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August 10, first pay-in date on CSE for Auto DO

Our Bureau

CALCUTTA, Aug. 2

THE Calcutta Stock Exchange, following initiatives taken on `automatic generation of delivery-out demat instructions' (Auto DO) by the National Securities Depository Ltd (NSDL), has come out with new clarifications on the issue.

In a fresh notice to members, Mr. Tapas Datta, Executive Director of CSE, has informed that the first demat securities pay-in date would be August 10. Mr. Datta also said that the facility would be available only for weekly settlements, and not for rolli ng settlements.

The notice follows a July 25 communication in which CSE explained how a broking firm could inquire about its delivery status from its depository participant (DP) before securities pay-in.

An example cited by the exchange, with hypothetical positions in ITC, HLL and Global Tele Systems, has underlined the merits of NSDL's facility, with special reference to its suitability and ease of operation. Auto DO, among other things, would eliminate the need for manual delivery-out instructions (through instruction slips), CSE has informed.

A member would not be required to provide delivery-out instructions to his DP. Instead, he must ensure that the right quantity of shares are with his pool account on or before the securities pay-in deadline. CSE, on its part, would download a statement i ndicating that Auto DO for delivery obligations have been generated.

CSE has also come out with a model letter of authority, as desired by NSDL. Through this, brokers would direct CSE to advise the depository to debit clearing-member accounts for the relevant settlement.

Significantly, the NSDL facility would not be used in certain cases, CSE has said. One, a member would have to enter manual delivery-out instructions in respect of non parri passu shares lying in his pool account. Two, manual instructions are necessary w hen irreversible delivery-out instructions are to be given.