Risk Disclosure - Hem Nxt - Smart Trading App by Hem Securities

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INDEX

1. Rights and Obligations of Stock Brokers, Sub-brokers and Clients (as prescribed by SEBI and Stock Exchange)

2. Clauses for Internet & Wireless Technology Based Trading Facility

3. Rights and Obligations of Beneficial Owner and Depository Participant (as prescribed by SEBI and Depositories)

4. Risk Disclosure Document for Capital Market and Derivatives Segments

5. Risk Management Policy (Facility of Voluntary Freezing/Blocking)

6. Details of Good Till Cancelled/Good Till Date and Orders (GTDT)

7. Guidance Note - Do's and Don'ts for Trading on Stock Exchange(s) for Investors

8. Most Important Terms & Conditions (MITC)

9. Rights & Obligations of Stock Brokers & Clients For Margin Trading Facility (MTF)

10. Investor Charter - Stock Broker

11. Investor Charter - DP

12. Important Circulars

Annexure A

RIGHTS AND OBLIGATIONS OF STOCK BROKERS, SUB-BROKERS AND CLIENTS

As prescribed by SEBI and Stock Exchanges

The client shall invest/trade in those securities/contracts/other instruments admitted to dealings on the Exchanges as defined in the Rules, Byelaws and Regulations of Exchanges/ Securities and Exchange Board of India (SEBI) and circulars/notices issued there under from time to time.

The stock broker, and the client shall be bound by all the Rules, Byelaws and Regulations of the Exchange and circulars/notices issued there under and Rules and Regulations of SEBI and relevant notifications of Government authorities as may be in force from time to time.
The client shall satisfy itself of the capacity of the stock broker to deal in securities and/or deal in derivatives contracts and wishes to execute its orders through the stock broker and the client shall from time to time continue to satisfy itself of such capability of the stock broker before executing orders through the stock broker.
The stock broker shall continuously satisfy itself about the genuineness and financial soundness of the client and investment objectives relevant to the services to be provided.

The stock broker shall take steps to make the client aware of the precise nature of the Stock broker’s liability for business to be conducted, including any limitations, the liability and the capacity in which the stock broker acts.

CLIENT INFORMATION

The client shall furnish all such details in full as are required by the stock broker in "Account Opening Form” with supporting details, made mandatory by stock exchanges/SEBI from time to time.
The client shall familiarize himself with all the mandatory provisions in the Account Opening documents. Any additional clauses or documents specified by the stock broker shall be non-mandatory, as per terms & conditions accepted by the client.
The client shall immediately notify the stock broker in writing if there is any change in the information in the ‘account opening form’ as provided at the time of account opening and thereafter; including the information on winding up petition/insolvency petition or any litigation which may have material bearing on his capacity. The client shall provide/update the financial information to the stock broker on a periodic basis.
The stock broker shall maintain all the details of the client as mentioned in the account opening form or any other information pertaining to the client, confidentially and that they shall not disclose the same to any person/authority except as required under any law/regulatory requirements. Provided however that the stock broker may so disclose information about his client to any person or authority with the express permission of the client.

MARGINS

The client shall pay applicable initial margins, withholding margins, special margins or such other margins as are considered necessary by the stock broker or the Exchange or as may be directed by SEBI from time to time as applicable to the segment(s) in which the client trades. The stock broker is permitted in its sole and absolute discretion to collect additional margins (even though not required by the Exchange, Clearing House/Clearing Corporation or SEBI) and the client shall be obliged to pay such margins within the stipulated time.
The client understands that payment of margins by the client does not necessarily imply complete satisfaction of all dues. In spite of consistently having paid margins, the client may, on the settlement of its trade, be obliged to pay (or entitled to receive) such further sums as the contract may dictate/require.

TRANSACTIONS AND SETTLEMENTS

The client shall give any order for buy or sell of a security/derivatives contract in writing or in such form or manner, as may be mutually agreed between the client and the stock broker. The stock broker shall ensure to place orders and execute the trades of the client, only in the Unique Client Code assigned to that client.
The stock broker shall inform the client and keep him apprised about trading/settlement cycles, delivery/payment schedules, any changes therein from time to time, and it shall be the responsibility in turn of the client to comply with such schedules/procedures of the relevant stock exchange where the trade is executed.
The stock broker shall ensure that the money/securities deposited by the client shall be kept in a separate account, distinct from his/its own account or account of any other client and shall not be used by the stock broker for himself/itself or for any other client or for any purpose other than the purposes mentioned in Rules, Regulations, circulars, notices, guidelines of SEBI and/or Rules, Regulations, Bye-laws, circulars and notices of Exchange.
Where the Exchange(s) cancels trade(s) suo moto all such trades including the trade/s done on behalf of the client shall ipso facto stand cancelled, stock broker shall be entitled to cancel the respective contract(s) with client(s).
The transactions executed on the Exchange are subject to Rules, Byelaws and Regulations and circulars/notices issued thereunder of the Exchanges where the trade is executed and all parties to such trade shall have submitted to the jurisdiction of such court as may be specified by the Byelaws and Regulations of the Exchanges where the trade is executed for the purpose of giving effect to the provisions of the Rules, Byelaws and Regulations of the Exchanges and the circulars/notices issued thereunder.

BROKERAGE

The Client shall pay to the stock broker brokerage and statutory levies as are prevailing from time to time and as they apply to the Client’s account, transactions and to the services that stock broker renders to the Client. The stock broker shall not charge brokerage more than the maximum brokerage permissible as per the rules, regulations and bye-laws of the relevant stock exchanges and/or rules and regulations of SEBI.

LIQUIDATION AND CLOSE OUT OF POSITION

Without prejudice to the stock broker's other rights (including the right to refer a matter to arbitration), the client understands that the stock broker shall be entitled to liquidate/close out all or any of the client's positions for non- payment of margins or other amounts, outstanding debts, etc. and adjust the proceeds of such liquidation/close out, if any, against the client's liabilities/obligations. Any and all losses and financial charges on account of such liquidation/closing-out shall be charged to and borne by the client.
In the event of death or insolvency of the client or his/its otherwise becoming incapable of receiving and paying for or delivering or transferring securities which the client has ordered to be bought or sold, stock broker may close out the transaction of the client and claim losses, if any, against the estate of the client. The client or his nominees, successors, heirs and assignee shall be entitled to any surplus which may result there from. The client shall note that transfer of funds/securities in favor of a Nominee shall be valid discharge by the stock broker against the legal heir.

The stock broker shall bring to the notice of the relevant Exchange the information about default in payment/delivery and related aspects by a client. In case where defaulting client is a corporate Entity/partnership/proprietary firm or any other artificial legal entity, then the name(s) of Director(s)/Promoter(s)/Partner(s)/Proprietor as the case may be, shall also be communicated by the stock broker to the relevant Exchange(s).

DISPUTE RESOLUTION

The stock broker shall provide the client with the relevant contact details of the concerned Exchanges and SEBI.
The stock broker shall co-operate in redressing grievances of the client in respect of all transactions routed through it and in removing objections for bad delivery of shares, rectification of bad delivery, etc.
The client and the stock broker shall refer any claims and/or disputes with respect to deposits, margin money, etc., to conciliation/arbitration as per the Rules, Byelaws and Regulations of the Exchanges where the trade is executed and circulars/notices issued thereunder as may be in force from time to time.
The stock broker shall ensure faster settlement of any dispute through conciliation/arbitration proceedings arising out of the transactions entered into between him vis-à-vis the client and he shall be liable to implement the conciliation report/settlement agreement /arbitration awards made in such proceedings.
The client/stock-broker understands that the instructions issued by an authorized representative for dispute resolution, if any, of the client/stock-broker shall be binding on the client/stock-broker in accordance with the letter authorizing the said representative to deal on behalf of the said client/stock-broker.

TERMINATION OF RELATIONSHIP

This relationship between the stock broker and the client shall be terminated; if the stock broker for any reason ceases to be a member of the stock exchange including cessation of membership by reason of the stock broker's default, death, resignation or expulsion or if the certificate is cancelled by the Board.
The stock broker and the client shall be entitled to terminate the relationship between them without giving any reasons to the other party, after giving notice in writing of not less than one month to the other parties. Notwithstanding any such termination, all rights, liabilities and obligations of the parties arising out of or in respect of transactions entered into prior to the termination of this relationship shall continue to subsist and vest in/be binding on the respective parties or his/its respective heirs, executors, administrators, legal representatives or successors, as the case may be.

ADDITIONAL RIGHTS AND OBLIGATIONS

The stock broker shall ensure due protection to the client regarding client’s rights to dividends, rights or bonus shares, etc. in respect of transactions routed through it and it shall not do anything which is likely to harm the interest of the client with whom and for whom they may have had transactions in securities.

The stock broker and client shall reconcile and settle their accounts from time to time as per the Rules, Regulations, Bye Laws, Circulars, Notices and Guidelines issued by SEBI and the relevant Exchanges where the trade is executed.

The stock broker shall issue a contract note to his constituents for trades executed in such format as may be prescribed by the Exchange from time to time containing records of all transactions including details of order number, trade number, trade time, trade price, trade quantity, details of the derivatives contract, client code, brokerage, all charges levied etc. and with all other relevant details as required therein to be filled in and issued in such manner and within such time as prescribed by the Exchange. The stock broker shall send contract notes to the investors within one working day of the execution of the trades in hard copy and/or in electronic form using digital signature.
The stock broker shall make pay out of funds or delivery of securities, as the case may be, to the Client within one working day of receipt of the payout from the relevant Exchange where the trade is executed unless otherwise specified by the client and subject to such terms and conditions as may be prescribed by the relevant Exchange from time to time where the trade is executed.
The stock broker shall send a complete `Statement of Accounts’ for both funds and securities in respect of each of its clients in such periodicity and format within such time, as may be prescribed by the relevant Exchange, from time to time, where the trade is executed. The Statement shall also state that the client shall report errors, if any, in the Statement within such time as may be prescribed by the relevant Exchange from time to time where the trade was executed, from the receipt thereof to the Stock broker.
The stock broker shall send daily margin statements to the clients. Daily Margin statement should include, inter- alia, details of collateral deposited, collateral utilized and collateral status (available balance/due from client) with break up in terms of cash, Fixed Deposit Receipts (FDRs), Bank Guarantee and securities.
The Client shall ensure that it has the required legal capacity to, and is authorized to, enter into the relationship with stock broker and is capable of performing his obligations and undertakings hereunder. All actions required to be taken to ensure compliance of all the transactions, which the Client may enter into shall be completed by the Client prior to such transaction being entered into.
The stock broker / stock broker and depository participant shall not directly /indirectly compel the clients to execute Power of Attorney (PoA) or Demat Debit and Pledge Instruction (DDPI) or deny services to the client if the client refuses to execute PoA or DDPI.

ELECTRONIC CONTRACT NOTES (ECN)

In case, client opts to receive the contract note in electronic form, he shall provide an appropriate e-mail id to the stock broker. The client shall communicate to the stock broker any change in the email-id through a physical letter. If the client has opted for internet trading, the request for change of email id may be made through the secured access by way of client specific user id and password.
The stock broker shall ensure that all ECNs sent through the e-mail shall be digitally signed, encrypted, non-tamper able and in compliance with the provisions of the IT Act, 2000. In case, ECN is sent through e-mail as an attachment, the attached file shall also be secured with the digital signature, encrypted and non-tamperable.
The client shall note that non-receipt of bounced mail notification by the stock broker shall amount to delivery of the contract note at the e-mail ID of the client.
The stock broker shall retain ECN and acknowledgement of the e-mail in a soft and non-tamperable form in the manner prescribed by the exchange in compliance with the provisions of the IT Act, 2000

and as per the extant rules/regulations/circulars/guidelines issued by SEBI/Stock Exchanges from time to time. The proof of delivery i.e., log report generated by the system at the time of sending the contract notes shall be maintained by the stock broker for the specified period under the extant regulations of SEBI/stock exchanges. The log report shall provide the details of the contract notes that are not delivered to the client/e-mails rejected or bounced back. The stock broker shall take all possible steps to ensure receipt of notification of bounced mails by him at all times within the stipulated time period under the extant regulations of SEBI/stock exchanges.

The stock broker shall continue to send contract notes in the physical mode to such clients who do not opt to receive the contract notes in the electronic form. Wherever the ECNs have not been delivered to the client or has been rejected (bouncing of mails) by the e-mail ID of the client, the stock broker shall send either a physical contract note to the client or an ECN through electronic instant messaging services within the stipulated time under the extant regulations of SEBI/stock exchanges and maintain the proof of delivery of such physical contract notes.
In addition to the e-mail communication of the ECNs to the client, the stock broker shall simultaneously publish the ECN on his designated web-site, if any, in a secured way and enable relevant access to the clients and for this purpose, shall allot a unique user name and password to the client, with an option to the client to save the contract note electronically and/or take a print out of the same.

LAW AND JURISDICTION

In addition to the specific rights set out in this document, the stock broker and the client shall be entitled to exercise any other rights which the stock broker or the client may have under the Rules, Bye-laws and Regulations of the Exchanges in which the client chooses to trade and circulars/notices issued thereunder or Rules and Regulations of SEBI.
The provisions of this document shall always be subject to Government notifications, any rules, regulations, guidelines and circulars/notices issued by SEBI and Rules, Regulations and Bye laws of the relevant stock exchanges, where the trade is executed, that may be in force from time to time.
The stock broker and the client shall abide by conciliation report/settlement agreement/arbitration award passed by the conciliator/Arbitrator(s) under the Arbitration and Conciliation Act, 1996. However, there is also a provision of appeal within the stock exchanges, if either party is not satisfied with the arbitration award.
Words and expressions which are used in this document but which are not defined herein shall, unless the context otherwise requires, have the same meaning as assigned thereto in the Rules, Byelaws and Regulations and circulars/notices issued thereunder of the Exchanges/SEBI.
All additional voluntary clauses/document added by the stock broker should not be in contravention with rules/regulations/notices/circulars of Exchanges/SEBI. Any changes in such voluntary clauses/document(s) need to be preceded by a notice of 15 days. Any changes in the rights and obligations which are specified by Exchanges/SEBI shall also be brought to the notice of the clients.
If the rights and obligations of the parties hereto are altered by virtue of change in Rules and regulations of SEBI or Bye-laws, Rules and Regulations of the relevant stock Exchanges where the trade is executed, such changes shall be deemed to have been incorporated herein in modification of the rights and obligations of the parties mentioned in this document.

RIGHTS AND OBLIGATIONS OF MEMBERS, AUTHORIZED PERSONS AND CLIENTS

As prescribed by SEBI and Commodity Exchanges

The client shall invest/trade in those commodities /contracts/other instruments admitted to dealings on the Exchanges as defined in the Rules, Byelaws and Business Rules/ Regulations of Exchanges/SEBI and circulars/notices issued there under from time to time.
The Member, Authorized Person and the client shall be bound by all the Rules, Byelaws and Business Rules of the Exchange and circulars/notices issued there under and Rules and Regulations of SEBI and relevant notifications of Government authorities as may be in force from time to time.
The client shall satisfy himself of the capacity of the Member to deal in commodities and/or deal in derivatives contracts and wishes to execute its orders through the Member and the client shall from time to time continue to satisfy itself of such capability of the Member before executing orders through the Member.
The Member shall continuously satisfy itself about the genuineness and financial soundness of the client and investment objectives relevant to the services to be provided.
The Member shall take steps to make the client aware of the precise nature of the Member's liability for business to be conducted, including any limitations, the liability and the capacity in which the Member acts.
Requirements of professional diligence
1. The Member must exercise professional diligence while entering into a financial contract or discharging any obligations under it.
2. "professional diligence" means the standard of skill and care that a Member would be reasonably expected to exercise towards a Client, commensurate with-
  1. honest market practice;
  2. the principle of good faith;
  3. level of knowledge, experience and expertise of the Client;
  4. the nature and degree of risk embodied in the financial product* or financial service being availed by the Client; and
  5. the extent of dependence of the Client on the Member.

*Commodity derivative contract

The Authorized Person shall provide necessary assistance and co-operate with the Member in all its dealings with the client(s).

CLIENT INFORMATION

The client shall furnish all such details in full as are required by the Member in "Account Opening Form" with supporting details, made mandatory by commodity exchanges/SEBI from time to time.
The client shall familiarize himself with all the mandatory provisions in the Account Opening documents. Any additional clauses or documents specified by the Member shall be non-mandatory; therefore, subject to specific acceptance by the client.
The client shall immediately notify the Member in writing if there is any change in the information in the 'account opening form' as provided at the time of account opening and thereafter; including the information on winding up petition/insolvency petition or any litigation which may have material bearing on his capacity. The client shall provide/update the financial information to the Member on a periodic basis.
A. Protection from unfair terms in financial contracts**
1. An unfair term of a non-negotiated contract will be void.
2. A term is unfair if it –
  1. causes a significant imbalance in the rights and obligations of the parties under the financial contract, to the detriment of the Client; and
  2. is not reasonably necessary to protect the legitimate interests of the Member.
3. The factors to be taken into account while determining whether a term is unfair, include –
  1. the nature of the financial product or financial service dealt with under the financial contract;
  2. the extent of transparency of the term;

**contracts offered by commodity exchanges

the extent to which the term allows a Client to compare it with other financial contracts for similar financial products or financial services; and
the financial contract as a whole and the terms of any other contract on which it is dependent.

A term is transparent if it –
1. is expressed in reasonably plain language that is likely to be understood by the Client;
2. is legible and presented clearly; and
3. is readily available to the Client affected by the term.
If a term of a financial contract is determined to be unfair under point 11.A.c, the parties will continue to be bound by the remaining terms of the financial contract to the extent that the financial contract is capable of enforcement without the unfair term.

11.B.

"Non-negotiated contract" means a contract whose terms, other than the terms contained in point 11.C. (given below) are not negotiated between the parties to the financial contract and includes –

a financial contract in which, relative to the Client, the Member has a substantially greater bargaining power in determining terms of the financial contract; and
a standard form contract.

"Standard form contract" means a financial contract that is substantially not negotiable for the Client, except for the terms contained in point 11.C.
Even if some terms of a financial contract are negotiated in form, the financial contract may be regarded as a non-negotiated contract if so indicated by –

an overall and substantial assessment of the financial contract; and
the substantial circumstances surrounding the financial contract

In a claim that a financial contract is a non-negotiated contract, the onus of demonstrating otherwise will be on the Member.

11. C.

The above does not apply to a term of a financial contract if it –

defines the subject matter of the financial contract;
sets the price that is paid, or payable, for the provision of the financial product or financial service under the financial contract and has been clearly disclosed to the Client; or
is required, or expressly permitted, under any law or regulations.

The exemption under point 11.C does not apply to a term that deals with the payment of an amount which is contingent on the occurrence or non- occurrence of any particular event.

The Member and Authorized Person shall maintain all the details of the client as mentioned in the account opening form or any other information pertaining to the client, confidentially and that they shall not disclose the same to any person/authority except as required under any law/regulatory requirements. Provided however that the Member may so disclose information about his client to any person or authority with the express permission of the client.

13. A. Protection of personal information and confidentiality

"Personal information" means any information that relates to a Client or allows a Client's identity to be inferred, directly or indirectly, and includes –
1. name and contact information;
2. biometric information, in case of individuals
3. information relating to transactions in, or holdings of, financial products
4. information relating to the use of financial services; or
5. such other information as may be specified.

13. B.

A Member must –

not collect personal information relating to a Client in excess of what is required for the provision of a financial product or financial service;
maintain the confidentiality of personal information relating to Clients and not disclose it to a third party, except in a manner expressly permitted under point 13.B.b.;
make best efforts to ensure that any personal information relating to a Client that it holds is accurate, up to date and complete;
ensure that Clients can obtain reasonable access to their personal information, subject to any exceptions that the Regulator may specify; and
allow Clients an effective opportunity to seek modifications to their personal information to ensure that the personal information held by the Member is accurate, up to date and complete.

A Member may disclose personal information relating to a Client to a third party only if –

it has obtained prior written informed consent of the Client for the disclosure, after giving the Client an effective opportunity to refuse consent;
the Client has directed the disclosure to be made;
the Regulator has approved or ordered the disclosure, and unless prohibited by the relevant law or regulations, the Client is given an opportunity to represent under such law or regulations against such disclosure;
the disclosure is required under any law or regulations, and unless prohibited by such law or regulations, the Client is given an opportunity to represent under such law or regulations against such disclosure;
the disclosure is directly related to the provision of a financial product or financial service to the Client, if the Member –

informs the Client in advance that the personal information may be shared with a third party; and
makes arrangements to ensure that the third party maintains the confidentiality of the personal information in the same manner as required under this Part; or

the disclosure is made to protect against or prevent actual or potential fraud, unauthorised transactions or claims, if the Member arranges with the third party to maintain the confidentiality of the personal information in the manner required under this Part.-

"Third party" means any person other than the concerned Member, including a person belonging to the same group as the Member.

14. A. Requirement of fair disclosure both initially and on continuing basis

Member must ensure fair disclosure of information that is likely to be required by a Client to make an informed transactional decision.
In order to constitute fair disclosure, the information must be provided –

sufficiently before the Client enters into a financial contract, so as to allow the Client reasonable time to understand the information;
in writing and in a manner that is likely to be understood by a Client belonging to a particular category; and
in a manner that enables the Client to make reasonable comparison of the financial product or financial service with other similar financial products or financial services.

The types of information that must be disclosed to a Client in relation to a financial product or financial service, which may include information regarding –

main characteristics of the financial product or financial service, including its features, benefits and risks to the Client;
consideration to be paid for the financial product or financial service or the manner in which the consideration is calculated;
existence, exclusion or effect of any term in the financial product or financial contract;
nature, attributes and rights of the Member, including its identity, regulatory status and affiliations;
contact details of the Member and the methods of communication to be used between the Member and the Client;
rights of the Client to rescind a financial contract within a specified period; or
rights of the Client under any law or regulations.

14. B.

Member must provide a Client that is availing a financial product or financial service provided by it, with the following continuing disclosures –

any material change to the information that was required to be disclosed under point 14.A at the time when the Client initially availed the financial product or financial service;
information relating to the status or performance of a financial product held by the Client, as may be required to assess the rights or interests in the financial product or financial service; and
any other information that may be specified.

A continuing disclosure must be made –

within a reasonable time-period from the occurrence of any material change or at reasonable periodic intervals, as applicable; and
in writing and in a manner that is likely to be understood by a Client belonging to that category.

MARGINS

The client shall pay applicable initial margins, withholding margins, special margins or such other margins as are considered necessary by the Member or the Exchange or as may be directed by SEBI from time to time as applicable to the segment(s) in which the client trades. The Member is permitted in its sole and absolute discretion to collect additional margins (even though not required by the Exchange or SEBI) and the client shall be obliged to pay such margins within the stipulated time.
The client understands that payment of margins by the client does not necessarily imply complete satisfaction of all dues. In spite of consistently having paid margins, the client may, on the settlement of its trade, be obliged to pay (or entitled to receive) such further sums as the contract may dictate/require.

TRANSACTIONS AND SETTLEMENTS

The client shall give any order for buy or sell of commodities derivatives contract in writing or in such form or manner, as may be mutually agreed between the client and the Member however ensuring the regulatory requirements in this regard are complied with. The Member shall ensure to place orders and execute the trades of the client, only in the Unique Client Code assigned to that client.
The Member shall inform the client and keep him apprised about trading/settlement cycles, delivery/payment schedules, any changes therein from time to time, and it shall be the responsibility in turn of the client to comply with such schedules/procedures of the relevant commodity exchange where the trade is executed.
The Member shall ensure that the money deposited by the client shall be kept in a separate account, distinct from his/its own account or account of any other client and shall not be used by the Member for himself/itself or for any other client or for any purpose other than the purposes mentioned in Rules, circulars, notices, guidelines of SEBI and/or Rules, Business Rules, Bye-laws, circulars and notices of Exchange.
Where the Exchange(s) cancels trade(s) suo moto all such trades including the trade/s done on behalf of the client shall ipso facto stand cancelled, Member shall be entitled to cancel the respective contract(s) with client(s).
The transactions executed on the Exchange are subject to Rules, Byelaws and Business Rules and circulars/notices issued thereunder of the Exchanges where the trade is executed and all parties to such trade shall have submitted to the jurisdiction of such court as may be specified by the Byelaws and Business Rules of the Exchanges where the trade is executed for the purpose of giving effect to the provisions of the Rules, Byelaws and Business Rules of the Exchanges and the circulars/notices issued thereunder.

BROKERAGE

The Client shall pay to the Member brokerage and statutory levies as are prevailing from time to time and as they apply to the Client's account, transactions and to the services that Member renders to the Client. The Member shall not charge brokerage more than the maximum brokerage permissible as per the Rules, Business Rules and Bye-laws of the relevant commodity exchanges and/or Rules of SEBI.

LIQUIDATION AND CLOSE OUT OF POSITION

Without prejudice to the Member's other rights (including the right to refer a matter to arbitration), the client understands that the Member shall be entitled to liquidate/close out all or any of the client's positions for non-payment of margins or other amounts, outstanding debts, etc. and adjust the proceeds of such liquidation/close out, if any, against the client's liabilities/obligations. Any and all losses and financial charges on account of such liquidation/closing-out shall be charged to and borne by the client.
In the event of death or insolvency of the client or his/its otherwise becoming incapable of receiving and paying for or delivering or transferring commodities which the client has ordered to be bought or sold, Member may close out the transaction of the client and claim losses, if any, against the estate of the client. The client or his nominees, successors, heirs and assignee shall be entitled to any surplus which may result there from. The client shall note that transfer of funds/commodities in favor of a Nominee shall be valid discharge by the Member against the legal heir.

DISPUTE RESOLUTION

The Member shall co-operate in redressing grievances of the client in respect of all transactions routed through it.
The client and the Member shall refer any claims and/or disputes with respect to deposits, margin money, etc., to arbitration as per the Rules, Byelaws and Business Rules of the Exchanges where the trade is executed and circulars/notices issued thereunder as may be in force from time to time.
The client/Member understands that the instructions issued by an authorized representative for dispute resolution, if any, of the client/Member shall be binding on the client/Member in accordance with the letter authorizing the said representative to deal on behalf of the said client/Member.
Requirement for each Member to have an effective grievance redress mechanism which is accessible to all its Clients
1. A Member must have in place an effective mechanism to receive and redress complaints from its Clients in relation to financial products or financial services provided by it, or on its behalf, in a prompt and fair manner.
2. A Member must inform a Client, at the commencement of relationship with the Client and at such other time when the information is likely to be required by the Client, of –
  1. the Client's right to seek redress for any complaints; and
  2. the processes followed by the Member to receive and redress complaints from its Clients.
A. Suitability of advice for the Client

Right to receive advice that is suitable taking into account the relevant personal circumstances of the Client, such as the Clients financial circumstances and needs. This obligation would apply to persons who render advice to Clients and the regulator may specify categories of financial products and service that necessarily require such advice to be given.

A Member must –
1. make all efforts to obtain correct and adequate information about the relevant personal circumstances of a Client; and
2. ensure that the advice given is suitable for the Client after due consideration of the relevant personal circumstances of the Client.
If it is reasonably apparent to the Member that the available information regarding the relevant personal circumstances of a Client is incomplete or inaccurate, the Member must warn the Client of the consequences of proceeding on the basis of incomplete or inaccurate information.
If a Client intends to avail of a financial product or financial service that the Member determines unsuitable for the Client, the Member –
1. must clearly communicate its advice to the Client in writing and in a manner that is likely to be understood by the Client; and
2. may provide the financial product or financial service requested by the Client only after complying with point 29.A.a and obtaining a written acknowledgement from the Client.

Dealing with conflict of interest

In case of any conflict between the interests of a Client and that of the Member, preference much be given to the Client interests.

A member must –
1. provide a Client with information regarding any conflict of interests, including any conflicted remuneration that the Member has received or expects to receive for making the advice to the Client; and
2. give priority to the interests of the Client if the Member knows, or reasonably ought to know, of a conflict between –
  1. its own interests and the interests of the Client; or
  2. the interests of the concerned Member and interests of the Client, in cases where the Member is a financial representative.
The information under point 16a.i. must be given to the Client in writing and in a manner that is likely to be understood by the Client and a written acknowledgement of the receipt of the information should be obtained from the Client.
In this section, "conflicted remuneration" means any benefit, whether monetary or non-monetary, derived by a Member from persons other than Clients that could, under the circumstances, reasonably be expected to influence the advice given by the Member to a Client.

TERMINATION OF RELATIONSHIP

This relationship between the Member and the client shall be terminated; if the Member for any reason ceases to be a member of the commodity exchange including cessation of membership by reason of the Member's default, death, resignation or expulsion or if the certificate is cancelled by the Exchange.
The Member, Authorized Person and the client shall be entitled to terminate the relationship between them without giving any reasons to the other party, after giving notice in writing of not less than one month to the other parties. Notwithstanding any such termination, all rights, liabilities and obligations of the parties arising out of or in respect of transactions entered into prior to the termination of this relationship shall continue to subsist and vest in/be binding on the respective parties or his/its respective heirs, executors, administrators, legal representatives or successors, as the case may be.
In the event of demise/insolvency of the Authorized Person or the cancellation of his/its registration with the Board or/withdrawal of recognition of the Authorized Person by the commodity exchange and/or termination of the agreement with the Authorized Person by the Member, for any reason whatsoever, the client shall be informed of such termination and the client shall be deemed to be the direct client of the Member and all clauses in the 'Rights and Obligations' document(s) governing the Member, Authorized Person and client shall continue to be in force as it is, unless the client intimates to the Member his/its intention to terminate their relationship by giving a notice in writing of not less than one month.

ADDITIONAL RIGHTS AND OBLIGATIONS

The Member and client shall reconcile and settle their accounts from time to time as per the Rules, Business Rules, Bye Laws, Circulars, Notices and Guidelines issued by SEBI and the relevant Exchanges where the trade is executed.
The Member shall issue a contract note to his clients for trades executed in such format as may be prescribed by the Exchange from time to time containing records of all transactions including details of order number, trade number, trade time, trade price, trade quantity, details of the derivatives contract, client code, brokerage, all charges levied etc. and with all other relevant details as required therein to be filled in and issued in such manner and within such time as prescribed by the Exchange. The Member shall send contract notes to the investors within 24 hours of the execution of the trades in hard copy and/or in electronic form using digital signature.
The Member shall make pay out of funds or delivery of commodities as per the Exchange Rules, Bye-Laws, Business Rules and Circulars, as the case may be, to the Client on receipt of the payout from the relevant Exchange where the trade is executed unless otherwise specified by the client and subject to such terms and conditions as may be prescribed by the relevant Exchange from time to time where the trade is executed.
The Member shall send a complete `Statement of Accounts' for both funds and commodities in respect of each of its clients in such periodicity and format within such time, as may be prescribed by the relevant Exchange, from time to time, where the trade is executed. The Statement shall also state that the client shall report errors, if any, in the Statement within such time as may be prescribed by the relevant Exchange from time to time where the trade was executed, from the receipt thereof to the Stock broker.
The Member shall send margin statements to the clients on daily basis. Margin statement should include, inter-alia, details of collateral deposited, collateral utilized and collateral status (available balance/due from client) with break up in terms of cash, Fixed Deposit Receipts (FDRs), Bank Guarantee, warehouse receipts, securities etc.
The Client shall ensure that it has the required legal capacity to, and is authorized to, enter into the relationship with Member and is capable of performing his obligations and undertakings hereunder. All actions required to be taken to ensure compliance of all the transactions, which the Client may enter into shall be completed by the Client prior to such transaction being entered into.
In case, where a member surrenders his/ her/ its membership, Member gives a public notice inviting claims, if any, from investors. In case of a claim relating to transactions executed on the trading system of the Exchange, ensure that client lodge a claim with the Exchange within the stipulated period and with the supporting documents.
A. Protection from unfair conduct which includes misleading conduct & abusive conduct
1. Unfair conduct in relation to financial products or financial services is prohibited.
2. "Unfair conduct" means an act or omission by a Member or its financial representative that significantly impairs, or is likely to significantly impair, the ability of a Client to make an informed transactional decision and includes –
  1. misleading conduct under point 41.B
  2. abusive conduct under point 41.C
  3. such other conduct as may be specified.

B.
1. Conduct of a Member or its financial representative in relation to a determinative factor is misleading if it is likely to cause the Client to take a transactional decision that the Client would not have taken otherwise, and the conduct involves –
  1. providing the Client with inaccurate information or information that the Member or financial representative does not believe to be true; or
  2. providing accurate information to the Client in a manner that is deceptive.
2. In determining whether a conduct is misleading under point 41.B.a, the following factors must be considered to be "determinative factors" –
  1. the main characteristics of a financial product or financial service, including its features, benefits and risks to the Client;
  2. the Client's need for a particular financial product or financial service or its suitability for the Client;
  3. the consideration to be paid for the financial product or financial service or the manner in which the consideration is calculated;
  4. the existence, exclusion or effect of any term in a financial contract, which is material term in the context of that financial contract;
  5. the nature, attributes and rights of the Member, including its identity, regulatory status and affiliations; and
  6. the rights of the Client under any law or regulations.

C.
1. A conduct of a Member or its financial representative in relation to a financial product or financial service is abusive if it –
  1. involves the use of coercion or undue influence; and
  2. causes or is likely to cause the Client to take a transactional decision that the Client would not have taken otherwise.
2. In determining whether a conduct uses coercion or undue influence, the following must be considered –
  1. the timing, location, nature or persistence of the conduct;
  2. the use of threatening or abusive language or behavior;
  3. the exploitation of any particular misfortune or circumstance of the Client, of which the Member is aware, to influence the Client's decision with regard to a financial product or financial service;
  4. any non-contractual barriers imposed by the Member where the Client wishes to exercise rights under a financial contract, including –
  5. the right to terminate the financial contract;
  6. the right to switch to another financial product or another Member and
  7. a threat to take any action, depending on the circumstances in which the threat is made.

ELECTRONIC CONTRACT NOTES (ECN)

In case, client opts to receive the contract note in electronic form, he shall provide an appropriate e-mail id to the stock broker. The client shall communicate to the stock broker any change in the email-id through a physical letter. If the client has opted for internet trading, the request for change of email id may be made through the secured access by way of client specific user id and password.
The Member shall ensure that all ECNs sent through the e-mail shall be digitally signed, encrypted, non-tamperable and in compliance with the provisions of the IT Act, 2000. In case, ECN is sent through e-mail as an attachment, the attached file shall also be secured with the digital signature, encrypted and non-tamperable.
The client shall note that non-receipt of bounced mail notification by the Member shall amount to delivery of the contract note at the e-mail ID of the client.
The Member shall retain ECN and acknowledgement of the e-mail in a soft and non-tamperable form in the manner prescribed by the exchange in compliance with the provisions of the IT Act, 2000 and as per the extant rules/circulars/guidelines issued by SEBI/Commodity exchanges from time to time. The proof of delivery i.e., log report generated by the system at the time of sending the contract notes shall be maintained by the Member for the specified period under the extant rules/circulars/guidelines issued by SEBI/Commodity exchanges. The log report shall provide the details of the contract notes that are not delivered to the client/e-mails rejected or bounced back. The Member shall take all possible steps to ensure receipt of notification of bounced mails by him at all times within the stipulated time period under the extant rules/circulars/guidelines issued by SEBI/Commodity exchanges.
The Member shall continue to send contract notes in the physical mode to such clients who do not opt to receive the contract notes in the electronic form. Wherever the ECNs have not been delivered to the client or has been rejected (bouncing of mails) by the e-mail ID of the client, the Member shall send a physical contract note to the client within the stipulated time under the extant Regulations/ Rules, Bye-Laws, Business Rules and Circulars of SEBI/commodity exchanges and maintain the proof of dispatch and delivery of such physical contract notes.
In addition to the e-mail communication of the ECNs to the client, the Member shall simultaneously publish the ECN on his designated web-site, if any, in a secured way and enable relevant access to the clients and for this purpose, shall allot a unique user name and password to the client, with an option to the client to save the contract note electronically and/or take a print out of the same.

LAW AND JURISDICTION

In addition to the specific rights set out in this document, the Member, Authorised Person and the client shall be entitled to exercise any other rights which the Member or the client may have under the Rules, Bye-laws and Business Rules of the Exchanges in which the client chooses to trade and circulars/notices issued thereunder or Rules of SEBI.
The provisions of this document shall always be subject to Government notifications, any rules, guidelines and circulars/notices issued by SEBI and Circulars, Rules, Business Rules and Bye laws of the relevant commodity exchanges, where the trade is executed, that may be in force from time to time.
The Member and the client shall abide by any award passed by the Arbitrator(s) under the Arbitration and Conciliation Act, 1996. However, there is also a provision of appeal, if either party is not satisfied with the arbitration award.
Words and expressions which are used in this document but which are not defined herein shall, unless the context otherwise requires, have the same meaning as assigned thereto in the Rules, Byelaws and Regulations/Business Rules and circulars/notices issued thereunder of the Exchanges/SEBI.
All additional voluntary/non-mandatory clauses/document added by the Member should not be in contravention with Rules/ Business Rules/Notices/Circulars of Exchanges/SEBI. Any changes in such voluntary clauses/document(s) need to be preceded by a notice of 15 days. Any changes in the rights and obligations which are specified by Exchanges/SEBI shall also be brought to the notice of the clients.
If the rights and obligations of the parties hereto are altered by virtue of change in Rules of SEBI or Bye-laws, Rules and Business Rules of the relevant commodity exchanges where the trade is executed, such changes shall be deemed to have been incorporated herein in modification of the rights and obligations of the parties mentioned in this document.
Members are required to send account statement to their clients every month.

INTERNET & WIRELESS TECHNOLOGY BASED TRADING FACILITY

(Commodities)

(All the clauses mentioned in the 'Rights and Obligations' document(s) shall be applicable. Additionally, the clauses mentioned herein shall also be applicable.)

Member is eligible for providing Internet based trading (IBT) and commodities trading through the use of wireless technology that shall include the use of devices such as mobile phone, laptop with data card, etc. which use Internet Protocol (IP). The Member shall comply with all requirements applicable to internet based trading/-commodities trading using wireless technology as may be specified by SEBI & the Exchanges from time to time.
The client is desirous of investing/trading in commodities and for this purpose, the client is desirous of using either the internet based trading facility or the facility for commodities trading through use of wireless technology. The Member shall provide the Member's IBT Service to the Client, and the Client shall avail of the Member's IBT Service, on and subject to SEBI/Exchanges Provisions and the terms and conditions specified on the Member's IBT Web Site provided that they are in line with the norms prescribed by Exchanges/SEBI.
The Member shall bring to the notice of client the features, risks, responsibilities, obligations and liabilities associated with commodities trading through wireless technology/internet or any other technology should be brought to the notice of the client by the Member.
The Member shall make the client aware that the Member's IBT system itself generates the initial password and its password policy as stipulated in line with norms prescribed by Exchanges/SEBI.
The Client shall be responsible for keeping the Username and Password confidential and secure and shall be solely responsible for all orders entered and transactions done by any person whosoever through the Member's IBT System using the Client's Username and/or Password whether or not such person was authorized to do so. Also the client is aware that authentication technologies and strict security measures are required for the internet trading/ commodities trading through wireless technology through order routed system and undertakes to ensure that the password of the client and/or his authorized representative are not revealed to any third party including employees and dealers of the Member
The Client shall immediately notify the Member in writing if he forgets his password, discovers security flaw in Member's IBT System, discovers/suspects discrepancies/ unauthorized access through his username/password/account with full details of such unauthorized use, the date, the manner and the transactions effected pursuant to such unauthorized use, etc.
The Client is fully aware of and understands the risks associated with availing of a service for routing orders over the internet/ commodities trading through wireless technology and Client shall be fully liable and responsible for any and all acts done in the Client's Username/password in any manner whatsoever.
The Member shall send the order/trade confirmation through email to the client at his request. The client is aware that the order/ trade confirmation is also provided on the web portal. In case client is trading using wireless technology, the Member shall send the order/trade confirmation on the device of the client.
The client is aware that trading over the internet involves many uncertain factors and complex hardware, software, systems, communication lines, peripherals, etc. are susceptible to interruptions and dislocations. The Member and the Exchange do not make any representation or warranty that the Member's IBT Service will be available to the Client at all times without any interruption.
The Client shall not have any claim against the Exchange or the Member on account of any suspension, interruption, non-availability or malfunctioning of the Member's IBT System or Service or the Exchange's service or systems or non-execution of his orders due to any link/system failure at the Client/Members/Exchange end for any reason beyond the control of the Member/Exchanges.

INTERNET & WIRELESS TECHNOLOGY BASED TRADING FACILITY

(Equity & Derivatives)

(All the clauses mentioned in the ‘Rights and Obligations’ document(s) shall be applicable. Additionally, the clauses mentioned herein shall also be applicable.)

Stock broker is eligible for providing Internet based trading (IBT) and securities trading through the use of wireless technology that shall include the use of devices such as mobile phone, laptop with data card, etc. which use Internet Protocol (IP). The stock broker shall comply with all requirements applicable to internet based trading/securities trading using wireless technology as may be specified by SEBI & the Exchanges from time to time.
The client is desirous of investing/trading in securities and for this purpose, the client is desirous of using either the internet based trading facility or the facility for securities trading through use of wireless technology. The Stock broker shall provide the Stock broker’s IBT Service to the Client, and the Client shall avail of the Stock broker’s IBT Service, on and subject to SEBI/Exchanges Provisions and the terms and conditions specified on the Stock broker’s IBT Web Site provided that they are in line with the norms prescribed by Exchanges/SEBI.
The stock broker shall bring to the notice of client the features, risks, responsibilities, obligations and liabilities associated with securities trading through wireless technology/internet/smart order routing or any other technology should be brought to the notice of the client by the stock broker.
The stock broker shall make the client aware that the Stock Broker’s IBT system itself generates the initial password and its password policy as stipulated in line with norms prescribed by Exchanges/SEBI.
The Client shall be responsible for keeping the Username and Password confidential and secure and shall be solely responsible for all orders entered and transactions done by any person whosoever through the Stock broker’s IBT System using the Client’s Username and/or Password whether or not such person was authorized to do so. Also the client is aware that authentication technologies and strict security measures are required for the internet trading/securities trading through wireless technology through order routed system and undertakes to ensure that the password of the client and/or his authorized representative are not revealed to any third party including employees and dealers of the stock broker
The Client shall immediately notify the Stock broker in writing if he forgets his password, discovers security flaw in Stock Broker’s IBT System, discovers/suspects discrepancies/ unauthorized access through his username/password/account with full details of such unauthorized use, the date, the manner and the transactions effected pursuant to such unauthorized use, etc.
The Client is fully aware of and understands the risks associated with availing of a service for routing orders over the internet/securities trading through wireless technology and Client shall be fully liable and responsible for any and all acts done in the Client’s Username/password in any manner whatsoever.
The stock broker shall send the order/trade confirmation through email to the client at his request. The client is aware that the order/ trade confirmation is also provided on the web portal. In case client is trading using wireless technology, the stock broker shall send the order/trade confirmation on the device of the client.
The client is aware that trading over the internet involves many uncertain factors and complex hardware, software, systems, communication lines, peripherals, etc. are susceptible to interruptions and dislocations. The Stock broker and the Exchange do not make any representation or warranty that the Stock broker’s IBT Service will be available to the Client at all times without any interruption.
The Client shall not have any claim against the Exchange or the Stock broker on account of any suspension, interruption, non-availability or malfunctioning of the Stock broker’s IBT System or Service or the Exchange’s service or systems or non-execution of his orders due to any link/system failure at the Client/Stock brokers/Exchange end for any reason beyond the control of the stock broker/Exchanges.

RIGHTS AND OBLIGATIONS OF BENEFICIAL OWNER AND DEPOSITORY PARTICIPANT

As prescribed by SEBI and Depositories

General Clause

The Beneficial Owner and the Depository participant (DP) shall be bound by the provisions of the Depositories Act, 1996, SEBI (Depositories and Participants) Regulations, 2018, Rules and Regulations of Securities and Exchange Board of India (SEBI), Circulars / Notifications / Guidelines issued there under, Bye Laws and Business Rules/Operating Instructions issued by the Depositories and relevant notifications of Government Authorities as may be in force from time to time.
The DP shall open/activate demat account of a beneficial owner in the depository system only after receipt of complete Account opening form, KYC and supporting documents as specified by SEBI from time to time.

Beneficial Owner information

The DP shall maintain all the details of the beneficial owner(s) as mentioned in the account opening form, supporting documents submitted by them and/or any other information pertaining to the beneficial owner confidentially and shall not disclose the same to any person except as required by any statutory, legal or regulatory authority in this regard.
The Beneficial Owner shall immediately notify the DP in writing, if there is any change in details provided in the account opening form as submitted to the DP at the time of opening the demat account or furnished to the DP from time to time.

Fees/Charges/Tariff

The Beneficial Owner shall pay such charges to the DP for the purpose of holding and transfer of securities in dematerialized form and for availing depository services as may be agreed to from time to time between the DP and the Beneficial Owner as set out in the Tariff Sheet provided by the DP. It may be informed to the Beneficial Owner that "no charges are payable for opening of demat accounts"
In case of Basic Services Demat Accounts, the DP shall adhere to the charge structure as laid down under the relevant SEBI and/or Depository circulars/directions/notifications issued from time to time.
The DP shall not increase any charges/tariff agreed upon unless it has given a notice in writing of not less than thirty days to the Beneficial Owner regarding the same.

Dematerialization

The Beneficial Owner shall have the right to get the securities, which have been admitted on the Depositories, dematerialized in the form and manner laid down under the Bye Laws, Business Rules and Operating Instructions of the depositories.

Separate Accounts

The DP shall open separate accounts in the name of each of the beneficial owners and securities of each beneficial owner shall be segregated and shall not be mixed up with the securities of other beneficial owners and/or DP's own securities held in dematerialized form.

The DP shall not facilitate the Beneficial Owner to create or permit any pledge and /or hypothecation or any other interest or encumbrance over all or any of such securities submitted for dematerialization and/or held in demat account except in the form and manner prescribed in the Depositories Act, 1996, SEBI (Depositories and Participants) Regulations, 2018 and Bye-Laws/Operating Instructions/Business Rules of the Depositories.

Transfer of Securities

The DP shall effect transfer to and from the demat accounts of the Beneficial Owner only on the basis of an order, instruction, direction or mandate duly authorized by the Beneficial Owner and the DP shall maintain the original documents and the audit trail of such authorizations.
The Beneficial Owner reserves the right to give standing instructions with regard to the crediting of securities in his demat account and the DP shall act according to such instructions.
The stock broker / stock broker and depository participant shall not directly / indirectly compel the clients to execute Power of Attorney (PoA) or Demat Debit and Pledge Instruction (DDPI) or deny services to the client if the client refuses to execute PoA or DDPI.

Statement of account

The DP shall provide statements of accounts to the beneficial owner in such form and manner and at such time as agreed with the Beneficial Owner and as specified by SEBI/depository in this regard.
However, if there is no transaction in the demat account, or if the balance has become Nil during the year, the DP shall send one physical statement of holding annually to such BOs and shall resume sending the transaction statement as and when there is a transaction in the account.
The DP may provide the services of issuing the statement of demat accounts in an electronic mode if the Beneficial Owner so desires. The DP will furnish to the Beneficial Owner the statement of demat accounts under its digital signature, as governed under the Information Technology Act, 2000. However if the DP does not have the facility of providing the statement of demat account in the electronic mode, then the Participant shall be obliged to forward the statement of demat accounts in physical form.
In case of Basic Services Demat Accounts, the DP shall send the transaction statements as mandated by SEBI and/or Depository from time to time.

Manner of Closure of Demat account

The DP shall have the right to close the demat account of the Beneficial Owner, for any reasons whatsoever, provided the DP has given a notice in writing of not less than thirty days to the Beneficial Owner as well as to the Depository. Similarly, the Beneficial Owner shall have the right to close his/her demat account held with the DP provided no charges are payable by him/her to the DP. In such an event, the Beneficial Owner shall specify whether the balances in their demat account should be transferred to another demat account of the Beneficial Owner held with another DP or to rematerialize the security balances held.
Based on the instructions of the (BO), the DP shall initiate the procedure for transferring such security balances or rematerialize such security balances within a period of 2 working days as per procedure specified from time to time by the depository in case of no outstanding dues and in case of outstanding dues, shall provide 30 days' notice. In case of non-payment of dues, DP shall reject the account closure request and in case the dues are cleared by BO, respective account shall be closed by DP within 2 working days of clearing the dues. Provided further, closure of demat account shall not affect the rights, liabilities and obligations of either the (BO) or the DP and shall continue to bind the parties to their satisfactory completion.

Default in payment of charges

In event of Beneficial Owner committing a default in the payment of any amount provided in Clause 5 & 6 within a period of thirty days from the date of demand, without prejudice to the right of the DP to close the demat account of the Beneficial Owner, the DP may charge interest at a rate as specified by the Depository from time to time for the period of such default.
In case the Beneficial Owner has failed to make the payment of any of the amounts as provided in Clause 5&6 specified above, the DP after giving two days notice to the Beneficial Owner shall have the right to stop processing of instructions of the Beneficial Owner till such time he makes the payment along with interest, if any.

Liability of the Depository

As per Section 16 of Depositories Act, 1996,

Without prejudice to the provisions of any other law for the time being in force, any loss caused to the beneficial owner due to the negligence of the depository or the participant, the depository shall indemnify such beneficial owner.

Where the loss due to the negligence of the participant under Clause (1) above, is indemnified by the depository, the depository shall have the right to recover the same from such participant.

Freezing/ Defreezing of accounts

The Beneficial Owner may exercise the right to freeze/defreeze his/her demat account maintained with the DP in accordance with the procedure and subject to the restrictions laid down under the Bye Laws and Business Rules/Operating Instructions.
The DP or the Depository shall have the right to freeze/defreeze the accounts of the Beneficial Owners on receipt of instructions received from any regulator or court or any statutory authority.
The Joint holders are aware that in case of any Statutory Order for freezing any one joint holder, the demat account will be frozen and the other joint holders will have to obtain a specific Order for unfreezing their percentage of joint ownership by submitting the relevant documentary proof to the Order issuing authority.

Redressal of Investor grievance

The DP shall redress all grievances of the Beneficial Owner against the DP within a period of thirty days from the date of receipt of the complaint.

Authorized representative

If the Beneficial Owner is a body corporate or a legal entity, it shall, along with the account opening form, furnish to the DP, a list of officials authorized by it, who shall represent and interact on its behalf with the Participant. Any change in such list including additions, deletions or alterations thereto shall be forthwith communicated to the Participant.

Law and Jurisdiction

In addition to the specific rights set out in this document, the DP and the Beneficial owner shall be entitled to exercise any other rights which the DP or the Beneficial Owner may have under the Rules, Bye Laws and Regulations of the respective Depository in which the demat account is opened and circulars/notices issued there under or Rules and Regulations of SEBI.
The provisions of this document shall always be subject to Government notification, any rules, regulations, guidelines and circulars/ notices issued by SEBI and Rules, Regulations and Bye-laws of the relevant Depository, where the Beneficial Owner maintains his/ her account, that may be in force from time to time.
The Beneficial Owner and the DP shall abide by the arbitration and conciliation procedure prescribed under the Bye-laws of the depository and that such procedure shall be applicable to any disputes between the DP and the Beneficial Owner.
Words and expressions which are used in this document but which are not defined herein shall unless the context otherwise requires, have the same meanings as assigned thereto in the Rules, Bye-laws and Regulations and circulars/notices issued there under by the depository and /or SEBI
Any changes in the rights and obligations which are specified by SEBI/Depositories shall also be brought to the notice of the clients at once.
If the rights and obligations of the parties hereto are altered by virtue of change in Rules and regulations of SEBI or Bye-laws, Rules and Regulations of the relevant Depository, where the Beneficial Owner maintains his/her account, such changes shall be deemed to have been incorporated herein in modification of the rights and obligations of the parties mentioned in this document.

RISK DISCLOSURE DOCUMENT FOR CAPITAL MARKET AND DERIVATIVES SEGMENTS

This document contains important information on trading in Equities/Derivatives Segments of the stock exchanges. All prospective constituents should read this document before trading in Equities/Derivatives Segments of the Exchanges.

Stock exchanges/SEBI does neither singly or jointly and expressly nor impliedly guarantee nor make any representation concerning the completeness, the adequacy or accuracy of this disclosure document nor have Stock exchanges /SEBI endorsed or passed any merits of participating in the trading segments. This brief statement does not disclose all the risks and other significant aspects of trading.

In the light of the risks involved, you should undertake transactions only if you understand the nature of the relationship into which you are entering and the extent of your exposure to risk.

You must know and appreciate that trading in Equity shares, derivatives contracts or other instruments traded on the Stock Exchange, which have varying element of risk, is generally not an appropriate avenue for someone of limited resources/limited investment and/or trading experience and low risk tolerance. You should therefore carefully consider whether such trading is suitable for you in the light of your financial condition. In case you trade on Stock exchanges and suffer adverse consequences or loss, you shall be solely responsible for the same and Stock exchanges/its Clearing Corporation and/or SEBI shall not be responsible, in any manner whatsoever, for the same and it will not be open for you to take a plea that no adequate disclosure regarding the risks involved was made or that you were not explained the full risk involved by the concerned stock broker. The constituent shall be solely responsible for the consequences and no contract can be rescinded on that account. You must acknowledge and accept that there can be no guarantee of profits or no exception from losses while executing orders for purchase and/or sale of a derivative contract being traded on Stock exchanges.

It must be clearly understood by you that your dealings on Stock exchanges through a stock broker shall be subject to your fulfilling certain formalities set out by the stock broker, which may inter alia include your filling the know your client form, reading the rights and obligations, do’s and don’ts, etc., and are subject to the Rules, Byelaws and Regulations of relevant Stock exchanges, its Clearing Corporation, guidelines prescribed by SEBI and in force from time to time and Circulars as may be issued by Stock exchanges or its Clearing Corporation and in force from time to time.

Stock exchanges does not provide or purport to provide any advice and shall not be liable to any person who enters into any business relationship with any stock broker of Stock exchanges and/or any third party based on any information contained in this document. Any information contained in this document must not be construed as business advice. No consideration to trade should be made without thoroughly understanding and reviewing the risks involved in such trading. If you are unsure, you must seek professional advice on the same.

In considering whether to trade or authorize someone to trade for you, you should be aware of or must get acquainted with the following:-

1. BASIC RISKS:

1.1 Risk of Higher Volatility:

Volatility refers to the dynamic changes in price that a security/derivatives contract undergoes when trading activity continues on the Stock Exchanges. Generally, higher the volatility of a security/derivatives contract, greater is its price swings. There may be normally greater volatility in thinly traded securities / derivatives contracts than in active securities /derivatives contracts. As a result of volatility, your order may only be partially executed or not executed at all, or the price at which your order got executed may be substantially different from the last traded price or change substantially thereafter, resulting in notional or real losses.

1.2 Risk of Lower Liquidity:

Liquidity refers to the ability of market participants to buy and/or sell securities / derivatives contracts expeditiously at a competitive price and with minimal price difference. Generally, it is assumed that more the numbers of orders available in a market, greater is the liquidity. Liquidity is important because with greater liquidity, it is easier for investors to buy and/or sell securities / derivatives contracts swiftly and with minimal price difference, and as a result, investors are more likely to pay or receive a competitive price for securities / derivatives contracts purchased or sold. There may be a risk of lower liquidity in some securities / derivatives contracts as compared to active securities / derivatives contracts. As a result, your order may only be partially executed, or may be executed with relatively greater price difference or may not be executed at all

1.2.1 Buying or selling securities / derivatives contracts as part of a day trading strategy may also result into losses, because in such a situation, securities / derivatives contracts may have to be sold/ purchased at low / high prices, compared to the expected price levels, so as not to have any open position or obligation to deliver or receive a security / derivatives contract.

1.3 Risk of Wider Spreads:

Spread refers to the difference in best buy price and best sell price. It represents the differential between the price of buying a security / derivatives contract and immediately selling it or vice versa. Lower liquidity and higher volatility may result in wider than normal spreads for less liquid or illiquid securities / derivatives contracts. This in turn will hamper better price formation.

1.4 Risk-reducing orders:

The placing of orders (e.g., "stop loss” orders, or "limit" orders) which are intended to limit losses to certain amounts may not be effective many a time because rapid movement in market conditions may make it impossible to execute such orders.

1.4.1 A "market" order will be executed promptly, subject to availability of orders on opposite side, without regard to price and that, while the customer may receive a prompt execution of a "market" order, the execution may be at available prices of outstanding orders, which satisfy the order quantity, on price time priority. It may be understood that these prices may be significantly different from the last traded price or the best price in that security / derivatives contract.

1.4.2 A "limit" order will be executed only at the "limit" price specified for the order or a better price. However, while the customer receives price protection, there is a possibility that the order may not be executed at all.

1.4.3 A stop loss order is generally placed "away" from the current price of a stock / derivatives contract, and such order gets activated if and when the security / derivatives contract reaches, or trades through, the stop price. Sell stop orders are entered ordinarily below the current price, and buy stop orders are entered ordinarily above the current price. When the security / derivatives contract reaches the pre -determined price, or trades through such price, the stop loss order converts to a market/limit order and is executed at the limit or better. There is no assurance therefore that the limit order will be executable since a security / derivatives contract might penetrate the pre-determined price, in which case, the risk of such order not getting executed arises, just as with a regular limit order.

1.5 Risk of News Announcements:

News announcements that may impact the price of stock / derivatives contract may occur during trading, and when combined with lower liquidity and higher volatility, may suddenly cause an unexpected positive or negative movement in the price of the security / contract.

1.6 Risk of Rumors:

Rumors about companies / currencies at times float in the market through word of mouth, newspapers, websites or news agencies, etc. The investors should be wary of and should desist from acting on rumors.

1.7 System Risk:

High volume trading will frequently occur at the market opening and before market close. Such high volumes may also occur at any point in the day. These may cause delays in order execution or confirmation.

1.7.1 During periods of volatility, on account of market participants continuously modifying their order quantity or prices or placing fresh orders, there may be delays in order execution and its confirmations.

1.7.2 Under certain market conditions, it may be difficult or impossible to liquidate a position in the market at a reasonable price or at all, when there are no outstanding orders either on the buy side or the sell side, or if trading is halted in a security / derivatives contract due to any action on account of unusual trading activity or security / derivatives contract hitting circuit filters or for any other reason.

1.8 System/Network Congestion:

Trading on exchanges is in electronic mode, based on satellite/leased line based communications, combination of technologies and computer systems to place and route orders. Thus, there exists a possibility of communication failure or system problems or slow or delayed response from system or trading halt, or any such other problem/glitch whereby not being able to establish access to the trading system/network, which may be beyond control and may result in delay in processing or not processing buy or sell orders either in part or in full. You are cautioned to note that although these problems may be temporary in nature, but when you have outstanding open positions or unexecuted orders, these represent a risk because of your obligations to settle all executed transactions.

2. As far as Derivatives segments are concerned, please note and get yourself acquainted with the following additional features:-

2.1 Effect of "Leverage" or "Gearing":

In the derivatives market, the amount of margin is small relative to the value of the derivatives contract so the transactions are 'leveraged' or 'geared'. Derivatives trading, which is conducted with a relatively small amount of margin, provides the

possibility of great profit or loss in comparison with the margin amount. But transactions in derivatives carry a high degree of risk.

You should therefore completely understand the following statements before actually trading in derivatives and also trade with caution while taking into account one's circumstances, financial resources, etc. If the prices move against you, you may lose a part of or whole margin amount in a relatively short period of time. Moreover, the loss may exceed the original margin amount.

Futures trading involve daily settlement of all positions. Every day the open positions are marked to market based on the closing level of the index / derivatives contract. If the contract has moved against you, you will be required to deposit the amount of loss (notional) resulting from such movement. This amount will have to be paid within a stipulated time frame, generally before commencement of trading on next day.
If you fail to deposit the additional amount by the deadline or if an outstanding debt occurs in your account, the stock broker may liquidate a part of or the whole position or substitute securities. In this case, you will be liable for any losses incurred due to such close-outs.
Under certain market conditions, an investor may find it difficult or impossible to execute transactions. For example, this situation can occur due to factors such as illiquidity i.e. when there are insufficient bids or offers or suspension of trading due to price limit or circuit breakers etc.
In order to maintain market stability, the following steps may be adopted: changes in the margin rate, increases in the cash margin rate or others. These new measures may also be applied to the existing open interests. In such conditions, you will be required to put up additional margins or reduce your positions.
You must ask your broker to provide the full details of derivatives contracts you plan to trade i.e. the contract specifications and the associated obligations.

2.2 Currency specific risks:

The profit or loss in transactions in foreign currency-denominated contracts, whether they are traded in your own or another jurisdiction, will be affected by fluctuations in currency rates where there is a need to convert from the currency denomination of the contract to another currency.
Under certain market conditions, you may find it difficult or impossible to liquidate a position. This can occur, for example when a currency is deregulated or fixed trading bands are widened.
Currency prices are highly volatile. Price movements for currencies are influenced by, among other things: changing supply-demand relationships; trade, fiscal, monetary, exchange control programs and policies of governments; foreign political and economic events and policies; changes in national and international interest rates and inflation; currency devaluation; and sentiment of the market place. None of these factors can be controlled by any individual advisor and no assurance can be given that an advisor's advice will result in profitable trades for a participating customer or that a customer will not incur losses from such events.

2.3 Risk of Option holders:

An option holder runs the risk of losing the entire amount paid for the option in a relatively short period of time. This risk reflects the nature of an option as a wasting asset which becomes worthless when it expires. An option holder who neither sells his option in the secondary market nor exercises it prior to its expiration will necessarily lose his entire investment in the option. If the price of the underlying does not change in the anticipated direction before the option expires, to an extent sufficient to cover the cost of the option, the investor may lose all or a significant part of his investment in the option.
The Exchanges may impose exercise restrictions and have absolute authority to restrict the exercise of options at certain times in specified circumstances.

2.4 Risks of Option Writers:

If the price movement of the underlying is not in the anticipated direction, the option writer runs the risks of losing substantial amount.
The risk of being an option writer may be reduced by the purchase of other options on the same underlying interest and thereby assuming a spread position or by acquiring other types of hedging positions in the options markets or other markets. However, even where the writer has assumed a spread or other hedging position, the risks may still be significant. A spread position is not necessarily less risky than a simple 'long' or 'short' position.
Transactions that involve buying and writing multiple options in combination, or buying or writing options in combination with buying or selling short the underlying interests, present additional risks to investors. Combination transactions, such as option spreads, are more complex than buying or writing a single option. And it should be further noted that, as in any area of investing, a complexity not well understood is, in itself, a risk factor. While this is not to suggest that combination strategies should not be considered, it is advisable, as is the case with all investments in options, to consult with someone who is experienced and knowledgeable with respect to the risks and potential rewards of combination transactions under various market circumstances.

3. TRADING THROUGH WIRELESS TECHNOLOGY/ SMART ORDER ROUTING OR ANY OTHER TECHNOLOGY:

Any additional provisions defining the features, risks, responsibilities, obligations and liabilities associated with securities trading through wireless technology/ smart order routing or any other technology should be brought to the notice of the client by the stock broker.

4. GENERAL

4.1 The term ‘constituent’ shall mean and include a client, a customer or an investor, who deals with a stock broker for the purpose of acquiring and/or selling of securities / derivatives contracts through the mechanism provided by the Exchanges.

4.2 The term ‘stock broker’ shall mean and include a stock broker, a broker or a stock broker, who has been admitted as such by the Exchanges and who holds a registration certificate from SEBI.

RISK MANAGEMENT POLICY

Risk management is an integral part of the "HEM FINLEASE PRIVATE LIMITED" and HEM SECURITIES LIMITED (herein referred Jointly as "HEM") approach to decision-making and accountability. HEM Finlease/Hem Securities is working as a Corporate Broking entity, conducts its business operations based on sound Risk Management Policies to pursue prudent business practices and, for providing hassle free trading / investment facility to the registered clients. The function of Risk Management being an ongoing exercise is reviewed periodically and necessary measures are initiated to enhance its overall effectiveness.

Various Risk Management Measures implemented by Hem Finlease/Hem Securities are detailed below:

1. CLIENT'S EXPOSURE LIMITS:

As per SEBI circular ref. no. SEBI/HO/MRD2_DCAP/CIR/2021/0598 dated July 20, 2021, regarding Segregation and Monitoring of Collateral at the client level, the trading limit will be provided to client once the funds are allocated at the clearing corporation.

Margin/Deposit based limits are assigned to the customers for trading purpose. VaR/SPAN margin including any additional margin as specified by the exchanges or as per our own assessment is blocked at scrip level on the positions taken by the clients during the day.

Deposit calculation: Deposit is calculated at customer level after netting off ledger balance in all segments. Margin is calculated as follows:

Margin = Ledger Balance (Dr/Cr) + Net value after haircut of holding in margin pledge available with HEM.

Valuation of margin pledge on eligible scrips: Margin pledge valuation is done on previous day's closing price. Net valuation is calculated by applying appropriate haircut based on VaR margin percentage specified by the exchanges or HEM Finlease prescribed rates, as the case may be.
Extreme market conditions: Limits are assigned based on credit in the ledger. In such conditions, clients will be allowed to buy only to the extent of Clear ledger credit available.

Margin Limit in Cash segment: We provide Margin based limit on the clear balance available in the customer's ledger account in our books, value of collateral benefit on pledged securities after applying haircut on holding lying in the client account and credit for sales. Limit on the basis of unsettled sales (credit for sale) and uncleared cheques will be at discretion of HEM.

Margin Limit for F&O, Currency and Commodity segment: HEM provides margin limit in F&O, Currency and Commodity segments based on availability of initial and exposure margin upfront available into the client account in the form of Clear Financial Ledger, cash collateral and non-cash collateral.

Client-wise differential limits: We shall have the prerogative to allow differential limits in Cash and Derivative segments varying from client to client, depending upon credit worthiness and past conduct of each client or any other criteria which we may find suitable.

HEM Discretions on limits:

(i) HEM has discretion to change the limits on the basis of risk perception and other factors considered relevant (such as broker level/exchange level limits in specific securities or Income declaration or volume Specific exposures based on surveillance measures)

(ii) HEM shall not be able to inform the client of such variation, reduction or imposition in advance.

(iii) HEM shall not be responsible for client's inability to execute any order on account of any such variation, reduction or imposition of limits.

(iv) HEM may provide exposure to client on stocks held in the CUSPA and pool account

LEVERAGE AND EXPOSURE LIMITS IN MARGIN TRADING FACILITY

While providing the margin trading facility, RMS Team shall ensure that:

Exposure to Single Client: The exposure to any individual client at any point of time shall not exceed either 10% of the company's maximum allowable exposure or Rs. 4 crore, whichever is lower.
Exposure to Single Stock: The exposure to any single stock (script) at any point of time shall not exceed either 10% of the company's maximum allowable exposure or Rs. 5 crore, whichever is higher.
Client-Specific Exposure: The exposure in any particular stock by a single client at any point of time shall not exceed Rs. 1 crore.
Mark-to-Market: Collateral and funded stocks (stocks purchased with borrowed funds) shall be marked to market on a daily basis.
Limit on Single Script: Any individual script (stock) within a client's collateral shall not constitute more than 50% of the total exposure provided to that client.
Debit Ledger Balance: The outstanding debit balance in a client's ledger shall not remain unpaid for more than 90 days at any given time.
Margin Shortfall: If the margin is not met by the client then the shares will be squared off after giving margin call.

MTF approved exchange list: If a stock is no longer in the MTF approved exchange list, any funded position must be closed. The client will have to make full payment for the stocks which have been removed from Exchange MTF approved list. (HEM refer both exchange approved stocks list (Group 1 stocks)

HEM reserves the right to liquidate and close client positions if the above requirements are not fulfilled.

These rules are designed to mitigate risks and ensure responsible management of margin trading activities, protecting both the company and its clients from excessive exposure and potential losses.

2. HANDLING OF SECURITIES FOR THE CUSTOMERS

It is the client's responsibility to clear his/her funds obligations towards unpaid securities by T-day itself (T indicates Trading day). If the client clears his/her funds obligation by the T-day EOD, then only those fully paid securities will be transferred to the respective client's Demat Account provided the net financial ledger balance after considering outstanding margin obligation (across exchange) is not in debit.
With regard to the unpaid securities (i.e., the securities that have not been paid for in full by the clients on the Trading day), such securities shall be transferred to the respective client's demat account followed by creation of an auto-pledge (i.e., without any specific instruction from the client) with the reason "unpaid", in favor of a separate account titled –"client unpaid securities pledgee account".
In case of receipt of partial payment from the client, the securities amounting to the value of such part payment will be transferred to the client's Demat account and remaining unpaid securities shall be pledged in CUSPA.
It should be noted that 150% of value of securities may be pledged by us against the outstanding debit of the client.
The securities pledged in 'client unpaid securities pledgee account' (CUSPA) shall either be transferred to the demat account of respective client upon fulfillment of client's funds obligation or shall be disposed of in the market.
Maximum permissible time to fulfill funds obligation towards unpaid securities:-

We may allow the client a maximum of four days from the date of securities pay-out ( T day+1+3 days) to meet his/her fund obligation; otherwise the unpaid securities will be disposed of by the next trading day.

Example: TM / CM transfers the pay-out securities to its unpaid client for the settlement having settlement day (i.e. pay-out day) on Monday where CUSPA Auto pledge is created instantly. Assuming there is no trading holiday in between except Saturday and Sunday,

-If the client fulfills its funds obligation by Thursday then we may release the pledge by the next trading day only, provided there are clear funds in his/her running ledger account for such unpaid securities and no running financial ledger account shall be negative on the date of transfer of such unpaid securities to his/her demat account.

- If the client does not fulfill its funds obligation by Thursday, we shall dispose of such unpaid securities in the market by Friday.

If the Client fulfills its funds obligation within four days from the date of securities pay-out (T day+1+3 days, We may release the pledge by the next trading day only on the best effort basis provided there are clear funds in his/her running ledger account for such unpaid securities and No running financial ledger account shall be negative on the date of transfer of such unpaid securities to its demat account.

However releasing the pledge by the next trading day is only on the best effort basis where we reserve the right to release the shares by the maximum time of five trading days after the date of payout of such unpaid securities.

In case of receipt of partial payment from the client, we may dispose of full value of unpaid securities which were transferred into CUSPA on the settlement day against debit balance or the securities amounting to the value of such part payment will be transferred to the client's Demat account
In case of non-payment or partial payment, as the case may be, HEM reserves the right to transfer the unpaid securities to the demat account of the client. We have sole discretion on this.
The unpaid securities shall be sold in the market with the Unique Client Code (UCC) of the respective client (without pre-order confirmation) to the extent of debit balance of the respective settlement. Profit / Loss on the sale transaction of the unpaid securities, if any shall be transferred to / adjusted from the respective client account.
CUSPA account of HEM (reduced by the appropriate haircut subject to minimum 20%) may be considered for collection and reporting of margin by HEM to the extent of debit balances in client ledger arising out of buying obligation of such unpaid securities.
Clients will be liable to pay interest charges and delayed payment charges (DPC) in case of non-payment of their Pay in obligations and Cash margin requirements on the Trading day itself. If the client's financial ledger balance (including the Cash margin on derivatives) is in debit Delayed Payment Charge (DPC) / Interest will be levied, for the amount in debit.

3. THE RIGHT TO SELL CLIENTS SECURITIES OR CLOSE CLIENTS POSITIONS, WITHOUT GIVING NOTICE TO THE CLIENT, ON ACCOUNT OF NON-PAYMENT OF CLIENTS DUES (THIS SHALL BE LIMITED TO THE EXTENT OF SETTLEMENT / MARGIN OBLIGATION)

HEM shall have the right to sell client's securities, both unpaid securities as well as collaterals pledged towards margins, or close out client's open positions, without giving notice to the client where there is a delay/failure of the client to the pay-in obligations and/or there is a failure of the client to bring additional margins to cover the increase in risk in the dynamic market conditions.

A. Unpaid Securities in Capital Market:

In case of unpaid obligation, to cover the pay-in obligations of client, we shall sell the unpaid/ partially paid securities within five trading days after the pay-out date. In addition we may sell the collaterals pledged by the client towards margins and/or paid securities purchased by the client in earlier settlements where the sale proceeds of unpaid securities are inadequate to cover the pay-in obligations and/where the unpaid securities appear to be comparatively illiquid and cannot be sold at reasonable rates to the extent required.
HEM may follow the Company Policy for liquidation of securities but it may not be binding on it to follow this method in all cases.

B. The margin shortfall in F&O, Currency and Commodity Segments:

Positions of the client may be closed out to the extent of margin shortfall on the T+1 basis /Real time monitoring basis.
While computing margin shortfall, value of unapproved securities shall not be considered.
As per the Exchange requirements, the HEM is required to maintain a prescribed ratio between cash and non cash collaterals deposited with the Exchange. HEM shall therefore have the prerogative to insist for at least 50% margin in cash and may not consider the value of securities over and above the cash component for the purpose of calculating margins shortfall and may close the F&O, Currency and Commodity segments position where it finds deviation.

Hence if at any time, client doesn't maintain enough margins in cash, i.e. 50%, then the client's account will be in debit balance and applicable delayed payment (interest) charges will be applicable on the shortfall in cash margin.

The client needs to maintain the defined margin to retain position in derivatives segment (FNO, Currency, Commodity), RMS team reserves the right to initiate liquidation of position up to the required margin at any point of time. If the defined margin or exchange margin is short any open position can be squared-off at the HEM discretion.

Note:

RMS liquidation will be done on T+1 basis for the Mark to Market (MTM) debit/margin shortfall. Even if due to sudden scrip volatility during the day, if a shortfall arises during the day due to MTM loss or margin increases, RMS liquidation will be done on the same day.

On T+1 day the required margin needs to be maintained before 9.00 AM in order to continue holding the position.

HEM reserves the right to square-off all intraday positions (cash as well as derivatives) and carry forward derivatives trades, the clients will be alerted at specified percentage on a best effort basis, however, given the market volatility, sending an alert should not be mis-construed as an obligation for HEM. The position will be reduced on the best effort basis and the client will be liable for any losses on square-off. All pending orders of the client will be cancelled. If a client is creating a buy position in options, then the full payment of the premium shall be blocked. In case of any MTM calculations or margin requirements, this option premium shall not be considered as a part of the calculation.

If due to reasons such as connectivity, link or system failure, stock at Lower or Upper circuit i.e. circumstances beyond control, an intraday position is not squared-off, then it will be treated as a carry forward position and any loss or penalty due this will be borne by clients only. RMS reserves the right to liquidate the same on the next trading day as soon as markets open in the absence of required margin.

C. Intra-day positions:

HEM shall have right to close out any intra-day positions taken by the client after a defined 'Cutoff' time (Presently 30 minutes before close of market).

D. General:

HEM may take into account the sales made, positions closed by the client or collections received from the client till a cut off time (as per company policy) while selling the securities /closing the clients positions against debit / margin shortfall.
While selling the securities/ closing the client positions, HEM may not take into consideration Cheques showing uncleared although deposited by the client with HEM until clear proceeds of such instruments are received by HEM in its bank account.
HEM shall have the right to sell clients securities or close out client's position but it shall not be under any obligations to undertake this exercise compulsorily.
HEM shall have the right to sell clients securities in case of Ageing of debit and margin shortfall in the client account
HEM shall not be responsible for any losses and penalties / charges levied by exchanges(s) caused on such square off
HEM shall therefore not be under any obligation to compensate / or provide reasons of any delay or omission on its part to sell clients securities or close open positions of the client.

4. CONDITIONS UNDER WHICH A CLIENT MAY NOT BE ALLOWED TO TAKE FURTHER POSITION OR THE BROKER MAY CLOSE THE EXISTING POSITION OF A CLIENT

A. All markets:

Client is not having adequate margins as per conditions in Risk Management policy.

B. Capital markets:

The client has not been able to meet his pay-in obligations in cash by the schedule date of pay-in irrespective of the value of collaterals available with HEM.
Clear proceeds of the cheque deposited by the client to meet the pay-in obligations have not yet been received by HEM.
Client is trading in "illiquid" scripts and volumes in his account exceed internal cut off limit fixed by HEM.

C. F&O, Currency and Commodity Segment:

The client has not made payment for Market to Market loss in Ledger
The "open" positions in a contract exceeded or are close to market wide cut off limits or client wise permissible positions by exchange

D. Intra- day:

Clients will not be able to place intra-day orders after a cut-off time fixed by HEM. (30 minutes prior to close of market)

E. Event Based:

Where based on a corporate / market event, HEM has the risk perception that further trading in the securities /contracts may not be allowed to its clients and/or the market.

5. PHYSICAL SETTLEMENT OF STOCK DERIVATIVES

As per SEBI circular starting from October 2019 expiry, if client hold a position in any Stock F&O contract, at expiry, he/she is required to give/take delivery of stocks.

Accordingly, if clients hold a position in any Stock F&O contract, at expiry and doesn't square off positions before the close of trading hours on the expiry day, he or she will either have to take delivery (for long futures, long in the money calls, short in the money puts) or give delivery of the underlying stock (short futures, long in the money puts, short "In the money" calls) as per the nature of contract.

Obligation of the clients:-

All positions that result in receiving delivery of shares will require the clients to have funds equivalent:

For Futures: Settlement Price * Lot Size * Number of lots
For Options: Strike Price * Lot Size * Number of lots

All positions that result in giving delivery of shares will require the clients to have shares in their demat account equal to the deliverable quantity i.e Lot Size * Number of lots.

6. TEMPORARILY SUSPENDING OR CLOSING A CLIENT'S ACCOUNT AT THE CLIENTS' REQUEST

HEM may carry a periodic review of the client accounts and may suspend the accounts from trading in the following circumstances:

The client is inactive for more than 12 month across group companies
The account is under investigation by any regulatory body.
Based on the recommendations made by the branch manager due to excessive speculations, unclear balances.
"Addressee" left, refusal to accept mails, signature mismatch on POD's or other reasons which may create suspicion.
ECN failed (bounced email) on more than 3 instances until client submits and registers new email id.
Non-delivery of the Statement of Account sent on periodic basis.
Non-Updation of communication details viz., email id, mobile no., landline details or it is found to be belonging to a third person.
Client lodges a complaint either directly with HEM or through Exchange relating alleged
Unauthorized Trades being executed in the account.
On notices received from statutory, Government or Local authorities and Income Tax, a Judicial or Quasi-Judicial authority, etc.
Client is reported to or known to have expired.
Due to any internal surveillance (if client indulges into manipulative trade practice) / regulatory orders (debarring orders) / client mis-conduct etc.

HEM may also suspend the account based on the written request received from the client.

7. REFUSAL OF ORDERS FOR PENNY STOCKS/ILLIQUID STOCKS

Penny/ illiquid Stocks are traded at relatively low price and market capitalization.

HEM shall have absolute discretion to accept, refuse or partially accept any buy or sell order for execution from a client in respect of penny stocks, illiquid stocks, stocks having low liquidity, illiquid "options", far month "options", writing of "options", and any other contracts which as per the perception of HEM are extremely volatile or subject to Market manipulation.

HEM may permit restrictive acceptance of orders in such scrips/contracts in controlled environments like orders received from clients being forwarded by branches to a centralized desk at HO instead of allowing trading in such scrips/contracts at branch level or through online trading platform. HEM shall not be responsible for delay in execution of such orders and consequential opportunity loss or financial loss to the client.

HEM may take appropriate declarations from the clients before accepting such orders.

HEM shall have the prerogative to place such restrictions, notwithstanding the fact that the client has adequate credit balance or margin available in his account and/or the client had previously purchased or sold such securities/contracts through HEM itself.

8. SHORT / NON-COLLECTION OF MARGINS AND PENALTIES IMPOSED THEREON

As per regulations, short margin penalty is levied when available client margin is less than the prescribed margin requirement of the Exchange/ Clearing Corporation. Shortage in Margin shall attract penalty as may be levied by the Exchange/Clearing Corporation.

Penalty on short/non-collection of upfront margins:

HEM shall pass on the penalty levied by clearing corporations on account of short/non-collection of upfront margin directly to the client. If short/non collection of upfront margin is on account of following reasons attributable to client:

I. Cheque issued by client to HEM is dishonoured.

II. Increase in margins on account of change in hedge position by client/ expiry of some leg(s) of the hedge positions of the clients.

With respect to point number II mentioned above, note that the potential situations resulting in a hedge break / loss of cross margin benefits like square off by the clients / expiry of some leg(s) of the hedge positions of the clients, leading to higher margin obligations on the open position(s).

Penalty on short/non-collection of margins (Other than upfront margins):

Other than "upfront margins" remaining margins such as consolidated crystallized obligation, delivery margins, other margins (Mark-to-market & additional margins) etc. Such various types of penalties would also be passed on to the client in case client fails to add funds in the account.

Penalties arising in case of sudden volatility in the market and increase in margin by the Exchange, which is beyond the jurisdiction of HEM, may be imposed on the client after providing relevant information.

9. TECHNOLOGICAL RISKS:-

HEM provides Trading on exchanges in Mobile/Web based platform, based on leased line/Internet based communications, combination of technologies and computer systems to place and route orders. Thus, there exists a possibility of communication failure or system problems or slow or delayed response from system or trading halt, or any such other problem/glitch whereby not being able to establish access to the trading system/network, which may be beyond the control of and may result in delay in processing or not processing buy or sell orders either in part or in full. You are cautioned to note that, although these problems may be temporary in nature, but when clients have outstanding open positions or unexecuted orders, these represent a risk because of their obligations to settle all executed transactions.

Impact of the Technological/System failure which may be faced by the client: -

Revenue loss - due to technical issue, the trading is on halt
Opportunity loss for Clients, since clients won't be able to place orders on time
Reputational Risk
Financial risk due to not squaring the open/risky position at the right time and price

10. REPORTING TO THE EXCHANGE(S)

In case the client is found indulging in suspicious activities, HEM may report such transactions to the exchange(s). The company is not responsible for any loss incurred by the client if he/she is found guilty of unethical practices. The company will share all the required information to the regulator, exchange, or any other recognized regulatory body when a client specific details is asked for. The company reserves the right to inform the client based on the directions received from the fore mentioned regulatory body.

11. FACILITY OF VOLUNTARY FREEZING/ BLOCKING THE ONLINE ACCESS OF THE TRADING ACCOUNT TO CLIENTS ON ACCOUNT OF SUSPICIOUS ACTIVITIES

.(As per requirements of SEBI Circular No. SEBI/HO/MIRSD/POD-1/P/CIR/2024/4 dated January 12, 2024)

Modes through which a client can request/communicate to the Trading Member:-

If any suspicious activity is observed in the Trading Account, the client may request us to voluntarily freeze/block the online access of the trading account through any of the following communications to us at the e-mail ID support@hemnxt.com and/or telephone number +91- 9555993300

a) Email from registered e-mail ID

b) SMS / Call from registered mobile number

Issuing of acknowledgement to the clients on receipt of message:-

After validating that request, Member will issue the acknowledgement as well as freeze/block the online access of the client's trading account.

Time period within which the request shall be processed and the trading account shall be frozen/blocked:-

The timelines for freezing/ blocking of the online access of the clients' trading account is as under:

Scenario	Timelines for issuing acknowledgement as well as freezing / blocking of the online access of the trading account.
Request received during the trading hours¹ and within 15 minutes before the start of trading.	Within 15 minutes²
Request received after the trading hours and 15 minutes before the start of trading.	Before the start of next trading session

1. Trading hours shall be as follows:

Capital Market Segment: 9.15 a.m. to 3.30 p.m., Equity Derivatives Segment: 9.15 a.m. to 3.30 p.m., Currency Derivatives Segment: 09.00 a.m. to 05.00 p.m., Commodity Derivatives Segment: 09.00 a.m. to 11.30 p.m.

2. To begin with, the time limit of 15 minutes is being specified for the purpose of issuing acknowledgement as well as freezing/blocking of the online access of the trading account. This time limit shall be contracted after a review in next six months after the date of its applicability to enhance protection of investors from suspicious activities.

Action to be taken by the Trading Member pursuant to the receipt of request for freezing/blocking of the trading account:-

The Trading Member shall take the following actions on the receipt of request through any modes of communications as provided by the Trading Member for freezing/blocking of the online access of the trading account from the client:

Validate that the request is received from the client as per prescribed mode of communication and issue the acknowledgement as well as freeze/block the online access of the client's trading account and simultaneously cancel all the pending orders of the said client.
Post freezing/blocking the client's trading account, send a communication on the registered mobile number and registered e-mail ID of the client, stating that the online access to the trading account has been frozen/blocked and all the pending orders in the client's trading account, if any, have been cancelled along with the process of re-enablement for getting the online access to the trading account.
Details of open positions (if any) should also be communicated to the client along with contract expiry information within one hour from the freezing/blocking of the trading account. This will eliminate the risk of unwanted delivery settlement. This time limit shall be contracted after a review in the next six months after the date of its applicability to enhance protection of investors from suspicious activities.

Process for re-enabling the client for trading/transfers:-

The Trading Member shall re-enable the online access of trading account after carrying out necessary due diligence including validating the client request and unfreezing / unblocking the online access of the trading account.

Intimation to be provided by the trading member to the client:-

Post freezing/blocking the client's trading account, send a communication on the registered mobile number and registered e-mail ID of the client, stating that the online access to the trading account has been frozen/blocked and all the pending orders in the client's trading account, if any, have been cancelled along with the process of re-enablement for getting the online access to the trading account.

It is also clarified that:

a. Freezing/blocking is only for the online access to the client's trading account, and there shall be no restrictions on the Risk Management activities of the Trading Member.

b. The request for freezing/ blocking does not constitute request for marking client Unique Client Code (UCC) as inactive in the Exchange records.

The Company reserves right to amend/modify any of the policies/procedures mentioned above from time to time depending upon regulatory, market, external conditions and our internal risk management framework, and the customers can obtain such change/ modification from the Company's website.

Last reviewed on 01.10.2025

1. Details of Good Till Cancelled/Good Till Date and Orders (GTDt) -

Hem Finlease Private Ltd. ("HFPL") enables its clients to place "Good Till Date" (GTDt) orders.
GTDt is an order facility through which a client can place buy and sell limit orders in shares specifying the period for which the order instruction is valid. The period selected by the client shall be within the maximum validity date defined by HFPL. Since client has the right to define validity date ("order validity date"), this order type is called as Good Till Date (GTDt) order.
All existing and new clients of HFPL who are eligible to trade in Equity Cash product can avail GTDt facility for order placement.
The facility of placing a GTDt order is available in Equity Cash product only. It is not available for other products like Margin, MTF etc. As and when, GTDt orders are introduced in new segments the same shall be displayed through the HFPL website and subsequently updated in the policy.
Client can specify disclosed quantity while placing cash orders with GTDt order validity.
GTDt orders can only be placed by specifying a limit price. GTDt orders cannot be placed at market price.
If a GTDt order is not executed for the entire quantity, HFPL is authorized to place fresh orders for the unexecuted quantity for the client on the subsequent trading days till the entire quantity is executed or till the validity expires, whichever is earlier. This feature permits the client to specify the number of days during which the client intends to place the orders.
GTDt orders can be placed during the pre-open session for all scrips, however only orders in scrips that are pre-open enabled would be sent to exchange during the pre-open session. Orders in all other scrips not enabled for pre-open session would be treated as overnight orders and sent to exchange during normal trading session.
Client shall ensure that necessary funds/margins are available to place GTDt orders in their account for the unexecuted quantity of the order.
"Order Validity Date" means the date entered by the client while placing GTDt orders. This date shall be equal to or less than the maximum validity date defined by HFPL which would appear as the default "Order Validity Date". Client can choose the GTDt order validity date as less than or equal to the maximum validity date defined by HFPL. Client shall not be allowed to place orders with GTDt validity beyond maximum defined validity date. This order validity date shall be visible while placing the order on screen.
In case the GTDt order validity date falls on a non trading day, the order is expired by HFPL on the last trading day which falls prior to such order valid date which is a non trading day. Post the expiry, the status of GTDt order is updated as Expired (Closed).

Once a client has placed a GTDt order, HFPL will place orders for the unexecuted quantity of the GTDt order for all the days during the validity period or till the quantity is fully executed or cancelled or rejected due to any reason. Client may login only to check the status of such orders.
For the unexecuted quantity orders shall be placed daily as overnight orders during the validity period, i.e. until the order validity date is less than or equal to the next trade date provided such GTDt order remains unexecuted and is not cancelled, nor rejected due to any reason. The orders would be placed on these dates provided they are trading days.
All securities in BSE & NSE except securities in debt segment, NCD, Bonds and illiquid securities are eligible for the placing GTDt order.
Orders with GTDt validity can be placed both during the market hours as well as post market hours.
GTDt orders can also be placed over CallNTrade.
Clients can modify the quantity or limit price of a GTDt orders Clients can modify the order only when the order is in 'Ordered status' (during market hours) or 'Requested status' (after market hours). "GTDt Blocked" orders cannot be modified but can only be cancelled.
All GTDt orders can be cancelled.
The Brokerage rates and applicable charges are same for normal transactions and GTDt orders. Further, GTDt orders shall be settled in the same manner as normal equity market transactions.
Validity of GTD orders will be maximum 15 calendar days from the date of order placement.

2. Handling of GTDt orders in case of corporate actions :

Post Corporate Action, GTDt orders will be validated against DPR (Daily Price Range) sent by the exchange. Before revalidating the order for next trading day (post corporate action), system will check for circuit limits and daily price range and would validate orders only within the circuit limit and daily price ranges.

The orders which would get failed in circuit check and daily price range for next day pumping would be kept in system in "GTDt Blocked" status for retry on subsequent trading day.

SMS/ Notification will be sent to the customers when the GTDt orders fall short of Funds / Securities or Blocked due to price beyond DPR range.

3. Updating Clients for upcoming Corporate Actions:

All upcoming corporate actions including dividend, bonus, split, etc. shall be intimated to clients having unexecuted GTDt orders at least one day prior to the ex-date of the corporate action.

Clients shall review their GTDt orders pro-actively whenever there may be impact of corporate action on their order/s. It would be the onus of the client to take appropriate action to modify / cancel orders accordingly.

GUIDANCE NOTE - DO's AND DON'Ts FOR TRADING ON THE EXCHANGE(S) FOR INVESTORS

BEFORE YOU BEGIN TO TRADE

Ensure that you deal with and through only SEBI registered intermediaries. You may check their SEBI registration certificate number from the list available on the Stock exchanges www.nseindia.com, www.bseindia.com, www. mcx-sx.com, www.useindia.com and SEBI website www.sebi.gov.in.
Ensure that you fill the KYC form completely and strike off the blank fields in the KYC form.
Ensure that you have read all the mandatory documents viz. Rights and Obligations, Risk Disclosure Document, Policy and Procedure document of the stock broker.
Ensure to read, understand and then sign the voluntary clauses, if any, agreed between you and the stock broker. Note that the clauses as agreed between you and the stock broker cannot be changed without your consent.
Get a clear idea about all brokerage, commissions, fees and other charges levied by the broker on you for trading and the relevant provisions/ guidelines specified by SEBI/Stock exchanges.
Obtain a copy of all the documents executed by you from the stock broker free of charge.
In case you wish to execute Power of Attorney (POA) or Demat Debit and Pledge Instruction (DDPI) in favour of the Stock broker, authorizing it to operate your bank and demat account for specified purpose, please refer to the guidelines issued by SEBI/Exchanges in this regard.

TRANSACTIONS AND SETTLEMENTS

The stock broker may issue electronic contract notes (ECN) if specifically authorized by you in writing. You should provide your email id to the stock broker for the same. Don't opt for ECN if you are not familiar with computers.
Don't share your internet trading account's password with anyone.
Don't make any payment in cash to the stock broker.
Make the payments by account payee cheque in favour of the stock broker. Don't issue cheques in the name of sub-broker. Ensure that you have a documentary proof of your payment/deposit of securities with the stock broker, stating date, scrip, quantity, towards which bank/ demat account such money or securities deposited and from which bank/ demat account.
Note that facility of Trade Verification is available on stock exchanges' websites, where details of trade as mentioned in the contract note may be verified. Where trade details on the website do not tally with the details mentioned in the contract note, immediately get in touch with the Investors Grievance Cell of the relevant Stock exchange.
In case you have given specific authorization for maintaining running account, payout of funds or delivery of securities (as the case may be), may not be made to you within one working day from the receipt of payout from the Exchange. Thus, the stock broker shall maintain running account for you subject to the following conditions:

a) Such authorization from you shall be dated, signed by you only and contains the clause that you may revoke the same at any time.

b) The actual settlement of funds and securities shall be done by the stock broker, at least once in a calendar quarter or month, depending on your preference. While settling the account, the stock broker shall send to you a 'statement of accounts' containing an extract from the client ledger for funds and an extract from the register of securities displaying all the receipts/deliveries of funds and securities. The statement shall also explain the retention of funds and securities and the details of the pledged shares, if any.

c) On the date of settlement, the stock broker may retain the requisite securities/funds towards outstanding obligations and may also retain the funds expected to be required to meet derivatives margin obligations for next 5 trading days, calculated in the manner specified by the exchanges. In respect of cash market transactions, the stock broker may retain entire pay-in obligation of funds and securities due from clients as on date of settlement and for next day's business, he may retain funds/securities/margin to the extent of value of transactions executed on the day of such settlement in the cash market.

d) You need to bring any dispute arising from the statement of account or settlement so made to the notice of the stock broker in writing preferably within 7 (seven) working days from the date of receipt of funds/securities or statement, as the case may be. In case of dispute, refer the matter in writing to the Investors Grievance Cell of the relevant Stock exchanges without delay.

In case you have not opted for maintaining running account and pay-out of funds/securities is not received on the next working day of the receipt of payout from the exchanges, please refer the matter to the stock broker. In case there is dispute, ensure that you lodge a complaint in writing immediately with the Investors Grievance Cell of the relevant Stock exchange.
Please register your mobile number and email id with the stock broker, to receive trade confirmation alerts/ details of the transactions through SMS or email, by the end of the trading day, from the stock exchanges.

IN CASE OF TERMINATION OF TRADING MEMBERSHIP

In case, a stock broker surrenders his membership, is expelled from membership or declared a defaulter; Stock exchanges gives a public notice inviting claims relating to only the "transactions executed on the trading system" of Stock exchange, from the investors. Ensure that you lodge a claim with the relevant Stock exchanges within the stipulated period and with the supporting documents.
Familiarize yourself with the protection accorded to the money and/or securities you may deposit with your stock broker, particularly in the event of a default or the stock broker's insolvency or bankruptcy and the extent to which you may recover such money and/or securities may be governed by the Bye-laws and Regulations of the relevant Stock exchange where the trade was executed and the scheme of the Investors' Protection Fund in force from time to time.

DISPUTES/ COMPLAINTS

Please note that the details of the arbitration proceedings, penal action against the brokers and investor complaints against the stock brokers are displayed on the website of the relevant Stock exchange.
In case your issue/problem/grievance is not being sorted out by concerned stock broker/sub-broker then you may take up the matter with the concerned Stock exchange. If you are not satisfied with the resolution of your complaint then you can escalate the matter to SEBI.
Note that all the stock broker/sub-brokers have been mandated by SEBI to designate an e-mail ID of the grievance redressal division/compliance officer exclusively for the purpose of registering complaints.

GUIDANCE NOTE - DO's AND DON'Ts FOR THE CLIENTS

Do's

Trade only through Registered Members of the Exchange. Check from the MCX website at following link https:// www.mcxindia.com/Membership/Notice Board/ member-AP Details to see whether the Member is registered with the MCX.
Insist on filling up a standard 'Know Your Client (KYC)' form before you commence trading
Insist on getting a Unique Client Code (UCC) and ensure all your trades are done under the said UCC.
Insist on reading and signing a standard 'Risk Disclosure Agreement'.
Obtain a copy of your KYC and/or other documents executed by you with the Member, from the Member.
Cross check the genuineness of trades carried out at the MCX through the trade verification facility available on the MCX website at the following link https: // www.mcxindia.com. The trades can be verified online where trade information is available up to 5 working days from the trade date.
Insist on a duly signed Contract Note in specified format for every executed trade within 24 hours of trade, highlighting the details of the trade along with your UCC.
Ensure that the Contract Note contains all the relevant information such as Member Registration Number, Order No., Order Date, Order time, Trade No., Trade rate, Quantity, Arbitration Clause, etc.
Obtain receipt for collaterals deposited with the Member towards margins.
Go through the Rules, Bye-laws, Regulations, Circulars, Directives, Notifications of the Exchange as well as of the Regulators, Government and other authorities to know your rights and duties vis-à-vis those of the Member.
Ask all relevant questions and clear your doubts with your Member before transacting.
Insist on receiving the bills for every settlement.
Insist on Monthly statements of your ledger account and report any discrepancies in the statement to your Member within 7 working days. In case of unsatisfactory response report the discrepancy to the Exchange within 15 working days from the date of cause of action.
Scrutinize minutely both the transaction & holding statements that you receive from your Depository Participant.
Keep Delivery Instruction Slips (DIS) book issued by DPs in safe possession.
Ensure that the DIS numbers are preprinted and your account number (UCC) is mentioned in the DIS book.
Freeze your Demat account in case of your absence for longer duration or in case of not using the account frequently.
Pay required margins in time and only by Cheque and ask for receipt thereof from the Member.
Deliver the commodities in case of sale or pay the money in case of purchase within the time prescribed.
Understand and comply with accounting standards for derivatives.
Ensure to read, understand and then sign the voluntary clauses, if any, agreed between you and the Member. Note that the clauses as agreed between you and the Member cannot be changed without your consent.
Get a clear idea about all brokerage, commissions, fees and other charges levied by the Member on you for trading and the relevant provisions/ guidelines specified by SEBI/Commodity exchanges.
Make the payments by account payee cheque in favour of the Member. Ensure that you have a documentary proof of your payment/deposit of commodities with the Member, stating date, commodity, quantity, towards which bank/ demat account such money or commodities (in the form of warehouse receipts) deposited and from which bank/ demat account.
The payout of funds or delivery of commodities (as the case may be) shall not be made to you within one working day from the receipt of payout from the Exchange, in case you have given specific authorization for maintaining running account to the member. Thus, in this regard, the running account authorization provided by you to the Member shall be subject to the following conditions:

a) Such authorization from you shall be dated, signed by you only and contains the clause that you may revoke the same at any time.

b) You need to bring any dispute arising from the statement of account to the notice of the Member in writing preferably within 7

(seven) working days from the date of receipt of funds/commodities or statement, as the case may be. In case of dispute, refer the matter in writing to the Investors Grievance Cell of the relevant Commodity exchanges without delay.

c) In case you have not opted for maintaining running account and pay-out is not received on the next working day of the receipt of payout from the exchanges, please refer the matter to the Member. In case there is dispute, ensure that you lodge a complaint in writing immediately with the Investors Grievance Cell of the relevant Commodity exchange.

d) Please register your mobile number and email id with the Member, to receive trade confirmation alerts/ details of the transactions through SMS or email, by the end of the trading day, from the commodity exchanges.

You should familiarize yourself with the protection accorded to the money or other property you may deposit with your member, particularly in the event of a default in the commodity derivatives market or the member becomes insolvent or bankrupt.
Please ensure that you have a documentary proof of having made the deposit of such money or property with the member, stating towards which account such money or property deposited.
In case your problem/grievance/issue is not being sorted out by concerned Member/Authorised Person then you may take up the matter with the concerned Commodity Exchange. If you are not satisfied with the resolution of your complaint then you can escalate the matter to SEBI.

Don'ts

Do not deal with any unregistered intermediaries.
Do not undertake off-market transactions as such transactions are illegal and fall outside the jurisdiction of the Exchange.
Do not enter into assured returns arrangement with any Member
Do not get carried away by luring advertisements, rumours, hot tips, explicit/ implicit promise of returns, etc.
Do not make payments in cash/ take any cash towards margins and settlement to/ from the Member.
Do not start trading before reading and understanding the Risk Disclosure Agreement.
Do not neglect to set out in writing, orders for higher value given over phone.
Do not accept unsigned/duplicate contract note/confirmation memo.
Do not accept contract note/confirmation memo signed by any unauthorized person.
Don't share your internet trading account's password with anyone
Do not delay payment/deliveries of commodities to Member.
Do not forget to take note of risks involved in the investments.
Do not sign blank Delivery Instruction Slips (DIS) while furnishing commodities, deposits and/or keep them with Depository Participants (DP) or member to save time.
Do not pay brokerage in excess of that rates prescribed by the Exchange
Don't issue cheques in the name of Authorized Person.

Additionally, Investors may refer to Dos and Don'ts issued by MIIs on their respective websites from time to time.

Most Important Terms and Conditions (MITC)

(For non-custodial settled trading accounts)

Your trading account has a "Unique Client Code" (UCC), different from your demat account number. Do not allow anyone (including your own stock broker, their representatives and dealers) to trade in your trading account on their own without taking specific instruction from you for your trades. Do not share your internet/ mobile trading login credentials with anyone else.
You are required to place collaterals as margins with the stock broker before you trade. The collateral can either be in the form of funds transfer into specified stock broker bank accounts or margin pledge of securities from your demat account. The bank accounts are listed on the stock broker website. Please do not transfer funds into any other account. The stock broker is not permitted to accept any cash from you.
The stock broker's Risk Management Policy provides details about how the trading limits will be given to you, and the tariff sheet provides the charges that the stock broker will levy on you.
All securities purchased by you will be transferred to your demat account within one working day of the payout. In case of securities purchased but not fully paid by you, the transfer of the same may be subject to limited period pledge i.e. seven trading days after the pay-out (CUSPA pledge) created in favor of the stock broker. You can view your demat account balances directly at the website of the Depositories after creating a login.
The stock broker is obligated to deposit all funds received from you with any of the Clearing Corporations duly allocated in your name. The stock broker is further mandated to return excess funds as per applicable norms to you at the time of quarterly/ monthly settlement. You can view the amounts allocated to you directly at the website of the Clearing Corporation(s).
You will get a contract note from the stock broker within 24 hours of the trade.
You may give a one-time Demat Debit and Pledge Instruction (DDPI) authority to your stock broker for limited access to your demat account, including transferring securities, which are sold in your account for pay-in.
The stock broker is expected to know your financial status and monitor your accounts accordingly. Do share all financial information (e.g. income, networth, etc.) with the stock broker as and when requested for. Kindly also keep your email Id and mobile phone details with the stock broker always updated.
In case of disputes with the stock broker, you can raise a grievance on the dedicated investor grievance ID of the stock broker. You can also approach the stock exchanges and/or SEBI directly.
Any assured/guaranteed/fixed returns schemes or any other schemes of similar nature are prohibited by law. You will not have any protection/recourse from SEBI/stock exchanges for participation in such schemes.

RIGHTS & OBLIGATIONS OF STOCK BROKERS & CLIENTS FOR MARGIN TRADING FACILITY (MTF)

CLIENT RIGHTS

Client shall receive all communications in a mode mutually agreed between the broker and the client regarding confirmation of orders/trades, margin calls, decision to liquidate the position/ security.
Client shall be free to take the delivery of the securities at any time by repaying the amounts that was paid by the Stock Broker to the Exchange towards securities after paying all dues.
Client has a right to change the securities collateral offered for Margin Trading Facility at any time so long as the securities so offered are approved for margin trading facility.
Client may close/ terminate the Margin Trading Account at any time after paying the dues.

CLIENT OBLIGATIONS

Client shall, in writing in his own hand or in any irrefutable electronic method, agree to avail of Margin Trading Facility in accordance with the terms and conditions of Margin Trading Facility offered by the broker, method of communication for confirmation of orders/ trades, margin calls and calls for liquidation of collateral/ security/ position.
Client shall inform the broker of its intent to shift the identified transaction under Margin Trading Facility within the time lines specified by the broker failing which the transaction will be treated under the normal trading facility.
Client shall place the margin amounts as the Stock Broker may specify to the client from time to time.
On receipt of 'margin call', the client shall make good such deficiency in the amount of margin placed with the Stock Broker within such time as the Stock Broker may specify.
By agreeing to avail Margin Trading Facility with the broker, client is deemed to have authorized the broker to retain and/ or pledge the securities provided as collateral or purchased under the Margin Trading Facility till the amount due in respect of the said transaction including the dues to the broker is paid in full by the client.
Client shall lodge protest or disagreement with any transaction done under the margin trading facility within the timelines as may be agreed between the client and broker.
The initial margin payable by the client to Hem Securities Limited/ Hem Finlease Private Limited shall be in the form of cash, cash equivalent or Group I equity shares with appropriate hair cut as specified in SEBI Master Circular No. SEBI/HO/MRD/DP/CIR/P/2016/135 dated December 16, 2016.

Category of Stock	Applicable Margin
Group I stocks available for trading in the F&O Segment	VaR + 3 times of applicable ELM*
Group I stocks other than F&O stocks	VaR + 5 times of applicable ELM*

*For aforesaid purpose the applicable VaR and ELM shall be as in the cash segment for particular stock.

STOCK BROKER RIGHTS

Stock Broker and client may agree between themselves the terms and condition including commercial terms if any before commencement of MTF.
Stock broker may set up its own risk management policy that will be applicable to the transactions done under the Margin Trading Facility. Stock broker may make amendments there to at any time but give effect to such policy after the amendments are duly communicated to the clients registered under the Margin Trading Facility.
The broker has a right to retain and/or pledge the securities provided as collateral or the securities bought by the client under the Margin Trading Facility.
The broker may liquidate the securities if the client fails to meet the margin call made by the broker as mutually agreed of liquidation terms but not exceeding 5 working days from the day of margin call.
In case of increase in the value of collateral, Hem Securities Limited/ Hem Finlease Private Limited may have the option of granting further exposure to clients subject to applicable haircuts. However, no such exposure shall be permitted on the increased value of Funded Stocks.

STOCK BROKER OBLIGATIONS

Stock broker shall agree with the client the terms and condition before extending Margin Trading Facility to such client. However, for clients who already have existing trading relationship and want to avail of Margin Trading Facility, stock broker may take consent in writing in his own hand or in any irrefutable electronic method after stock broker has communicated the terms and conditions of Margin Trading Facility to such existing clients.
The terms and conditions of Margin Trading Facility shall be identified separately, in a distinct section if given as a part of account opening agreement.
The mode of communication of order confirmation, margin calls or liquidation of position/ security shall be as agreed between the broker and the client and shall be in writing in his own hand or in any irrefutable electronic method. Stock broker shall prescribe and communicate its margin policies on haircuts/ VAR margins subject to minimum requirements specified by SEBI and exchanges from time to time.
The Stock Broker shall monitor and review on a continuous basis the client's positions with regard to MTF. It is desirable that appropriate alert mechanism is set up through which clients are alerted on possible breach of margin requirements.
Any transaction to be considered for exposure to MTF shall be determined as per the policy of the broker provided that such determination shall happen not later than T + 1 day.
If the transaction is entered under margin trading account, there will not be any further confirmation that it is margin trading transaction other than contract note.
In case the determination happens after the issuance of contract, the broker shall issue appropriate records to communicate to Client the change in status of transaction from Normal to Margin trading and should include information like the original contract number and the margin statement and the changed data.
The Stock Broker shall make a 'margin call' requiring the client to place such margin; any such call shall clearly indicate the additional/deficient margin to be made good.
Time period for liquidation of position/ security shall be in accordance declared policy of the broker as applicable to all MTF clients consistently. However, the same should not be later than 5 working (trading) days from the day of 'margin call'. If securities are liquidated, the contract note issued for such margin call related transactions shall carry an asterisk or identifier that the transaction has arisen out of margin call.

The daily margin statements sent by broker to the client shall identify the margin/ collateral for Margin Trading separately.
Margin Trading Accounts where there was no transaction for 90 days shall be settled immediately.
The stocks deposited as collateral with the stock broker for availing margin trading facility (Collaterals) and the stocks purchased under the margin trading facility (Funded stocks) shall be identifiable separately and there shall not be any comingling for the purpose of computing funding amount.
Stock Broker shall close/ terminate the account of the client forthwith upon receipt of such request from the client subject to the condition that the client has paid dues under Margin Trading Facility.

RIGHTS & OBLIGATIONS (BSE/ NSE)

Stock Broker/ Trading Member is eligible to provide Margin Trading Facility (MTF) in accordance with SEBI & Exchange Guidelines as specified from time to time.
Stock Broker/ Trading Member desirous of extending MTF to their clients is required to obtain prior permission of BSE/ NSE. Stock Broker/ Trading Member may note that BSE/ NSE has the right to withdraw the permission at anytime.
Stock Broker/ Trading Member shall extend the MTF to the client, on such terms and conditions as specified by the Stock Exchange / SEBI from time to time. Stock Broker/ Trading Member and the client shall abide by the requirements of the margin trading framework, including rights and obligations, as prescribed by Stock Exchange/ SEBI/ Stock Broker/ Trading Member.
Stock Broker/ Trading Member shall intimate all the terms and conditions, including maximum allowable exposure, specific stock exposures etc., as well as the rights and obligations to the client desirous of availing MTF.
Stock Broker/ Trading Member may, at its sole and absolute discretion, increase the limit of initial and/or maintenance margin, from time to time. The Client shall abide by such revision, and where there is an upward revision of such margin amount, he agrees to make up the shortfall within such time as the Stock Broker/ Trading Member may permit. It may however, be noted that the initial/ maintenance margins shall never be lower than that prescribed by Stock Exchange/ SEBI.
Stock Broker/ Trading Member shall provide MTF only in respect of such shares, as may be permitted by Stock Exchange/ SEBI.
Stock Broker/ Trading Member shall liquidate the securities and other collateral, if the client fails to meet the margin call to comply with the margin requirement as specified by Stock Exchange/ SEBI/ Stock Broker/ Trading Member. In this regard, Stock Broker/ Trading Member shall also list down situations/ conditions in which the securities may be liquidated (Stock Broker/ Trading Member to list down situations/ conditions):
Stock Broker/ Trading Member shall not use the funds of one client to provide MTF to another client, even if the same is authorized by the first client.
The stocks deposited as collateral with the Stock Broker/ Trading Member for availing margin trading facility (Collaterals) and the stocks purchased under the margin trading facility (Funded stocks) shall be identifiable separately and no comingling shall be permitted for the purpose of computing funding amount.
IPF shall not be available for transactions done on the Stock Exchange, through MTF, in case of any losses suffered in connection with the MTF availed by the client.

The rights and obligations prescribed hereinabove shall be read in conjunction with the rights and obligations as prescribed under SEBI Circular no. CIR/MIRSD/16/2011, dated: August 22, 2011.

TERMINATION OF RELATIONSHIP

The margin trading arrangement between the stock broker and the client shall be terminated; if the Stock Exchange, for any reason, withdraws the margin trading facility provided to the Stock Broker or the Stock Broker surrenders the facility or the Stock Broker ceases to be a member of the stock exchange.
The MTF facility may be withdrawn by the broker, in the event of client committing any breach of any terms or conditions therein or at any time after due intimation to client allowing such time to liquidate the MTF position as per the agreed liquidation terms without assigning any reason. Similarly, client may opt to terminate the margin trading facility in the event of broker committing any breach of any terms or conditions therein or for any other reason.
In the event of termination of this arrangement, the client shall forthwith settle the dues of the Stock Broker. The Stock Broker shall be entitled to immediately adjust the Margin Amount against the dues of the client, and the client hereby authorizes the Stock Broker to make such adjustment.
After such adjustment, if any further amount is due from the client to the Stock Broker, the client shall settle the same forthwith. Upon full settlement of all the dues of the client to the Stock Broker, the Stock Broker shall release the balance amount to the client.
If the client opts to terminate the margin trading facility, broker shall forthwith return to the client all the collaterals provided and funded securities retained on payment of all the dues by clients.

Investor Charter – Stock Brokers

1. VISION

To follow highest standards of ethics and compliances while facilitating the trading by clients in securities in a fair and transparent manner, so as to contribute in creation of wealth for investors.

2. MISSION

To provide high quality and dependable service through innovation, capacity enhancement and use of technology.
To establish and maintain a relationship of trust and ethics with the investors.
To observe highest standard of compliances and transparency.
To always keep 'protection of investors' interest' as goal while providing service.
To ensure confidentiality of information shared by investors unless such information is required to be provided in furtherance of discharging legal obligations or investors have provided specific consent to share such information.

3. Services provided to Investors by stockbrokers include

Execution of trades on behalf of investors.
Issuance of Contract Notes.
Issuance of intimations regarding margin due payments.
Facilitate execution of early pay-in obligation instructions.
Periodic Settlement of client's funds.
Issuance of retention statement of funds at the time of settlement.
Risk management systems to mitigate operational and market risk.
Facilitate client profile changes in the system as instructed by the client.
Information sharing with the client w.r.t. relevant Market Infrastructure Institutions (MII) circulars.
Provide a copy of Rights & Obligations document to the client.
Communicating Most Important terms and Conditions (MITC) to the client.
Redressal of Investor's grievances.

4. Rights of Investors

Ask for and receive information from a firm about the work history and background of the person handling your account, as well as information about the firm itself (including website providing mandatory information).
Receive complete information about the risks, obligations, and costs of any investment before investing.
Receive a copy of all completed account forms and rights & obligation document.
Receive a copy of 'Most Important Terms & Conditions' (MITC).

Receive account statements that are accurate and understandable.
Understand the terms and conditions of transactions you undertake.
Access your funds in a prescribed manner and receive information about any restrictions or limitations on access.
Receive complete information about maintenance or service charges, transaction or redemption fees, and penalties in form of tariff sheet.
Discuss your grievances with compliance officer / compliance team / dedicated grievance redressal team of the firm and receive prompt attention to and fair consideration of your concerns.
Close your zero balance accounts online with minimal documentation
Get the copies of all policies (including Most Important Terms and Conditions) of the broker related to dealings of your account
Not be discriminated against in terms of services offered to equivalent clients
Get only those advertisement materials from the broker which adhere to Code of Advertisement norms in place
In case of broker defaults, be compensated from the Exchange Investor Protection Fund as per the norms in place
Trade in derivatives after submission of relevant financial documents to the broker subject to brokers' adequate due diligence.
Get warnings on the trading systems while placing orders in securities where surveillance measures are in place
Get access to products and services in a suitable manner even if differently abled
Get access to educational materials of the MIIs and brokers
Get access to all the exchanges of a particular segment you wish to deal with unless opted out specifically as per Broker norms
Deal with one or more stockbrokers of your choice without any compulsion of minimum business
Have access to the escalation matrix for communication with the broker
Not be bound by any clause prescribed by the Brokers which are contravening the Regulatory provisions.

5. Various activities of Stock Brokers with timelines

S.NO.	Activities	Expected Timelines
	KYC entered into KRA System and CKYCR	3 working days of account opening
	Client Onboarding	Immediate, but not later than one week
	Order execution	Immediate on receipt of order, but not later than the same day
	Allocation of Unique Client Code	Before trading
	Copy of duly completed Client Registration Documents to clients	7 days from the date of upload of Unique Client Code to the Exchange by the trading member
	Issuance of contract notes	24 hours of execution of trades
	Collection of upfront margin from client	Before initiation of trade
	Issuance of intimations regarding other margin due payments	At the end of the T day
	Settlement of client funds	First Friday/Saturday of the month / quarter as per Exchange pre-announced schedule
	'Statement of Accounts' for Funds, Securities and Commodities	Monthly basis
	Issuance of retention statement of funds/commodities	5 days from the date of settlement
	Issuance of Annual Global Statement	30 days from the end of the financial year
	Investor grievances redressal	21 calendar days from the receipt of the complaint

6. DOs and DON'Ts for Investors

DOs	DON'Ts
1. Read all documents and conditions being agreed before signing the account opening form.	1. Do not deal with unregistered stock broker.
2. Receive a copy of KYC, copy of account opening documents and Unique Client Code.	2. Do not forget to strike off blanks in your account opening and KYC.
3. Read the product / operational framework / timelines related to various Trading and Clearing & Settlement processes.	3. Do not submit an incomplete account opening and KYC form.
4. Receive all information about brokerage, fees and other charges levied.	4. Do not forget to inform any change in information linked to trading account and obtain confirmation of updation in the system.
5. Register your mobile number and email ID in your trading, demat and bank accounts to get regular alerts on your transactions.	5. Do not transfer funds, for the purposes of trading to anyone other than a stock broker. No payment should be made in name of employee of stock broker.
6. If executed, receive a copy of Demat Debit and Pledge Instruction (DDPI) However, DDPI is not a mandatory requirement as per SEBI / Stock Exchanges. Before granting DDPI, carefully examine the scope and implications of powers being granted.	6. Do not ignore any emails / SMSs received with regards to trades done, from the Stock Exchange and raise a concern, if discrepancy is observed.
7. Receive contract notes for trades executed, showing transaction price, brokerage, GST and STT/CTT etc. as applicable, separately, within 24 hours of execution of trades.	7. Do not opt for digital contracts, if not familiar with computers.
8. Receive funds and securities/ commodities on time, as prescribed by SEBI or exchange from time to time.	8. Do not share trading password.
9. Verify details of trades, contract notes and statement of account and approach relevant authority for any discrepancies. Verify trade details on the Exchange websites from the trade verification facility provided by the Exchanges.	9. Do not fall prey to fixed / guaranteed returns schemes.
10. Receive statement of accounts periodically. If opted for running account settlement, account has to be settled by the stock broker as per the option given by the client (Monthly or Quarterly).	10. Do not fall prey to fraudsters sending emails and SMSs luring to trade in stocks / securities promising huge profits.
11. In case of any grievances, approach stock broker or Stock Exchange or SEBI for getting the same resolved within prescribed timelines.	11. Do not follow herd mentality for investments. Seek expert and professional advice for your investments
12. Retain documents for trading activity as it helps in resolving disputes, if they arise.

Additionally, Investors may refer to Dos and Don'ts issued by MIIs on their respective websites from time to time.

7. Grievance Redressal Mechanism

The process of investor grievance redressal is as follows:

Investor complaint/Grievances

Investor can lodge complaint/grievance against stock broker in the following ways:

Mode of filing the complaint with stock broker

Investor can approach the Stock Broker at the designated Investor Grievance e-mail ID of the stock broker. The Stock Broker will strive to redress the grievance immediately, but not later than 21 days of the receipt of the grievance

Mode of filing the complaint with stock exchanges

i. SCORES 2.0 (a web based centralized grievance redressal system of SEBI) (https://scores.sebi.gov.in)

Two level review for complaint/grievance against stock broker:

First review done by Designated body/Exchange
Second review done by SEBI

ii. Emails to designated email IDs of Exchange

Online Dispute Resolution (ODR) platform for online Conciliation and Arbitration

If the Investor is not satisfied with the resolution provided by the Market Participants, then the Investor has the option to file the complaint/ grievance on SMARTODR platform https://smartodr.in/login for its resolution through online conciliation or arbitration.

Steps to be followed in ODR for Review, Conciliation and Arbitration

Investor to approach Market Participant for redressal of complaint
If investor is not satisfied with response of Market Participant, he/she has either of the following 2 options:
1. May escalate the complaint on SEBI SCORES portal.
2. May also file a complaint on SMARTODR portal for its resolution through online conciliation and arbitration.
Upon receipt of complaint on SMARTODR portal, the relevant MII will review the matter and endeavor to resolve the matter between the Market Participant and investor within 21 days.
If the matter could not be amicably resolved, then the matter shall be referred for conciliation.
During the conciliation process, the conciliator will endeavor for amicable settlement of the dispute within 21 days, which may be extended with 10 days by the conciliator with consent of the parties to dispute.
If the conciliation is unsuccessful, then the investor may request to refer the matter for arbitration.
The arbitration process to be concluded by arbitrator(s) within 30 days, which is extendable by 30 days with consent of the parties to dispute.

8. Handling of Investor's claims / complaints in case of default of a Trading Member / Clearing Member (TM/CM)

Default of TM/CM

Following steps are carried out by Stock Exchange for benefit of investor, in case stock broker defaults:

Circular is issued to inform about declaration of Stock Broker as Defaulter.
Information of defaulter stock broker is disseminated on Stock Exchange website.
Public Notice is issued informing declaration of a stock broker as defaulter and inviting claims within specified period.
Intimation to clients of defaulter stock brokers via emails and SMS for facilitating lodging of claims within the specified period.

Following information is available on Stock Exchange website for information of investors:

Norms for eligibility of claims for compensation from IPF.
Claim form for lodging claim against defaulter stock broker.
FAQ on processing of investors' claims against Defaulter stock broker.
Provision to check online status of client's claim.
Standard Operating Procedure (SOP) for handling of Claims of Investors in the Cases of Default by Brokers
Claim processing policy against Defaulter/Expelled members
List of Defaulter/Expelled members and public notice issued

Format for Investor Complaints Data to be displayed by Stock Brokers on their respective websites

Data for every month ending

SN	Received from	Carried forward from previous month	Received during the month	Total Pending	Resolved*	Pending at the end of the month**		Average Resolution time^ (in days)
SN	Received from	Carried forward from previous month	Received during the month	Total Pending	Resolved*	Pending for less than 3 months	Pending for more than 3 months	Average Resolution time^ (in days)
1	2	3	4	5	6	7	8	9
1	Directly from Investors
2	SEBI (SCORES 2.0)
3	Stock Exchanges
4	Other Sources (if any)
5	Grand Total

Trend of monthly disposal of complaints

SN	Month	Carried forward from previous month	Received	Resolved*	Pending**
1	2	3	4	5	6
1	April -YYYY
2	May-YYYY
3	June-YYYY
4	July-YYYY
5	….
6	…..
7	March-YYYY
8	Grand Total

*Should include complaints of previous months resolved in the current month, if any.

**Should include total complaints pending as on the last day of the month, if any.

^Average resolution time is the sum total of time taken to resolve each complaint in the current month divided by total number of complaints resolved in the current month.

Trend of annual disposal of complaints

SN	Year	Carried forward from previous year	Received during the year	Pending at the end of the year
1	2021-22
2	2022-23
3	2023-24
4	2024-25
5	2025-26
6	2026-27
	Grand Total

Investor Charter – DP

1. Vision

Towards making Indian Securities Market - Transparent, Efficient, & Investor friendly by providing safe, reliable, transparent and trusted record keeping platform for investors to hold and transfer securities in dematerialized form.

2. Mission

To hold securities of investors in dematerialized form and facilitate its transfer, while ensuring safekeeping of securities and protecting interest of investors.
To provide timely and accurate information to investors with regard to their holding and transfer of securities held by them.
To provide the highest standards of investor education, investor awareness and timely services so as to enhance Investor Protection and create awareness about Investor Rights.

3. Details of business transacted by the Depository and Depository Participant(DP)

A Depository is an organization which holds securities of investors in electronic form. Depositories provide services to various market participants - Exchanges, Clearing Corporations, Depository Participants (DPs), Issuers and Investors in both primary as well as secondary markets. The depository carries out its activities through its agents which are known as Depository Participants (DP). Details available on the link [https://www.cdslindia.com/DP/dplist.aspx].

4. Description of services provided by the Depository through Depository Participants (DPs) to investors

(1) Basic Services

Sr. no.	Brief about the Activity /Service	Expected Timelines for processing by the DP after receipt of proper documents
1.	Dematerialization of securities	7 days
2.	Rematerialization of securities	7 days
3.	Mutual Fund Conversion / Destatementization	5 days
4.	Re-conversion / Restatementisation of Mutual fund units	7 days
5.	Transmission of securities	7 days
6.	Registering pledge request	15 days
7.	Closure of demat account	30 days
8.	Settlement Instruction	Depositories to accept physical DIS for pay-in of securities up to 4 p.m. and DIS in electronic form up to 6 p.m. on T+1 day. For T+0 day settlements, Participants shall accept EPI instructions from the clients, till 11:00 AM on T day. Note: 'T' refers 'Trade Day'

(2) Depositories provide special services like pledge, hypothecation, internet-based services etc. in addition to their core services and these include

Sr.No.	Type of Activity /Service	Brief about the Activity / Service
1.	Value Added Services	Depositories also provide value added services such as a. Basic Services Demat Account (BSDA)ᴬ¹ b. Transposition cum dematerialization ᴮ² c. Linkages with Clearing System ᶜ³ d. Distribution of cash and non-cash corporate benefits (Bonus, Rights, IPOs etc.), stock lending, demat of NSC / KVP, demat of warehouse receipts etc.
2.	Consolidated Account statement (CAS)	CAS is issued 10 days from the end of the month (if there were transactions in the previous month) or half yearly (if no transactions).
3.	Digitalization of services provided by the depositories	Depositories offer below technology solutions and e-facilities to their demat account holders through DPs: a. E-account opening: Details available on the link [https://signup.hemnxt.com/]⁴ b. Online instructions for execution: Details available on the link ᵇ⁵ c. e-DIS / Demat Gateway: Details available on the link ᶜ⁶ d. e-CAS facility: Details available on the link ᵈ⁷ e. Miscellaneous services: Details available on the link [https://www.hemnxt.com/]⁸

5. Details of Grievance Redressal Mechanism

(1) The Process of investor grievance redressal

Investor Complaint/Grievances

Investor can lodge complaint/ grievance against the Depository/DP in the following ways:

a. Electronic mode -

(i) SCORES 2.0 (a web based centralized grievance redressal system of SEBI) [https://scores.sebi.gov.in]

Two Level Review For Complaint/Grievance Against Dp:

-First Review Done By Designated Body

- Second Review Done By SEBI

(ii) Respective Depository's web portal dedicated for the filing of compliant [https://www.cdslindia.com/Footer/grievances.aspx]

(iii) Emails to designated email IDs of Depository [complaints@cdslindia.com]

b. Offline mode [details of link to the form to be provided by DPs]

The complaints/ grievances lodged directly with the Depository shall be resolved within 21 days.

Online Dispute Resolution (ODR) platform for online Conciliation and Arbitration

If the Investor is not satisfied with the resolution provided by DP or other Market Participants, then the Investor has the option to file the complaint/ grievance on SMART ODR platform for its resolution through by online conciliation or arbitration.

https://smartodr.in/login

Steps to be followed in ODR for Review, Conciliation and Arbitration

Investor to approach Market Participant for redressal of complaint.
If investor is not satisfied with response of Market Participant, he/she can escalate the complaint on SEBI SCORES portal.
Alternatively, the investor may also file a complaint on SMARTODR portal for its resolution through online conciliation and arbitration.
Upon receipt of complaint on SMARTODR portal, the relevant MII will review the matter and endeavour to resolve the matter between the Market Participant and investor within 21 days.
If the matter could not be amicably resolved, then the Investor may request the MII to refer the matter case for conciliation.
During the conciliation process, the conciliator will endeavor for amicable settlement of the dispute within 21 days, which may be extended with 10 days by the conciliator.
If the conciliation is unsuccessful, then the investor may request to refer the matter for arbitration.
The arbitration process to be concluded by arbitrator(s) within 30 days, which is extendable by 30 days.

6. Guidance pertaining to special circumstances related to market activities: Termination of the Depository Participant

Sl No.	Type of special circumstances	Timelines for the Activity/ Service
1.	Depositories to terminate the participation in case a participant no longer meets the eligibility criteria and/or any other grounds as mentioned in the bye laws like suspension of trading member by the Stock Exchanges. Participant surrenders the participation by its own wish.	Client will have a right to transfer all its securities to any other Participant of its choice without any charges for the transfer within 30 days from the date of intimation by way of letter/email.

7. Dos and Don'ts for Investors

For Do's and Don'ts please refer to the link [https://www.hemnxt.com]¹⁰

8. Rights of investors

For rights, please refer to the link [https://www.hemnxt.com]¹¹

9. Responsibilities of Investors

For responsibilities, please refer to the link [https://www.hemnxt.com]¹²

10. Code of Conduct for Depositories

For Code of Conduct for Depositories, please refer to the link¹³

11. Code of Conduct for Participants

For Code of Conduct for Participants, please refer to the link¹⁴

Annexure B

INFORMATION CONTAINED IN LINKS TO THE INVESTOR CHARTER FOR DEPOSITORIES AND DPS

This document contains the contents pertaining to the qualifier "[https://www.cdslindia.com/Investors/InvestorCharter.html/]" in the Investor Charter main document. The same is to be made available by the Depositories on their websites and web-links to the same is to be provided for incorporation in the Investor Charter.

For reasons of convenience, the contents in main Charter and this document have been mapped with the same superscript.

Para 4 (2) of Investor Charter

Point 1: Value Added Services

Basic Services Demat Account (BSDA) ᴬ¹: The facility of BSDA with limited services for eligible individuals was introduced with the objective of achieving wider financial inclusion and to encourage holding of demat accounts. No Annual Maintenance Charges (AMC) shall be levied, if the value of securities holding is upto Rs. 50,000. For value of holdings between Rs 50,001- 2,00,000, AMC not exceeding Rs 100 is chargeable. In case of debt securities, there are no AMC charges for holding value upto Rs 1,00,000 and a maximum of Rs 100 as AMC is chargeable for value of holdings between Rs 1,00,001 -2,00,000.
Transposition cum dematerialization ᴮ²: In case of transposition-cum- dematerialisation, client can get securities dematerialised in the same account if the names appearing on the certificates match with the names in which the account has been opened but are in a different order. The same may be done by submitting the security certificates along with the Transposition Form and Demat Request Form.
Linkages with Clearing System ᶜ³ for actual delivery of securities to the clearing system from the selling brokers and delivery of securities from the clearing system to the buying broker.

Point 3: Digitization of services provided by the depositories

E-account opening⁴: Account opening through digital mode, popularly known as "On-line Account opening", wherein investor intending to open the demat account can visit DP website, fill in the required information, submit the required documents, conduct video IPV and demat account gets opened without visiting DPs office.

Online instructions for execution ᵇ⁵: internet-enabled services like Speed-e (NSDL) & Easiest (CDSL) empower a demat account holder in managing his/her securities 'anytime-anywhere' in an efficient and convenient manner and submit instructions online without the need to use paper. These facilities allows Beneficial Owner (BO) to submit transfer instructions and pledge instructions including margin pledge from their demat account. The instruction facilities are also available on mobile applications through android, windows and IOS platforms.

e-DIS / Demat Gateway ᶜ⁶: Investors can give instructions for transfer of securities through e-DIS apart from physical DIS. Here, for on-market transfer of securities, investors need to provide settlement number along with the ISIN and quantity of securities being authorized for transfer. Client shall be required to authorize each e-DIS valid for a single settlement number / settlement date, by way of OTP and PIN/password, both generated at Depositories end. Necessary risk containment measures are being adopted by Depositories in this regard.

e-CAS facility ᵈ⁷: Consolidated Account Statements are available online and could also be accessed through mobile app to facilitate the investors to view their holdings in demat form.
Miscellaneous services ᵉ⁸: Transaction alerts through SMS, e-locker facilities, chatbots for instantaneously responding to investor queries etc. have also been developed.

Para 5(1) of Investor Charter

Point 2 (Investor Grievance Redressal Committee of Depository):

If no amicable resolution is arrived, then the Investor has the option to refer the complaint/ grievance to the Grievance Redressal Committee (GRC) of the Depository. Upon receipt of reference, the GRC will endeavor to resolve the complaint/ grievance by hearing the parties and examining the necessary information and documents.

Point 3(Arbitration proceedings):

The Investor may also avail the arbitration mechanism set out in the Byelaws and Business Rules/Operating Instructions of the Depository in relation to any grievance, or dispute relating to depository services. The arbitration reference shall be concluded by way of issue of an arbitral award within 4 months from the date of appointment of arbitrator(s).

Para 5(2) of Investor Charter

Complaint Resolution process at Depositories

Para 7 of Investor Charter

Dos and Don'ts for Investor¹⁰

Sl No.	Guidance
1	Always deal with a SEBI registered Depository Participant for opening a demat account.
2	Read all the documents carefully before signing them.
3	Before granting Power of attorney to operate your demat account to an intermediary like Stockbroker, Portfolio Management Services (PMS) etc., carefully examine the scope and implications of powers being granted.
4	Always make payments to registered intermediary using banking channels. No payment should be made in name of employee of intermediary.
5	Accept the Delivery Instruction Slip (DIS) book from your DP only (pre-printed with a serial number along with your Client ID) and keep it in safe custody and do not sign or issue blank or partially filled DIS slips. Always mention the details like ISIN, number of securities accurately. In case of any queries, please contact your DP or broker and it should be signed by all demat account holders. Strike out any blank space on the slip and Cancellations or corrections on the DIS should be initialed or signed by all the account holder(s). Do not leave your instruction slip book with anyone else. Do not sign blank DIS as it is equivalent to a bearer cheque.
6	Inform any change in your Personal Information (for example address or Bank Account details, email ID, Mobile number) linked to your demat account in the prescribed format and obtain confirmation of updation in system
7	Mention your Mobile Number and email ID in account opening form to receive SMS alerts and regular updates directly from depository.
8	Always ensure that the mobile number and email ID linked to your demat account are the same as provided at the time of account opening/updation.
9	Do not share password of your online trading and demat account with anyone.
10	Do not share One Time Password (OTP) received from banks, brokers, etc. These are meant to be used by you only.
11	Do not share login credentials of e-facilities provided by the depositories such as e-DIS/demat gateway, SPEED-e/easiest etc. with anyone else.
12	Demat is mandatory for any transfer of securities of Listed public limited companies with few exceptions.
13	If you have any grievance in respect of your demat account, please write to designated email IDs of depositories or you may lodge the same with SEBI online at https://scores.gov.in/scores/Welcome.html
14	Keep a record of documents signed, DIS issued and account statements received.
15	As Investors you are required to verify the transaction statement carefully for all debits and credits in your account. In case of any unauthorized debit or credit, inform the DP or your respective Depository.
16	Appoint a nominee to facilitate your heirs in obtaining the securities in your demat account, on completion of the necessary procedures.
17	Register for Depository's internet-based facility or download mobile app of the depository to monitor your holdings.
18	Ensure that, both, your holding and transaction statements are received periodically as instructed to your DP. You are entitled to receive a transaction statement every month if you have any transactions.
19	Do not follow herd mentality for investments. Seek expert and professional advice for your investments
20	Beware of assured/fixed returns.

Para 8 of Investor Charter

Rights of investors¹¹

Receive a copy of KYC, copy of account opening documents.
No minimum balance is required to be maintained in a demat account.
No charges are payable for opening of demat accounts.
If executed, receive a copy of Power of Attorney. However, Power of Attorney is not a mandatory requirement as per SEBI / Stock Exchanges. You have the right to revoke any authorization given at any time.
You can open more than one demat account in the same name with single DP/ multiple DPs.
Receive statement of accounts periodically. In case of any discrepancies in statements, take up the same with the DP immediately. If the DP does not respond, take up the matter with the Depositories.
Pledge and /or any other interest or encumbrance can be created on demat holdings.
Right to give standing instructions with regard to the crediting of securities in demat account.
Investor can exercise its right to freeze/defreeze his/her demat account or specific securities / specific quantity of securities in the account, maintained with the DP.
In case of any grievances, Investor has right to approach Participant or Depository or SEBI for getting the same resolved within prescribed timelines.
Every eligible investor shareholder has a right to cast its vote on various resolutions proposed by the companies for which Depositories have developed an internet based 'e-Voting' platform.
Receive information about charges and fees. Any charges/tariff agreed upon shall not increase unless a notice in writing of not less than thirty days is given to the Investor.
Right to indemnification for any loss caused due to the negligence of the Depository or the participant.
Right to opt out of the Depository system in respect of any security.

Para 9 of Investor Charter

Responsibilities of Investors¹²

Deal with a SEBI registered DP for opening demat account, KYC and Depository activities.
Provide complete documents for account opening and KYC (Know Your Client). Fill all the required details in Account Opening Form / KYC form in own handwriting and cancel out the blanks.
Read all documents and conditions being agreed before signing the account opening form.
Accept the Delivery Instruction Slip (DIS) book from DP only (preprinted with a serial number along with client ID) and keep it in safe custody and do not sign or issue blank or partially filled DIS.

Always mention the details like ISIN, number of securities accurately.
Inform any change in information linked to demat account and obtain confirmation of updation in the system.
Regularly verify balances and demat statement and reconcile with trades /transactions.
Appoint nominee(s) to facilitate heirs in obtaining the securities in their demat account.
Do not fall prey to fraudsters sending emails and SMSs luring to trade in stocks / securities promising huge profits.

Para 10 of Investor Charter

Code of Conduct for Depositories¹³

(Part D of Third Schedule of SEBI (D & P) regulations, 2018)

A Depository shall:

(a) always abide by the provisions of the Act, Depositories Act, 1996, any Rules or Regulations framed thereunder, circulars, guidelines and any other directions issued by the Board from time to time.

(b) adopt appropriate due diligence measures.

(d) take appropriate measures towards investor protection and education of investors.

(e) treat all its applicants/members in a fair and transparent manner.

(f) promptly inform the Board of violations of the provisions of the Act, the Depositories Act, 1996, rules, regulations, circulars, guidelines or any other directions by any of its issuer or issuer's agent.

(g) take a proactive and responsible attitude towards safeguarding the interests of investors, integrity of depository's systems and the securities market.

(h) endeavor for introduction of best business practices amongst itself and its members.

(i) act in utmost good faith and shall avoid conflict of interest in the conduct of its Functions.

(j) not indulge in unfair competition, which is likely to harm the interests of any other Depository, their participants or investors or is likely to place them in a disadvantageous position while competing for or executing any assignment.

(k) segregate roles and responsibilities of key management personnel within the depository including

a. Clearly mapping legal and regulatory duties to the concerned position

b. Defining delegation of powers to each position

c. Assigning regulatory, risk management and compliance aspects to business and support teams

(l) be responsible for the acts or omissions of its employees in respect of the conduct of its business.

(m) monitor the Compliance of the rules and regulations by the participants and shall further ensure that their conduct is in a manner that will safeguard the interest of investors and the securities market.

Para 11 of Investor Charter

Code of Conduct for Participants¹⁴

(Part A of Third Schedule of SEBI (D & P) regulations, 2018)

1. A participant shall make all efforts to protect the interests of investors.

2. A participant shall always endeavour to—

(a) render the best possible advice to the clients having regard to the client's needs and the environments and his own professional skills;

(b) ensure that all professional dealings are effected in a prompt, effective and efficient manner;

(d) grievances of investors are redressed without any delay.

3. A participant shall maintain high standards of integrity in all its dealings with its clients and other intermediaries, in the conduct of its business.

4.A participant shall be prompt and diligent in opening of a beneficial owner account, dispatch of the dematerialisation request form, rematerialisation request form and execution of debit instruction slip and in all the other activities undertaken by him on behalf of the beneficial owners.

5. A participant shall endeavour to resolve all the complaints against it or in respect of the activities carried out by it as quickly as possible, and not later than one month of receipt.

6.A participant shall not increase charges/fees for the services rendered without proper advance notice to the beneficial owners.

7. A participant shall not indulge in any unfair competition, which is likely to harm the interests of other participants or investors or is likely to place such other participants in a disadvantageous position while competing for or executing any assignment.

8. A participant shall not make any exaggerated statement whether oral or written to the clients either about its qualifications or capability to render certain services or about its achievements in regard to services rendered to other clients.

9. A participant shall not divulge to other clients, press or any other person any information about its clients which has come to its knowledge except with the approval/authorisation of the clients or when it is required to disclose the information under the requirements of any Act, Rules or Regulations.

10. A participant shall co-operate with the Board as and when required.

11. A participant shall maintain the required level of knowledge and competency and abide by the provisions of the Act, Rules, Regulations and circulars and directions issued by the Board. The participant shall also comply with the award of the Ombudsman passed under the Securities and Exchange Board of India (Ombudsman) Regulations, 2003.

12. A participant shall not make any untrue statement or suppress any material fact in any documents, reports, papers or information furnished to the Board.

13. A participant shall not neglect or fail or refuse to submit to the Board or other agencies with which it is registered, such books, documents, correspondence, and papers or any part thereof as may be demanded/requested from time to time.

14. A participant shall ensure that the Board is promptly informed about any action, legal proceedings, etc., initiated against it in respect of material breach or non-compliance by it, of any law, Rules, regulations, directions of the Board or of any other regulatory body.

15. A participant shall maintain proper inward system for all types of mail received in all forms.

16. A participant shall follow the maker—Checker concept in all of its activities to ensure the accuracy of the data and as a mechanism to check unauthorised transaction.

17. A participant shall take adequate and necessary steps to ensure that continuity in data and record keeping is maintained and that the data or records are not lost or destroyed. It shall also ensure that for electronic records and data, up-to-date back up is always available with it.

18. A participant shall provide adequate freedom and powers to its compliance officer for the effective discharge of his duties.

19. A participant shall ensure that it has satisfactory internal control procedures in place as well as adequate financial and operational capabilities which can be reasonably expected to take care of any losses arising due to theft, fraud and other dishonest acts, professional misconduct or omissions.

20. A participant shall be responsible for the acts or omissions of its employees and agents in respect of the conduct of its business.

21. A participant shall ensure that the senior management, particularly decision makers have access to all relevant information about the business on a timely basis.

22. A participant shall ensure that good corporate policies and corporate governance are in place.

IN CASE OF ANY QUERIES FEEL FREE TO GET IN TOUCH WITH US AT 91-9555993300 OR YOU COULD WRITE TO US AT:

grievance@hemnxt.com / support@hemnxt.com

WEBSITE: WWW.HEMNXT.COM

CIRCULAR

Date: 19.05.2021

Dear Clients

Subject: VOLUNTARY AUCTION FACILITY TO MEET SETTLEMENT SHORTAGES

As communicated to you in our earlier intimation about the Company's close out policy, we would like to inform to you that NSE Clearing has introduced the facility of Voluntary Auction for internal shortages in capital market segment and physical settlement of equity. Therefore, if a client initiates a short position and thereafter fails to deliver the securities, then auction of market shortage will be carried out by the Voluntary Auction Facility as provided by NSE.

POINTS TO REMEMBER

Auction shall be in respect of internal shortages in capital market segment, physical settlement of equity derivatives.
You are requested to kindly place the delivery of securities within T+1 day, before 5 p.m. or else the same will be voluntarily auctioned.
In case the Voluntary Auction is not successful then the internal close out (as already existing) shall apply i.e. the first priority will be given to Voluntary auction and only if required the internal closeout will be done thereafter.
In case where auction is successful but there is a settlement shortage i.e. auction seller fails to deliver the securities on T+3 day, NSE Clearing shall conduct financial close out in accordance with the extant procedures.
This is only a facility and no settlement guarantee shall be provided.
There shall be a facilitation fees of 1.5 (1 NSE fees + 0.5 HFPL's charges) on the value of security considering the price of security on day prior to auction.

Thus, we hereby suggest you to kindly ensure timely delivery of shares against short positions to avoid such voluntary auction/ close-out charges.

With Thanks and Regards,

HEM SECURITIES LIMITED &

HEM FINLEASE PRIVATE LIMITED

203, Jaipur Tower,

M.I. Road, Jaipur-302001.