Investor Protection Fund refund admissible where deposits were made for trading purpose despite no actual trades being executed.

Refund from the Investor Protection Fund is treated as admissible where deposits were made for the purpose of executing trades on the exchange platform, even if no actual trading took place. The applicable circular was read as limiting eligibility to exchange-linked transactions and amounts deposited for trading, and the facts were found materially similar to an earlier matter in which refund had been granted on reconsideration. As there was no material showing any purpose other than trading, and the broker's debarment removed any practical opportunity for further trading, the non-trading objection was rejected on the facts and the refund claim was allowed.

---

---

Issues: Whether the appellant's claim for refund from the Investor Protection Fund was admissible where funds were deposited for the purpose of executing trades on the exchange platform, notwithstanding that no actual trading had taken place.

Analysis: The claim was examined in the light of the relevant circular governing admissibility of payment out of the Investor Protection Fund, which limited eligibility to transactions executed on the exchange platform and amounts deposited for the purpose of executing trades. The appellant's case was treated as materially similar to an earlier matter where refund had been granted on reconsideration. The Tribunal found no material to show that the deposits were made for any purpose other than trading, and the broker's debarment removed any practical opportunity for further trading. The distinction sought to be drawn on the basis of non-trading was not accepted on the facts.

Conclusion: The refund claim was held admissible and the appeal was allowed in favour of the appellant.

---