Investor Education and Protection Fund
        Ministry of Corporate Affairs
        Government of India

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"Investors' interest is our primary concern."


Shri Salman Khurshid
Union Minister of State (I/C) for Corporate Affairs
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INVESTOR GRIEVANCES & ARBITRATION
Source: NSE
Registering complaints with NSE
 
1.

In case of complaint against a trading member (TM) /registered sub-broker, whom do I address the complaint to?
 
You should address the complaint to the Mumbai Office or the Regional Offices of NSE based on the dealing office where the deals were executed as given below:

State in which Dealing office of the trading member is located

Complaint to be addressed to

Maharashtra, Gujarat, Goa, Daman, Diu, Dadra & Nagar Haveli, Madhya Pradesh

MUMBAI:
National Stock Exchange of India Ltd.
‘Exchange Plaza’, C-1, Block G,
Bandra-Kurla Complex, Bandra (East),
Mumbai – 400 051
Tel. No: (022) 2659 8190
Fax No : (022) 2659 8191

Delhi , Haryana, Uttar Pradesh, Uttaranchal, Himachal Pradesh, Punjab, Jammu & Kashmir, Chandigarh , Rajasthan

DELHI :
National Stock Exchange of India Ltd.
4th Floor, Jeevan Vihar Building ,
Parliament Street,
New Delhi-110 001
Tel No : (011) 2334 4313
Fax No: (011) 2336 6658

West Bengal, Bihar, Jharkhand, Orissa, Assam, Arunachal Pradesh, Mizoram, Manipur, Sikkim, Meghalaya, Nagaland, Tripura, Chhattisgarh

KOLKATA:
National Stock Exchange of India Ltd.
1st Floor, Park View Apartments,
99, Rash Behari Avenue ,
Kolkata – 700 029.
Tel No : (033) 24631802 1805
                       24631809 1812
Fax No : (033) 24631791 / 1806

Andhra Pradesh, Karnataka, Kerala, Tamilnadu, Andaman & Nicobar, Lakshadweep, Pondicherry

CHENNAI:
National Stock Exchange of India Ltd.
2nd floor, Ispahani Centre,
Door No 123-124,
Nungambakkam High Road,
Chennai - 600 034
Tel No : (044) 2833 2500
Fax No.: (044) 2833 2510 / 2521

 
NSE also provides a facility for registering complaints on-line. For more information, visit the website of NSE: www.nseindia.com under the link ‘INVESTORS’
 
 
2. In case of a complaint against a company traded on NSE, whom should I address the complaint to?
 
All complaints in respect of companies should be addressed to:
 
Investor Services Cell (ISC) 
National Stock Exchange of India Ltd. 
‘Exchange Plaza’, C-1, Block G, 
Bandra-Kurla Complex, Bandra (East), 
Mumbai – 400 051
 
Tel. No: (022) 2659 8190
Fax No: (022) 2659 8191
e-mail address: ignse@nse.co.in
 
 
3.

What complaints are taken up for redressal by the ISC?
 
Investor Services Cell of the Exchange deals with the complaints of investors against the Trading Members of the Exchange or against the listed companies. Investors could lodge their complaints in the format prescribed by the Exchange along with the supporting documents either by registering their complaints in electronic mode through our website www.nseindia.com or may send in their complaints to the nearest investor service centre.

Generally, the complaints of following nature are taken up for resolution by the Exchange.

Complaints against Exchange Members

Capital Markets/ Futures & Options Segment:

  1. Non-Issuance of the Documents by the Trading Member 
  2. Non-receipt of funds / securities 
  3. Non-receipt of margin/security deposit given to the Trading Member 
  4. Non-Receipt of Corporate Benefit (dividend / interest / bonus etc.) 
  5. Auction value / close out value received or paid 
  6. Execution of Trades without Consent 
  7. Excess Brokerage charged by Trading Member / Sub-broker 
  8. Non-receipt of credit balance as per the statement of account 
  9. Non-Receipt of Funds / Securities kept as margin 
  10. Excess Brokerage Charged (other than on Option Premium) 

Complaints against Listed Companies:

  1. Public / Further offerings: Complaint regarding non-receipt of…
     
    1. Allotment Advice, securities allotted, refund order 
    2. Interest on delay in Redemption / Refund Amount 
    3. Sale Proceeds of Fractional Entitlement 
    4. Composite Application Form (CAF) for Rights offer Rights for (CAF) Application 
    5. Securities purchased through a Rights Offer 
    6. Letter of offer for Buyback 
  2. Corporate Actions: Complaint regarding non-receipt of…
     
    1. Dividend 
    2. Interest on Debentures, Bonds or other Debt Instruments 
    3. Securities on account of a Bonus / De-merger / Merger / Stock Split 
    4. Redemption Amount
  3. Transfer of Securities: Complaint regarding non-receipt of…
     
    1. Securities after Dematerialization 
    2. Securities after Transfer/Transmission 
    3. Duplicate Certificate relating to Securities
  4. Miscellaneous: Complaint regarding non-receipt of copy of the Annual Reports
     
4. What complaints are not taken up for redressal by the ISC?
 
The Investor Services Cell of the Exchange would not be in a position to deal with certain types of complaints. Illustrative list of nature of complaints that would not be handled by Investor Services Cell are as under: 
 
Complaints against Exchange Members:
  1. Complaints in respect of transactions which are already subject matter of Arbitration proceedings 
  2. Complaint involving payment of funds and transfer of securities to entities other than Trading Member 
  3. Claims for mental agony/harassment and expenses incurred for pursuing the matter with the ISC 
  4. Claim for notional loss, opportunity loss for the disputed period or trade 
  5. Complaints pertaining to trades not executed on the Trading System of the Exchange 
  6. Claims of sub-broker/authorized persons for private commercial dealings with the trading member 
  7. Claims relating to transactions which are in the nature of loan or financing which are not within the framework defined by the Exchange 
  8. Claims which are relating to entities/activities which are not regulated by Exchange 

Against a Company:

  1. Complaints pertaining to securities not listed on the Exchange 
  2. Complaints for refund of postal charges, telephone expenses and miscellaneous charges 
  3. Compensation for mental agony, harassment 
  4. Notional loss due to delay in receipt of shares sent for transfer or after IPO 
  5. Complaints which fall outside the purview of the listing agreement and not related to the Exchange 
  6. Pledge and assignment of shares 
  7. Inability of complainant to establish ownership of security. 
     
5. Is there any specified form for lodging the complaint? 
 
Investors are requested to use the following forms: 
  • Investor Complaint Form – TM for lodging complaints against trading members/registered sub-brokers and
  • Investor Complaint Form - CO for complaints in respect of companies traded on NSE.

These forms are available on the website of NSE: www.nseindia.com under the link ‘INVESTORS’
 
 
Investor Protection Fund
 
 
1. What is the Investor Protection Fund (IPF) and when is it used?
 
The IPF is maintained by NSE to make good investor claims, which may arise out of non-settlement of obligations by the trading member, who has been declared defaulter / expelled, in respect of trades executed on the Exchange. The IPF is utilised to settle claims of such investors where the trading member through whom the investor has dealt has been declared a defaulter or expelled by the Exchange. Payments out of the IPF may include claims arising on account of non payment of funds, credit balance by the defaulter /expelled member or non receipt of securities purchased by the investor through the trading member or non receipt of securities or fund provided as margin by the investor to the trading member, who has been declared a defaulter/expelled member.
 
The maximum amount of claim payable from the IPF to the investor (where the TM through whom the investor has dealt is declared a defaulter) is Rs.11 lakhs. 
 

ARBITRATION
 
1. What is “Arbitration”?
Ans.

Arbitration is a quasi judicial process of settlement of disputes between Trading Member, investor, clearing member, sub-brokers etc. Arbitration aims at quicker legal resolution for the disputes. When one of the parties feels that the complaint has not been resolved satisfactorily either by the other party or through the complaint resolution process of the Exchange, the parties may choose the route of arbitration. 
 
2. Who can apply for arbitration?
Ans.

One of the parties to the dispute who wants legal remedy for resolving dispute could apply for arbitration. In other words investor, sub-broker, trading member or clearing member can apply for arbitration.
 
3. What are the different forms / documents required to be submitted while applying for arbitration?
Ans. Lists of documents that are required to be submitted are provided below. 
 

Forms / Document

Purpose

Mandatory

 

1. Form no. I

Application for arbitration

2. Form no. II

For providing Arbitrator preference in descending order

3. Statement of Case

Brief description of the case date wise, the basis of arriving at the claim amount and relief sought through arbitration.

4. Cheque /Pay Order/Demand Draft

Towards cost of arbitration.

Additional Documents *

 

5. Statement of Accounts

Incase of dispute for funds / securities

6. Copies of the relevant Contract Notes &  Bills

Relevant to the matter or as per the direction given by the arbitrator

 
* In case investor does not have additional documents at the time of making application, same may be submitted during the course of arbitration.
 
4. How do I obtain arbitration application forms, if I wish to apply for Arbitration?
Ans.

Arbitration application forms are available on Exchange website at http://www.nseindia.com/content/assist/asst_arb_forms.zip and applicant may download the same and use the form for making application. Alternatively, investors may request for forms by sending an email to ignse@nse.co.in along with the complete postal address, so that the forms can be mailed to them.
 
5. Where can investor file arbitration against the trading member?
Ans.

The application for arbitration has to be filed at the Regional Arbitration Centre (RAC) viz. Mumbai, Delhi, Kolkata or Chennai covering the state in which the Constituent ordinarily resides.

Seats of Arbitration – Regional Arbitration Centres (RACs)

States covered by the RAC

 

DELHI

Delhi , Haryana, Uttar Pradesh, Uttaranchal, Himachal Pradesh, Punjab, Jammu & Kashmir, Chandigarh , Rajasthan

KOLKATA

West Bengal, Bihar, Jharkhand, Orissa, Assam, Arunachal Pradesh, Mizoram, Manipur, Sikkim, Meghalaya, Nagaland, Tripura, Chhattisgarh

CHENNAI

Andhra Pradesh, Karnataka, Kerala, Tamilnadu,

Andaman & Nicobar, Lakshadweep, Pondicherry

MUMBAI

Maharashtra, Gujarat, Goa, Daman, Diu, Dadra &

Nagar Haveli, Madhya Pradesh

6. How is arbitrator appointed? For a case, how is the number of Arbitrator determined?
Ans.

If the value of claim made by applicant or counter claim made by the other party is less than or equal to Rs. 25 lakh, sole Arbitrator is appointed.
If the value is more than Rs. 25 Lakh, panel of three Arbitrators is constituted.
 
7. Who can represent the arbitration matter on behalf of the investor?
Ans.

Investor may attend the arbitration proceedings and defend the matter on his own or authorize a representative to defend the matter. He also has the opportunity to use services of an advocate to represent the matter.
 
8. What is a hearing? Are hearing required in all matters?
Ans.

Hearing is a process, wherein the investor and trading member appear before the Arbitrator at the Exchange premises to present their case.
 
In case the claim amount is less than Rs. 25,000 the Arbitrator may hold hearing to pass the award else he may pass the award based on the documents submitted by both the parties.
 
If the claim amount is more than Rs. 25,000 Arbitrator holds hearing at the Exchange premises.
 
9. What is the time required for completion of arbitration proceedings?
Ans. The arbitrator is required to complete arbitration proceedings within three months from the date of initial (first) hearing and pass the award. However, the period can be extended by three more months to complete the arbitration proceedings and pass the award.
 
10. What is an “Award”?
Ans. Award is a judgment passed by the arbitrator which gives decision on dispute, clearly stating the action that the parties have to take.
 
11. How is award implemented?
Ans.

Award may be passed in favour of investor or trading member. When award is passed in favour of investor, the Exchange ensures implementation of the award.
 
The trading member may settle the award and confirm the same to the Exchange. Incase, trading member fails to settle the award, the award amount is kept aside. On expiry of three months from the date of receipt of award, the award amount is released to the investor if trading member has not challenged the award in court.
 
If the trading member challenges the award in court, the award amount kept aside is dealt as per the court order.
 
12. What if there are errors in the award? Can it be rectified?
Ans.

The investor is required to make an application under section 33 of the Arbitration and Conciliation Act, 1996 within thirty days from the receipt of the arbitral award with the Exchange for getting errors rectified. The Exchange forwards a copy of application to the arbitrator for carrying out the correction.
 
13. What if investor wants to seek interpretation on a specific point or part of the award?
Ans.

The investor is required to make an application under section 33 of the Arbitration and Conciliation Act, 1996 within thirty days from the receipt of the arbitral award with the Exchange for seeking interpretation. The Exchange forwards a copy of application to the arbitrator for giving interpretation on the specific point or part of the award.
 
14. What if investor wants an additional award on the claims presented before the Arbitrator but omitted in the award?
Ans.

The investor is required to make an application under section 33 of the Arbitration and Conciliation Act, 1996 within thirty days from the receipt of the arbitral award with the Exchange for making an additional award for the claims presented in arbitral proceeding but omitted from the award. The Exchange forwards a copy of application to the arbitrator for giving an additional award.
 
15. What if either of the parties is not satisfied with the Award passed by the arbitrator?
Ans.

If either of the parties is not satisfied with the Award, the aggrieved party may approach the appropriate court with an application for setting aside the award under section 34 of the Arbitration and Conciliation Act, 1996 within a period of three months from the date of receipt of the Award.
 
16. What are the deposits collected towards cost of arbitration? Is it one time, or additional amount is required to be paid towards cost of arbitration?
Ans. The parties are required to deposit the cost of arbitration depending on the claim as under:
 

S. no.

Amount of Claim / Counter Claim (higher amount to be considered)

Amount of deposit

1

Upto Rs. 10 lakhs

Rs.10,000/- (deposit is taken only from the trading member and not from the investor)

2

More than Rs.10 Lakhs but less than or equal to Rs.25 Lakhs.

Rs.12,000/-

3

Above Rs.25 Lakhs

Rs.18,000/-

 
Additional deposit may be called towards cost of arbitration from the parties depending on the number of hearings held in the matter.

In case the investor files arbitration against issuer (listed companies), he is required to deposit the cost of arbitration even if the claim amount is less than Rs. 10 Lakh.
 
17. What will be the status of the complaint filed with Investor Services Cell (ISC), if arbitration is initiated against the trading member?
Ans. Once arbitration proceedings are initiated against the trading member, the complaint filed with the Investor Services Cell (ISC) is treated as closed.
 
18. What if arbitration application is not filed within six months from the date of claim, difference or dispute?
Ans. If the arbitration application is not filed within six months from the date of claim, difference or dispute, the matter may suffer on limitation. However, the issue regarding limitation is decided by the arbitrator in the award after considering the submissions made by the parties to arbitration.
 
19. Who bears the cost of arbitration? Is there any different approach for a retail investor?
Ans.

The Arbitrator decides in the award as to which party should bear the cost of arbitration.

In respect of arbitration matters, where the claim amount is less than Rs. 10 lakhs, the investor is not required to pay the cost of arbitration, the Exchange bears the cost of arbitration on behalf of investor (Investor may be applicant or respondent).

 
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