Legal Question in Wills and Trusts in India

Dear Sir,

We are Shares Broker of Stock Exchanges. To ease the process of Client submitting Physical Delivery Instruction Slip to its Depository Participant ( DP) for Transfer of Shares from His Demat Account to Brokers Settlement / Margin Account on selling of Shares, We take Revocable power of Attorney ( POA) from Client.

Using the PAO we give a consolidated instruction to DP signed by us, on behalf of all clients to debit the shares from Client�s Account and Credit our Settlement / Margin Account whenever Client sells.

Client POA document have a clause which reads as

�I / We further agree that the powers and authorities conferred by this power of Attorney shall continue until I / we give to the Depository Participant fifteen Days advance notice in writing to the contrary.�

Now, as per SEBI new circular :

PoA executed in favour of a Stock Broker and Depository Participant by the client should be revocable at any time, without notice.

And circular requires us to revoke those authorizations given by the existing clients to the stock brokers/ stock broker and depository participants through PoA that are inconsistent with the present guidelines.

You are requested to kindly suggest :

1. How can Client revoke that one clause. Does revocation has to be on another stamp paper signed by client. Or can revocation letter be on simple paper or notarized copy of revocation letter which will form part of existing POA stamp paper?

2. Can we as a POA holder our self revoke such one clause and intimating clients. If yes, how?

3. What can be other alternatives of revocation apart from going to clients for getting their sign and / or using new stamp papers.

Thanks & Regards

Yashpal Singh

1 Answer from Attorneys

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