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Subscription to SPEED-e

The following DP has subscribed to the SPEED-e facility of NSDL in the month of July 2006:

  • Oriental Bank of Commerce

Clients of the above mentioned DP can now avail of the facility of submitting various instructions through SPEED-e facility.

This takes the total number of DPs who have subscribed to SPEED-e to 64.

Direction to Clients by DPs on lost/misplaced/changes/correction on PAN Card

NSDL had issued a circular on March 3, 2006 regarding SEBI directive on PAN. In this regard, DPs have brought to NSDL's attention that Clients have reported the following problems:

  • PAN card has been lost / misplaced or PAN card was never received but has the PAN allotment letter from the Income Tax Department;
  • Change in the name of the Client due to marriage or voluntary action etc., (in case of individuals) or due to merger, amalgamation etc (in case of a corporate entity).

NSDL advised DPs that the Income Tax Department issues a new PAN card with the same PAN with changes in PAN data, for the above reported problems. Detailed procedure is available at http://www.incometaxindia.gov.in or http://www.tin-nsdl.com.

This has been intimated to DPs vide Circular No. NSDL/POLICY/2006/0024 dated July 7, 2006.

Clarification - Telephone bill (landline) as Proof of Address

DPs have been seeking clarification whether bills in respect of landline telephones provided by any service provider can be accepted as Proof of Address (POA).

NSDL has clarified that telephone bills (not more than two months old) pertaining to only Landline telephones (other than Fixed Wireless Phone) irrespective of the service provider can be accepted by DPs as POA. DP may ascertain the fact that such telephone number exists in the name of the entity, by making a call or by any other means.

This has been intimated to DPs vide Circular No. NSDL/POLICY/2006/0026 dated July 17, 2006.

Clarification - Capturing PAN in case of HUF and minor accounts

DPs have been seeking clarification from NSDL regarding capturing of PAN details with respect to HUF and Minor accounts.

In this regard, DPs have been advised that for HUF accounts, PAN details of the HUF and for Minor accounts, PAN details of the Minor should be captured.

DPs should obtain a photocopy of the PAN card of the HUF / Minor, as the case may be, verify the same with the original PAN card and follow the requisite procedure.

This has been intimated to DPs vide Circular No. NSDL/POLICY/2006/0028 dated July 18, 2006.

NSDL not to charge Custody Fee

A custody fee at the rate of Re. 1 per quarter per ISIN of unlisted securities was being charged by NSDL to its Depository Participants (DPs). NSDL has decided not to charge DPs for the above w.e.f November 15, 2005. With this, NSDL will not levy any custody fee on DPs.

This has been intimated to DPs vide Circular No. NSDL/PI/2005/2208 dated November 10, 2005.

Precautions regarding operation of demat accounts based on Power of Attorney

During the inspection of the DPs, it was noticed that a DP was obtaining Power of Attorney (POA) from its client(s) as a requirement for opening a demat account. As this practice is unacceptable, NSDL has advised its DPs to discontinue such requirement immediately. It was further noticed that the POA contained the following clauses:

  • POA Holder i.e. Donee has the sole authority to operate the account and the account holder(s) is/are restrained from operating the account;
  • Delivery Instruction Slip (DIS) books are denied to the account holders who have executed a POA;
  • DPs are authorised to merge the securities kept under various accounts of the clients; and
  • DPs have a lien on the securities of the clients.

NSDL had in the past informed its DPs that where a client has executed a POA, such depository accounts can be operated by both the client(s) as well as by the POA holder. Therefore, DPs are required to provide DIS books to the clients who have executed a POA and allow the clients to operate their accounts as well.

This has been intimated to DPs vide Circular No. NSDL/PI/2005/2329 dated November 25, 2005.

Tamilnad Mercantile Bank Limited joins NSDL as Depository Participant (DP)

Tamilnad Mercantile Bank Limited has been made operational as a DP on March 22, 2006. It will conduct its depository operations from Chennai. The DP Id allotted is IN303069.

This takes the total number of operational DPs to 223 and the total number of DPM set-ups to 297.

SEBI directive on PAN as a mandatory requirement for demat account opening

SEBI in its meeting held on January 18, 2006 discussed the issue of tightening the KYC norms. It was decided that the Depositories will issue directions to DPs making Permanent Account Number (PAN) compulsory for all categories of demat account-holders including minor, trust, foreign corporate body, banks, corporates, FIIs and NRIs. This comes into effect in respect of all demat accounts that are opened on or after April 1, 2006. Further, from October 1, 2006 onwards, the existing account holders would not be able to operate the accounts if they do not produce the PAN card by then.

In view of the aforesaid SEBI decision, NSDL has advised its DPs as follows:

(I) In respect of accounts that are opened on or after April 1, 2006:

  • Obtain a photocopy of the PAN card of the person(s) seeking to open the account and verify the same with the original PAN card, in addition to the existing procedure for account opening.
  • Personally verify the identity and address of each of the applicant while opening demat accounts.
  • In case of joint accounts, the PAN of each of the joint holder should be captured in the DPM system after making necessary verification.

(II) In respect of accounts that are opened till March 31, 2006:

  • Send a suitable written communication with a request to produce the PAN card alongwith a photo copy, for verification, at the earliest but not later than October 1, 2006 in respect of all account holder(s).
  • In case the account holder(s) fail(s) to submit the PAN details to the DP by October 1, 2006 or there are discrepancies in the PAN details that are not resolved by September 30, 2006, such accounts should be 'Suspended for Debit,' until PAN details are verified and updated at the DPM.

This has been intimated to DPs vide Circular No. NSDL/POLICY/2006/0007 dated March 7, 2006.

Exemption from sending physical transaction statement to subscribers of IDeAS

NSDL offers an Internet based facility called IDeAS (Internet-based Demat Account Statement) through its SPEED-e website (https://eservices.nsdl.com). IDeAS can be availed of by a Beneficial Owner (Client) provided its DP has subscribed to this facility.

IDeAS enables a Client to view latest balances as well as the transactions that have taken place in the last five days in its demat account. IDeAS also features the facility of download of digitally signed monthly transaction statements. Clients can verify the digital signature of NSDL using a Signature Verification Utility. The detailed procedure regarding installation of Signature Verification Utility is available on SPEED-e website.

If a Client subscribes to IDeAS, SEBI has permitted the DPs to discontinue providing physical transaction statements to such Clients. However, the DPs will be required to send a consolidated transaction statement, in physical form, for the entire financial year and the same shall be dispatched before 15th of May every year.

To enable the DPs to service the Clients, NSDL proposes to maintain month-wise transaction statements for a period of 12 months on IDeAS. Transaction statement for a particular month will be available for download by 7th of the following month (eg. transaction statement of April 2006 will be available for download by May 7, 2006).

This has been intimated to DPs vide Circular No. NSDL/POLICY/2006/0010 dated March 24, 2006.

Procedure for opening an account in the name(s) of Partners for holding securities that belong to the Partnership firm

DPs have been seeking clarification from NSDL whether Partners of a Partnership firm can provide the PAN of the Partnership firm at the time of opening a demat account. In this regard, NSDL has advised its DPs as follows:

  • The account should be opened only in the name of Partner(s) and the securities that belong to the Partnership Firm can be held in this account.
  • Obtain Proof of Identity and Proof of Address of the Partner(s) as per the procedure laid down and a copy of the Partnership Deed to verify the names of Partner(s). In addition, DPs should obtain a photocopy of the PAN card of the Partner(s) seeking to open the account and verify the same with the original PAN card.
  • If the Partner(s) make(s) a request to the DP to capture the PAN of the Partnership firm, obtain a photocopy of the PAN card of the firm and capture the PAN details of the firm in the DPM against the names of all the Partner(s).
  • Obtain an undertaking in the specified format from the Partner(s) to the effect that the Partner(s) would comply with the provisions of the Companies Act, 1956 and other applicable statutes in respect of securities of the Partnership firm held in the account opened in the name of the Partner(s).

This has been intimated to DPs vide Circular No. NSDL/POLICY/2006/0008 dated March 4, 2006.

Updation of MICR code, pursuant to SEBI circular on Electronic Clearing System (ECS) for refund in public issues

SEBI, vide its circular no. SEBI/MRD/DEP/Cir-3/06 dated February 21, 2006 has mentioned that applicants residing in 15 centers where clearing houses are managed by Reserve Bank of India (RBI) will get refunds through Electronic Clearing System only for public issues. In view of the above, NSDL has advised its DPs as under :

  • Inform all the clients residing in 15 centers (For the list of centers refer RBI website http://www.rbi.org.in under Electronic Clearing Service) to provide the details of MICR code, if not already updated in the DPM system.
  • For all new accounts that are opened or changes in bank details of existing accounts, who are residing in 15 centers, Participants should ensure that the details of MICR code are updated as per the procedure mentioned in circular no. NSDL/PI/2000/2295 dated December 20, 2000.

This has been intimated to DPs vide Circular No. NSDL/POLICY/2006/0006 dated February 23, 2006.

Name change of SSKI Investor Services Private Limited to Sharekhan Limited

Consequent to the change in name of SSKI Investor Services Private Limited to Sharekhan Limited, the Securities and Exchange Board of India has granted the certificate of registration to Sharekhan Limited as a Participant. The DP Id of Sharekhan Limited is IN300513.

Nikunj Stock Brokers Limited joins NSDL as Depository Participant (DP)

Nikunj Stock Brokers Limited has been made operational as a DP on October 13, 2005. It will conduct its depository operations from New Delhi. The DP Id allotted is IN302994.

Kripa Securities Private Limited joins NSDL as DP

Kripa Securities Private Limited has been made operational as a DP on October 21, 2005. It will conduct its depository operations from Kolkata. The DP Id allotted is IN303001.

The above additions take the total number of operational DPs to 219 and the total number of operational DPM set-ups to 291.

Account closure with pending remat/suspended ISIN - Exemption from providing transaction statement to clients provided AMC is waived

DPs have been seeking clarification from NSDL whether they could discontinue providing transaction statement to a Client under the following conditions:

  • The Client has given an account closure request to the Participant;
  • The Client account has only those ISIN(s) in the account which is / are in 'suspended' status and / or pending rematerialisation request(s); and
  • The Client authorises the Participant to remove the standing instruction to receive credits in the account.

If the above conditions are satisfied, DPs need not provide transaction statement to the Client, provided the DP waives all charges viz., annual maintenance charges etc. on such accounts from the date of such discontinuation.

This has been intimated to DPs vide Circular No. NSDL/PI/2005/1692 dated September 9, 2005

SEBI Directive on reduction in charges

Securities and Exchange Board of India has vide its letter no. MRD/DOP/NSDL/VM/46618/05 dated August 10, 2005 advised NSDL to intimate the DPs to pass on the benefits of the reduction in charges for debit instructions, to the beneficial owners.

NSDL has advised its DPs to ensure compliance of the above vide Circular No. NSDL/PI/2005/1478 dated August 12, 2005.

Activation of Multi Commodity Exchange of India Limited

Multi Commodity Exchange of India Ltd. (MCX) has been made operational as an Exchange. MCX has provided a list of DPs empanelled for the purpose of providing depository services for warehouse receipts. Only these DPs can open Pool Accounts of CMs of MCX.

As legal status of warehouse receipts is different from that of securities, it is necessary for DPs to enter into a separate agreement with persons seeking to open a depository account for the purpose of holding and dealing in electronic warehouse receipts of MCX..

The following charges will be levied by NSDL on the DPs towards demat services for warehouse receipts:

Details Charges Payable
Transaction Charges Rs. 8/- [per debit] *
Remat request [delivery for commodities] Rs. 50/- [per request]
Pledge charges - Pledge Creation Rs. 25/- [per request]
Pledge closure & Invocation NIL

This has been intimated to the DPs vide Circular No. NSDL/PI/2005/1441 dated August 9, 2005.

[* Will be reduced to Rs. 6 w.e.f. October 1, 2005]

Procedure for servicing blind persons

DPs have been seeking clarification from NSDL regarding the procedure to be followed for opening an account and processing instructions received from a person who is blind.

NSDL has advised its DPs the aforesaid procedure vide its Circular No. NSDL/PI/2005/1584 dated August 26, 2005.

Way2Wealth Brokers Private Limited joins NSDL as Depository Participant (DP)

Way2Wealth Brokers Private Limited has been made operational as a DP on April 5, 2006. It will conduct its depository operations from Bangalore. The DP Id allotted is IN303077.

Madhuvan Securities Private Limited joins NSDL as DP

Madhuvan Securities Private Limited has been made operational as a DP on April 13, 2006. It will conduct its depository operations from Ahmedabad. The DP Id allotted is IN303085.

The above additions take the total number of operational DPs to 225 and the total number of DPM set-ups to 299.

Closure of Gayatri Capital Limited DP Operations

Gayatri Capital Limited (DP ID IN302558), a DP of NSDL, has informed NSDL that it intends to close down its depository operations.

Closure of Growth Avenues Limited DP Operations

Growth Avenues Limited (DP ID IN302599), a DP of NSDL has informed NSDL that it intends to close down its depository operations.

Name change of DPs

Consequent to the change in name of the following DPs, the Securities and Exchange Board of India has granted certificates of registration to the following DPs as Participants of NSDL:

Sr. No. Old Name New Name DP Id
1 J M Morgan Stanley Retail Services Private Limited J M Morgan Stanley Financial Services Private Limited IN302927
2 Microsec India Limited Microsec Capital Limited IN302978
3 Fortis Securities Limited Religare Securities Limited IN301774