KATHMANDU, Feb 1: Investors in the secondary market paid ‘closeout’ fines worth Rs 73.93 million in the first six months of the current fiscal year.
According to the CDS and Clearing Limited, the fine amount was Rs 16.21 million more than the amount collected in the same period of 2020/21. In the review period this year, a total of 9,978 transactions fell in ‘closeout.’ In the last fiscal year, investors while carrying out 7,450 transactions had to pay the fine amount to the authority.
One-fourth of business firms found cheating consumers as festiv...
A closeout refers to the situation when the investors, while selling stocks, fail to transfer scrip in the name of the buyers within T+1 period (within 24 hours of transacting the shares). After selling shares in the secondary market, the sellers can transfer the shares either through Electronic Debit Instruction Slip (EDIS), an online system, or Debit Instruction Slip (DIS), a manual system through the stockbroker concerned.
The sellers are also penalized if they sold the shares of a company in excess of the number than they actually possess. As per the law, the authority slaps the sellers with 20 percent of the total share value as a closeout fine. Of the penalized amount the government takes 25 percent as capital gains tax while the remaining amount is booked in the name of the buyers.
