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Vijay Rathod (propritor)     09 January 2010

DP Termination

Can an agreement between a DP registered with CDSL or NSDL be terminated on immediate date? i.e. say in a dp named 123 is registered with cdsl, now out of the blue can CDSL terminate the said agreement without prior notice and on immediate effect.  Say the dp is registered with cdsl since 15/04/2006 and suddenly on 04/07/2007 cdsl gives an email to the dp that with immediate effect your registeration is cancelled and on the same date sends all bo a letter saying that they have closed the dp and now the bo will have to contact cdsl directly for transfering the securities in any other account.  can cdsl terminate the agreement without prior notice?

i need to know the rules and regulations on immediate basis please help me.  kindly update whether the dp can comment or take any action in such a situation. 



Learning

 3 Replies

Dirgesh kumar sharma (Advocate)     09 January 2010

Hi Vijay

Nothing any rules without Prior Notice termination of agreement this is fals termination

you can file civil suit under specific relief act. 

 

 

Smita_L01042008 (student)     10 January 2010

Dear Mr. Vijay,

in such situation, one can speak to member ship department or concern person of the DP in case reason for such termination of agreement. kindly check agreement whether any such power or right is vested with NSDL / CDSL.

you can search on NSDL and CDSL website . in case of injustice and non following terms and condition by NSDL and CDSL matter can be taken up to SEBI.

V. VASUDEVAN (LEGAL COUNSEL)     10 January 2010

 The rules for agreement between a DP and the Depository is primarily governed by the bye-laws of the Depository concerned. Hence please check the CDSL Bye-laws which should be available on line for the notice period and what basis a DP, if at all can be terminated by email. Based on that you can take up the matter with SEBI for redressal.

vasudevan


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