GENERAL MANAGER
Market Regulation Department
E-mail: sundaresanvs@sebi.gov.in
MRD/DoP/SE/Cir-21/2006
December 14,
2006
The
Executive Directors/Managing Directors/Administrators
of All
Stock Exchanges
Dear Sir /
Madam,
Sub: Clarification to
Clause 24 of Comprehensive IPF/CPF Guidelines.
1. Please refer to SEBI
Circular Ref No MRD/DoP/SE/Cir-38/2004 dated
2. The provisions of Clause
24 of the Annexure to the aforesaid circular dealing with Disbursement of
Claims from IPF/CPF reads as under:-
The Stock Exchange shall ensure that
the amount realised by the auction / close-out of the card / realisation of
assets of the defaulter members are credited to the IPF/CPF after satisfying
the claims of the Stock Exchange and the SEBI in accordance with the bye-laws
of the Stock Exchange.
3. In this regard, SEBI
has received queries regarding disbursement of claims from IPDF/CPF in case of
defaulter broker having multiple memberships. It is clarified that in the case of
stock broker having multiple memberships, who has been declared defaulter, any
amount remaining to his credit after satisfying the eligible claims at the
stock exchange / SEBI / other stock exchanges, shall be credited to the IPF/CPF
of such exchange. This would be in line with the provisions contained in Clause
(viii) of Government of India directive (circular ref 1/26/SE/91 dated
4. Accordingly, the
Clause 24 of the Comprehensive IPF/CPF Guidelines is restated with the
incorporation of the aforesaid clarification as Annexure -1 to this circular.
5.
The Stock Exchanges are advised to ;
5.1. if necessary make appropriate amendment
to the relevant bye-laws, rules and regulations to suitably reflect this
clarification.
5.2. bring the provisions
of this circular to the notice of the member brokers/clearing members of the
Exchange and also to disseminate the same on the website.
5.3. communicate to SEBI,
the status of the implementation of the provisions of this circular in Section
II, item no. 13 of the Monthly Development Report for the month of December
2006.
6. This circular is being
issued in exercise of powers conferred under Section 11 (1) of the Securities
and Exchange Board of India Act, 1992, to protect the interests of investors in
securities and to promote the development of, and to regulate the securities
market.
Yours
faithfully,
V
Encl:
Annexure - 1
ANNEXURE - 1
Comprehensive
Guidelines for IPF/CPF at Stock Exchanges
Disbursement
of claims from IPF/CPF
Clause
21…………….
Clause
22…………….
Clause
23…………….
Clause
24
The
Stock Exchange shall ensure that the amount realised by the auction / close-out
of the card / realisation of assets of the defaulter members are credited to
the IPF/CPF after satisfying the claims of the Stock Exchange and the SEBI in
accordance with the bye-laws of the Stock Exchange.
It is clarified that in the case of stock broker having multiple
memberships, who has been declared defaulter, any amount remaining to his
credit after satisfying the eligible claims at the stock exchange / SEBI / other
stock exchanges, shall be credited to the IPF/CPF of such exchange.
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