The depositories act 1996. Summary of the “The Depositories Act” 2019-01-29

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The Depositories Act, 1996

the depositories act 1996

Power of Board to give directions in certain cases 19A. Registration of transfer of securities with depository 8. Short title, extent and commencement. 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 bye-laws. 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. Depositories Act provides for registration of depositories from the Securities and Exchange Board of India Board. Register and index of beneficial owners.

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Summary of the “The Depositories Act”

the depositories act 1996

A depository shall, on receipt of information enter the name of the person in its records, as the beneficial owner. Penalty for contravention where no separate penalty has been provided:- Whoever fails to comply with any provision of this Act, the rules or the regulations or bye-laws made or directions issued by the Board thereunder for which no separate penalty has been provided, shall be liable to a penalty which may extend to one crore rupees. The depository as a registered owner shall not have any voting rights or any other rights in respect of securities held by it. ? Depositories Act provides for the regulation of depositories in securities and matters connected there with in India. Options to receive security certificate or hold securities with depository 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.

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Depositories Act, 1996

the depositories act 1996

Penalty for failure to redress Investors' grievances 19D. Section 22A shall be omitted. Rules and regulations to be laid before Parliament. Register and index of beneficial owners to be of debenture holder. Agreement between depository and participant:- 1 A depository shall enter into an agreement with one or more participants as its agent. 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 and place of the hearing of the appeal and may send a copy of the appeal to the Board either before or with such communication.

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DEPOSITORIES ACT, 1996

the depositories act 1996

Full Specifications General Publisher Publisher web site Release Date April 13, 2015 Date Added April 13, 2015 Version 1. Furnishing of information and records by depository and issuer. Penalty for delay in dematerialisation or issue of certificate of securities:- If any issuer or its agent or any person, who is registered as an intermediary under the provisions of section 12 of the Securities and Exchange Board of India Act, 1992 15 of 1992 , fails to dematerialise or issue the certificate of securities on opting out of a depository by the investors, within the time specified under this Act or regulations or bye- laws made thereunder or abets in delaying the process of dematerialisation or issue the certificate of securities on opting out of a depository of securities, such issuer or its agent or intermediary shall be liable to a penalty of one lakh rupees for each day during which such failure continues or one crore rupees, whichever is less. Power of Board to make regulations 1 Without prejudice to the provisions contained in section 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. There is an improved cash flow from not having funds tied up for long periods.

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Summary of the “The Depositories Act”

the depositories act 1996

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. 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. All subsequent transactions in such immobilised securities take place through book entries. The Depositories Act, 1996 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. Options to receive security certificate or hold securities with depository.

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Summary of the “The Depositories Act”

the depositories act 1996

Furnishing of information and records by depository and issuer. Register and index of beneficial owners to be of debenture holder. Offences:- Whoever contravenes or attempts to contravene or abets the contravention 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 fine or with both. A depository shall, on receipt of information under sub-section 2 , enter the name of the person referred to in sub-section 1 in its records, as the beneficial owner. Rectification of Register on transfer. Securities and Exchange Board of India? 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 bye-laws.

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Summary of the “The Depositories Act”

the depositories act 1996

If any issuer or its agent or any person, who is registered as an intermediary under the provisions of section 12 of the Securities and Exchange Board of India Act, 1992 15 of 1992 , fails to dematerialise or issue the certificate of securities on opting out of a depository by the investors, within the time specified under this Act or regulations or bye-laws made thereunder or abets in delaying the process of dematerialisation or issue the certificate of securities on opting out of a depository of securities, such issuer or its agent or intermediary shall be liable to a penalty of one lakh rupees for each day during which such failure continues or one crore rupees, whichever is less. Inserted by the Securities Laws Second Amendment Act, 1999. Further there is an elimination of financial loss owing to loss of physical scrip and greater liquidity from speedier settlements and reduction in delays in registration. Any person who has entered into an agreement with a depository 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. Penalty for failure to reconcile records 19F. Rights of depositories and beneficial owner.

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Depositories Act, 1996

the depositories act 1996

. Whoever contravenes or attempts to contravene or abets the contravention 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 fine, or with both. Rights and obligations of depositories,etc. Procedure for filing appeal 1 An appeal shall be preferred by the appellant or his authorized 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. In Section 11, in sub-section 2 , in clause ba , for the words? Also, there is an ability to arrange pledges without movement of physical scrip and further increase overall level of trading activity, liquidity and profits.

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The Depositories Act, 1996

the depositories act 1996

The Board shall not grant it certificate under sub-section 1 unless it is satisfied that the depository has adequate systems and safeguards to prevent manipulation of records and transactions. Section 83 shall be omitted. Substituted by the Securities Laws Amendment Act, 2004, w. In Section 111, after sub-section 13 , the following sub-section shall be inserted, namely:? Cons: 10 characters minimum Count: 0 of 1,000 characters 5. 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. Pros: 10 characters minimum Count: 0 of 1,000 characters 4. Cognizance of offences by courts.

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