 OTC
EXCHANGE OF INDIA Ref.No:
2590/2003/CP/MDD/1233 November
3, 2003 Dear
Members/Dealers Sub:
Reckoning of the first five-year turnover based fee
payable period SEBI vide their circular no. MIRSD/Reg-1/Cir-40/20301/03
dated 28th October, 2003 have advised us to
inform the following to all Members/Dealers: “SEBI,
vide circular No.SMD/POLICY/Cir-07/2002 dated 28.03.2002,
issued a clarification under the heading “Reckoning of
five years fees” that the brokers have to pay fee on the
basis of their turnover for the previous financial year from
the date of commencement of business; This clarification was
examined by the Securities Appellate Tribunal (SAT) while
disposing off the Appeal No.102/2002 in the matter of Mr.
Anoop Jain Vs. SEBI. The
SAT (Securities Appellate Tribunal), vide its order dated
September19, 2003, has observed that the fees are payable by
brokers from the date of initial registration and not from
the date of commencement of business. It also observed that
there is no provision in the Act, Rules or the Regulation
for making the registration effective retrospectively. In view, of the above, it is clarified that the five financial years contemplated in clause (c) of para (1) of Schedule III of the SEBI (Stock Brokers and Sub-Brokers) Regulations 1992 are reckoned with reference to the date on which initial registration is granted by SEBI to the stock broker under the said Regulations. The date on which the broker made application for registration or the date from which the broker commenced business has no relevance for reckoning the five year fee payable period. Therefore, for brokers registered during 1992-93, the five financial years in respect of which turnover based fee is payable would be the years 1991-92 to 1995-96 and for brokers registered during 1993-94, the relevant years would be 1992-93 to 1996-97 and so on. The
aforesaid Circular dated March 28, 2002 shall stand modified
as stated above”. Kindly
take a note of the above. Yours
faithfully, Ajay
C. Singhvi Asst.
Vice President
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