SECURITIES AND EXCHANGE BOARD OF INDIA
SECONDARY MARKET DEPARTMENT
Mittal Court, A Wing, Gr. Floor,
224, Nariman Point, Mumbai 400 021
SMD/POLICY/GBDN/CIR-25/97
October 09, 1997
To,
The Executive Directors/ Managing Directors/
Presidents of all Stock Exchanges.
Dear Sir,
SUB : Amendments to the Uniform Norms for Good/Bad Deliveries
This is in continuation of our previous circulars no.: SMD/RCG/2796/96 dated July 16, 1996, SMD/RCG/3811/96 dated August 19, 1996 and SMD/POLICY/CIR/7-97 dated April 16, 1997 on the captioned subject. Based on the various suggestions received and as discussed in the meeting of the committee on Good/Bad Delivery Norms, it has been decided to modify/amend some of the existing Good/Bad Delivery guidelines. You are requested to take cognizance of the modified amendments as under.
1. Clause 63 : Inspite of the Issue of Share Certificate Rules requirement that the company affix its common seal on each share certificate, it has been observed that a lot companies have not affixed the common seal on their share certificates. This is one of the causes of a lot of bad deliveries in the market and has caused inconvenience to the investor for which the companies are responsible. In order to avoid undue hardship to investors, it has been agreed that the stock exchange may accept the share certificate without common seal of the company for market deliveries, however, the genuineness of the share certificate would continue to be checked at the Company/Registrar’s end. The stock exchange would also initiate action against the companies for non-compliance of the rules concerning Issue of Share Certificates. Accordingly, Clause 63 of the uniform norms for good/bad deliveries stands amended as under :
Clause 63 :
Name of the company or emblem is not readable in the common seal or there is no common seal on the share certificate – GOOD.
2. Clause 101 : In case of joint holding, and in event of death of any of the holders, transfer can take place on the basis of death certificate accompanying the transfer deed only for a period of two years from the date of the death or ensuing book closure, whichever is later.
The Introducing member of a recognised Stock Exchange may certify/attest copy of the death certificate and also issue an identity certificate in case where the name of the deceased on the share certificate is not identical with the name on the death certificate – GOOD
Clause 109 : The following addition has been made :
In cases where duplicate shares have been issued to a third party under the provisions of section 108 (1)A of the Companies Act, the company should also provide the name and address of the third party to whom the duplicate shares have been issued along with the date of request for duplicate shares by the third party.
Yours faithfully,
M. D. PATEL
EXECUTIVE DIRECTOR
cc to
a] Chairman’s Secretariat.
b] All Executive Directors, Division Chiefs and Regional Managers of SEBI.
c] All SEBI Nominee Directors on the Board of Exchanges.
d] All Division Chiefs requested to circulate to all their officers.
Note :
1. SMD Stock Exchange Administration Division to follow-up with the Exchanges for implementation of the decisions.
2. All the SEBI Nominee Directors on the Board of the Exchanges to follow-up the issues in the Board Meeting of the Exchanges.
