the attachment sheets, is complete and true. And we further agree that, we will notify Securities and Exchange Board of India immediately any change in the information provided in the application. We further agree that we shall comply with, and be bound by theSecurities and Exchange Board of India Act, 1992-, and Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996, and such other guidelines/instruc- tions which may be announced by the Securities and Exchange Board of India from time to time. We further agree that as a condition of registration, we shall abide by such operational instructions/directives as may be issued by the Securities and Exchange Board of India from time to time. For and on behalf of ...................................... (Name of the applicant) Authorised signatory................. (Name) (Signature) Date: Place:

FORM D SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICIPANTS) REGULATIONS, 1996

Certificate of commencement of business as depository In exercise of the powers conferred bysection 3 of the Depositories Ordinance, 1996(17 of 1996)read with the regulations, the Board hereby grants a certificate of commence- ment of business to as a depository subject to the conditions specified in the Act, the Depositories Ordinance and the regulations made thereunder. Date: Place: Mumbai By order Sd/- For and on behalf of Securities and Exchange Board of India

FORM E SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICIPANTS) REGULATIONS, 1996

Application for grant of certificate of registration as participant Securities and Exchange Board of India Mittal Court, 'B' Wing, 1st Floor Nariman Point, Mumbai 400 021-India INSTRUCTIONS i. This form is meant for use by an applicant for grant of registration as participant. ii. The form should be filled in by the applicant and submitted to the depository in which it is acting as participant, who shall forward it, along with all supporting documents to the Board at its head office at Mumbai. iii This application form should be filled in accordance with the regulations. iv. Application for grant of registration as participant or renewal of such registration, as the case may be, will be considered provided it is complete in all respects. v. All answers must be typed. vi. Information which needs to be supplied in more detail may be given on separate sheets which should be attached to this application form. vii The application must be signed and all signatures must be original. viii The application must be accompanied by an application fee as specified in the Second Schedule to these regulations. ix. Every page of the form and every additional sheet must be initialled by the authorised signatory of the applicant. x. All copies of documents should be attested as true by an authorised notary. 1. Name, address of the registered office, address for correspondence, telephone number(s), fax number(s), telex number(s) of the applicant and the name of the contact person. 2. Please indicate to which of the categories under sub-regulation (a) ofregulation 19-, the applicant belongs. 3. (a) Date and place of incorporation or establishment and date of commence- ment of business (enclose certificate of incorporation, memorandum and articles of association or statutory provisions, if any). (b) Details of the activities carried on by the applicant, in India or overseas. (c) Details of affiliates and subsidiaries of the applicant operating in India, and activities carried on by them. (d) Details of registration with the Securities and Exchange Board of India, the Reserve Bank of India or with any regulatory authority overseas of the applicant, and of its affiliates and subsidiaries operating in India. (e) Date of commencement of business in India and overseas (please enclose copies of the Reserve Bank of India's permission, and if applicable copies of approvals from the Central Government to carry on activities mentioned above). (f) Type and number of beneficial owners on whose behalf the applicant proposes to act as participant (Financial Institutions, Mutual Funds, Foreign Institutional Investors, Portfolio Managers, Non-Banking Finance Compa- nies, Stock Brokers, Corporates, Individuals, or for own account). 4. Please give the name and SEBI registration number of the depository in which the applicant is to act as participant. 5. Please indicate the names and SEBI registration numbers of all other depositories in which the applicant is acting as participant and the applicant's SEBI registration number as participants in such depositories. 6. Please state whether the applicant, his partner, director or principal officer is involved in any litigation connected with the securities market which has an adverse bearing on the business of the applicant; or has at any time been convicted for any moral turpitude or at any time has been found guilty of any economic offence. 7. Please also state whether there has been any instance of violation or non- adherence to the securities laws, code of ethics/conduct, code of business rules, for which the applicant, or its parent or holding company or affiliate may have been subject to economic, or criminal, liability, or suspended from carrying out its operations, or the registration revoked temporarily. 8. Please indicate the net worth and paid-up capital in Rs. crore as per the latest audited financial statements of the applicant (enclose copy) 9. Please indicate services that the applicant is already providing to beneficial owners on whose behalf the applicant proposes to act as participant, and services proposed to be provided to beneficial owners. 10. Please provide the following details regarding staff involved in activities as participant. (i) organisation structure; (ii) experience and background of key personnel. 11. Please provide the following details regarding safekeeping and security systems and procedures: (i) risk control and operations manuals (enclose copies); (ii) give details of independent internal control mechanisms for monitoring, evaluation and review of accounting, and reporting systems and procedures. 12. Please provide the following details regarding automatic data processing systems and record keeping: ( i) details of hardware, software and communications systems, their capability, function and location; (ii) details of data storage and back up procedures and sites, their capability, function and location; (iii) details of disaster recovery systems and procedures. 13. Details of insurance cover to be taken up. 14. Please indicate the applicant's shareholding for each depository in which it has such shareholding and whether any shareholding is proposed to be acquired in the depository through which this application is being made. 15. Please enclose a copy of an undertaking from the depository in which the applicant is to act as participant that (a) the applicant is eligible to act as participant in the depository through which this application is being submitted to SEBI, and meets with the eligibility criteria for participants specified in these regulations and in the depository's bye-laws; (b) the applicant has adequate automatic data processing systems, adequate and competent staff, risk management systems, procedures and manuals, disaster recovery procedures, secure data storage and off site back up facilities, adequate communications links and insurance; to enable the applicant to fulfil its obligations as participants to the satisfaction of the depository; and (c) the agreement to be entered into between the participant and beneficial owners has been submitted to the depository is in accordance with the depository's bye-laws. 16. Declaration statement (to be given as below). We hereby agree and declare that the information supplied in the application, including the attachment sheets, is complete and true. And we further agree that, we will notify Securities and Exchange Board of India immediately any change in the information provided in the application. We further agree that we shall comply with, and be bound by theSecurities and Exchange Board of India Act, 1992-, and Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996, and such other guidelines/instruc- tions which may be announced by the Securities and Exchange Board of India from time to time. We further agree that as a condition of registration, we shall abide by such operational instructions/directives as may be issued by the Securities and Exchange Board of India from time to time. For and on behalf of ....................................................... (Name of the applicant) Authorised signatory..................................................... (Name) (Signature) Date: Place:

FORM F SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICIPANTS) REGULATIONS, 1996

Certificate of Registration as participant I. In exercise of the powers conferred by sub-section (1A) ofsection 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992)-read with the regulations made thereunder and with the Depositories Ordinance, 1996 (17 of 1996) the Board hereby grants a certificate of registration to as a participant subject to the conditions specified in the Act, the Depositories Ordinance and the regulations made thereunder. II. Registration Number for the participant is IN/DP/ / / III. Unless renewed, the certificate of registration is valid from to Date: Place: Mumbai By order Sd/- For and on behalf of Securities and Exchange Board of India

SCHEDULE 2 SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICIPANTS) REGULATIONS, 1996

SCHEDULE[Seeregulations 3-,7-,8-,16-,20-]

PART A APPLICATION FEES, REGISTRATION FEES AND ANNUAL FEES

____________________________________________________________________________ Application fees payable by sponsor (Rs.) 50,000 Application fees payable by participant (Rs.) 5,000 Registration fees payable by depository (Rs.) 25,00,000 Registration fees payable by participant (Rs.) 1,00,000 Annual fees payable by depository (Rs.) 10,00,000 Annual fees payable by participant (Rs.) 1,000 ________________________________________________________________________

PART B MANNER OF PAYMENT OF APPLICATION, REGISTRATION AND ANNUAL FEES

_____________________________________________________________________________ Fees to be paid by Manner of payment _____________________________________________________________________________ Sponsor or depository Participant A demand draft or bankers cheque payable to the "Securities and Exchange Board of India" at Mumbai. Particulars Fees to be paid to the depository in which the payer is a Participant. The Depository shall forward the fees collected from participants to the Board, with a demand draft or bankers cheque payable to the "Securities and Exchange Board of India" at Mumbai. ________________________________________________________________________