General Manager
Market Regulation Department
Email: sundaresanvs@sebi.gov.in
MRD/Policy/IG/NR/ 41005/2005
May 20, 2005
Computer Age Management Services Pvt. Ltd.
A & B, Lakshmi Bhawan
609, Anna Salai
Chennai 600 006.
Dear Sirs,
Sub.: Request for Informal Guidance under the SEBI (Informal Guidance) Scheme, 2003
1.0 Please refer to your letter dated February 8, 2005 requesting for an interpretive letter under the SEBI (Informal Guidance) Scheme, 2003 (hereinafter referred to as the said Scheme).
1.1 The interpretive letter has been sought on the following issues:-
“In respect of IPO and Post IPO subscriptions into Equity and Mutual Funds, whether
i) We, as Transfer Agent are deemed to “deal in or allot” the securities in our principal capacity and therefore required to interpret and comply with the above Regulations as an Intermediary.
or
ii) Are deemed to act as Agent of issuer carrying out the activity of allotment on their behalf, and thus required to comply with the provisions of the MAPIN Regulations as Interpreted and directed by the Issuer, their Board and/or Trustees.”
2.0 You have submitted that as Registrar and Transfer Agents the Investors applications / transactions are being processed by you as directed by the issuers and on the basis of the written instructions.
3.0 You have not analysed all material facts and have not submitted your analysis of the rules and regulations as required under clause 6 of the said scheme. However, on the basis of the information submitted by you, our opinion, on the query raised by you as mentioned above, is as under –
3.1 Regarding the query at 1.1 (i) :
It is to be mentioned here that your activities while dealing as a Share Transfer Agent can not be stated to be done in the principal capacity, instead while dealing or allotting shares, your activities are in the nature of an agent. It may also be noted that as per regulation 6 (4) of the said Regulations, an intermediary can not deal or allot securities on behalf of a specified investor or to a specified investor unless the said specified investor has been allotted a UIN. You are required to comply with the provisions of the said Regulations.
3.2 Regarding the query at 1.1 (ii) :
As per the provisions of the said Regulations, you can not deal or allot securities on behalf of a specified investor or to a specified investor unless the said specified investor has been allotted a UIN. On a perusal of the said Regulations you cannot be absolved of the obligations specified under the said Regulations
4.0 This position is based on the representation made to the Division in your aforesaid letter dated February 08, 2005. Different facts or conditions might require different results. This letter does not express decision of the Board on the questions referred.
5.0 You may note that the above views are expressed only with respect to the clarification sought by you as stated in para. 1.1 of this letter and do not affect the applicability of any other law or Regulations of SEBI.
Yours faithfully,
V S SUNDARESAN