Karvy case: SAT asks NSE to decide on revoking stock broker firm's license by 6 December

New Delhi: The Securities Appellate Tribunal (SAT) has asked the NSE to take a decision by Friday in the matter of suspension of trading licence of Karvy Stock Broking Ltd. This comes after Karvy moved to SAT against the NSE's directive which suspended the broker's licence on Monday due to non-compliance of regulatory provisions of the exchange. This suspension pertains to its trading in capital market, futures & options, currency derivatives, debt and commodity derivatives segments. Karvy had allegedly misused securities of over 95,000 clients which it was holding on behalf of the clients to raise over Rs 600 crore in loans from various lenders. In an order passed on Tuesday, the tribunal said that Karvy would be at liberty to file an appeal under the NSE Rules. "In case, if such an appeal is filed, appellant (Karvy) shall be heard as expeditiously as possible and in any event shall be decided by 6 December, 2019. [caption id="attachment_6154491" align="alignleft" width="380"]

NSE (National Stock Exchange) building in Mumbai, India.

Reuters.[/caption]"In case the relevant authority would not be able to decide the appeal within the period, the decision on the temporary stay to the impugned order may be taken by the relevant authority on or before 6 December, 2019," it added. The National Stock Exchange (NSE) in its report to SEBI on 22 November had said that Karvy was misusing the clients' securities and various other misappropriation of the clients' securities. Following this, markets regulator on the same day had barred Karvy from taking new clients in respect of its stock broking activities and also prevented it from using the power of attorney (PoA) given by clients after the broker was found to have allegedly misused clients' securities. Separately, the tribunal on Tuesday asked NSDL not to transfer any more shares to the clients of the crippled Karvy Broking. The SAT order came on a plea from affected lenders -- HDFC Bank, ICICI Bank, Indusind Bank and Bajaj Finance-- which challenged NSDL's Monday decision to transfer shares from now-banned Karvy Broking back to 83,000 clients, which helped almost 90 percent of the demat accountholders of brokerage to recover their investments.