May 07, 2002

The Executive Directors/Managing Directors Of all the Stock Exchanges

Dear Sir/Madam

SUB : Amendment to the Listing Agreement

Please refer to the Circular No. SMDRP/POLICY/CIR-46/2001 dated September 27, 2001, where the stock exchanges were advised about the decision taken in the meeting of the stock exchanges held on August 14, 2001, pertaining, inter alia, to delay in transfer of shares by the companies. The said circular also specified the norms to be observed by the companies for dealing with cases where transfer of shares is delayed beyond a stipulated time period for certain reasons viz., signature difference etc. The said circular, inter alia, provides that the company would compensate the aggrieved party / parties in cases where there is a delay on the part of the company in either transferring the shares or communicating the objection to the transfer of shares, within the stipulated time period of one month

In this respect, in order to give effect to the above, you are advised to amend the Listing Agreement to incorporate after sub-clause (1), of Clause 12A the following new sub-clause (1a) as under.

“(1a) The company agrees that in respect of transfer of shares where the company has not effected transfer of shares within 1 month or where the company has failed to communicate to the transferee any valid objection to the transfer within the stipulated time period of 1 month, the company shall compensate the aggrieved party for the opportunity losses caused during the period of the delay.

In addition, the company keeping in view the provisions of Section 206A of the Companies Act and Section 27 of the Securities Contracts (Regulation) Act, 1956, provide all benefits (i.e. bonus shares, right shares, dividend ) which accrued to the investor during the intervening period on account of such delay.”

You are also advised to accordingly amend the Bye-Laws of the exchange to provide for the mechanism of arbitration for determining the amount of compensation in case of delay in transfer of securities and delay in furnishing of the objection memo beyond the specified time.
You are advised to implement the above immediately and confirm it to SEBI.

Yours faithfully,


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