The National Stock Exchange of India (NSE) recently issued a circular, referencing Circular Ref No: NSE/CML/2024/15, dated May 29, 2024. This circular pertains to the intimation of dividend credit into bank accounts of notified parties under the Special Court (TORTS) Act 1992. The directive, originating from the Office of the Custodian under the Department of Financial Services, Ministry of Finance, Government of India, emphasizes the necessity for listed companies to ensure compliance with the stipulated guidelines regarding dividend payments.
The circular, addressed to the Company Secretary/ Compliance Officer of all listed companies, highlights the requirement for immediate action upon the receipt of online dividend payments into the bank accounts of notified parties. Failure to adhere to this directive could result in further necessary action by the Custodian’s office. The communication urges companies to send intimation to the Custodian’s office without fail, facilitating subsequent compliance procedures.
Moreover, a letter dated April 26, 2024, from the Office of the Custodian to the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE), underscores the importance of issuing suitable advisories to ensure compliance by listed companies. The Custodian’s office expresses concern over the lack of communication from the NSE regarding the previous advisory issued on February 1, 2024. The absence of proactive measures from the NSE could impede the Custodian’s ability to effectively manage the credit of dividends to notified parties.
The letter further outlines the challenges faced by the Custodian’s office in individually addressing each listed company, given their substantial number and diverse shareholding structures. To streamline the process and enhance compliance, the NSE is urged to issue appropriate guidelines or advisories via their website. Such measures would facilitate prompt action by listed companies, thereby enabling the Custodian’s office to fulfill its obligations under the direction of the Hon’ble Special Court (TORTS).
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National Stock Exchange of India
Circular Ref No: NSE/CML/2024/15 Date: May 29, 2024
To,
The Company Secretary/ Compliance Officer,
All Listed Companies
Subject: Intimation of credit of Dividend into attached bank accounts of notified parties under Special Court (TORTS) Act 1992
Dear Sir/ Madam,
The Exchange is in receipt of a letter from the Office of the Custodian, Department of Financial Services dated April 26, 2024 (copy enclosed), inter alia advising the exchange to issue suitable guidelines / advisory to all listed companies to ensure that whenever online dividend payment is credited into bank account of notified parties, intimation thereof shall be invariably sent to Custodian’s office without fail for further necessary action.
The listed companies are requested to take note of it and comply accordingly.
Yours faithfully,
For National Stock Exchange of India Limited
Ajit Mahadik
Manager – Listing Compliance
Office of the Custodian
The Special Court (TORTS) Act, 1992
Department of Financial Services.
Ministry of Finance, Government of India.
10th Floor, Nariman Bhawan, 227,Vinay K. Shah Marg,
Nariman Point, Mumbai 400 021.
Phones:22022251, 22856780, 22833007 Fax: 022-20820375
E-mail: custodian.mumbai@yahoo.com
No. 188/CUS/BOM/CORR/COMP/3053
Dated 26 /04/2024
To
1) The DGM —Listing Compliance
Bombay Stock Exchange
P.J. Towers,
Dalai Street,
Mumbai — 400001.
2. The DGM —Listing Compliance,
National Stock Exchange,
Exchange Plaza,
C-1, Block —G,
Bandra kurla Complex,
Bandra (East),.
Mumbai 400051.
Sub: Intimation of credit of Dividend into attached bank accounts of notified Parties under Special Court (TORTS) Act 1992.
Respected Sir,
Please refer to this office letter bearing no. 1733/CUS/BOM/DIV/CORR/COMP/3053 dated 1 St February, 2024 on above subject requesting to issue suitable advisory/to all listed companies to ensure that whenever online dividend payment is credited into bank account of notified parties, an intimation thereof is invariably sent to this office without fail for further necessary action.
2. In this connection it is stated that since no communication in this regard from your office has been received, it is requested to kindly intimate whether the issue raised by this office has been redressed by your office and if so whether any action has been initiated from your end for compliance by the companies if not it is once again requested to kindly consider the same for issue of suitable guidelines/advisory to all companies through your website.
3. This office cannot take up the issue independently with each company as companies involved with all notified parties are more than 250 and their share holding is running into thousands of folio.
4. Therefore it is felt that if a suitable advisory is issued by you, compliance will be ensured by the companies, which would facilitate this office to provide the information about credit of dividend to the notified parties as per the direction of the Hon’ble Special Court(TORTS)
5. In view of the above it is requested to kindly intimate the action taken at your end in the matter referred to your office vide above referred letter.
This has approval of Director.
Yours faithfully,
(Esmat A. Shaikh)
Officer on Special duty.
