https://www.taxtmi.com/caselaws?id=465061 The SEBI Board held that the depository (Noticee) had not violated Regulation 79(5) read with Regulation 79(3) of the DP Regulations, Regulation 17 read with Clauses 2, 5 and 10 of the Code of Conduct for Depositories, or relevant CDSL Bye Laws and SEBI circular provisions. It found that, at the time of pledge creation by the broker, no freezing order was in force, and the depository had neither the mandate nor operational visibility to detect alleged illegality in hypothecation based on clients' debit balances. The account-tagging system sufficiently complied with nomenclature requirements. Further, allowing invocation of pledge post-freeze did not violate SEBI's Interim Order. Consequently, no liability or monetary penalty under Section 19G of the Depositories Act, 1996 or Section 15HB of the SEBI Act, 1992 arose, and the Show Cause Notice was dismissed. en-us Mon, 24 Jul 2023 00:00:00 +0530 Wed, 03 Dec 2025 15:52:40 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=465061 The SEBI Board held that the depository (Noticee) had not violated Regulation 79(5) read with Regulation 79(3) of the DP Regulations, Regulation 17 read with Clauses 2, 5 and 10 of the Code of Conduct for Depositories, or relevant CDSL Bye Laws and SEBI circular provisions. It found that, at the time of pledge creation by the broker, no freezing order was in force, and the depository had neither the mandate nor operational visibility to detect alleged illegality in hypothecation based on clients' debit balances. The account-tagging system sufficiently complied with nomenclature requirements. Further, allowing invocation of pledge post-freeze did not violate SEBI's Interim Order. Consequently, no liability or monetary penalty under Section 19G of the Depositories Act, 1996 or Section 15HB of the SEBI Act, 1992 arose, and the Show Cause Notice was dismissed. Case-Laws SEBI Mon, 24 Jul 2023 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=465061