Extends relaxation in procedures till September-end
The Securities and Exchange Board of India (SEBI) has issued guidelines to fast-track refund for un-allotted and partially allotted applications for rights issue. SEBI has said that bankers, registrar, and other recognised intermediaries should ensure the refund for un-allotted/ partial allotted application are completed on or before T+1 day.
Applications in rights issue are allowed only through the Application Supported by Blocked Amount (ASBA) facility (whereby bidders provide instructions to specified banks to block amounts equivalent to the bid amount in their ASBA accounts).
SEBI had relaxed this condition for eligible rights issues by allowing the issuer, along with the lead manager, registrar and other intermediaries, to formulate an additional non-cash mechanism to accept applications from shareholders. However, no third-party payments were allowed in respect of any application under such additional mechanism. It had clarified that the mechanism was an additional option and not a replacement of the existing process.