KARVY CAPITAL LIMITED PORTFOLIO MANAGEMENT … PMS RDD_01.10.2015.pdf · KARVY CAPITAL LIMITED . PORTFOLIO MANAGEMENT SERVICES . DISCLOSURE DOCUMENT ... interchanged with Plans/Products/Options

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KARVY CAPITAL LIMITED

PORTFOLIO MANAGEMENT SERVICES

DISCLOSURE DOCUMENT

[As required under Regulation 14 of SEBI (Portfolio Managers) Regulation, 1993]

1. This document supercedes the Disclosure document dated_ March 30, 2015 filed

with Securities and Exchange Board of India (SEBI) on March 31, 2015.

2. This Disclosure Document has been filed with SEBI along with the certificate from

independent chartered accountant in the prescribed format in terms of Regulation

14 of the SEBI (Portfolio Managers) Regulations, 1993 as amended till date.

3. The purpose of this Disclosure Document is to provide essential information about

the portfolio management services offered by Karvy Capital Limited in such manner

as to assist and enable the investors in making informed and considered decision for

engaging Karvy Capital Limited as a Portfolio Manager.

4. This document contains the necessary information about the Portfolio Manager

required by an investor.

5. Karvy Capital Limited is permitted to provide Portfolio Management Services

pursuant to its registration as a Portfolio Manager with SEBI vide Registration

number INP000004524 dated June 10, 2014.

6. Investors should carefully read this entire document before making a decision to

avail portfolio management services from Karvy Capital Limited and retain this

document for future reference. Any other relevant information may be provided

upon request.

7. No person has been authorized to give any information or to make any

representations not confirmed in this draft Disclosure Document in connection with

the services proposed to be provided by the Portfolio Manager, and any information

or representations not contained herein must not be relied upon as having been

authorized by the Portfolio Manager.

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8. The Principal Officer designated by Karvy Capital Limited, the Portfolio Manager is:

Name of the Principal Officer Ms. KANIKA KHORANA

Tel No: 022 6149 1500

Email : [email protected]

Address: 702, Hallmark Business Plaza,

Sant Dnyaneshwar Marg,

Bandra (E), Mumbai 400 051

* The Principal Officer has been changed from Mr. Swapnil Pawar to Ms. Kanika Khorana

with effect from March 13, 2015.

9. This disclosure document is dated October 1, 2015

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Portfolio Management Services KARVY CAPITAL LIMITED

INDEX

Sr No Contents Page

Number

1 Disclaimer 4

2 Definitions 4

3 Description - The Portfolio Manager 6

i History, Present Business and background of the Portfolio Manager.

8

ii Promoters of the Portfolio Manager, Directors and their background. 09

iii Details of the top 10 group companies of the Portfolio manager

based on turnover as on March 31, 2014

11

iv Details of Services being offered. 12

4 Penalties/Pending Litigations/Proceedings etc 12

5 Services offered 13

6 Risk Factors 16

7 Client Representation 20

i Category of clients as onAugust 31,2015 20

ii Complete disclosure in respect of transactions with related parties as

per the standards specified by the Institute of Chartered

Accountants of India (as on March 31,2014)

21

8 Financial Performance of Portfolio Manager, Karvy Capital Limited

22

9 Portfolio Management Performance of the Portfolio Manager for last

3 years

23

10 Nature of Expenses 24

11 Taxation 25

12 Accounting Policies 30

13 Investor Services 32

14 Grievances Redressal 32

15 Dispute Settlement Mechanism 32

16 General 33

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Section 1: DISCLAIMER

This document has been prepared in accordance with the Securities Exchange Board of India

(Portfolio Managers) Regulations, 1993, as amended from time to time and other circulars

issued by SEBI from time to time and has been filed with SEBI. This Document has neither

been approved nor disapproved by SEBI nor has SEBI certified the accuracy or adequacy of

the contents of this Document.

This information is not for public distribution and has been furnished to you solely for your

information and may not be reproduced or redistributed to any other person.

Section 2: DEFINITIONS

In this Agreement, unless otherwise clearly indicated by or inconsistent with the context, the

following expressions shall have the meaning assigned to them hereunder respectively:

“Act” – means the Securities and Exchange Board of India Act, 1992.

“Agreement” means the agreement that shall be entered between Karvy Capital Limited, the

Portfolio Manager and the client for the management of funds or securities of the client in

terms of Regulation 14 of the SEBI (Portfolio Managers) Regulations, 1993 and SEBI (Portfolio

Managers) Amendment Regulations, 2002 issued by the Securities and Exchange Board of

India and as may be modified from time to time and shall include all schedules and

annexures thereto and shall also include all modifications, alterations, additions or deletions

made thereto in accordance with the terms thereof.

“Board” means the Securities and Exchange Board of India.

“Bank Account” means one or more bank accounts opened, maintained and operated by

the Portfolio Manager in the name of clients or a pool account in the name of the Portfolio

Manager in which the funds handed over by the client shall be held by the Portfolio Manager

on behalf of the Client.

“Chartered Accountant” means a chartered accountant as defined in clause (b) of sub-

section (1) of section 2 of the Chartered Accountants Act, 1949 (38 of 1949) and who has

obtained a certificate of practice under sub-section (1) of section 6 of that Act.

“Client” means any body corporate, partnership firm, individual, HUF, association of person,

body of individuals, trust, statutory authority, or any other person who enters into

agreement with Karvy Capital limited, the Portfolio Manager for availing the Portfolio

Management Services

“Custodian” means any person who carries on or proposes to carry on the business of

providing custodial services in accordance with the regulations issued by SEBI from time to

time.

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“Depository” means Depository as defined in the Depositories Act, 1996 (22 of 1996) and

currently includes National Securities Depository Limited (NSDL) and Central Depository

Services (India) Limited (CDSL).

“Depository Account” means any account of the client or for the client with an entity

registered as depository participant under sub-section 1A of Section 12 of the Act or any

other law for the time being relating to registration of depository participants in which the

securities comprising part of the Portfolio of the Client are kept by the Portfolio Manager.

“Discretionary Portfolio Management Services” means the discretionary portfolio

management services to be rendered to a Client by Karvy Capital limited, the Portfolio

Manager pursuant to the terms and conditions contained in the Portfolio Management

Services Agreement, where under the Portfolio Manager exercises absolute and unfettered

discretion, with regards to the investments and management of the portfolio of securities or

the funds of the client, as the case may be.

“Disclosure Document” means this draft disclosure document for offering Portfolio

Management Services.

“Financial year” means the period of twelve months commencing on 1st April every year and

ending on 31st March of the following year.

“Funds” means the monies placed by the Client with the Portfolio Manager and any

accretions thereto and also includes any further monies placed by the client with the

Portfolio Manager to be managed pursuant to the Agreement, the proceeds of the sale or

realization of the portfolio and any interest, dividend or other monies so long as the same is

being managed by the Portfolio Manager.

“Funds managed” means the market value of the Portfolio of the Client as on date.

“Fund Manager” (FM) means the individual/s appointed by the portfolio manager who

manages, advises or directs or undertakes on behalf of the client (whether as a discretionary

portfolio manager or otherwise) the management or administration of a portfolio of

securities or funds of the client, as the case may be.

“Initial Corpus” means the value of the funds and the market value of securities brought in

by the client and accepted by the Portfolio Manager at the time of registering with the

Portfolio Manager for the portfolio management services. The Initial corpus brought in by

the Client in the form of securities shall be valued at the closing market price of such

securities, prevailing on recognised stock exchange [NSE/ BSE (only if security is not listed on

NSE)] on the previous working date of activation of client’s portfolio management account

by the Portfolio Manager or of the previous working day of the transfer of such securities

from client’s account to the Depository account whichever is later. The Portfolio Manager

shall not accept from the client, funds or securities worth less than Twenty five lakh rupees.

“Investment Advisory Services” means the non exclusive, non binding services, where the

Portfolio Manager advises Clients on investments in general or gives specific advice

required by the Clients as agreed upon in the Agreement. Advice,whether general or specific

is non-binding in nature and it is entirely at client’s discretion to follow the advice.

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“Non-Discretionary Portfolio Management Services” means the non-discretionary portfolio

management services to be rendered to a Client by the Portfolio Manager on the terms and

conditions pursuant to the Agreement, where under the Portfolio Manager invests and

manages the Funds of the Client based on the instructions of the Client.

“Net Asset Value” or “NAV” means the market value of the Assets managed by the Portfolio

Manager, as calculated by the Portfolio Manager from time to time, depending on the

Strategy chosen by the Client.

“Person directly or indirectly connected” means any person being an associate, subsidiary,

inter connected company or a company under the same management within the meaning of

section 370(1B) of the Companies Act, 1956 or in the same group.

“Portfolio” means the total holdings of securities and / or funds belonging to the client.

“Portfolio Manager” (PM) means Karvy Capital Ltd., a company incorporated under the

Companies Act, 1956 and registered with SEBI as a Portfolio Manager in terms of SEBI

(Portfolio Managers) Regulations 1993 vide registration no. INP000004524 and having its

Registered Office at its PMS dealing office at 702, Hallmark Business Plaza, Sant

Dnyaneshwar Marg, Bandra (E), Mumbai 400 051[ but may add more dealing offices in

future] and who pursuant to a contract or arrangement with a client, advises or directs or

undertakes on behalf of the client (whether as a discretionary Portfolio Manager or

otherwise) the management or administration of a portfolio of securities or the funds of the

client, as the case may be.

“Portfolio Management Services” means the Discretionary Portfolio Management Services, and/or the Non-Discretionary Portfolio Management Services, and/or the Investment Advisory Services, as the case may be. “Portfolio Value” means the aggregate of the Portfolio Funds and Value of Portfolio

Securities.

“Principal Officer” means a director/an employee of the portfolio manager who is

responsible for the activities of portfolio management and has been designated as principal

officer by the portfolio manager.

“Regulations” – means the Securities and Exchange Board of India (Portfolio Managers)

Regulations, 1993, as amended by SEBI from time to time and includes Securities and

Exchange Board of India (Portfolio Managers) Amendment Regulations, 2012, and rules,

guidelines or circulars issued in relation thereto from time to time.

“Strategy” means any of the Portfolio Investment categories mentioned herein or that may

be introduced by the Portfolio Manager from time to time. The Term Strategy may be

interchanged with Plans/Products/Options.

“SEBI” means the Securities and Exchange Board of India established under sub-section (1)

of Section 3 of the Securities and Exchange Board of India Act, 1992.

“Securities” means securities as defined under the Securities Contracts (Regulation) Act,

1956 and includes:

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(i) shares, scrips, stocks, bonds, debentures, debenture stock or other marketable securities of a like nature in or of any incorporated company or other body corporate

(ia) derivative;

(ib) units or any other instrument issued by any collective investment Strategy to the

investors in such Strategies;

(ic) security receipt as defined in clause (zg) of section 2 of the Securitisation and

Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002;

(id) units or any other such instrument issued to the investors under any mutual fund

Strategy;

(ii) Government securities;

(iia) such other instruments as may be declared by the Central Government to be

securities; and

(iii) rights or interest in securities.

A descriptive, but not the exhaustive list of “Securities” is given hereunder:

Shares (whether dematerialized or otherwise), derivatives (futures and options, Interest rate

swaps & Forward rate agreements etc), scrip, stocks, bonds (whether dematerialized or

otherwise), warrants, convertible debentures (whether dematerialized or otherwise), non-

convertible debentures (whether dematerialized or otherwise), securitised debt (whether

dematerialized or otherwise), fixed return investments, floating rate instruments linked to

MIBOR/ call money etc., equity shares and equity linked instruments or other marketable

securities of a like nature in or of any incorporated company or other body corporate,

negotiable instruments, including usage bills of exchange, trade bills, deposits or other

money market instruments, derivatives, commercial paper, certificates of deposits, units

issued by Unit Trust of India, units issued by Mutual Funds, units issued by SEBI registered

Alternative Investment Funds, mortgage backed or other asset backed securities issued by

any institution or corporate, cumulative convertible preference shares issued by any

incorporated Company and securities issued by the Central Government or a State

Government , Pass Through Certificates , RBI auctions, open market sales conducted by RBI

or any other securities that may be issued from time to time.

“Securities lending” means the securities lending as per the Securities Lending Scheme, 1997

and related guidelines specified by SEBI.

“Structured Products” means products returns on which may be linked to Equity Index, Debt

instruments, Non Convertible Debentures and may also be based on Basket of stock, index or

stock futures with pre-defined capital protection. These are normally third party products.

The terms that are used herein and not defined herein, except where the context otherwise

so requires, shall have the same meanings as are assigned to them under the Act, the

Regulations or the Rules.

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Words importing the singular include the plural and vice-versa. Words importing a gender include the other gender.

Section 3 DESCRIPTION

i. HISTORY, PRESENT BUSINESS AND BACKGROUND OF THE PORTFOLIO MANAGER :

Karvy Capital Limited, a wholly owned subsidiary of Karvy Stock Broking Limited, was

incorporated under the Companies Act, 1956 as amended from time to time as a Private

Limited Company on December 31, 1981 with the name ‘Grant Holding and Trading

Company Private Limited’. On June 30, 2011, the name of the company was changed to

Karvy Capital Private Limited. The name of the company was further changed from Karvy

Capital Private Limited to Karvy Capital Limited with effect from February 8, 2012 and

presently Karvy Capital Limited is a Public Company domiciled in India.

Karvy Capital Limited has its Registered Office at 702, Hallmark Business Plaza, Sant

Dnyaneshwar Marg, Bandra (E), Mumbai – 400051.

Karvy Capital Limited is principally engaged in business of trading of shares and securities.

Karvy Capital Limited has been registered with Reserve Bank of India (‘RBI’) to carry on the

business of non-banking financial institution with effect from March 24, 1998.

Karvy Capital Limited is also acting as a Sponsor and Manager to Karvy Capital Alternative

Investment Fund (Trust) for which it has obtained Category III License on April 10, 2013.

Karvy Capital Limited is registered with SEBI as a Portfolio Manager vide registration number

INP000004524, for the period 10th June 2014 to 9th June 2017.

Karvy Capital Limited started proprietary trading in August 2010 with a focus on Quantitative

and Absolute Return strategies. Currently, Karvy Capital Limited acts as an Investment

Manager to Karvy Capital Alternative Investment Fund – a category III Alternative Investment

Fund.

Karvy Capital Limited also has a retail debt business and acts as a facilitator for structured

finance deals. Karvy Capital Limited is also a direct sales associate and main distributor to the

various products and services being offered by Karvy Group.

Karvy Capital Limited aims to be a reputable asset manager providing comprehensive

investment solutions across asset classes to its investors. To diversify the set of offerings,

Karvy Capital Limited intends to provide customized and focused portfolio management

solutions to investors. These services would include discretionary portfolio management

services, non discretionary portfolio management services and advisory services.

Karvy Capital Limited is a group company of the KARVY Group, which is a premier integrated

financial services provider, and ranked amongst the leading corporate in the country in all its

business segments, servicing over millions of individual investors in various capacities, and

provides investor services to many corporates, comprising the who’s who of Corporate

India. KARVY group companies cover the entire spectrum of financial services such as Stock

Broking, Depository Participants, Distribution of financial products – mutual funds, bonds,

fixed deposit, equities, Insurance Repository , Commodities Broking, Personal Finance,

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Advisory Services, Merchant Banking & Corporate Finance, placement of equity, IPOs,

services related to data management and Non Banking Financial company among others.

KARVY Group has a professional management team and ranks among the best in technology

and operations.

ii. DETAILS OF PROMOTERS,DIRECTORS AND THEIR BACKGROUND:

The directors of Karvy Capital Limited as on October 1, 2015 and their background are as

follows:

Name and age: Mr. Kedar Ramesh Deshpande, aged 42 years

Designation: Whole-time Director.

Qualification: BE Civil Engineering and MBA Marketing

Experience (General and specific Intermediaries activity):

Over 19 years of wide-ranging retail broking and market

research experience and founder director of Repeat

Purchase India Pvt. Ltd., an ecommerce company and COS

and Financial Catalysts Private Limited for imparting

training for retail BFSI sector.

Has been associated with ICICI group for period of 7 years. Headed the retail broking business, commodities segment, retail demat business. Has set up the retail broking business at Edelweiss Financial Services Ltd. and played a key role in designing website to give clients simplified execution.

Date of appointment: August 10, 2015

Other directorships: Name of Company Date of appointment

Repeat Purchase India

Private Limited

10/08/2012

COS and Financial

Catalysts Private Limited

25/08/2013

Previous Positions held: Country Head Retail Broking in Karvy Stock Broking Limited prior to Business Head Retail Broking in Edelweiss Financial Services Ltd and Deputy General Manager in ICICI Bank Ltd.

Name and age: Mr. G. Krishna Hari, aged 57 years

Designation: Director

Qualification: Bachelors degree in Commerce and an associate member

of the Institute of Chartered Accountants of India (ICAI)


He has over 27 years of experience in the areas of finance

and accounts functions encompassing fund raising,

financial reporting, management accounting, working

capital management, budgeting and forecasting and

financial due diligence reviews for mergers & acquisitions

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and investment proposals. He has been associated with

the Karvy Group for the past 15 years.

Date of appointment: September 27, 2012


Karvy Holdings Limited March 1, 2013

Karvy Realty & Services

Limited

March 2 , 2015

Previous Positions held: Prior to joining Karvy, he was the head of finance & accounts division in Asia Pacific Investment Trust Limited, Hyderabad (Formerly Nagarjuna Investment Trust Limited) an NBFC Company.

Name and age: Mr. V. Mahesh, aged 50 years

Designation: Director

Qualification: Graduate in BA - Corporate Secretary ship from University

of Madras. He also holds a Post Graduate degree in

Commerce from University of Madras (M.Com) and a Post

Graduate Diploma in Computer Applications.


He has work experience spanning over two decades and

has in depth exposure to operations on most financial

services businesses. Commencing his professional stint

with Karvy’s Registry business where he has to his credit

managing over 300 Initial Public Offerings and other forms

of offerings, he was amongst the first few to work closely

on the Book Building process initiated by SEBI in 1995

Date of appointment: June 29, 2011


Buoyant Consultants Pvt. Ltd

April 1, 2002

Karvy Realty (India) Limited August 31, 2006

Contours Motors & Dealers Private Limited

December 14, 2007

Karvy Data Management Services Ltd. [Managing Director]

April 21, 2008

Efin Services (India) Private Limited

February 20, 2009

Karvy Financial Services Limited

July 17, 2009

Karvy Forex & Currencies Private Limited

March 10, 2011

Karvy Insurance Repository Limited

November 30, 2011

Karvy Global Services Limited

January 21, 2014

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Karvy Solar Power Limited January 28 , 2015

Karvy Insights Limited February 19, 2015

Karvy Analytics Limited March 02 , 2015

Mr. V Mahesh resigned from Karvy Holdings Limited

w.e.f.09.02.2015 and Karvy Realty & Services Limited

w.e.f.02.03.2015.

Previous Positions held: After initially working with Mass Computer Services Ltd (MCS) as an Assistant Vice President, he moved to Karvy

Name and age: Mr. K.P. Jeewan, aged 47 years

Designation: Director.

Qualification: B.Com (Hons Accounts), MBA


He has over 24 years of experience in investment banking,

corporate finance, fixed income, forex/interest rate

structured products.

He was also associated as a Vice President in Kotak

Mahindra Bank Limited, as in charge of structured

products desk of the treasury. The assignment involved

structuring Derivative products (Forex and Interest rate)

for Institutional clients.

Additionally, he has worked for about an year at Kotak

Mahindra Capital Company Primary Dealers in various

capacities in investment Banking & Fixed Income.

Date of appointment: May 29, 2015

Other directorships: Not Applicable

Previous Positions held: a. Head of Fixed Income Division in Karvy Stock Broking Limited

b. Vice President and In charge of structured products desk of the treasury and various capacities in investment Banking & Fixed Income in Kotak Mahindra Bank Limited

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Name and age: Mr. P. B. Ramapriyan, aged 48 years


Qualification: B.Com, PGDBA


He is working with Karvy for over 2 decades; He has strength of sorts in the distribution of financial products including Equity, Bonds, Fixed Deposits and Auto Finance. He has successfully marketed several financial products for large number of corporate of various sizes. He is also responsible for managing the Pan India Network of brokers and sub-brokers. He has been instrumental in Karvy’s success in distribution of debt products.


Other directorships: Director in Karvy Realty (India) Limited appointed on

31.08.2006

Previous Positions held: Karvy Group - Distribution of Financial products

Name and age: Mr. Rajiv Ranjan Singh, aged 45 years


Qualification: Cost & Management Accountant


He has enormous experience in finance industry with capabilities in building strategy, revenue generation, business development and overall customer satisfaction.


Other directorships: Not Applicable

Previous Positions held: Karvy Group- Vice President & Business Head of the Equity Broking business

Mr.Swapnil Pawar, Managing Director of Karvy Capital Limited has tendered his

resignation effective October 1 ,2015.

iii DETAILS OF THE TOP 10 GROUP COMPANIES/ FIRMS BASED ON TURNOVER AS ON

MARCH 31, 2015 [ based on audited financials]:

S. NO Name of the

Company Nature of Business Status Turnover (Rs)

1 Karvy Stock Broking Limited

SEBI Registered Stock broker, Depository Participant, Portfolio Manager

Parent Company

3,691,869,126

2 Karvy Financial Services Ltd. Financial Services-NBFC

Group company

3,579,787,839

3

Karvy Computershare Pvt. Ltd.

SEBI Registered Registrar and Share Transfer Agent

Group company

2,690,202,383

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4

Karvy Data Management Services Ltd Transaction Processing

Group company

2,025,996,810

5 Karvy Realty (India) Ltd. Realty Services

Group company

289,725,633

6 Karvy Comtrade Ltd.

FMC/ NCDEX /MCX/NMCE/ACE / ICEX/ NCDEX Spot Exchange / National Spot Exchange registered commodity broker

Group company

223,868,626

7 Karvy Holdings Limited Consulting and Advisory Services

Group company

135,598,416

8

Karvy Consultants Limited Consultancy and advisory services

Group company

118,365,390*

9

Karvy Insurance Repository Limited Insurance Repository and Other services

Group company

60,792,932

10 Karvy Middle East LLC, Dubai Commercial Broker and Advisory Services

Group company

51,549,269

* Based on unaudited financials

iv DETAILS OF THE SERVICES BEING OFFERED:

Karvy Capital Limited, Portfolio Manager, offers Discretionary, Non discretionary & Advisory

services as per the preference and agreement with the individual client. For details of the

services offered kindly refer Annexure A.

Section 4: PENALTIES, PENDING LITIGATION OR PROCEEDINGS, FINDINGS OF INSPECTION OR INVESTIGATIONS FOR WHICH ACTION MAY HAVE BEEN TAKEN OR INITIATED BY ANY REGULATORY AUTHORITY

I All cases of penalties imposed

by the Board or the directions

issued by Board under the Act

or Rules or Regulations made

there under

There are no penalties imposed or litigation

pending against the Karvy Capital Limited.

Details of litigations pending against group

companies/ associates of the portfolio manager

have been provided as Annexure B to this

document.

II The nature of penalty/direction Not Applicable

III Penalties imposed for any

economic offence and/or for

violation of any securities laws

Not Applicable

IV Any pending material

litigation/legal proceedings

against the Portfolio

Not Applicable

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Manager/key personnel with

separate disclosure regarding

pending criminal cases, if any

V Any deficiency in the systems

and operations of the Portfolio

Manager observed by the Board

or any regulatory agency

Not Applicable

VI Any enquiry/adjudication

proceedings initiated against

the Portfolio Manager or its

directors, principal officer or

employee or any person directly

or indirectly connected with the

Portfolio Manager or its

directors, principal officer or

employee, under the Act or

Rules or Regulations made

there under

Not Applicable

Section 5: SERVICES OFFERED

5.1 The Portfolio Manager offers the following three types of Services

a. Discretionary Services

The Portfolio account of the client is managed at the full discretion and liberty of Karvy

Capital limited, the Portfolio Manager.

Under these services, the choice as well as the timings of the investment decisions on an on-

going basis rest solely with the Portfolio Manager. The Portfolio Manager may at times and

at its own discretion, adhere to the views of the Client pertaining to the investment

/disinvestment decisions in the Client’s Portfolio. The Portfolio Manager shall have the sole

and absolute discretion to invest in respect of the Client’s account in any type of security as

per the Agreement and make such changes in the investments and invest some or all of

funds in the Client’s account in such manner and in such markets as it deems fit. The Client

may give informal guidance to customize the portfolio strategies; however, the final decision

rests with the Portfolio Manager. The securities invested / disinvested by the Portfolio

Manager for Clients in the same Strategy may differ from one Client to another Client. The

Portfolio Managers’ decision (taken in good faith) in deployment of the Clients’ account is

absolute and final and can never be called in question or be open to review at any time

during the currency of the agreement or any time thereafter except on the ground of

malafide, fraud, conflict of interest or gross negligence. This right of the Portfolio Manager

shall be exercised strictly in accordance with the relevant Acts, Rules, and Regulations,

guidelines and notifications in force from time to time.

Under these services, the Clients may authorize the Portfolio Manager to invest their Funds

in specific financial instruments or a mix of specific financial instruments or restrict the

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Portfolio Manager from investing in specific financial instruments or securities. Periodical

statements in respect of Client’s Portfolio shall be sent to the respective Clients.

Details of the strategies being offered by the Portfolio Manager are contained in Annexure A.

b. Non Discretionary

In Non-Discretionary Portfolio management, the Portfolio Manager would manage the

client’s portfolio in consultation with and as per the directions or consent of the client.

Under these services, the Clients decide their own investments with the Portfolio Manager

only facilitating the execution of transactions. The Portfolio Manager’s role would include

but not limited to providing research, structuring of clients’ portfolios, investment advice and

guidance and trade execution at the Client’s request. The Portfolio Manager shall execute

orders as per the mandate received or consent obtained from the Client. The deployment of

the Client’s Funds by the Portfolio Manager shall be as per the instructions or consent of the

Client. The rights and obligations of the Portfolio Manager shall be exercised strictly in

accordance with the Act, Rules and/or Regulations, guidelines and notifications in force from

time to time. Periodical statements in respect of Client’s Portfolio shall be sent to the

respective Clients. Details of strategies offered by the Portfolio manager under non

discretionary services can be viewed in Annexure A.

c. Advisory

Portfolio Manager will provide advisory services, as per the Regulations, which shall be in the

nature of investment advice and shall include the responsibility of advising on the portfolio

strategy, investment, disinvestment of the various securities in the client’s portfolio, for an

agreed fee, entirely at the client’s risk. The Portfolio Manger will render the best possible

advice to the client having regard to the client’s needs and the requirements, using his own

professional skills. This service will be purely of advisory in nature under an agreed fee

structure with the client. It is up to the client to accept the recommendations/advice of

Portfolio Manager and Portfolio Manager will not be held responsible for any consequence

arising out of acceptance of Portfolio Manager’s advice under this service.

5.2 Present Investment Objective

The General Objective is to formulate and device the investment philosophy to

achieve long term growth of capital by investing in assets, which generate

reasonable risk–adjusted return . The actual portfolio management style will vary in

line with profile of each client with regards to his risk tolerance levels and specific

preferences or concerns. (The specific objective will be as mentioned in the

agreement with the client).

5.3 Types of securities

The Portfolio Manager/Fund Manager shall invest in all such types of Securities as

defined (kindly refer to the definition) and in all such Securities as permissible from

time to time.

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5.4 Investment in Group / associate companies

The Portfolio Manager/Fund Manager may invest in Securities of the

associate/group companies subject to the applicable laws/ regulations/ guidelines.

These investments will be carried out to achieve the investment objectives and

strategies and in the normal course of investment activity subject to the applicable

laws/regulations.

The Portfolio Manager / Fund Manager may invest in any unlisted securities of any

associate/group companies of the Portfolio Manager/ promoter. The Portfolio

Manager / Fund Manager may also invest in privately placed securities issued by

Associate/Group companies of the promoter.

5.5 Minimum Investment Amount

The Portfolio Manager shall not accept funds and/or securities from new clients,

cumulative value of which is less than Rupees Twenty Five Lakhs or as specified in

the agreement with the Portfolio Manager or as amended/specified in the SEBI

(Portfolio Managers) Regulations, 1993.

5.6 Conflict of Interest

Karvy Capital Limited, Portfolio Manager is also the Investment Manager to a

Category III Alternate Investment Fund (AIF). Since the entity is the same, the

management for both the portfolio management division and Investment

Management division remains the same. However, the personnel such as fund

manager(s), teams involved in order generation and execution will be independent

of the personnel involved in the same activity for portfolio management services.

Further, the services offered by Karvy Capital Limited under the AIF offering and the

Portfolio Management services to clients are inherently very different. The key

difference is that while the investments under the AIF route are primarily in the

derivative segment, investments made as a portfolio manager may encompass the

entire gamut of products in the financial space. Further, trades in the AIF are

generated through the system by use of defined algorithms whereas the portfolio

manager uses a lot of thought process in picking the instrument based on

fundamental analysis for investment be it equity, debt or mutual funds.

Nonetheless, the management will provide their guidance and insight with relation

to monitoring of overall functioning of both the AIF and portfolio management

services and their broad macro views on the investment front shall be used for both.

As described above, due to the difference in the nature of the investments under AIF

and portfolio management services offered, it may happen that a scrip is purchased /

held for a client of the Karvy Capital Limited, the portfolio manager while the

algorithm which dictates trades in the AIF generates an opposite signal say “sell”

instruction for the same scrip usually as the trigger for a trade could be a

quantitative factor rather than a fundamental factor. Further, the holding period for

the trade may be shorter for the AIF .Therefore Karvy Capital Limited, the

P a g e 1 7 o f 3 3

Investment Manager to the AIF may sell the same scrip while maintaining “buy” for

the same scrip for its portfolio management clients. Such a situation could show

opposite trading positions in the AIF and Portfolio Management Services.

The portfolio manager being an NBFC purchases securities as a part of its routine

business activity. These securities may be bought for investment or trading

purposes. Therefore Karvy Capital as discretionary portfolio manager may buy the

securities from Karvy Capital limited {NBFC}. These securities would be purchased at

a price deemed fit by the portfolio manager and may also at times be at a premium

depending on the demand for the security. Additionally, depending on reasons such

as demand for the security prevalent at the time of purchase by Karvy Capital as

discretionary portfolio manager from itself as an NBFC , the portfolio manager may

get different prices for the same security. Effectively it is a possibility that the price

of the security bought by the portfolio manager in the above manner may differ

interse the clients of the portfolio manager on account of the same being bought at

different points of time. Karvy Capital , discretionary portfolio manager shall ensure

that its rationale for all its decisions to purchase securities in the abovesaid manner

shall be documented and approved by its Investment Committee.

Section 6: RISK FACTORS

1. Investments in securities are subject to market risks including price volatility and

liquidity risk and there is no assurance or guarantee that the objectives of the

strategy will be achieved. The investment may not be suited for all categories of

investors. The past or present performance of these strategies does not indicate the

future performance of the same strategy or any other future strategies launched

subsequently by Portfolio Manager. With reference to appreciation on the portfolio,

the investors are not being offered any guaranteed or indicative returns through any

of the strategies. The Portfolio Manager also does not guarantee any capital

protection for any strategy.

2. There are inherent risks arising out of investment objectives, investment strategy,

asset allocation and non-diversification of portfolio. The investment objective,

investment strategy and asset allocation may differ from client to client. However,

generally, highly concentrated portfolios with lesser number of stocks will be more

volatile than a portfolio with a larger number of stocks. Portfolios with higher

allocation to equities will be subject to higher volatility that portfolios with low

allocation to equities. Diversified portfolios (allocated across companies and broad

sectors) generally tend to be less volatile than non diversified portfolios. The names

of the various strategies do not in any manner indicate their prospects or returns.

3. Investment decisions made by the Portfolio Manager may not always be profitable

since actual market movement may be at variance with anticipated trends.

4. ETF may trade above or below their NAV. The NAV of ETF will fluctuate with changes

in market value of scheme’s holdings of underlying stocks. However, given that ETF

can be created and redeemed only in creation units directly with the Mutual Fund, it

P a g e 1 8 o f 3 3

is expected that large discounts or premiums to the NAVs of ETFs will not sustain due

to availability of arbitrage possibility. Any changes in trading regulations by the

Exchange (s) or SEBI may affect the ability of market maker to arbitrage resulting into

wider premium / discount to NAV for ETFs.

5. The performances of the strategies depend on the performance of the market and

the individual companies in which investment have been made under strategies

relative to industry specific and macro economic factors. The Portfolio Manager does

not assure or guarantee that Performance of Portfolio of the Investor shall better the

Performance of any Benchmark Index.

6. The tax benefits described in this Disclosure Document are as available under the

present taxation laws and are available subject to conditions. The information given is

included for general purpose only and is based on advice received by the Portfolio

Manager regarding the law and practice in force in India and the investors should be

aware that the relevant fiscal rules or their interpretation may change. As is the case

with any investment, there can be no guarantee that the current tax position or the

proposed tax position prevailing at the time of an investment in the Portfolio will

endure indefinitely. In view of the individual nature of tax consequences, each

investor is advised to consult his/her own professional tax advisor regarding the

taxation aspects of his/ her portfolio investments.

7. Prospective investors should review/ study this Disclosure Document carefully and in

its entirety and shall not construe the contents hereof or regard the summaries

contained herein as advice relating to legal, taxation, or financial/investment matters.

Prospective investors are advised to consult their own professional advisor(s) as to

the legal, tax, financial or any other requirements or restrictions relating to the

subscription, gifting, acquisition, holding, disposal (sale or conversion into money) of

Portfolio and to the treatment of income(if any), capitalization, capital gains, any

distribution, and other tax consequences relevant to their portfolio, acquisition,

holding, capitalization, disposal (sale, transfer or conversion into money) of portfolio

within their jurisdiction of nationality, residence, incorporation, domicile etc. or

under the laws of any jurisdiction to which they or any managed funds to be used to

purchase/gift portfolio of securities are subject, and also to determine possible legal,

tax, financial or other consequences of subscribing/gifting, purchasing or holding

portfolio of securities before making an investment.

8. The debt investments and other fixed income securities may be subject to interest

rate risk, liquidity risk, credit risk and reinvestment risk. Liquidity in these

investments may be affected by trading volume, settlement period and transfer

procedures. Issuer of fixed income security may default or may be unable to make

timely payments of principal and interest. Net Asset Value of portfolio may be

affected due to perceived level of credit risk as well as actual event of default.

9. The corporate debt market is relatively illiquid vis-à-vis the government securities

market. There could therefore be difficulties in exiting from corporate bonds in times

of uncertainties. Further, liquidity may occur only in specific lot sizes. Liquidity in a

security can therefore suffer. Even though the Government securities market is more

P a g e 1 9 o f 3 3

liquid compared to that of other debt instruments, on occasions, there could be

difficulties in transacting in the market due to extreme volatility or unusual

constriction in market volumes or on occasions when an unusually large transaction

has to be put through. There can be no assurance that the requirements of the

securities market necessary to maintain the listing of specified debt security will

continue to be met or will remain unchanged.

10. Exposure to select Sector(s) carries the performance risk of the relevant sector, which

could outperform or underperform the market and/or various indices.

11. Technology and pharmaceutical stocks and some of the investments in niche sectors

run the risk of volatility, high valuation, obsolescence and low liquidity.

12. Frequent rebalancing of portfolio may result in higher brokerage / transaction cost.

Also the allocation to different securities can vary from 0 to 100 %, hence there can

be a vast difference between the performance of the products and returns generated

by underlying securities.

13. Information available on some companies in which the Portfolio manager has made

investments may be limited.

14. The performance of the strategies may be affected by change in Government Policies

including taxation, and certain unforeseen developments in political or general areas

at the national or international level. Also, the investments are subject to external

risks such as war, natural calamities and policy changes of local / international

markets which affect stock markets.

15. The performance of the strategies may also be affected and investor could lose

money over short periods due to fluctuation in NAV of Portfolio arising out of

fluctuations of interest rates, credit risk, political and geopolitical risk, currency risk,

foreign exchange risks, foreign investments, risks arising from changing business

dynamics, risk associated with investment in securities debt, risk due to movement in

Futures and options markets, changes in the general market conditions, forces

affecting the capital markets, closure of stock exchange due to circuit filter rules or

otherwise and risks associated with trading volumes, settlement periods, transfer

procedures, liquidity and settlement systems in equity and debt markets.

16. There is a possibility that loss may be sustained by the Portfolio as a result of the

failure of another party (usually referred as the “Counter party”) to comply with the

terms of the derivative contract.

17. Portfolio Manager, subject to authorization in writing by the client, may participate in

securities lending. Engaging in securities lending is subject to risks related to

fluctuations in collateral value/settlement/liquidity/default from counter party,

including corporate benefits accrued thereon. This may lead to the risk of Approved

Intermediary unable to deliver back the securities. Portfolio Manager cannot be held

liable for any loss arising out of operation of such strategies.

The portfolio manager may in the course of its activities, avail the services of persons

/ bodies who are not employees of the portfolio manager. The portfolio manager

would exercise due diligence when employing such persons, however there may be

P a g e 2 0 o f 3 3

losses incurred on account of any act or omission on part of such persons or bodies.

The portfolio manager disclaims liability for any loss in the portfolio on this account.

All portfolios under portfolio management are subject to change at anytime at the

discretion of the Portfolio Manager.

18. In the case of stock lending, risks relate to the defaults from counterparties with

regard to securities lent and the corporate benefits accruing thereon, inadequacy of

the collateral and settlement risks. The Portfolio Manager is not responsible or liable

for any loss resulting from the operations of the strategies/options.

19. Investments in the Market Linked Debentures (MLDs) are also subject to model risk.

The MLDs are created on the basis of complex mathematical models involving

multiple derivative exposures which may or may not be hedged and the actual

behavior of the securities selected for hedging may significantly differ from the

returns predicted by the mathematical models.

20. Strategies may use derivative instrument like futures and options (index as well as

individual securities), warrants, convertible securities, swap agreements, etc. for the

purpose of hedging and/or portfolio balancing, as permitted under the

Regulations/guidelines. Strategies using such derivative products may be affected by

risks different from those associated with stock and bonds. Such derivative products

are highly leveraged instruments and their use requires a high degree of skill,

expertise and diligence. Small price movements in the underlying security may have a

large impact on the value of the derivatives and futures and options and may also

result in loss. Some of the risks relate to mis-pricing or the improper valuation of the

derivatives/futures and option and the inability to correlate the positions with the

underlying assets, rates and indices. The risk of loss associated with futures contracts

is potentially unlimited due to the low margin deposits required and the extremely

high degree of leverage involved in futures pricing. Also, the derivatives/future and

options market is nascent in India.

The liquidity of the investments is guided by trading volumes in the securities in

which it invests. Although securities may be listed on the Exchange(s), there can be

no assurance that an active secondary market will develop or be maintained. This

may limit the Portfolio Manager’s ability to freely deal with securities in the Portfolio

and may lead to incurring of losses till the security is finally sold. Different segments

of the financial markets have different settlement periods and such periods may be

extended significantly due to unforeseen circumstances. The inability of a Portfolio to

make intended securities purchase due to settlement problems could cause the

portfolio to miss certain investment opportunities. Similarly, the inability to sell

securities held in the portfolio due to absence of a well developed and liquid

secondary market would at times result in potential losses in the Portfolio, in case of

a subsequent decline in the value of securities held in the Portfolio.

21. The Portfolio Manager may invest in non-publicly offered debt securities and unlisted

securities. This may expose client’s portfolio to liquidity risks.

22. Securities, which are not listed on the Stock Exchanges, are inherently illiquid in

nature and carry a larger amount of liquidity risk, in comparison to securities that are

P a g e 2 1 o f 3 3

listed on the Exchanges or offer other exit options to the investor. The Portfolio

Manager may, at its discretion, invest in lower rated/unrated securities that offer

attractive yield, which may increase the risk of the Portfolio. Such investments shall

be subject to the scope of investments laid down in the executed agreement.

23. The Portfolio Manager may seek to create value by investing in stocks that trade

below the estimated fair value of the Company, which shall be judged by various

quantitative valuation parameters. But due to various reasons, it may so happen that

such stocks continue to languish and are not able to attain the price discovery.

Accordingly, this may have material adverse impact on the performance of the

portfolio.

24. After accepting the corpus for management, the Portfolio Manager may not get an

opportunity to deploy the same or there may be delay in deployment. In such

situation the clients may suffer opportunity loss.

i. Category of clients as on August 31, 2015:

Category of Clients as on h August 31,2015

:

Category of Clients No of

Clients

Funds

Managed

Remarks

(Rs. In Crs)

Associate/ Group Companies

As on August 31,2015 0 0 Discretionary

As on 30th Sept, 2014. 0 0 Discretionary

As on 31st March 2014. 0 0 Discretionary



Others

As on August 31, 2015. 265 108.28 Discretionary

As on 31st March 2015. 167 65.81 Discretionary

As on 31st March 2014.



Total

As on 28th Feb, 2015.

265

108.28

Discretionary




Section 7: CLIENT REPRESENTATION

P a g e 2 2 o f 3 3

ii. Complete disclosure in respect of transactions with related parties as per the standards specified by the Institute of Chartered Accountants of India (as on 31st March 2015)

Sr. No

Name of the related party Nature of Transaction

Amount

2014-15 2013-14

1 Karvy Stock Broking Limited

Loans given / (refunded)# -

19,15,50,000

Loans taken / (repaid)#

9,10,00,000

3,90,00,000

Interest income

-

31,47,865

Interest expense

7,98,331

1,06,669

Brokerage on trading in securities*

26,336

1,45,576

Shared Services of Expenses/ (revenue), net

1,26,93,952

4,01,65,888

2 Karvy Financial Services Limited

Loans taken / (repaid)# -

1,80,00,000

Interest expense -

80,814

3 Karvy Realty (India) Limited

Loans given / (refunded)# -

70,00,000

Interest income -

5,178


-

(2,49,70,000

)

4 Karvy Comtrade Limited

Brokerage on trading in securities*

-

15,789

5 Karvy Investor Services Limited

Loans taken / (repaid)# (2,00,00,00

0)

2,00,00,000

Interest expense 1,19,836

22,192

6 Karvy Forex & Currencies Pvt. Ltd.


-

10,548

7 Karvy Capital Alternative Investment Fund

Investments made -

2,75,00,000

Dividend received 4,62,867

-

Fee income 7,87,831

33,31,551

8 Mr. Hrishikesh Parandekar

Loans taken / (repaid)# -

1,00,00,000

Interest expense -

26,302

9 Mr. Swapnil Pawar Managerial Remuneration paid 80,02,401

74,56,464

# Maximum loan given / taken at any time during the year

* Trading in Securities is carried out in the normal course of business at the prevailing market prices

P a g e 2 3 o f 3 3

Section 8: FINANCIAL PERFORMANCE OF PORTFOLIO MANAGER (BASED ON AUDITED FINANCIAL STATEMENTS})

As at As at As at

31-Mar-15 31-Mar-14 31-Mar-13

Rs in Lakhs

(Audited)

Rs in Lakhs (Audited)

Rs in Lakhs (Audited)

SOURCES OF FUNDS

Shareholders' Funds 1,157.46 859.15 599.52

Share Application Money

-

- -

Loan Funds 2,100.39 2,080.62 1,127.39

Deferred Tax Liability - 0.53 -

Total 3,257.86 2,940.30 1,726.91

APPLICATION OF FUNDS

Net Fixed Assets 37.88 48.64 42.51

Stock Exchange Membership Cards - - -

Investments 275.00 279.00 4.00

Current Assets 3,079.66 2,719.06 1,708.53

Less: Current Liabilities and Provisions (136.13) (106.41) (118.57)

Net Current Assets 2,943.53 2,612.66 1,589.96

Deferred Tax Asset 1.45 - 90.44

Total 3,257.86 2,940.30 1,726.91

Summarized Financial Statement - Profit and Loss Account

For the year

ended

For the year ended

For the year ended

31-Mar-15 31-Mar-14 31-Mar-13

Rs. In Lakhs Rs. In Lakhs Rs. In Lakhs

Total Income 1,305.84 1,403.95 682.50

Total Expenses (837.59) (1,023.70) (753.34)

Profit before Depreciation and Tax 468.25 380.25 (70.84)

Depreciation/Amortisation (22.34) (15.00) (12.11)

P a g e 2 4 o f 3 3

Profit before Tax 445.91 365.25 (82.95)

Provision for Tax (147.60) (105.61) 20.09

Profit After Tax 298.31 259.64 (62.86)

Section 9: PORTFOLIO MANAGEMENT PERFORMANCE OF PORTFOLIO MANAGER FOR THE LAST THREE YEARS. IN CASE OF DISCRETIONARY PORTFOLIO MANAGER, DISCLOSURE OF PERFORMANCE INDICATORS CALCULATED USING WEIGHTED AVERAGE METHOD IN TERMS OF REGULATION 14(2)(b)(iv) OF THE SEBI (PORTFOLIO MANAGERS) REGULATIONS, 1993

Period

01.07.2014

–

31.03.20152

8.02.2015*

01.04.2015 –

31.08.2015

01.04.2012 –

31.03.2013

Discretionary PMS Resident

Portfolio

Performance

Demeter Strategy 15.15% 7.87%

-

Benchmark

Performance

S&P BSE India

Corporate Bond

Index**

8.76% 3.36%

-

Discretionary PMS Non- Resident

Portfolio

Performance Demeter Strategy - - -

Benchmark

Performance

S&P BSE India

Corporate Bond

Index** - - -

*The first client in the portfolio was activated on July 1, 2014. Hence, the performance has

been provided from July 1, 2014 instead of April 1, 2014.

**Disclaimer: Earlier NSE Gsec 1-3 year Sub-maturity Index was used as Benchmark. Due to

the discontinuation of its publication by NSE, beginning this month, we have changed the

benchmark to “S&P BSE India Corporate Bond Index”.

Section 10: NATURE OF EXPENSES

The following are the general costs and expenses to be borne by the Client availing the

services by the Portfolio Manager. However, the exact nature of expenses relating to each of

the following services is provided in the annexure to this Risk Disclosure Document and in

the Schedule of Charges signed by the client in respect of each of the services provided.

P a g e 2 5 o f 3 3

(i) Portfolio Management and Advisory Fees

This fee relates to the portfolio management services offered by Portfolio Manager

(including advisory services) to the clients. The fee may be a Fixed Charge on the quantum of

the funds being managed (or) charges linked to portfolio return (or) combination of both. For

details kindly refer the annexure to this Risk Disclosure Document.

(ii) Premature Redemption Charges

If the redemption is done prematurely at the option of the client, the Portfolio Manager shall

levy the Premature Redemption Charges. For details kindly refer the annexure to this Risk

Disclosure Document.

(iii) Custodian/Depository Participant fee

The charges relating to opening and operation of demat accounts, custody and transfer

charges for shares, bonds and units, dematerialization and rematerialization, pledge and

removal of pledge, etc. will be as per the actual charged by the Depository

Participant/Custodian. For details kindly refer the annexure to this Risk Disclosure

Document.

(iv) Registrar and transfer agent fee

Charges payable to the Registrar and Share Transfer Agents in connection with effecting

transfer of securities and bonds, units, etc. including stamp charges, cost of affidavits, notary

charges, postage/courier charges and other related charges will be recovered on actual. For


(v) Placement fee :

A Placement fee not exceeding 5% on the investment value will be charged in some of the

strategies over and above the fixed management fee and performance fee. The placement

fee, if charged, shall be deducted from client’s initial corpus. For details kindly refer the

annexure to this Risk Disclosure Document.

(vi) Brokerage and transaction cost

The Brokerage and other charges like Service tax and related charges such as Education cess,

Stamp duty, Security Transaction Tax, SEBI Fees, Bank charges, Turnover tax, and other

charges (if any), as per the rates existing from time to time, will be charged on actual. For


The investment by Portfolio Manager will be done through such SEBI registered Stock

Broker(s) as may be empanelled by the Portfolio manager only and would as per the rates

negotiated between Portfolio Manager and such stock broker. The charges relating to

brokerage as per the related party transactions charged by Karvy Capital Limited or through

any SEBI Registered stock broker will be recovered on actual by the Portfolio Manager

(vii) Securities Lending Charges

If utilized, the charges pertaining to lending of securitiesand costs associated with transfer of

securities connected with lending transfer operations, Depository Participant Charges, Share

P a g e 2 6 o f 3 3

Transfer Agent Charges, etc. would be recovered on actual. For details kindly refer the


(viii) Certification Charges or Professional Charges

Any charges payable for outsourced professional services like accounting, taxation, auditing,

and any legal services, notarizations, etc., incurred on behalf of the Client by the Portfolio

Manager, will be charged from the client on actual. For details kindly refer the annexure to

this Risk Disclosure Document.

(ix) Incidental Expenses

Charges in connection with day to day operations like courier charges incurred in providing

physical reports relating to client’s portfolio / welcome letter / other communication to

clients , stamp duty, service tax, postal, telegraphic expenses, opening and operation of bank

and demat accounts or any other out of pocket expenses incurred by the Portfolio Manager,

on behalf of the client, would be recovered from the client. For details kindly refer the


Section 11: TAXATION

General

It may be noted that the information given hereinafter is only for general information

purposes and is based on the advice received by the Portfolio Manager regarding the law

and practice currently in force in India and the Investors should be aware that the relevant

fiscal rules or their interpretation may change or it may not be acceptable to the tax

authorities. As is the case with any interpretation of any law, there can be no assurance that

the tax position or the proposed tax position prevailing at the time of an investment in the

strategy/plan/option will be accepted by the tax authorities or will continue to be accepted

by them indefinitely.

Further statements with regard to tax benefits mentioned herein below are mere

expressions of opinion and are not representations of the Portfolio Manager to induce any

investor to invest whether directly from the Portfolio Manager or indirectly from any other

persons by the secondary market operations. In view of the above, and since the individual

nature of tax consequences may differ in each case on its merits and facts, each Investor is

advised to consult his / her or its own professional tax advisor with respect to the specific tax

implications arising out of its participation in the PMS strategy/plan/option, as an investor.

In view of the above, it is advised that the investors appropriately consult their investment /

tax advisors in this regard.

Portfolio Manager cannot be held responsible for assisting or completing the fulfillment of

the client’s tax obligations.

Income arising from purchase and sale of securities under Portfolio Management Services can give rise to business income or capital gains in the hands of the Client. The issue of characterization of income is relevant as the tax computation and rates differ in either of the two situations. The said issue is essentially a question of fact and depends on whether the

P a g e 2 7 o f 3 3

shares are held as business trading assets or on capital account. Based on judicial decisions, the following factors need to be considered while determining the nature of assets as above:

a. Motive for the purchase of securities

b. Frequency of transactions

c. Length of period of holding of the securities

d. Treatment of the securities and profit or loss on their sale in the accounts of the assessee and disclosure in notes thereto

e. Source of funds out of which the securities were acquired - borrowed or own

f. Existence of an objects clause permitting trading in securities – relevant only in the case of corporate.

g. Circumstances responsible for the sale of securities

h. Acquisition of the securities -from primary market or secondary market Infrastructure and set - up employed for undertaking the securities transactions by the client

Any single factor discussed above in isolation cannot be conclusive to determine the exact nature of the shares. All factors and principles need to be construed harmoniously.

Investors may refer to CBDT instruction no. 1827 dated August 31, 1989 read with CBDT Circular no. 4 dated June 15, 2007 for further guidance on the matter.

Tax implications under the Income Tax Act, 1961 ("IT Act") arise in the hands of the Clients

(resident as well as the non-resident) under both the scenarios, viz:

a. Securities in the Portfolio held as business asset; and

b. Securities in the Portfolio held on capital account.

Additionally, non-residents (including Flls/FPIs) are governed by the applicable Double Tax

Avoidance Agreement ("DTAA), which lndia has entered into with the country of residence of

the non-resident, if that is more beneficial. The same would have to be considered on a case-

to-case basis depending upon the applicable DTAA. Ordinarily, capital gains and interest

income are taxable in lndia in the manner and at the rates prescribed under the relevant

DTAA or the relevant rates applicable in India, whichever is beneficial to the assessee.

Further, business income is normally not taxable in lndia.

Tax Deducted at Source

Presently, tax is withheld at source for non-residents. If any tax is required to be withheld on

account of any future legislation, Portfolio Manager shall be obliged to act in accordance

with the regulatory requirements in this regard.

Advance Tax installment obligations

It shall be the client’s responsibility to meet the advance tax obligation installments payable

on the due dates under the Income Tax Act, 1961.

Tax Implications - Investment in Shares or units of Equity Oriented Mutual Fund

P a g e 2 8 o f 3 3

Dividend

Dividend received by shareholders is exempt from tax- section 10 (34) of IT Act.

Profits from sale / transfer of shares (or units of equity oriented mutual fund) • If considered as capital gains: (capital gains = sale consideration – cost of acquisition–expenses incurred in connection with such transfer)

Capital Gains Long term Capital Gains (LTCG) Short term Capital Gains (STCG)

Period of holding

Rate Period of holding

Rate

Listed Shares (Where STT is paid)

More than 1 year

Exempt u/s. 10(38)

1 year or less 15%

Listed Shares (Where STT is not paid)

More than 1 year

20% with indexation or 10% without indexation

(whichever is more beneficial

to clients)

1 year or less maximum marginal rate of

tax or at slab rates, as the case may be

Unlisted Shares More than 1 year

20% with indexation



• If considered as business income - net income taxable at maximum marginal rate of tax or

at slab rates, as the case may be.

Note: Education Cess & Surcharge &Higher Education Cess and surcharge (if applicable) will

be charged additionally. Clients are requested to contact their tax consultant to determine

their exact tax status.

Tax Implications - Investment in Derivative instruments

Investment in derivative instruments is considered as business income & is taxable at

maximum marginal rate of tax or at slab rates, as the case may be.

Note: E.Cess & S.&H.E.Cess and surcharge (if applicable) will be charged additionally. Clients

are requested to contact their tax consultant to determine their exact tax status.

Tax Implications - Investment in Debentures or bonds

Interest income

Interest received by debenture holder is taxable under the head “Income from other

sources” at slab rates or at maximum marginal rate of tax as the case may be

Profits from sale / transfer of Debentures (or bonds)

P a g e 2 9 o f 3 3

• If considered as capital gains: (capital gains = sale consideration – cost of acquisition–expenses incurred in connection with such transfer)


Period of holding


Rate

Listed Debenture or bonds

More than 1 year

20% with indexation or 10% without indexation

(whichever is more beneficial

to clients)



Unlisted Debenture or bonds

More than 3 years

20% with indexation

3 years or less maximum marginal rate of







Tax Implications - Investment in Debt Oriented Mutual Fund

Dividend

Dividend received by shareholders is exempt from tax- section 10 (34) of IT Act.

Profits from sale / transfer of units • If considered as capital gains: (capital gains = sale consideration – cost of acquisition–expenses incurred in connection with such transfer)


Period of holding


Rate

Debt MF units More than 3 years

20% with indexation

3 years or less maximum marginal rate of




P a g e 3 0 o f 3 3




Capital loss

Losses under the head 'capital gains' cannot be set off against income under any other head.

Further, within the head 'capital gains', long-term capital losses cannot be adjusted against

short-term capital gains. However, short-term capital losses can be adjusted against any

capital gains. Unabsorbed long-term capital loss can be carried forward and set off against

the long-term capital gains arising in subsequent eight assessment years. Unabsorbed short-

term capital loss can be carried forward and set off against the income under the head

capital gains in subsequent eight assessment years

Securities Transaction Tax

Securities Transaction Tax is the tax leviable on the taxable securities transactions i.e.

transaction of:

(a) Purchase or sale of an equity share of a listed companies (whether delivery based or non-

delivery based) or a derivative or a unit of an equity oriented fund, entered into in a

recognized stock exchange; or

(b) Sale of a Unit of an equity oriented fund to the Unit Trust of India or Mutual Fund.

The income arising from the securities transactions shall be taxed at applicable rates under

the Income Tax Act, 1961 if Securities Transaction Tax is not applicable in respect of such

transactions.

Section 12: ACCOUNTING POLICIES

The following is the accounting policy followed by the Portfolio Manager while accounting

for the portfolio investments of the clients.

Investment in equities will be valued on the closing price of that equity at NSE. In case of any

investments done in any equity listed on BSE only, the same will be valued based on the

closing price of that equity in BSE. In case the prices are not available from NSE or BSE Stock

exchange, then any other stock exchange shall be considered. These shall include the Equity

shares including Indian Depository Receipts and other instruments, as the case may be. In

case a share is not traded on a valuation date, latest closing price of either principal /

secondary or any other stock exchange would be used.

Equity shares which are not listed on stock exchanges are included in portfolio valuation at

fair/cost value. In case an Equity share is suspended/non-traded/ awaiting Corporate

Actions, then the valuation of such equity share shall be done on the basis of good faith

relying upon prevailing practices elsewhere.

P a g e 3 1 o f 3 3

In case of the warrants been traded separately they would be valued as an equity share and

valued accordingly. In case of the non traded warrants, the warrants will be valued at the

value of the share which would be obtained on exercise of the warrant less the amount

payable on exercise of the warrant. On exercise of warrant, the warrants would be

transferred to the normal equity and valued accordingly.

For valuation of the derivatives contract, the open positions, as on the date of valuation,

shall be valued as per the last traded prices available from the relevant stock exchange, and

will be valued on the mark to market method.

In case of Mutual Fund, investments in mutual funds shall be valued at the latest available

NAV of the respective scheme. Investment in Exchange listed (ETF) shall be valued at the

closing price on the relevant exchange. If on a valuation date Exchange Traded Funds (ETF) is

not traded either on the primary or secondary stock exchange, ETF shall be valued at the

latest available NAVs of the ETF Scheme.

Investment in debt instruments will be valued at the market value of the debt instrument as

on cut off date (or) the latest available price on the relevant exchange or the most recent

NAV will be reckoned. For illiquid securities, the valuation may be provided by the issuer on a

periodic basis and/or as required by the portfolio manager.

Realised gains/losses will be calculated on the basis of First in First out (FIFO) basis.

Transaction date will be the trade date and not the settlement or auction date.

For derivatives transactions (if any), the unrealized gains/losses on open position will be

calculated on the mark to market method.

Unrealized gain/losses means the profit/loss not yet booked and the same will be the

difference of the current market price or NAV minus the actual purchase price (or) the

historical cost of the securities.

All income will be accounted on accrual or receipt basis, whichever is earlier. All expenses

will be accounted on due or payment basis, whichever is earlier.

Purchase and sale transactions are accounted for on contract date basis. Cost of purchase

and sale includes consideration for scrip and brokerage but excludes Securities Transaction

Tax, Service Tax & other charges paid on purchase/sale of securities. Other expenses like

Custodian charges (Safe keeping charges, Transaction charges, Fund Accounting charges, Out

of Pocket expenses) shall beaccounted for as & when debited by the Custodian.

Any corporate benefits like dividend on shares, mutual fund units, interest on debt

instruments, stock lending fees etc. shall be accounted on accrual basis except interim

dividend which would be accounted on receipt basis.

Bonus shares are recorded on the ex-benefit date (ex-date). Dividend income is recorded on

the ex-dividend date (ex-date)

P a g e 3 2 o f 3 3

Tax deducted at source on interest on instruments such as Fixed Deposits etc. /Dividend is

considered as withdrawal of corpus and debited accordingly.

Portfolio Manager and the Client, on case to case basis, can mutually agree to any specific

norms or methodology for valuation of investment and/or accounting

The Client may contact the Portfolio Manager for the purpose of clarifying or elaborating on

any of the above.

Section 13: INVESTOR RELATIONS OFFICER - IRO

The below mentioned employee has been nominated as the Investor Relations Officer by

Portfolio Manager who will attend to the investor queries and complaints:

Mr. Pankaj Bhagat

Karvy Capital Limited 702, Hallmark Business Plaza, Sant Dnyaneshwar Marg, Bandra (E), Mumbai 400 051. Tel No. (B) 022-33055000 Tel No. (D) 02261491622

Fax No. 022-61491577 Email ID – [email protected]

Section 14: GRIEVANCE REDRESSAL

The Portfolio Manager has dedicated an email id

[email protected] for all the investors to lodge their grievance. Apart from this,

the portfolio clients can get in touch with the IRO in person, over phone or through written

communication.

Portfolio Manager will ensure that the above IRO attends to all investor grievance/service

issues with promptness and Portfolio Manager will ensure that this IRO is vested with

necessary authority, independence and the means to handle investor grievance effectively

and immediately, within reasonable period of time.

If not satisfied with our response, you may approach SEBI with your grievance through SEBI’s

web based centralized grievance redressal system (SCORES) on http://scores.gov.in or may

also write to SEBI in physical form.

Section 15: DISPUTE SETTLEMENT MECHANISM

All disputes, differences, claims and questions, whatsoever, which shall arise either during

the subsistence of the agreement with the Client or afterwards, with regard to the terms

thereof or any clause or thing contained therein or otherwise in any way relating to or arising

there from or the interpretation of any provisions therein shall be, at the first instance,

settled by mutual discussions, failing which the same shall be referred settled in accordance

mailto:[email protected]

http://scores.gov.in/

A. Discretionary Portfolio Management Services

1. Demeter Portfolio

Introduction

Demeter Portfolio is designed for investors seeking income and capital appreciation from

their asset allocation to debt.

Investment Objective

The investment objective of the strategy is to generate long term capital appreciation and

income through interest and trading (both in the short term and over the long term) of

securities in the secondary markets. The portfolio will primarily consist of high yielding debt

securities.

Investment Horizon and Risk Return Profile

Demeter portfolio is recommended for investors seeking to hold a debt portfolio with

moderate to high risk appetite expecting a moderate return over a long term horizon.

Asset Allocation

The portfolio will be predominantly invested in debt using the securities defined below. The

portfolio manager may decide to hold cash/liquid funds if required.

Securities

Investments would be made in all types of debt securities (which may or may not be in

dematerialized form) including but not limited to debentures of any maturity (fixed, floating,

Variable Coupon, and equity index /stocks /stocks basket linked, real estate backed) which

may be listed, unlisted, convertible, non-convertible, secured, unsecured, rated or unrated,

Securitised Debt, instruments with debt like features (eg. Compulsorily redeemable

preference shares), Pass Through Certificates, Bonds, Government securities issued or

guaranteed by Central or State Government, corporate debt of both public and private

sector undertakings, securities issued by banks (both public and private sector) and

development financial institutions, fixed deposits, commercial papers, certificate of deposit,

trade bills, treasury bills and other money market instruments, units of mutual funds,

Exchange Traded Funds, units of SEBI registered Alternative Investment Funds, floating rate

debt securities and fixed income derivatives like interest rate swaps, forward rate

agreements and the like as may be permitted by the Act, Rules and/or Regulations,

guidelines and notifications in force from time to time. These securities may be acquired

through primary market issuances such as subscription to Initial public offers, Follow on

Public offers, Rights issues and private placements of securities, secondary market

purchases, auctions held by the Reserve Bank of India, open market sales of securities

conducted by Reserve Bank of India and the like.

The Portfolio manager may buy securities which have equity like nomenclature while the

features in terms of returns and convertibility will be like debt. These instruments would

include but not be limited to securities like non convertible compulsorily redeemable

preference shares and some Optionally convertible debentures.

Investment in listed/publicly traded securities will be valued on the day end’s NAV/closing

price. Investment in other debt instruments will be valued as per valuation provided by the

Issuer.

With respect to the debentures being bought by Karvy Capital Limited as Discretionary

Portfolio Manager for its clients in Demeter strategy, clients may please note the following:

Karvy Capital Limited as an NBFC / any Karvy Group entity has assisted the Issuer to

structure the debenture issuance for the purpose of raising capital through the private

placement route. Karvy Capital Limited as an NBFC / any Karvy Group entity has actively

associated with the Issuer for structuring of the security in relation to the debentures,

preparation of the term sheets and related documents for sharing product details with

prospective clients and for appointment of key agents such as trustee, escrow agent, legal

counsel and the like.

Karvy Capital Limited is also the “Debenture Holder Representative and Calculating Agent”

thereby having the power to approve amongst other things - dilution of promoter stake in

the Issuer company, disbursal of amounts from escrow account to the Issuer , any change in

the security cover for the debentures and without whose consent the above cannot occur.

As a Calculating Agent, Karvy Capital Limited calculates the amount of interest and final

redemption amount due to the debenture holders.

For this, Karvy Capital Limited as an NBFC / any Karvy Group entity has received a payment

from the Issuer which could be structured as advisory fee, discount on such debentures to

Karvy Capital Limited [NBFC] or the Karvy group entity at the time of first purchase or a

combination of the two.

Karvy Capital Limited as an NBFC / any Karvy Group entity is also the first subscriber to such

privately placed debentures. Therefore Karvy Capital as discretionary portfolio manager will

buy the debentures from Karvy Capital limited {NBFC} or any Karvy Group entity [first

subscriber]. Such down selling by Karvy Capital Limited {NBFC} to Karvy Capital Limited

{Portfolio manager} / any Karvy Group entity may be done at a premium.

Alongside, Karvy Capital Limited as an NBFC shall continue to undertake distribution activity

with regard to the said debentures i.e to down sell the debentures to prospective clients

other than the PMS customers.

In addition to down selling by Karvy Capital Limited {NBFC} as mentioned above, Karvy

Capital Limited (Portfolio Manager) may purchase debentures for clients of the Demeter

strategy through the below routes as well:

a. Primary issuance of debentures by an Issuer debentures by Karvy Capital PMS

b.

Purchase of debentures by Karvy Capital PMS.

Additionally,

a. the debentures which the Portfolio Manager may invest in for the client

will usually have some form of collateral backing them. Such collateral

may include one or more amongst the following – real estate assets,

shares of the issuing company, shares of other companies related to the

issuing company, other listed or unlisted shares, escrow of cashflows,

brand, patents, fixed assets of the company etc. However, depending on

the specific collateral used and as per the interpretation of the

Companies Act, 2013 the debentures may be deemed to be secured or

unsecured in nature.

b. Owing to the credit risk of high yield debt that the strategy is investing

into, the preservation of capital is not guaranteed. In case of a default by

issuer in any of the underlying securities, the trustees would endeavour

to recover the principal and the interest for the investors but there is a

risk of erosion of the principal invested in the strategy by the investor.

Additionally, the recovery process in case of a default may take time to

be implemented. Hence, at the level of each individual instrument, there

exists a risk of partial or complete capital erosion in case of a default by

the issuer.

c. The high yield debentures invested into by the Demeter strategy will

have credit quality of a wide range and hence a varying amount of credit

risk. Such debentures may be rated or unrated. The issuing company

may be rated or unrated and if rated, the latest available credit rating

will be considered.. The rating of the debentures or the issuing company

may be investment grade or speculative grade.

The debentures investments in the Demeter strategy could carry their own set of risks. Some

of these could include:

(i) Operational Risk: The risks that arise out of systemic issues within an

organization. Operational risk is intrinsic to any business. Every company may

have sector and company specific risks which may affect operations.

(ii) Regulatory Changes

These risks may arise if various concerned authorities amend the regulatory

framework, which could impact the Issuing Company.

(iii) Downturn in the market

There can be a down turn in the market in which the issuing Company operates

which can lead to decrease in profit margins of the Issuing Company.

The Demeter strategy will undertake to an extent as deemed fit by the Portfolio Manager,

opportunistic buying and selling of debt securities to improve the returns earned by

investors. However, in this endeavour, the portfolio manager may on some occasions not

receive suitable exit for the securities thus bought in the portfolio. In such cases, the

portfolio manager may either decide to hold such security to maturity or to exit it at a loss

when compared with the purchase price. For investors entering the strategy partially or

wholly through their current holdings of debt instruments, the portfolio manager will seek to

diversify these holdings to reduce concentration of credit risk. As a possible implication, the

yield in Internal Rate of Return [IIR] terms and income paid out through regular coupons of

the portfolio thus achieved may be different (and lower) from that of their current holdings.

Kindly refer Section III below for other features of this strategy.

Fees and Expenses: Defined in Section II below

2. Soteria Portfolio

Introduction

Soteria Portfolio is a strategy focusing on debt investments across maturities, credit quality

and yields aiming to provide investors regular income and capital appreciation from their

investments.


The investment objective of the strategy is to generate long term capital appreciation and

income through interest and trading of securities (both in the short term and over the long

term) in the secondary markets.


Soteria portfolio is recommended for investors seeking to hold a debt portfolio with low to

moderate risk appetite expecting a moderate return over a long term horizon using short

term transactions in fixed income instruments.

Asset Allocation

The portfolio will be predominantly invested in debt using the securities defined below. The

portfolio manager may decide to hold cash/liquid funds if required.

Securities


dematerialized form) including but not limited to debentures of any maturity (fixed, floating,

Variable Coupon, and equity index /stocks /stocks basket linked, real estate backed) which

may be listed, unlisted, convertible, non-convertible, secured, unsecured, rated or unrated,

Securitised Debt, instruments with debt like features (eg. Compulsorily redeemable

preference shares), Pass Through Certificates, Bonds, Government securities issued or

guaranteed by Central or State Government, corporate debt of both public and private

sector undertakings, securities issued by banks (both public and private sector) and

development financial institutions, fixed deposits, commercial papers, certificate of deposit,

trade bills, treasury bills and other money market instruments, units of mutual funds,

Exchange Traded Funds, units of SEBI registered Alternative Investment Funds, floating rate

debt securities and fixed income derivatives like interest rate swaps, forward rate

agreements and the like as may be permitted by the Act, Rules and/or Regulations,

guidelines and notifications in force from time to time. These securities may be acquired

through primary market issuances such as subscription to Initial public offers, Follow on

Public offers, Rights issues and private placements of securities, secondary market

purchases, auctions held by the Reserve Bank of India, open market sales of securities

conducted by Reserve Bank of India and the like.

The Portfolio manager may buy securities which have equity like nomenclature while the

features in terms of returns and convertibility will be like debt. These instruments would

include but not be limited to securities like non convertible compulsorily redeemable

preference shares and some Optionally convertible debentures.

Investment in listed/publicly traded securities will be valued on the day end’s NAV/closing

price. Investment in other debt instruments will be valued as per valuation provided by the

Issuer.


Fees and Expenses: As defined in Section II below

3. Metis Portfolio

Introduction

Metis Portfolio is designed for investors who seek long-term capital appreciation from their

asset allocation to equities. The portfolio will invest in stocks across sectors, market

capitalization categories and investment themes.


The investment objective of the strategy is to generate growth of capital through a blend of

value, growth opportunistic and event driven investing.


This Portfolio is recommended for investors seeking to hold a diversified equity portfolio

with moderate risk appetite expecting a moderate return over medium term horizon.

Asset Allocation

The Portfolio will seek to remain substantially invested in Equities or Equities related

instruments at all times. Cash in the portfolio may be invested in Liquid schemes of Mutual

Funds or Liquid Bees.

Securities

Investments will be made in various equity and equity related securities including but not

limited to stocks, convertible/non-convertible and/or cumulative/non-cumulative preference

shares, convertible and/or cumulative/non-cumulative debentures, bonds and warrants

carrying the right to obtain equity shares, units of mutual funds, Exchange Traded Funds and

other eligible modes of investment as may permitted by the Regulations from time to time.

Investments may be made in securities acquired through secondary market purchases, open

market sales/auctions, Initial Public Offers (IPOs), other public offers, placements, rights,

offers and the like. These securities may be listed or unlisted.

The Portfolio will also use derivative instruments – Futures and Options – for hedging and

rebalancing of the portfolio. Derivative Instruments shall, however, not be used in case of

NRI investors.



4. Aegis Portfolio

Aegis Portfolio is designed for those investors who seek long-term capital appreciation from

their asset allocation to equities, debt, gold and other asset classes which are available

through either exchange traded products or through mutual funds.


The investment objective of the Strategy is to generate long term capital appreciation of

wealth through a portfolio of debt, equity, gold ETFs and other asset classes which are

available through either exchange traded products or through mutual funds.


This Portfolio is recommended for investors seeking to hold a diversified multi asset portfolio

with moderate risk appetite expecting a moderate return over medium term horizon.

Asset Allocation

The portfolio will be invested in Equities, Debt, Gold ETFs and other asset classes in a

proportion deemed appropriate for the investor and the in accordance with the market

scenario.

Securities




carrying the right to obtain equity shares, units of mutual funds, ETFs and other eligible

modes of investment as may permitted by the Regulations from time to time. Investments

may be made in securities acquired through secondary market purchases, open market

sales/auctions, Initial Public Offers (IPOs), other public offers, bilateral offers, placements,

rights, offers, negotiated deals, etc. These securities may be listed or unlisted.


dematerialized form) including but not limited to listed, unlisted, convertible, non-

convertible, secured, unsecured, rated or unrated debentures of any maturity, and acquired

through secondary market purchases, RBI auctions, open market sales conducted by RBI etc.,

other public offers, bilateral offers, placements, rights, offers, negotiated deals, etc. They

could include Securitised Debt, instruments with debt like features (eg. Compulsorily

redeemable preference shares), Pass Through Certificates, Debentures (fixed, floating,

Variable Coupon, and equity index /stocks /stocks basket linked, real estate backed), Bonds,

Government securities issued or guaranteed by Central or State Government, corporate

debt of both public and private sector undertakings, securities issued by banks (both public

and private sector) and development financial institutions, fixed deposits, commercial

papers, certificate of deposit, trade bills, treasury bills and other money market instruments,

units of mutual funds, ETFs, units of SEBI registered AIFs, floating rate debt securities and

fixed income derivatives like interest rate swaps, forward rate agreements etc. as may be

permitted by the Act, Rules and/or Regulations, guidelines and notifications in force from

time to time.

Investments will also be made in gold ETFs and other asset classes which are available

through either exchange traded products or through mutual funds.



NRI investors.

Investment in equities will be valued on the closing price of that equity at NSE. In case of

investments in any stocks listed on BSE only, the same will be valued based on the closing

price of that equity at BSE. Investment in Mutual Funds and ETFs will be valued on the day

end’s NAV.

Debt investment in listed/publicly traded securities will be valued on the day end’s

NAV/closing price. Investment in other debt instruments will be valued as per valuation

provided by the Issuer.



5. Caerus Portfolio

Caerus Portfolio is designed for those investors who seek long-term capital appreciation

through opportunistic and event driven trades taken in their portfolio having an allocation to

equities (listed & unlisted), debt (listed & unlisted) and other asset classes which are

available through either exchange traded products or through mutual funds.



wealth through a portfolio of debt, equity and other asset classes which are available

through either exchange traded products or through mutual funds. Capital appreciation will

be generated through opportunistic and event driven trades taken in securities.


This Portfolio is recommended for investors seeking to hold a diversified portfolio with

moderate risk appetite expecting a moderate return over medium term horizon.

Asset Allocation

The portfolio will be invested in Equities, Debt and other asset classes in a proportion

deemed appropriate for the investor and the in accordance with the market scenario.

Securities





modes of investment as may permitted by the Regulations from time to time. These

securities may be acquired through primary market issuances such as subscription to Initial

public offers, Follow on Public offers, Rights issues and private placements of securities ,

secondary market purchases, open market sales/auctions and the like. These securities may

be listed or unlisted.
















time to time.

Investments will also be made in other asset classes which are available through either

exchange traded products or through mutual funds.



NRI investors.




end’s NAV.






6. Eos Portfolio

Eos Portfolio is designed for those investors who seek long-term capital appreciation

primarily through Private Investment in Public Equity. The portfolio may consist of

investments in Equity & debt.



wealth through Private Investment in Public Equity. Investments may be done in the form of

Equity or debt. Investments will also be made in the primary market.


This Portfolio is recommended for investors seeking to hold a diversified portfolio with

moderate risk appetite expecting a moderate return over medium term horizon.

Asset Allocation

The portfolio will be invested primarily in Equities & Debt. Allocation will be decided on the

availability of opportunities and as deemed appropriate for the investor.

Securities





modes of investment as may permitted by the Regulations from time to time. These

securities may be acquired through primary market issuances such as subscription to Initial

public offers, Follow on Public offers, Rights issues and private placements of securities,

secondary market purchases, open market sales/auctions and the like. These securities may

be listed or unlisted.
















time to time.

Investments will also be made in other asset classes which are available through either

exchange traded products or through mutual funds.



NRI investors.




end’s NAV.






For all strategies mentioned above, the Portfolio Manager shall be entitled to issue one or more series of the strategy. The portfolio manager may also decide to make periodic payouts to investors.

The fee portion below is common for all strategies mentioned in Annexure A

PLACEMENT FEE: A placement fee not exceeding 5.00% on the investment will be charged

over and above the Fixed Management Fee and Performance fee as defined below. The

placement fee, if charged, shall be deducted from client’s corpus both initial and at time of

making fresh infusion.

ADDITIONAL DETAIL REGARDING CALCULATION OF PERFORMANCE SHARING FEE:

In case where the portfolio comprises of debentures, the issuers may deduct TDS before

paying out funds to the investors. In case TDS has been deducted, for the purpose of

calculation of profit made by the investor, the TDS amount will be added back. This profit

arrived at (after adding back the TDS amount) will be used to calculate the applicable

performance sharing fee.

Some instruments may provide return on post tax basis. This would essentially mean that the

income received by the investor is tax free for them. Since all returns for NCDs etc are

considered on a pre tax basis, pre tax equivalent of the returns from instruments providing

post tax returns will be considered for the purpose of calculation of portfolio performance

and performance fee. The Portfolio Manager shall charge audit fees, custodial/ AMC charges

and other charges/costs, attributable to the Portfolio Management Services at actual.

The Client will also have to bear brokerage charges not exceeding @2.50% of the transaction

value and other incidental charges/fees/duties and taxes including Securities Transaction Tax

at actual.

Clients have the following fee options:

Option 1: Fixed Management Fee up to 5.00% p.a.

FIXED MANAGEMENT FEE: The Fixed fee for all strategies above(without profit sharing)

charged by the Portfolio Manager will not exceed 5.00% p.a. charged up to 1.25% at the

beginning of every quarter on the Net Asset Value of the Portfolio (inclusive of all securities

and cash/bank balance) or the outstanding capital as detailed in the agreement between the

client and the portfolio manager. The portfolio manager may charge the management fee for

the first year on an upfront basis at the time of investment.

Following charges shall be payable by the client upon withdrawal from all strategies above

under Option 1:

Withdrawal when made Charges payable by Client

SECTION II: FEES AND EXPENSES PERTAINING TO THE PORTFOLIO STRATEGIES

In case of withdrawal before 60 months of date from

which client account is activated

a) Fixed Management Fee up to 5% p.a.

and

b) Exit fees up to 5%

When exiting, after completing a period of 60 months

of date from which client account is activated

Fixed management fee up to 5% p.a. till

the day client exits the strategy.

Option 2: Fixed Management Fee NIL & Performance fees up to 30% on all gains

PERFORMANCE FEE: The Performance fee in this option will not exceed 30% of incremental

gains beyond annualized hurdle rate not exceeding 0% on the basis of High Water Mark

Principle over the life of the investment. The performance fee will be charged on quarterly

basis.


under Option 2:


In case of withdrawal before 60

months of date from which client

account is activated

a) Performance fee up to 30% of incremental gains beyond

annualized hurdle rate not exceeding 0% will be charged

(Performance fee payable will be calculated on the NAV on the

day of exit) and

a) Exit fees up to 5%

When exiting, after completing a

period of 60 months of date from

which client account is activated

Performance Fee up to 30% of incremental gains beyond

annualized hurdle rate not exceeding 0% on the basis of High

Water Mark Principle based on the NAV of the day of exit.

Option 3: Fixed Management Fee up to 5% p.a. & Performance fees up to 30%

FIXED MANAGEMENT FEE: The Fixed fee for all strategies above (without profit sharing) will

not exceed 5.00% p.a. which is up to 1.25% at the beginning of every quarter on the Net

Asset Value of the Portfolio (inclusive of all securities and cash/bank balance) or the

outstanding capital as detailed in the agreement between the client and the portfolio

manager. The portfolio manager may charge the management fee for the first year on an

upfront basis at the time of investment.

PERFORMANCE FEE: The Performance fee in this option will not exceed 30% of incremental

gains beyond annualized hurdle rate not exceeding 15% (or a specific benchmark pre-

decided with the client) on the basis of High Water Mark Principle over the life of the

investment. The performance fee will be charged on quarterly basis.


under Option 3:


In case of withdrawal

before 60 months of date

from which client account is

activated

a) Fixed management fee payable up to 5.00% p.a. and

b) Performance fee payable up to 30% of incremental gains

beyond annualized hurdle rate not exceeding 15% (or a

specific benchmark pre-decided with the client) will be

charged (Performance fee payable will be calculated on the

NAV on the day of exit) and

a) Exit fees up to 5%

When exiting, after

completing a period of 60

months of date from which

client account is activated

a) Fixed Management fee up to 3% p.a. and

b) Performance Fee up to 30% of incremental gains beyond

annualized hurdle rate not exceeding 15% (or a specific

benchmark pre-decided with the client) on the basis of High

Water Mark Principle based on the NAV of the day of exit.

The final fee structure and fee charging frequency may vary with every client and would be

pre decided between the portfolio manager and the client. This may be changed during the

term of the PMS arrangement upon mutual consent by the investor and the portfolio

manager.

SECTION III: COMMON FEATURES OF THE PORTFOLIO STRATEGIES {common features applicable to all strategies}

Minimum investment amount is Rs. 25 Lakhs.

Liability of a client shall not exceed client’s investment with the portfolio manager.

The Portfolio Manager shall charge audit fees, custodial/ AMC charges and other

charges/costs, attributable to the Portfolio Management Services on actual.

Any charges payable for outsourced professional services like accounting, taxation, auditing,

and any legal services, notarizations, etc., incurred on behalf of the Client by the Portfolio

Manager, will be charged from the client on actual.

The Client may withdraw whole or part of the funds or securities from the portfolio account

by giving advance notice and the Portfolio Manager will endeavor to liquidate the securities

held in the strategy and return the funds or securities of the strategy, as the case may be, to

the client within reasonable time. In case the Portfolio Manager is for any reason unable to

sell the securities, the Client shall be obliged to accept the securities in the portfolio.

The Portfolio Manager will provide periodical reports as required under the regulations at

the communication address provided by the client at time of account opening. In case

Portfolio Manager is unable to provide the periodic reports in physical copy, the same shall

be provided to clients via email at the email id registered by clients at time of account

opening.

The portfolio account will be audited by the Independent Chartered Accountant every year

and copy of the Certificate issued by the Chartered Accountant will be given to the Client.

A. Non – Discretionary Portfolio Management Services

The following are illustrative, but not exhaustive, investment strategies which would be

available for client availing Non-Discretionary Portfolio Management Services.

1. Equity oriented strategies

These strategies would include equity focused strategies with the flexibility to invest

across Equity instruments available and across market capitalizations. The strategy

may invest in non convertible debentures with performance linked to an equity

instrument. Specific details of the portfolio would depend on the requirement of the

client.

2. Debt Focused strategies

These strategies would include debt focused strategies with the flexibility to invest

across Debt instruments available including mutual funds, bonds and non convertible

debentures. The strategy may also invest in debentures providing capital protection

and offering debt like returns which may have an equity index, basket of stocks or

commodities as the underlying. Specific details of the portfolio would depend on the

requirement of the client.

3. Multi Asset strategies

These strategies would include investments across Equity, debt, gold and other asset

classes which may be available through exchange traded products or mutual funds.

Non convertible debentures (other than equity or debt) will also be included here.

Specific details of the portfolio would depend on the requirement of the client.

GLOSSARY OF TERMS USED IN THE RISK DISCLOSURE DOCUMENT AND ANNEXURE A

Discretionary portfolio: A portfolio where the funds of each client are managed individually

and independently by the fund manager in accordance with the needs of the client.

Non discretionary Portfolio: A portfolio where the funds are managed by the fund manager in

accordance with the directions of the client.

Hurdle rate: The rate over which profit sharing / performance related fees are usually charged by

portfolio managers. This is not a fixed number and would be specified in the agreement signed with

the client.

High Water Mark Principle: As defined by SEBI, High Water Mark shall be the highest value that the

portfolio/account has reached. Value of the portfolio for computation of high watermark shall be

taken to be the value on the date when performance fees are charged. The portfolio manager shall

charge performance based fee only on increase in portfolio value in excess of the previously achieved

high water mark

Asset allocation: Asset allocation is an investment strategy that attempts to balance risk versus

reward by adjusting the percentage of each asset in an investment portfolio according to the investors

risk tolerance, goals and investment time frame.

Asset Classes: A group of securities that exhibit similar characteristics, behave similarly in the

marketplace, and are subject to the same laws and regulations. Asset classes include but are not

limited to Equities, fixed-income and cash equivalents.

Non convertible debentures: A debenture is a document that either creates a debt or acknowledges

it, and it is a debt without collateral (hence, unsecured debt). Non-convertible debentures are regular

debentures which cannot be converted into equity shares of the liable company.

Investment vehicles: An investment vehicle is a product used by investors with the intention of having

positive returns. Investment vehicles can be low-risk, such as certificates of deposit (CDs) or bonds, or

can carry a greater degree of risk such as with stocks, options and futures.

1

ANNEXURE B - Details of all settled and pending disputes against directors/associates of Karvy Capital Limited as on August 15, 2015

There have been no pending disputes or imposition of any major strictures by any financial sector regulator or by a court of law against Karvy Capital Limited/ its directors/associates, except as mentioned below:

A. DETAILS REGARDING SEBI ACTIONS INITIATED/TAKEN/ PENDING AGAINST KARVY STOCK BROKING LIMITED

Sl.no. Details of the case SEBI observation(s) SEBI Action Corrective steps taken by Company towards observations made by SEBI

Pending actions, if any

(a) (b) (c) (d) (e)

1 Inspection of Karvy

Stock Broking Limited

(KSBL) conducted in

2003-04.

Based on the findings of

inspection, adjudication

proceedings were

initiated against the

Company.

(i)Based on the findings of

inspection, adjudication

proceedings were initiated

against the Company.

(ii)The adjudicating officer vide

his order dated November 18,

2005 imposed a penalty of Rs. 2

lakhs on the company which

has been paid.

(i) Copy of order book is maintained

physically and in case of telephonic

orders through voice loggers. Records

of all such transactions are also being

maintained in the system.

(ii) Separate teams have been formed

for monitoring different activities

relating to trading and automation of

various processes like pay-in and pay-

out of securities, providing

confirmations to clients on trades

executed etc., getting the LBC’s and

other confirmation documents from the

clients.

NIL

2



2 Two enquiry proceedings were initiated against Karvy Securities Limited (now merged with Karvy Stock Broking Limited).

No deviation observed by SEBI in the processes.

One of the proceedings was

dropped vide order dated April

23, 1999 and another was

dropped by Board Decision in

the meeting held on November

09, 2002. The proceedings have

been dropped by SEBI and no

action has been taken / no

penalty was levied / no warning

has been issued to the

Company.

- NIL

3 (i).Administrative

warning issued in the

matter of Software

Technology Group

International Limited

on August 3, 2004

(ii). Administrative

warning issued in the

matter of 10 scrip

report (Aarti

Industries Limited,

Aarti Drugs Limited,

Havells India Limited,

Jindal Polyester

With respect to the administrative

warnings dated 03.08.2004 and

12.10.2007 received by the Company

from SEBI, the company has redefined

the policy on risk monitoring and has

adopted various measures for

improving the processes systems and

surveillance for effective control and

monitoring on the trades done by

clients.

The complete broking operations based

on the feedback received from the

exchanges were redefined and

activities/processes reorganized

NIL

3



Limited, Kajaria

Ceramics Limited,

KRBL Limited, Lyka

Lab Limited, Nirma

Limited, Opto Circuit

(I) Limited, Tasc

Pharmaceuticals

Limited on October

12, 2007.

subsequent to the issuance of

adjudication order and administrative

warnings to the company.

i. Risk monitoring and surveillance

team has been strengthened for

monitoring the trades done by

clients continuously.

ii. Separate teams have been formed

for monitoring different activates

relating to trading and automation

of various processes like pay-in and

pay out of securities, providing

confirmations to clients on trades

executed, etc, have been

implemented for strengthening the

monitoring procedures and to

reduce manual errors.

iii. SMS alerts are sent to clients at the

end of the day for trades done by

them. Trade confirmations are also

sent to clients through emails at

the end of the day.

iv. The company has ensured that only

individuals/entities registered with

4



SEBI act as sub brokers and all

clients dealing through sub brokers

mandatorily open the trading

account with the company by

submitting proper KYC

documentation.

v. Trading platform has been

enhanced by incorporating

mechanisms for effective control

on the trades done by clients based

on value, scrip and quantity.

There have also been multiple

inspections by both the Exchanges and

there has been no untoward

observation with regard to any of the

activities pointed out in the adjudication

order of the administrative warnings.

5



4 Administrative warning

issued by IVD-ID 4 ON

January 19,2009 in the

matter of IPO

irregularities

(complaint

of Shri Vimal Kumar

Surana). This warning

was not issued in the

matter of IPO

irregularities, but

regarding opening of

Beneficial Owner

accounts.

- (i) The Company has ensured that

demat accounts are opened only on

receipt of valid and completely filled

application form along with proper

supporting KYC documents towards

Proof of Identity and Proof of Address.

(ii) The company strictly follows the

maker – checker concept for all

processes relating to depository

services. On receipt of the application,

the application form and supporting

documents are verified at the branch

and a receipt is issued to the client. The

documents provided as POI and POA are

verified with the originals and certified

by the official accepting the application

form.

(iii) A detailed scrutiny and verification

of the application forms and the

documentation is done once again at

the Head Office before the accounts are

opened and activated. The accounts

opened are subject to a 100%

concurrent audit by an external agency.

A welcome kit providing complete client

master information of the demat

6



account opened, DIS booklet etc. is

dispatched to the clients for their

reference.

(iv) Training is also provided to the staff

/ officials involved in the activities of

account opening and are kept informed

about the circulars and guidelines

issued by the regulatory authorities

regarding demat account opening from

time to time.

5 SEBI vide order dated

26.05.2006,

directed, Karvy Stock

Broking Ltd. (KSBL),

not to act as a

depository

participant, pending

enquiry and passing

of final orders, except

for acting on the

instructions of

existing beneficial

owners ('BOs’). SEBI

also directed KSBL, as

- (i) Subsequent to the enquiry

and hearing with the whole

time member, SEBI in its final

order dated June 22, 2007,

directed that KSBL as a DP is

prohibited from opening

new demat accounts till

December 31, 2007. SEBI also

passed an order that the

certificate of KSBL as a broker

be suspended for a period of 3

months.

(ii) KSBL as a broker had filed

an appeal no 75 of 2007 on

(i) Subsequent to PAN being made

mandatory by regulators, the Company

has developed a software application

wherein the PAN details provided by the

applicants are validated online with the

Income Tax website. Only such

applications where PAN details are valid

in all respects are processed for opening

BO accounts. The Company has taken

permission from the depository for such

online validation.

(ii) The concurrent audit has been

strengthened by way of 100% audit of

account opening application forms by

NIL

7



a stock broker, not to

undertake any

proprietary trades in

securities, either off-

market or on market,

pending enquiry and

passing of final

orders.

June 25, 2007. SAT had stayed

the order on July 4, 2007.

(iii) KSBL as a DP had filed an

appeal no 111 of 2007 on July

17, 2007. SAT had stayed the

order on August 8, 2007.

(iv) SAT in its final order dated June 30, 2008 set aside the impugned order dated June 22, 2007, remanding the matter back to SEBI with a direction to pass separate orders against KSBL – as a Broker as well as a DP with regard to the violations emanating from the enquiry officer’s report.

The Whole Time Member had granted a personal hearing as per the order of Hon’ble SAT, wherein submissions to SEBI have been made by the company. SEBI issued final order in respect of KSBL – Depository

external agency with regard to

compliance and fulfillment of the

documents required as per KYC

norms.Extensive training sessions to all

the DP front office employees has been

conducted educating them on the

scrutiny required to be done while

accepting account opening application

form

(iii) Front office personnel of some of

the branches have also been nominated

for NSDL / CDSL training for the purpose

of compliance of NCFM / NCDO

certification requirement. Fortnightly

review of the Demat accounts opened

with the same address is undertaken by

a senior resource

(iv) No applications are accepted and

accounts are opened without an “in-

person” verification and re-verification

of original documents, required as a

part of KYC, by an employee of the

Company. Reporting of off-market

transactions submitted for execution to

the DP and Compliance Head on a

8



Participant on 28th January, 2014 and has in paragraph 20 such order clearly concluded that KSBL – Depository participant has already undergone prohibition from taking up any new assignment for a period of 18 months and 26 days and hence there need not be any further penalty on KSBL – Depository Participant.

SEBI issued final order in respect of KCPL – RTI on 3rd February, 2014 and in such order stated that since KCPL has already undergone prohibition from acting as RTI for approximately 10 months no further penalty is warranted.

In the matter of enquiry proceedings conducted against the Company, Securities Exchange Board of

fortnightly basis.

(v) The above corrective actions taken

by the Company have been intimated to

SEBI in our various correspondences

during the process. An inspection has

also been conducted by SEBI during

October 2009 to review if the

procedures and processes adopted are

in order. There has been no adverse

observation by the inspection team.

9



India (SEBI) had passed order dated 14 March 2014 prohibiting the Company from taking up any new assignment or contract or launch a new scheme (i.e., not to take new clients/customers) for a period of 6 months in respect of its business as a stock broker. The Company had preferred an appeal before Hon’ble Securities Appellate Tribunal (SAT) against the order. Hon’ble SAT, vide order dated 16 April 2014, granted a stay on SEBI’s order dated 14 March 2014. Further, SAT vide order dated 21 January 2015 has set aside the SEBI’s order dated 14 March 2014 and directed SEBI to pass appropriate order after hearing by the Whole Time Member, preferably

10



within a period of four months considering the fact that substantial time has elapsed. Subsequently hearing was held before the WTM SEBI on 7th April, 2015. SEBI issued final order dated 15th June, 2015 disposing off the proceedings against KSBL by directing it to not undertake new primary market assignment including acting as syndicate member or providing syndication services (procuring IPO applications and bidding in IPOs), directly or indirectly , in IPOs for a period of one year. SEBI has also clarified that this direction shall not hinder the activities for which KSBL was already engaged for undertaking primary market activities before

11



the date of the order.

6 A matter

between Shri Jaidev

Kumar Jain

, KSBL & others is

going on

before District

Consumer Disputes

Redressal Forum,

Gwalior (EFD DRA

I).The complainant is

a client of our

subsidiary company

Karvy Comtrade Ltd.,

a member of MCX,

We have received a

letter from SEBI that the

complaint does not

come under the

purview of SEBI.

Karvy Comtrade Limited approached the

client, Mr. Jaidev Kumar Jain and

resolved the investor Grievance. Mr.

Jaidev Kumar Jain vide its letter dated

17.04.2012 addressed to Karvy

Comtrade Limited submitted the letter

of satisfaction.

NIL

12



NCDEX, National Spot

Exchange Ltd. The

case was actually filed

against Karvy

Comtrade Ltd. As the

order of the District

Consumer Forum was

unreasonable and

also the same

pertains to Karvy

Comtrade Ltd, an

appeal was filed

before the State

Consumer Forum. MP

State Consumer

Dispute Redressal

Commission, Bhopal

in its order dated

24.09.2011 stated

that the Appellant is

not a consumer

within the meaning

under sec2(1)(d) of

the act and does not

fall within the

parameters of the

explanation

13



hereinabove. Under

these circumstances,

MP State Consumer

Dispute Redressal

Commission found

that both the appeals

are not maintainable

before the consumer

forum. Both the

appeals are

dismissed. As a result,

complaint is also

dismissed.

7 Administrative

Warning dated July

13, 2010 issued in the

case of PAN

mismatches in IDR

issue of SCPLC/IPO of

Parabolic Drug Ltd.

The PAN mismatches have been

identified as those of walk-in clients

who are not registered with clients and

have utilized the distribution services of

the company. KSBL has already

developed a bidding software

application for entry of the information

provided in the IPO bid application form

by the client and has also obtained

required permission from the Stock

Exchanges for utilizing the software for

IPO bidding. The bidding application

software also has an in built provision

NIL

14



where by the applicant’s details are

validated if they are the registered

clients of the Company. KSBL, as a stock

broker, is not currently authorized to

utilize the bulk PAN verification facility

provided by NSDL and is therefore not

able to validate the PAN of walk in

clients. To avoid these PAN mismatches,

the Company is in the process of

requesting NSDL to provide the utility

for bulk verification of PAN with the ITD

website already provided to the

Depository participants and registrars so

that the utility can be incorporated in

the bidding application software

developed and validation of PAN is done

online at the time of bidding the

application itself.

The Company is also checking and

analyzing the viability and methodology

of implementing the concept of maker

checker in the IPO bidding process to

minimize the errors as the time frame

available for bidding of the application

is very less.

15



8 SEBI had initiated proceedings under section 24 of the SEBI act, against the three directors of the company, viz. Mr. C. Parthasarathy, Mr M. Yugandhar, Mr. M. S. Ramakrishna, and Karvy Stock Broking Limited which are pending before the additional chief metropolitan magistrate, Mumbai.

-- -- -- Pending

9 A complaint was lodged by SEBI with Central Bureau of Investigation, Mumbai on 20.02.2006 alleging frauds committed by certain individuals / entities, in connivance with certain bank officials and depository participants in the IPOs of IDFC and Yes Bank to obtain undue

-- -- -- Pending

16



pecuniary benefits by illegally cornering large number of shares which were offered to Retail Investors by opening various fictitious / benami bank accounts and demat accounts. It was stated by SEBI in the complaint that Karvy Stock Broking Ltd had purportedly relied upon the bogus documents furnished by the individuals who acted as front entities (key operators) to the ultimate beneficiaries who had financed the fictitious applications. Karvy Stock Broking Ltd had accepted letters purportedly issued by BhOB as POI and POA of the persons for opening demat accounts and such documents purportedly received prima facie appeared

17



to be forged and hence it appears that Karvy Stock Broking Ltd had not done Know Your Client verifications.

10 Two cases - BS & FC (RC 3(E)/ 2006 and 4(E)/ 2006) under Sections 120 B r/w 420, 467, 468 & 471 of IPC, under Section 68(A) of the Companies Act 1956 and under Section 13(2) r/w 13 (1) (d) of the PC Act, 1988 were registered by CBI in the matter of Yes Bank and IDFC Ltd. after arraying Karvy Stock Broking Limited, Karvy Computershare

-- -- -- Pending

18



Pvt. Ltd and Karvy Consultants Ltd and other officers of these entities including Mr. C. Parthasarathy, as co-accused. The matter is pending before the Hon’ble Special judge.

11 Subsequently, the Enforcement Directorate, after relying on the investigations of CBI and that of SEBI and on the premise that Section 467 of IPC framed against the co-accused represents a predicate offence which is categorized as a scheduled offence under Section 2(u) of the Prevention of Money Laundering Act-2002 (PMLA), has

-- -- -- Pending

19



filed a prosecution complaint bearing no.04/2013, in terms of the provisions of PMLA. The matter is pending before The Appellate Tribunal PMLA New Delhi.

12 Inspection of Portfolio

Management services

business of Karvy

Stock Broking Limited

(KSBL) conducted in

2013-14.

Based on the findings of

inspection, the

company has received a

show cause notice as to

why adjudication

proceedings should not

be initiated against the

Company.

Based on the findings of inspection, the company has received a show cause notice as to why adjudication proceedings should not be initiated against the Company. The Company has responded to the said show cause notice in writing. Personal Hearing in this matter was held on June 29, 2015 by the Adjudicating Officer as requested by KSBL. Further to the Hearing, the Adjudicating Officer required KSBL to submit certain documents. The said documents have been

1. The PMS Operations team actively

ensures in coordination with the

operations team at Hyderabad

that KYC details of clients who

opt for PMS are uploaded to

KRA

2. The PMS Operations team

routinely scrutinizes account

opening forms and any

difference in ink if observed

between signatures of client

and text written by client is

immediately escalated and the

form rejected for clarification

NIL

20



submitted on July 31, 2015. Further directions are awaited from the Adjudication Officer. Meanwhile KSBL is awaiting directions from SEBI as regards the consent application dated January 23, 2015 for settlement filed by it in this matter.

and confirmation by client

3. All teams are being repeatedly

sensitized to fact that the word

“scheme” is not to be used with

respect to PMS documents

4. The PMS Product team is in the

process of introducing a risk

profiling tool.

B. DETAILS REGARDING SEBI ACTIONS INITIATED/ TAKEN/ PENDING AGAINST ASSOCIATES OF KARVY STOCK BROKING LIMITED



(a) (b) (c) (d) (e)

1 In the matter of IPO of

Rajesh Exports Ltd.,

A warning letter dated October, 10, 2002, directing us to be cautious in future and to adhere to all the Rules, Regulations, Circulars and Guidelines issued by SEBI strictly.

NIL

21



2 In the matter of transfer of

equity shares of Bellary

Steels and Alloys Limited

The following alleged violations have been cited in the notice (i) failure to comply with SEBI Circular No. 001 (2000-2001) dated 09-05-2001 (clauses 7 & 11) and (ii) failure to exercise due diligence, care and skill expected from a professional SEBI registered market intermediary (clause 2,3 & 16 of Schedule III read with Regulation 13 of Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agent) Regulations, 1993.

After receipt of the copies of the documents relied upon by SEBI, reply to the notice was filed on 09-04-2009. KCPL attended a personal hearing on May 11, 2009 and also subsequently submitted the written submissions on 15th May, 2009. After a detailed investigation and personal hearing, the adjudication proceedings were disposed off in favour of the company vide order dated January 5, 2010, without levying any penalty, monetary or otherwise.

Not applicable as the

Company has not been

reprimanded / warned for

non-compliance nor was

any penalty levied / action

taken against the

company.

NIL

3 (i) SEBI had initiated

enquiry proceedings

against Karvy

Consultants Limited

(KCL) (whose Certificate

of Registration was

transferred to Karvy

Computershare Private

Limited (KCPL) under

regulation 6(1) of the

KCL which acted as registrars to the IPO of UCO Bank Limited in September 2003 had not abided by the code of conduct as specified by SEBI in schedule III read with Regulation 13 of SEBI (Registrar to Issues and Share Transfer Agents) Regulations 1993.

Subsequent to the personal

hearing on November 6, 2009,

with the enquiry officer, the

proceedings against the

company were disposed off vide

order dated 12th July, 2010

in favour of the company,

without levying any penalty.

A penalty of Rs. 10 lakhs was

imposed by the AO which was

The Company had

reviewed the processes

and had ensured a second

level verification of the

details captured from the

IPO application forms to

ensure that such errors do

not occur again. Also, the

company has been strictly

adhering to the various

NIL

22



Enquiry Regulations.

(ii) SEBI had initiated

adjudication

proceedings in the year

2004 in matter of

issuance of physical

shares against the

applications for

electronic allotment

(DEMAT).

subsequently reduced to Rs.

1.50 lakhs by Hon’ble Securities

Appellate Tribunal (SAT).

norms, rules and

regulations laid down by

SEBI and other regulatory

authorities in IPO

processing from time to

time.

4 Vide order dated

26.05.2006, KCPL was

directed not to act as a

registrar to an issue and as a

share transfer agent,

pending enquiry and passing

of final order, except for the

assignment already

contracted before passing

of interim order dated April

27, 2006. The direction was

not applicable to KCPL as

Registrar and Transfer

Agent to Mutual Funds.

Failure to exercise due

diligence in weeding out

multiple and fictitious /

benami applications, issuance

of consolidated refund orders

and failure to maintain arms

length distance with other

Karvy entities

Subsequent to the enquiry and

hearing with the whole time

member, SEBI in its order dated

22.02.2007 lifted the directions

issued vide an earlier order

dated 26.5.2006 without

prejudice to the pending enquiry

proceedings against its associate

company Karvy stock Broking

Limited (KSBL), without any

further directions. Subsequent to

the enquiry and hearing granted

to the associate company, KSBL,

SEBI passed a another order

dated June 22, 2007 wherein it

The company has already

undergone prohibition of

not acting as a RTI for

more than 10 months. The

changes in the regulations

such as making PAN

mandatory has helped in

implementing the revised

process for verifying

duplication of PAN

numbers in weeding out

multiple applications in

addition to matching the

names, addresses and the

DP ID and Client IDs of the

NIL

23



reiterated that KCPL is prohibited

to act as Registrars to the issue

for a period of 9 months and

since KCPL had already

undergone prohibition for more

than the said 9 months period,

therefore, there shall be no

further directions against KCPL.

KCPL had filed an appeal no 153

of 2007 before Securities

Appellate Tribunal (SAT)

challenging the order dated June

22, 2007. SAT after the hearing,

vide it order dated June 30, 2008

set aside the impugned order

dated June 22, 2007 and referred

the matter back to SEBI for

passing a separate and distinct

order after giving a fresh hearing

to the company.

SEBI issued final order in respect

of KCPL – RTI on 3rd February,

2014 and in such order stated

that since KCPL has already

undergone prohibition from

applicants. The refund

amounts are being

credited electronically

directly to the bank

accounts of the applicants

through RTGS, ECS and

NEFT.

24



acting as RTI for approximately

10 months no further penalty is

warranted.

C. Details of action initiated / taken/pending, i f any , by SEBI against Karvy Investor Services Limited., Group Company.

Sl.no. Details of the case SEBI observation(s) SEBI Action

Corrective steps taken by Company towards observations made by SEBI


(a) (b) (c) (d) (e)

1 Advisory letter was issued to Karvy investor

services Limited as a Merchant Banker in the year

2005.

SEBI has given an

administrative

warning vide letter

dated IVD/ID-

5/MSR/PB/47713/05

dated August 22,

2005for providing

incorrect and

misleading

information /

particulars to the

Board that no pre-IPO

presentations were

made by the

company, Fortune

Informatics Ltd.

KISL vide its letter

dated September 10,

In depth training has been imparted to

the personnel involved in the merchant

banking activities. Scrutiny of every

document diligently is being done by a

senior official and verification of all the

facts and figures mentioned in the

document is also done before the same

is filed with SEBI. Checklist of

documents being filed done to ensure

all the documents and information is

being provided to SEBI.

NIL

25




2 An administrative warning was given by SEBI vide letter reference no CFD/DIL/ISSUES/SC/65284/2006 dated April 20, 2006 when DRHP of Shirt Company (India) Ltd. was filed without incorporating the suggestions made earlier by SEBI in respect of the risk element when the DHRP Opto Circuits Ltd. was filed.

In reply, KISL has submitted that the DRHP of Shirt Company (India) Ltd was filed much before the DRHP of Opto Circuits Ltd. and hence the observations suggested by SEBI could be incorporated

It was confirmed vide letter dated April

24, 2006 to SEBI that adequate steps

have been taken to ensure that the risk

element is reflected appropriately in

the headings of risk factors appearing

in the DRHPs submitted.

NIL not be incorporated.

26




3 SEBI has given a warning vide letter reference no

CFD/DIL/ SC /ISSUES/54996/2005 dated November

30, 2005 highlighting the deficiencies such as,

inconsistent disclosures, statements without

supporting facts and non-compliance with various

provisions of the SEBI (DIP) Guidelines, 2000 in the

draft Letter of Offer of Agro Dutch Industries Ltd.

In response, it was informed by KISL to SEBI vide

letter dated April 13, 2006 that KISL would ensure

that it shall henceforth submit offer documents of

good standard quality.

In depth training was imparted to the

personnel involved in the merchant

banking activities. Scrutiny of every

document diligently is being done by a

senior official and verification of all the

facts and figures mentioned in the

document is also done before the same

is filed with SEBI. Checklist of documents

being filed done to ensure all the

documents and information is being

provided to SEBI.

NIL

C.DETAILS REGARDING ANY OTHER LITIGATION PERTAINING TO KARVY STOCK BROKING LIMITED OR ITS ASSOCIATES

(I) ARBITRATION PENDING AT NSE PERTAINING TO KARVY STOCK BROKING LIMITED

Name of the Applicant

NSE/ BSE Region

Remarks Status Amount in INR

Mr. Baljit Singh Dagar

Delhi We have filed Appeal u/s 34 at District court New Delhi, Court proceedings are going on

Appeal under process 108700

Mr. Ram Chandra Nayak

Kolkata We have filed Appeal u/s 34 at District court Cuttack, Court proceedings are going on


27


NSE/ BSE Region


Mr. Sanjeev Kumar Chadha

Delhi We have filed Appeal u/s 34 at District court New Delhi, Court proceedings are going on


Ms. Aarthi Acharaya Chennai We have filed Appeal u/s 34 at District court Bangalore, Court proceedings are going on


Mr. Sonam Gailson Delhi We have filed Appeal u/s 34 at District court Jammu, Court proceedings are going on


Mr. B K Mishra Kolkata We have Appealed u/s 34 at District court Jamshedpur, Court proceedings are going on


Mr. Radheshyam Biyani

Delhi Arbitration and Appeal award against us. We have Appealed at district court Delhi u/s 34. Court proceedings are going on


Mr. Harbans Kaur Khalsa

Delhi Arbitration and Appeal award against us. We have Appealed at district court Delhi u/s 34. Court proceedings are going on


Ms. Poonam Sharma Delhi Arbitration and Appeal award against us. We have Appealed at district court Delhi u/s 34. Court proceedings are going on


Mr. Vimal Kumar Gupta

Kanpur Arbitration and Appeal award against us. We have Appealed at district court Kanpur u/s 34. Court proceedings are going on


Mr. G .Babu Rao Hyderabad Arbitration award against us. We have appealed at NSE, Hyderabad


Mr. K N Raju Bangalore NSE Appeal award against us. We have Appealed at District court, Bangalore


Ms. Manasi Vasudeo Deshpande

Mumbai Arbitration Pending at NSE Arbitration under process 262500

Ms. Dipali Vijaykumar Damle


Mr. Pishori Lal Delhi Arbitration award against us. We are in process to Appeal at NSE, Delhi


28


NSE/ BSE Region


Mr. Arjan Singh Chandigarh Arbitration award against us. We have appealed at NSE, Delhi


Mr. Anurag Yadav Lucknow Arbitration award against us. We are in process to Appeal at NSE, Lucknow


Mr. Raziya Begum Bangalore Arbitration Pending at NSE Arbitration under process 949232

Mr. Krishan Murari Sharma

Delhi Arbitration Pending at NSE Arbitration under process 50384

Ms. S.Uma Devi Chennai Arbitration Pending at NSE Arbitration under process 295555

Mr. Udesingh.M.Padhiyar

Baroda Arbitration Pending at NSE Arbitration under process 803614

Ms. Duraiya Bombaywala


Mr. Abidbhai Bombaywala


Ms. Ranjana Das Kolkata Arbitration Pending at NSE Arbitration under process 116378

Mr. Pramod Shankar Ghag


Mr. Pramod Shankar Ghag

Mumbai Arbitration Pending at BSE Arbitration under process 900000

Mr. C.Vijay Kumar Reddi

Bangalore Arbitration Pending at NSE Arbitration under process 13873311

(II) DETAILS OF LEGAL CASES PENDING AGAINST KARVY STOCK BROKING LIMITED

Sl No Name Amount Case No. Status/Remarks

1 T P Pramaleela 1,00,000 OS:305/2011 The client has preferred Civil Suit against the order of Consumer Forum in Complaint No. 48/2010 which was awarded in our

29


favour. The matter is presently posted for arguments and next date of Hearing is September 7, 2015

2 S Manu 2,15,000

Appeal No. 1049/2011

Complaint No. 64/2010 was awarded in our favour at Consumer forum in Tumkur Branch, aggrived by the order of the CF, the client has preferred appeal before the State Commission - Bangalore, appeal admitted awaiting the further legal process, argument complete by both the parties posted for orders. (Member retired fresh hearing). Matter is posted for fresh arguments before new member on next date of hearing viz October 5, 2015.

3 G V Ramachandra

4,50,000

Appeal: 2323/2011

Claiming for losses on the ground of old age, health and ignorance of trade done in his account, client is disputing signature on contract and the same was referred to handwriting experts. The complaint was dimssed on the grounds that he is not a consumer on 10/11/2010, now after 190 days he has filed the appeal before the State Commission. On August 5, 2015 , the appeal too has been dismissed in favour of KSBL.

4 Shashikanth Thimmapur

5400000 CRP No: 258/2012

Setting aside the impugned order dated 30/3/12 and B Report filed by IO of Market Police Station in Crime No. 29/2009 at IV JMFC, Belgaum. The matter is under process.Next date of Hearing is on October 5, 2015.

5 ARVIND KUMAR

3,44,830

1328/2009 Delays in payments of dues by the client. Arbitration award was in favor of KSBL. Client filed the case in alipore court against arbitration award.

6 TAPAN KUMAR BISWAL

63,000

174/2009 Cheque bounce case against the client. Arbitration award was in favor of KSBL. Client filed the case in district court against arbitration award

7 MOHAN SINGH

3,63,112

CCN.602/2009

Cheque bounce case against the client. Client has filed counter case in Sahibgunj Court alleging unauthorized trade and debit.

8 SANJAY KUMAR AGARWAL

4,77,429

CCN.604/2009

Cheque returned uncleared. Arbitration award was in favor of KSBL. Client has filed appeal petition against Arbitration Award in Dist Judge Darjeeling.

9 SHOBHA SONI 2,89,624

F&O/M-072/2008/C

The Client refused to pay the outstandings. We had filed for arbitration against the client and got award in our favour. In between the client got transferred from Ambikapur to Dhamtari. We have filed a recovery suite against the client in Dhamtari Court. Last time after a lot of dates and persuasion we were supposed to get the case registered against the client, in between the judge got transferred. Now again the hearing process is going on.

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10 ASHISH SHARMA

93,278

F&O/K-0041/2009

Delays in payments of dues by the client. Arbitration award was in favor of KSBL. Execution petition has been filed before the Chief Judge at City Civil Court Bilaspur.

11 AJAY CHANDRA SATPATHY

84,057

127/2009 Cheque bounce case against the client. Arbitration award was in favor of KSBL. Execution Petition has been filed in Kolkata, however client has moved to undisclosed location and cannot be contacted.

12 SANJAY BHATTER

1106/08 The client has filed arbitration against us. Arbitration Award was in our favour but the client is absconding and is not traceable.

9 ASIM CHATTERJEE

1788/2011 The criminal complaint filed against the Company along with Aritration case. But the Arbitrator passed award against the Client. Based on the award passed by the Arbitrator, we are asking for dismiss of complaint filed by the Client. 10 AJOY KRISHNA

ROY 75,000

Client filed the complain for unauthorised trade in his trading a/c in Consumer Forum.

11 LAL BAHADUR SINGH

1,12,000

60/2011 Client sent legal notice through District Comsumer forum , Buxar, for oppurtunity loss due to trade square-up by KSBL.

S.NO PARTIES NAME

CASE NO. NAME OF COURT

CASE DETAILS

1 Srichand Rupeja

600/2011 CDRF, Lucknow

The client has filed this complaint against KSBL before the CDRF, Lucknow, and has claimed Rs.1,50,000/- alongwith 18% interest. He has made allegation that many unauthorised trades have been executed in his trading account without his instruction between October 2009 to Feb 2010. KSBL has filed its written submission and evidence and case is posted for arguments on November 16, 2015

2 Ankur Mahal 334/2011 CDRF, Meerut The complainant has claimed that due to deficiency in service of the O. P. his late father Mr. Rajpal Singh suffered a loss of Rs. 2,25,490/- from his demat account No.366407. Which he has prayed to be compensated alongwith 18% interest. This case has been dismissed, as per branch.

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S.NO PARTIES NAME


CASE DETAILS

3 Vidya Sagar awasthi

R.S.No.13/2006

D. J. , Lucknow

The client had claimed through arbitration Rs.32,857/- for loss against unauthorised trades which was rejected on account of lack of merrits by the arbitrator on18-02-2006. Thereafter, the application of the client u/s 34 of the arbitration act was dismissed by the D. J. , Lucknow, on 06-02-13.

4 Durgesh N. Khanna

Complaint No.08/2008

CDRF, Kanpur Nagar

The complaint/claim of the client for for rs.1,77,549/- was dismissed by the consumer Forum, Kanpur, by the order dated 29-12-12 on account of lack of evidences against which this Appeal has been filed by the client for a decree of Rs.1,10,992.75 and 50000/- for mental agony and rs.2000/- as cost of the case. hence his total claim is for Rs.1,62,992.75. The case was dismissed on 29/12/2012 as the complainant was not been considered to be a consumer.

5 Manish Kumar vs KK Sharma & Others

Mrs. Suruchi Atreja Singh, J. M., Rohtak.

Mr. Manish Kumar (the complainant) has filed this complaint against Mr. K. K. Sharma, Rakesh Negi & Sarvesh Pandey due to dispute in payment for computer systems supplied by him to Karvy branches. As per complaint the claim amount is Rs.1,66,799/-

6 Rakesh chandra

R. S. No.12/2006

D. J., Lucknow The client had claimed Rs. 1,36,880/- through arbitration against the unauthorised trades which was rejected by the arbitrator on account of merrits on 18-02-2006. Thereafter, the application of the client u/s 34 of the arbitration act was dismissed by the D. J. Lucknow on 06-02-13. Case was dismissed by D. J. , Lucknow on 06-02-13

7 Parth Singh Rai

Case No.418/12

CDRF, Jaipur This complaint has been filed by Parth Singh Roy (UCC - 111591) against the loss of Rs. 300000/- (Rs. Three Lacs) caused by employees of Jaipur branch of KSBL in his Trading account which was adjusted by sale of shares from his demat account. KSBL has filed its written submission and evidence and case is posted for arguments on November 18, 2015

8 Surendra Singh

690/2007 CDRF -II, Lko This complaint has been filed by Mr. Surendra Singh (Client Id. - 21177324) against the fraudulent transfer and sale of 50 shares of Matrix Lab Limited on 21-12-2004 and 35 shares on 23-12-2004 from his demat account without his instruction. KSBL has filed its written submission and evidence

32

S.NO PARTIES NAME


CASE DETAILS

and case is posted for arguments on November 21, 2015

9 Gurbux Singh 691/2007 CDRF -II, Lko This complaint was filed by Guru Bux Singh (died on 19-03-2009) and his wife Smt. Sheela Kaur who's joint demat a/c no. is 21160811. They alleged that O. P. no. (1) , (2) and (3) have fraudulently transferred and sold 300 equity shares of HDFC from their joint demat account in collusion with each other . So, they have claimed the shares or the value of the same along with 15% interest. KSBL has filed its written submission and evidence and case is posted for arguments on November 21, 2015

10 Harsh Kr.Chawla

1111/2009 CDRF-I, Lko This complaint has been filed by Harsh Kumar Chawala U C C - 233L 4263 and Clint Id - 21332619. He has alleged that unauthorised trades were executed in his trading account from 18-05-2007 to 07-06-2007 due to which he incurred a loss of Rs. 80000/- in his trading account. So, this amount he has claimed along with other reliefs. This case has been dismissed by CDRF, Lucknow, on 21-07-15.

11 Ayodhya Nath Chaturvedi vs Dhirendra Mohan Chaturvedi & others

407/2012 Civil Judge(S.D) -II,Mathura

As per para (25) of the Plaint, this suit / Injunction petition has been filed by the plaintiff Ayodhyanath Chturvedi for order of injunction against the defendant no. (1) Dhirendra Mohan Chaturvedi and defendant no. (2) Virendra Mohan Chaturvedi and all the other defendants that the shares which have been transferred by the defendant no. (1) and (2) by way of cheating from the demat account of the plaintiff be not further transferred to any other's demat or trading account and the same be not sold by any of the defendants or the proceeds of the same be not given to defendant no. (1) or (2) by any other defendant. So, the court has summoned KSBL i. e. defendant no. (3) and (4) for submission of the status of the demat or trading acounts lying with Karvy in the name of the plaintiff and the defendant no. (1) and (2). No specific claim of any amount has been made by the complainant from Karvy in this case. KSBL has filed its written submission and evidence and case is posted for arguments. Last Hearing date was April 9, 2015.

12 Daya Shankar Dubey

451/2012 CDRF, Jaipur In this complaint, the client Mr. Daya Shankar Dubey has denied from his trades and has allegated that the trades have been executed in his trading account without his instruction except a few trades. And, he has claimed for the amount of cheques he had given for purchase of some particular shares i. e. valued at Rs.6,20,000/- along with compensations. KSBL has filed its written submission and evidence and case is posted for arguments. Last Hearing date was March 3, 2015.

33

S.NO PARTIES NAME


CASE DETAILS

13 Raj Narayan Tandan

Case no.87/09

CDRF Sitapur As per complaint, the client Mr. Raj Narain Tandon has clained Rs.44795/- for the loss caused to him because 60 shares of Imfosys Technology could not be sold as per his instruction and time and he had to pay Rs.3430/- for the shares auctioned. Hence, he suffered a loss of Rs.48225/-. further, he has claimed Rs. 10000/- as cost of the case and Rs.15000/- for mental agony and harassment and Rs.23000/- for deficiency in service. Therefore, total claim = Rs.96225/- which he has wrongly mentioned in complaint as Rs.98225/- along with interest @ 18% per month. KSBL has filed its written submission and evidence and case is posted for arguments on September 21, 2015

14 Ram Gopal Verma

Case No.137/2008

CDRF Mirzapur

As per complaint, client Ram Gopal Verma has claimed the value of 300 shares of allahabad bank @ Rs.99/- per share = Rs. 29700/- along with 5% interest from 02-01-05 = Rs.35640/- , Rs. 25000/- for mental agony and harassment and Rs.20000/- for cost of the case. hence, Total = Rs.80640/- In this case written submission on behalf of KSBL has been filed. Submission of evidence by Complainant is awaited. Last Hearing date was August 26, 2015.

15 Nirupama Shrivastava

326 / 2009 CDRF - I, Lucknow

The complainant Nirupama Srivastav has claimed 1000 shares of DCW Ltd., 1000 shares of IGL, 50 shares of Maruti Suzuki India Ltd. And 37 shares of Allahabad Bank from the O.P. KSBL along with cost of mental agony and the cost of the case. This case has been dismissed by CDRF, Lucknow, on 18-09-14.

16 Amisha 47 / 2011 A D J - Mandsaur

As per arbitration award dated 10-11-2008 Amisha Modi had to pay to the applicant Karvy Rs.3,10,796/- within 30 days from the date of award against which the client has filed an application u/s 34 of the arbitration act before the D. J. Mandsaur, is pending. The counter claim of the client of Rs.15,55000/- was rejected by the arbitrator. A Revision is pending for final argument. Last Hearing date is July 29, 2015.

17 Smt. Santosh 46 / 2011 A D J - Mandsaur

As per arbitration award dated 07-11-2008 Smt. Santosh had to pay to the applicant Karvy the claim amount of Rs. 1,14,539.89 within 30 days from the date of award against which the client has filed an application u/s 34 of the arbitration act before the D. J. , Mandsaur, which is pending thereat now. And, the counter claim of the client of Rs.7,50,000/- was rejected by the arbitrator. In this case , a Revision is pending for final argument. Last Hearing date is July 29, 2015.

34

S.NO PARTIES NAME


CASE DETAILS

18 Banita Jain Comp 517/2008

CDRF, Kanpur Dehat

The complainant has alleged that she had given a cheque of Rs.300400/- to the O.P. towards her Trading account no.285500003 which was duly received by the O.P. on 11-08-2007. But she had not given any instruction for execution of any trade in her account. Whereas, the O.P. has executed many trades without her instruction and has caused loss to the complainant to the tune of Rs. 300400/- and again a debit of Rs.70022.35 is reflecting in her trading account for which the O.P. is responsible. So, the complainant has claimed a sum of Rs. 300400/- along with cost and compensation towards the interest, cost and litigation. Case was dismissed against the complainant on 13-09-13 for non presentation of evidences by the Complainant.

19 Priti Poddar 706 /2009 Civil Judge (S D), Kanpur Nagar

This suit has been filed by the plaintiffs for mandatory injunction against the defendants. In this suit the value of shares have been mentioned in three parts such as Rs.7,41,629.95 and Rs.2,01,821.35 and Rs.9,43,451.30 which have been transferred fraudulently from the demat accounts of the plaintiffs and proforma defendant no.4 and 5. In this suit, defendant no. 3. (1) and (2) i.e. Karvy Stock broking Limited, are the proforma parties. And the demat accounts related to this suit have been frozen as per instruction of the court. KSBL has filed its written submission and evidence and case is posted for arguments on September 30, 2015

20 Sudesh Kr. Gupta

D. J., Patiala House,

This objection petition u/s 34 of the Arbitration Act has been filed by Mr. Sudesh Kumar Gupta against the award dated 11-08-2012 passed by the Arbitrator in favour of KSBL. As per award, the amount of Rs.8,18,026.16 is recoverable from the the respondent Sudesh Kumar Gupta on account of trades carried out by him in his account. KSBL has filed its reply and case is posted for arguments on September 19, 2015.

35

S.NO PARTIES NAME


CASE DETAILS

21 Sanjogita Gupta

D. J., Patiala House,

This objection petition u/s 34 of the Arbitration Act has been filed by Smt. Sanjogita Gupta against the award dated 01-08-2008 passed by the arbitrator in vafour of the applicant KSBL. As per award, the respondant Sanjogita Gupta shall pay Rs.5, 04,198.84 to the applicant KSBL along with simple interest @ 10 % p a from the date of award till the date of payment. KSBL has filed its reply and case is posted for arguments on September 19, 2015.

22 Alpana Malik D. J., Patiala House,

This objection petition u/s 34 of the Arbitration Act has been filed by Smt Alpana Malik against the award dated 24-07-2008 passed by the arbitrator in favour of the applicant KSBL. As per award, the respondant shall pay Rs.1,38,916.91 to the applicant along with simple interest @ 10% p a from the date of order till the date of payment. . KSBL has filed its reply and case is posted for arguments on September 19, 2015.

23 Manju Saraswat

Execution Case No.62/2011 - In Re: Complaint No.362/2008

CDRF, Kanpur Nagar

This Execution case was filed by Smt. Manju Saraswat and her daughters for enforcement of the order dated 26-04-2011 passed by the CDRF Kanpur Nagar in complaint no. 362/2008. The Consumer Forum, Kanpur Nagar has issued certificate of recovery against the O.P. KSBL against which an Appeal has been filed by KSBL before, the State Commission at Lucknow, upon which the proceeding of recovery has been stayed. Appeal is pending for final hearing before the state Commission, Lucknow. Next Hearing date is yet to be fixed.

24 Kamala Devi Title Suit No.

Civil Judge (J D), Patiala

This suit has been filed by Smt. Kamala Devi against KSBL and others for injunction (against the respondants) on transfer or sale of her 1200 shares of ESSIL Packaging Ltd. From the demat account where the same has been wrongly transferred and for decree of declaration of title in favour of the plaintiff. The said shares were purchased by the plaintiff in her Trading account (with Karvy branch at Patiala) which were then kept in her demat account (with Karvy branch at Patiala) and thereafter transferred to the demat account of defendant no. (2), as per plaint. W. S. on behalf of Karvy has been filed. This suit has been dismissed on 17-08-15 by Civil Judge, Patiala.

36

S.NO PARTIES NAME


CASE DETAILS

25 Zakiya Sultana Execution case no.03/2013 against Complaint No. 58/2008

CDRF, Jaunpur

This complaint has been decided on 07-09-2012 in favour of the complainant. As per judgment, the complainant had opened a demat account with Karvy at Jaunpur, in which she had deposited 45 shares of Reliance Industries and 45 shares of Reliance communication. The O.P./ Karvy had already provided DIS Booklet to Zakiya. However, another DIS Booklet was erroneously issued in the name of Zakiya Sultana., to one Arshad Ali when he presented a printed application form in the name and signature of Zakiya Sultana (to karvy branch) which authorised Mr. Arshad Ali to receive DIS slips on behalf of Zakiya Sultana. And, thereafter the shares in question were transferred through two of those DIS slips bearing signature of Zakiya Sultana which were not matching with the signature of the client (given on Member - Client - Agreement) to the demat account of one Mr. Pramod Kumar Verma of Abhipra Capital at Jaunpur. The O.P. Karvy had absolutely denied the allegations of the complainant. But, as per order, the O.P. will either provide 45 shares of Reliance Industries and 45 shares of Reliance Communication to the complainant within one month or the value of those shares as per value on the date of transfer of the same along with Rs.1000/- as cost of the case. Claimed amount is approx 1,15,548/- This execution case has been closed by CDRF, Jaunpur, after Compliance of order.

26 Smt. Saroj Gupta

comp.203/2010

CDRF - I, Lucknow

The complainant Saroj Gupta has claimed Rs. 97,379.30 as cost and compensation towards the loss caused to her shares and the litigation. She has alleged that she has kept many shares in her demat account no.11153499 which was suspended by the O.P. for a long time even after depositing the A M C and the required address proof to the O.P. She could not make transaction of her shares lying in the demat account. So, she suffered loss in respect of value of the shares. KSBL has filed its written submission and evidence and case is posted for arguments on November 23, 2015

27 Praveen Kr. Singh

1091/12 CDRF, Lucknow

Complaint of unauthorized trades executed in trading account. Claim of Rs. 5,50,000/-. KSBL has filed its written submission and evidence and case is posted for arguments. Last date of Hearing was March 11, 2015

28 Banwari Pd Maurya-Complainant - 1 Brij Mohan

366/2012 CDRF, Gorakhpur

Complaint of unauthorized trades executed in trading account of Banwari Pd Maurya (Complainant - 1) who has claimed Rs.600000/- as well as Brij Mohan Maurya (Complainant -2) who has claimed Rs.6,50,000/- through Consumer Complaint. Prior to this Complaint, one Arbitration filed by Banwari Pd Maurya by A. M. No.F&O/D-0063/2012 was decided in favour of KSBL by NSE Award

37

S.NO PARTIES NAME


CASE DETAILS

Maurya -Complainant - 2

dated 30-11-2012. And, another Arbitration filed by Brij Mohan Maurya by A. M. No. F&O/D-0064/2012 was decided in favour of KSBL by NSE Award dated 30-11-2012. KSBL has filed its written submission and evidence and case is posted for arguments. However Hearing date is not yet fixed.

29 Tribhuwan Das 73/2013 CDRF, MATHURA

The complainant had claimed that the O.P. had executed unauthorized trade in his acount and caused a loss of Rs. 259903/- and Paise 75. But this claim has already been decided by the Arbitrator Mr. Divakar Dev in favour of the O.P. and the application was rejected. KSBL has filed its written submission and evidence and case is posted for arguments. However Hearing date is not yet fixed.

30 Abhinandan Jain

1529/13 CDRF, jaipur The complainant Abhinandan Jain (client of Jaipur) has claimed as follows: Rs.15000/- for the loss caused in trading, Rs. 11000/- as cost of the case and Rs. 10000/- as compensation for mental agony. KSBL has filed its written submission and evidence. The case has been posted for arguments on September 17, 2015

31 Lokpal Sharma 278/12 CDRF, Jaipur The Complainant has demanded Rs.150000/- for the loss incurred by him in his trading account and Rs. 21000/- for Advocate's fee along with other compensation. KSBL has filed its written submission and evidence. The case has been posted for arguments on October 23, 2015.

32 Anil Kumar Taneja

Contempt Case No.78/2013 In Re: Complaint No.296/2011

CDRF, Ajmer As per order of the CDRF, Ajmer, O. P. No.3, KSBL, Ajmer, has to pay Rs. 49000/- of the application amount with interest @ 9% and Rs. 1000/- as cost of the case. Case Closed on 21-11-2013 after compliance of the order passed in Complaint No.296/2011, on payment of Rs.63230/- to the complainant .

38

S.NO PARTIES NAME


CASE DETAILS

33 Durgesh Narain Khanna

Appeal No. A/2013/621

State Commission, Lucknow

This appeal has been filed by Durgesh N. Khanna against the impugned order dated 29-12-12 of the CDRF, Kanpur. The complainant had claimed Rs.110992/- along with compensation in his Complaint No.08/2008 filed before the CDRF, Kanpur Nagar. KSBL has filed its reply and case is posted for arguments. However Hearing date is not yet fixed.

34 Amarjit Singh Case No. 271/2013

CDRF, Ambala City

The Complainant gave a cheque of Rs.5000/- to the O. P. for purchase of shares which was cleared by the O.P. But, this amount was wrongly crdited to the trading account No.343160 of the Complainant's wife in place of the trading account No.343197 of the Complainant, without the consent of the complainant. And, the O. P. failed to rectify the error even after legal notice from the Complainant. The Complainant has claimed Rs.5000/- with interest @ 18% and Rs.20000/- towards mental agony and Rs.5000/- as cost of the case. This Complaint has been dismissed, as per branch.

35 KailashChander Trama

Cr. Appeal ---/2013

Dist. & Sessions Judge

This appeal has been filed by the appellant against his conviction in cheque bounce case against two cheques of Rs.100000/- each. The appellant has been acquitted by the Court after payment given by appellant to KSBL by Judgement dated 12-11-2013.

36 Avtar Singh Gill

Consumer Complaint

CDRF, Ludhiana

This Complaint has been filed for reversal of 1000 shares of Idea, 4000 shares of J P Hydro and 3000 shares of R P L or the value of the shares in question along with compensation. This case has been decided and closed in favour of KSBL by judgment dated 27-03-2014 by CDRF, Ludhiana.

37 Patwant kaur Gill

Consumer Complaint

CDRF, Ludhiana

This Complaint has been filed for reversal of 2000 shares of Ispat Industries, 2000 shares of J P Hydro,2255 shares of Venkey's India Ltd. And 7000 shares of Zee News or the value of the shares in question as on 19/12/2009 along with compensation. This case has been decided and closed in favour of KSBL by judgment dated 27-03-2014 by CDRF, Ludhiana. .

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S.No CASE NO

NAME OF THE PARTIES

COURT SUBJECT AMOUNT (Rs.) REMARKS

1 O P No. 106 of 2013

Sujatha Gattu and others Vs. KSBL and others

I Senior Civil Judge, Hyderabad

The Plaintiff filed petition before the Civil Court for granting Succession Certificate. As her deceased husband was holding some shares. The matter posted for enquiry.

Not applicable, since KSBL is formal party and there is no liability to KSBL. KSBL will implement the orders of the Court.

The matter posted for enquiry.

2 O S No. 1084 of 2013

Srivalli Vs. Jyothy and others

District Judge, L B Nagar,

The Civil Suit filed for partition and allotment of share in the property left over by deceased Sri. S Bhaskar Rao. The shares of the deceased are said to lying in DP account maitained by KSBL. Hence, suit filed for their share, both in movable and immovable.

Not applicable, since KSBL is formal party and there is no liability to KSBL. KSBL will implement the orders of the Court.

The matter posted for enquiry.

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MATTER PERTAINING TO KARVY STOCK BROKING LIMITED PENDING BEFORE THE NATIONAL CONSUMER COMMISSION, NEW DELHI

1 Revision Petition No. 39 of 2013

C H N V Sri Ram Vs. KSBL

The National Consumer Commission, New Delhi

The Complaint filed before the District Forum, Machilipatnam for transfer of 40 shares of MRF along with costs of Rs. 10000/ and Rs. 20000/ as compensation. But the Forum granted 40 shares of MRF along with costs of Rs. 1000/ and Rs. 5000/ as compensation. Against the said orders, KSBL filed appeal before the State Commission, Hyderabad. In the said appeal the Commission set aside the orders passed by the District Forum. Now, the Complainant filed Revision Petition before the National Consumer Commission, New Delhi. On receipt of the notices from the National Commission, New Delhi, KSBL has filed vakalat before the Commission. The matter posted for arguments of Complainant's Counsel

40 shares of MRF (Rs. 9,05,650/)

S.No. Name of the Client Amount Exchange Remarks

1. Bhaskar M Pandya 13,58,486 NSE-Mumbai

On receipt of the Award passed by the Arbitrator, the Client filed appeal against the award in Bombay High Court and the same is pending for hearing.

2 Jitendra

Chaudhary 5,56,823 NSE-

Mumbai On receipt of the Award passed by the Arbitrator, the Cleint filed appeal before the High Court of Mumbai, but, the High Court dismissed the Appeal. Once again, the Client preferred an appeal before the Supreme Court of India.

No Client Name Amount Case Number Court Name

1 S.Narayanasamy 50,000 os 486/2008 1ST ADM,Coimbatore

2 P.Shanmugam 4,000 OS 851/2010 PDM,Coimbatore

3 Thilago Sulochana 15,54,000 OS 654 / 2010 1 ADJ, Coimbatore

4 Tamilarasi 3,20,856 EP 225/2010 DJ, Coimbatore

5 V Chidambaram 5,89,628 EP 226/2010 DJ, Coimbatore

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No Client Name Amount Case Number Court Name

6 C Indhra 73,171 EP 227/2010 DJ, Coimbatore

7

V Arumugam 2,31,408 EP 228/2010 DJ, Coimbatore

Service tax matters, under dispute The Department of Central Excise and Customs has raised a demand with respect to the Service Tax on brokerage/commission earned on distribution of mutual funds of Rs. 5,157,611 (Previous year: Rs. 5,157,611) which has been contested by the erstwhile Karvy Securities Limited, now merged with the Company, before the Honourable High Court of Andhra Pradesh. The entire amount had been paid under protest. The High Court of Andhra Pradesh has quashed the said circular vide order dated 1 September 2004. Aggrieved by the said order, the Department of Central Excise and Customs has filed a Special Leave Petition with the Honourable Supreme Court of India, which is pending for hearing.

DETAILS OF LITIGATION/ DISPUTES PERTAINING TO KARVY COMPUTERSHARE PRIVATE LIMITED

Contingent Liability as of August, 2015 - Corporate Registry Division

Sl No.

Case No. Court/ Forum Complainant name Unit Nature of complainant Contingent Liability (in

Rs.)

1 66/98 Rajnandgoan Ms Sunitha Corporation Bank Non receipt of share cert after transfer

17,800.00

2 647/98 Mylapore V Ramachandran & Padma

Ramachandran IDBI - equity

return of interest & deficiency of service

1,03,120.00

3 1/99 Nalbary Dulal Deka IDBI - equity transfer of shares & mental agony

30,000.00

4 CD /98 Chennai Nitya Mohan Kolipakkam IDBI - equity non receipt of fully paid stickers & compensation

50,000.00

5 148/98 Chennai Ghanshyam Sahu IDBI - equity non receipt of fully paid stickers & compensation

2,00,000.00

6 CDRF Karnal Narendra Kumar Flexi Bonds II issue of Deep Discount Bonds or refund of amount and costs

9,500.00

42


Sl No.


Rs.)

7 CDRF Raebarelli Ram Prakash Trivedi Bank of Baroda

Waive interest on call money and compensation for delay in service and costs

21,000.00

8 CDRF Raebarelli Jagdish Saran Agarwal Bank of Baroda transfer of shares, compensation & costs

25,000.00

9 CDRF Karnal Pradeep Kumar Bank of Baroda issue of fully paid stickers, compensation & costs

50,000.00

10 CDRF Pratapgarh Shiripal Mishra Bank of Baroda

issue of fully paid stickers and dividend for the year 1997-98, compensation & costs

67,290.00

11 CDRF Jhunjhunu Ratan Lal Bank of Baroda

issue of fully paid stickers and dividend for the year 1997-98, compensation & costs

6,240.00

12 148/98 Chennai C L Choudhary & others Agro Dutch transfer of shares, compensation & costs

13,200.00

13 ID

584/2000 Hyderabad Sudha Rani Karvy

Matter posted for trial, cross examination

56,448.00

14 126/2008 Jhansi Meera Devi Gupta Power Grid

allotment of shares, financial loss, legal expenses, mental agony – case closed

1,25,402.00

15 244/2008 Shivpuri Lokesh Sharma Power Grid non-credit of shares and refund

16,000.00

16 214/2008 Jalandhar Ashok Kumar Arora REC non credit of shares, refund, legal expenses, travelling expenses, court

22,941.00

43


Sl No.


Rs.)

fee, mental agony, etc

17 131/2009 Bareilly forum Kanhaiyalal Agarwal Bank of Baroda Transmission of his name as karta in place of the deceased karta.

25,000.00

18 38/2009 Consumer forum at

Kota Arun Kumar Sharma Strides Arcolabs

Claim for 25 shares of the company in lieu of the old shares.

50,000.00

19 752/09 Jaipur forum Mohit Agarwal JSW Steel claim for 130 shares after merger and benefits.

50,000.00

20 872/09 Jaipur Forum Neeraj Gupta GMRI Non refund in IPO – case closed

15,000

DETAILS OF LITIGATION/ DISPUTES PERTAINING TO KARVY COMTRADE LIMITED

S. NO.

Client Name Client Code

Branch Region Amount involved

Appeal filed by

Court Status as on 30-August -2015

Nature of case

1 Pooja Cold Storage

Sri Ganganagar Rajasthan 22,36,703 KCTL City Civil Court Hyderabad

Judgment came in our favour

Civil suit filed for freeze other accounts of the client.

2 Amarnath Cheppali

800727 PUNE (Sub Brok)

Maharashtra 1,94,850

KCTL Criminal Court erramanzil

Case transferred to Pune Criminal court

Cheque bounce case for recovery of the amount, Criminal case.

44

S. NO.

Client Name Client Code

Branch Region Amount involved

Appeal filed by

Court Status as on 30-August -2015

Nature of case

3 Vanita Luthra

56158 MUMBAI COMM (Sub brok)

Maharashtra 59,00,000 KCTL Nampally Criminal court

Investigation by the police done

Private complaint for recovery of the amount from the client.

4 Sivashakthi 36428 ERODE Coimbatore 8,00,000

KCTL Nampally Criminal court

Investigation by the police done

Private complaint for recovery of the amount from the client.

5 Arun Kumar 36490 CHITRADURGA SOUTH KARNATAKA

36,255 KCTL Bangalore Criminal Court

Appearance of the client Cheque bounce case for recovery of the amount, Criminal case.

6 Nazar 55083 KOCHI Kerala 2,52,192

KCTL Criminal court Kochi

Investigation by the police Cheque bounce case for recovery of the amount, Criminal case.

7 Purushotam Nagapal and State of Rajasthan

Sri Ganganagar Rajasthan Client Rajasthan High court

Stay of all proceedings Cheating case filed by the client against NCDEX and also made KCTL as a party, criminal case in FIR No. 2/12. There after KCTL has filed Quash Petition in the High Court of Jodhpur, Rajasthan challanging the FIR No. 2/12. The same is pending.

45

DETAILS OF LITIGATION/ DISPUTES PERTAINING TO KARVY INVESTMENT ADVISORY SERVICESLIMITED [FORMERLY KNOWN AS KARVY INSURANCE BROKING LIMITED]

Sl.No Name of the Complainant

Matter Pending before

Case Description Amount Claimed Remarks/Next Hearing Date

1 Arvind Kumar Singh Consumer Forum

Customer was sold the policy as a single premium but the policy had a 3 year premium paying term. The customer has already sent a notice to SBI life on 16/05/2011 for which SBI has sent response on 24/05/2011 denying the refund of Rs.25000 premium

25,000

Appealed against the Judgement/Order of the consumer Forum. Next hearing date is on 1st Sep’15

2 T R Mohana Consumer Forum

Customer has taken NHP group insurance policy with NICL for 1 year. Claim rejected due to non submission of Customer id proof.

26,131

Case dismissed in our favour.

3 Kamuben Patel Consumer Forum

Customer has taken a NHP group insurance policy with sum insured for 4.00 lac. The customer was diagnosed with "Bilateral Osteoarthritis of Knee Joint" and undergone a surgery. Claim rejected due to non submission of Original Money receipt for Rs.4,01,391/- and also non submission of Customer id proof.

4,05,835 Case dismissed on 29th Oct’14

P Naeem Khan Consumer Forum

As per customer he was promised that a coverage for Rs.1,52,000 but policy was issued for SA of Rs.82,192.

40,200

Hearing date on 30th Oct’15

• Policy was not cancelled even after submission of all relevant documents

• Was not provide the free accidental cover of Rs.100,000

46




• Customer is now claiming for cancellation of policy + refund of premium Rs.15200+ Rs.25000 expense for treatment on account of ill health + 10000 miscellaneous expenses.

5 Shamshad Begum Legal Notice

The complainant has taken the medical insurance policy to cover health insurance from National Insurance Company Limited vide Policy Nos.154400/46/10/8500000691, UHID No.NIC0008462907. The part settlement was already done by NICL. Remaining is pending due to submission of incomplete documentation.

2,50,000 Complaint dismissed in our favour on 8th

Nov’14.

6 Ashok Modi Consumer Forum

Claim rejected due to the complainant has declared his previous aliments. 63,457 Hearing date on 8th September 2015

7 BETHA RAMA RAO Consumer Forum

Claim rejected due to non submission of Doctor's certificate, past prescription, Original medicine bills, Original Investigation bills, Customer Id proof and age proof, etc.,

35,000

Case dismissed on 21st May 2015.

8 B Radhakrishna Consumer Forum

Customer has taken an mediclaim policy for 1.00 lac sum insured. Complaint received towards non renewal of NHP Policy.

3,711 Pending

9 Parul Saxena Legal Notice

Free Look Cancellation case. TALIC has responded confirming that the policy documents, as per their dispatch records, was received by the customer on 02nd Feb

Final Judgement awaited

47




2011 & cancellation request was received on 03rd Nov 2011. Hence request for cancellation & subsequent refund has been rejected.

10 Ashok Kumar Chaubey

Legal Notice

Customer has taken a mediclaim policy under NHP. Customer's wife has undergone pregnancy & had a benefits upto to 25,000/-. Due to non submission of documents in required time, hence the claim got rejected.

25,000 Pending at Forum, Next hearing 26th November

2015

11 Kanthi Nagaraj Consumer Forum / Legal Notice

Customer has taken NHP group insurance policy with NICL for 1 year. Customer has undergone eye treatment and paid Rs.24,000/- towards treatment charges. Due to non submission of required documents in time, the claim got rejected.

24,000 Pending at Forum, Next hearing 4th September

2015

48

DETAILS OF ARBITRATION CASE FILED AGAINST KARVY INVESTOR SERVICES LIMITED

S. No.

Case No.

Name of the Party

Court & Place

Case Description Claim Amount (Rs.)

Remarks

1 NA Escorts Services Limited

Sole Arbitrator, Sri Rajeev Saxena, Advocate, New Delhi.

KISL received a legal notice dated 3/1/2005 from the Counsel, Mr Pavan Kumar Saxena, Advocate of Escorts Securities Limited, New Delhi. In the said notice, the Counsel for Escorts Securities Limited advised the KISL to pay Rs.14,86,350/- to Escorts Securities Limited towards its commission for referring an investor to invest in Onconova Therapeutics Inc. In reply to the notice, KISL sent a reply dated 15/1/2005 stating that the allegations made in the notice are not valid and far from the truth. KISL denied the conducting of meeting on 3/10/2002 at Delhi and signing of Memorandum of Understanding by Mr P B Ramanujam. In our reply notice we categorically mentioned that Mr P B Ramanujam is not at all authorised signatory of the Company and the Board of Directors has not given any power to enter into commercial terms and agreements with any other Company and further we have mentioned that if Mr P B Ramanujam signed minutes of meeting and Memorandum of Understanding the same is not binding on the Company.

1486350.00 (along with interest)

Without considering the reply Escorts Securities

Limited have filed Arbitration Petition before

the Arbitrator Mr Rajeev Saxena, Advocate,

New Delhi. At the time of filing our counter and

objections for arbitration petition filed by

Escorts Securities Limited, we have mentioned

that the allegations are not true and correct.

The sole Arbitrator posted the matter for

Escorts Securities’ reply affidavit / petition.

After filing of the reply affidavit, the Arbitrator

is conducting the proceedings. The Counsel of

Escorts Securities Limited is conducting cross

examination in the said matter. During cross

examination, Authorised Signatory of Karvy

Investor Services Limited, produced original

Minutes of the Meeting records from the date

of appointment of Mr. P B Ramanujam before

the Sole Arbitrator. After verification of the

original records, the Counsel for Escorts

requested time for further cross examination.

But, time and again, the Counsel is taking time

from the Sole Arbitrator. Meanwhile, we

requested the Arbitrator for closing of

arbitration proceedings for non-conducting of

cross examination. The Sole Arbitrator finally

posted the matter for cross examination and as

Documents

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