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Securities and Exchange Board of India (SEBI) vide its circular no. D&CC/FITTC/CIR-19/2003 dated March 4, 2003 has intimated its decision to shorten the existing T+3 rolling settlement to T+2 rolling settlement w.e.f. April 1, 2003. The time schedule prescribed by SEBI for implementation of T+2 rolling settlements, beginning from April 1, 2003, is as follows:

Depository Participants (DPs) have been advised to take note of the above and ensure the following:

• DPs shall accept instructions from the Clients, in physical form upto 4 p.m. (in case of electronic instructions upto 6 p.m.) on T+1 for pay-in of securities, viz.; instructions to transfer securities from Client account to Clearing Member (CM) Settlement account, Inter-Settlement Instructions, CM Settlement to CM Settlement account transfers and Delivery-Out Instructions, etc. For example, pay-in for trades executed on 'Monday' will be on Wednesday. Clients will have to submit instructions to their DPs upto 4 p.m. (in case of electronic instructions upto 6 p.m.) on Tuesday.
• Settlement instructions received from any Client beyond the aforementioned deadlines would be received by the DPs at Clients' risk and acknowledgment thereof should be issued by DPs to the Clients, with suitable remarks.
• DPs should complete execution of pay-in instructions and ensure that they are in status "Accepted by NSDL" well before the pay-in deadline time of 10.30 a.m. on T+2.

Further, DPs have been advised to bring to the notice of their clients that all instructions submitted to the DPs must have an execution date. The execution date can be current date or future date. Instructions will be valid till the pay-in deadline or till 'end of day' (EOD) of the execution date, whichever is earlier. In case the account does not have sufficient balance before pay-in deadline or till EOD, such instructions will fail.

SEBI has also intimated the following:

• Depositories would download the processed pay-in files to the exchange / Clearing House / Clearing Corporation latest by 11:00 a.m. on T+2.
• Pay-out of securities by the exchange / Clearing House / Clearing Corporation to the Depositories by 1:30 p.m. on T+2.
• Pay-out of securities to be completed by the Depositories by 2:00 p.m. on T+2.

The above instructions have been communicated to DPs vide NSDL Circular No. NSDL/PI/2003/0406 dated March 7, 2003.

SEBI vide its letter no. CS/4753/2003 dated March 4, 2003 has intimated to NSDL that with the introduction of T+2 settlement from April 1, 2003 it is imperative that the transfer of securities takes place in an efficient and efficacious manner without any settlement failure. This requires that DPs throughout the country should have technological compatibility with the existing infrastructure. Since they have their offices in various cities/towns, it is necessary that all the branches of a DP should be linked electronically to its head office. This would ensure that all the clearing and settlement instructions are communicated without fail. This would also mitigate risk of settlement failure.

NSDL has advised DPs to ensure compliance of the above vide NSDL Circular No. NSDL/PI/2003/0392 dated March 6, 2003.

BOI Shareholding Limited (Clearing House of BSE) has intimated NSDL that the NSDL deadline time for pay-in of securities for various settlements of BSE has been changed to 10.30 a.m. as against the current deadline of 11.00 a.m.. DPs have been advised to capture and verify/release instructions till the aforementioned deadline time. This has been communicated to DPs vide NSDL Circular No. NSDL/PI/2003/0511 dated March 26, 2003.