NSDL Pays ₹3.12 Crore to Settle Rule Violation Case with Sebi

On Thursday, the National Securities Depository Ltd (NSDL) settled a case with the Securities and Exchange Board of India (Sebi) concerning alleged violations of depository rules by paying ₹3.12 crore. NSDL agreed to settle the case without admitting or denying the findings, as outlined in Sebi’s regulations for Depositories and Participants, 2018.

The allegations against NSDL included failing to address complaints from participants and beneficial owners within the required 30-day period, as stated in Regulation 7(g). They were also accused of breaching the Code of Conduct specified in the same regulations, both before and after August 28, 2023.

The settlement order noted that, with the acceptance of the terms and the payment made, Sebi has closed the adjudication proceedings initiated against NSDL on February 8, 2024.

Sebi received the settlement amount of ₹3.12 crore from NSDL on October 14.

In late September, Sebi approved NSDL’s plan to launch its initial public offering (IPO), which was pending for over a year since the company submitted its preliminary IPO application in July 2023. The IPO will involve an offer for sale of more than 5.72 crore equity shares by various shareholders, including the National Stock Exchange of India (NSE), State Bank of India (SBI), and HDFC Bank, as detailed in the draft red herring prospectus (DRHP).

NSDL, a registered market infrastructure institution with Sebi, provides various products and services to India’s financial and securities markets. It was the first to introduce dematerialisation of securities in India in November 1996, following the introduction of the Depositories Act.