Chapter 12: Grievance Redressal Mechanism — Complete Study Notes

1. Informational Stage: Fundamental Concepts & First-Line Redressal

Overview of Grievance Redressal

• Direct Resolution Mandate: Before escalating any complaint to regulatory bodies like SEBI, an aggrieved investor must first directly contact the concerned company, stock exchange, or broker to seek resolution.
• Speed of Resolution: Attempting direct resolution with the entity involved is recommended because it often leads to a quicker problem resolution than formal regulatory escalation.

2. Commercial Investigation Stage: SEBI SCORES & System Mechanism

SCORES Framework (SEBI COmplaints REdress System)

• Definition: SCORES stands for SEBI COmplaints REdress System, which is a centralized web-based online complaints redressal platform launched by SEBI.
• Core Purpose: It provides a platform for aggrieved investors whose securities market grievances remain unresolved by the listed company or registered intermediary after direct contact.
• Access Modes: Investors can access the portal via http://scores.gov.in or through the SEBI SCORES Mobile Application.
• Stipulated Filing Timeline: An investor must lodge a complaint on SCORES within three years from the date of the cause of complaint. If this stipulated timeframe is missed, the investor must take up the matter directly with the entity or through an appropriate court of law.

Step-by-Step Procedure for Filing a Complaint on SCORES

1. User Registration:
   • First-time users must click "Register Here" under "Not Registered yet?" and enter personal details such as name, address, and mobile number.
   • Existing users log in by clicking "Register/ login to lodge complaints".
2. Category Selection: The complainant must select one specific category from the following options:
   • Listed companies / registrar & transfer agents
   • Brokers / stock exchanges
   • Depository participants / depository
   • Mutual funds
   • Other entities
   • Information to SEBI
3. Entering Complaint Details: Enter specific details of the grievance under the chosen category and confirm submission.
4. Attaching Supporting Documents:
   • Supporting documents up to 2 MB can be uploaded directly in PDF format.
   • If supporting data for a category exceeds 2 MB, it must be sent by post to any SEBI office.
5. Registration Number & Status Tracking:
   • Upon successful submission, a unique registration number is generated for future communications, and a confirmation e-mail is sent.
   • Investors can track complaint status online by logging in. For physical complaints sent to SEBI, investors log in using the password provided in the SEBI acknowledgement letter.
6. SEBI Processing & Action-Taken Report:
   • SEBI examines the complaint to verify if it falls within its regulatory purview.
   • If within purview, SEBI forwards the complaint to the concerned entity, advising them to send a written reply to the investor and submit an Action-Taken Report (ATR) within stipulated timelines.

Features of the SEBI SCORES Mobile Application

• Platform Availability: Available on both iOS and Android platforms.
• Core Functionalities: Allows investors to lodge grievances, track complaint status, set reminders for pending grievances, and view FAQs.
• Notifications: Sends automated acknowledgements via SMS and e-mail to registered contact details for every grievance filed.
• Helpline Integration: Features built-in connectivity to the SEBI Toll-Free Helpline.

Matters NOT Considered as Complaints in SCORES

The following items are excluded from the SCORES redressal mechanism:

• Incomplete or non-specific complaints.
• Allegations made without supporting documents.
• Submissions offering suggestions or seeking guidance/explanation.
• Seeking explanations for non-trading or illiquidity of company shares.
• Dissatisfaction with the market trading price of company shares.
• Non-listing of shares originating from a private offer.
• Disputes arising out of private agreements with companies.

3. Transactional Stage: SEBI Helpline & Direct Support

SEBI Toll-Free Helpline Service

• Toll-Free Numbers: 1800 266 7575 or 1800 22 7575.
• Operational Hours: Available on all days from 9:30 a.m. to 5:30 p.m..
• Language Support: Available to investors across India in 8 languages.
• Alternative Contacts: Phone numbers: 022-26449188, 022-26449199, 022-40459188, 022-40459199 | E-mail: [email protected].

Services and Information Provided by the Helpline

• Company & Intermediary Details:
  • Status of companies (unlisted, sick, delisted, liquidated, or wound up).
  • Company name changes following amalgamation, merger, or demerger.
  • Details of Registrar and Share Transfer Agents (RTAs) and SEBI-registered intermediaries.
• Regulatory & Market Information:
  • Guidance on locating SEBI regulatory actions and corporate actions (dividends, bonus shares, rights issues).
  • Direction for obtaining the latest Net Asset Value (NAV) of Mutual Fund schemes.
  • Contact information for Registrars of Companies (RoC), official liquidators, and the National Company Law Tribunal (NCLT).
• Complaint Guidance: Assistance on how and against whom to file complaints on SCORES, and tracking complaint status.
• Non-SEBI Regulatory Guidance: Re-directing queries outside SEBI's jurisdiction to appropriate bodies like RBI, IRDAI, PFRDA, or MCA.
• Procedural Assistance:
  • Opening Demat/client accounts.
  • Share transfer and transmission procedures and required documentation.
  • Procedures for lost, fake, or forged shares, and applying for duplicate shares.
  • Process for applying in an Initial Public Offer (IPO) and details of companies filing offer documents.
• Scope Exclusion: The helpline does not provide legal opinions or investment advice.

4. Cross-Sectoral Grievance Redressal Comparison

5. Key Takeaways & Essential Terms

• SCORES: SEBI's web-based platform designed for lodging and tracking unresolved securities market complaints online.
• 3-Year Limitation: The maximum allowable period from the date of grievance cause to file a complaint on SCORES.
• Action-Taken Report (ATR): The official written resolution report required by SEBI from an entity against whom a complaint is lodged.
• Banking Ombudsman: RBI authority handling unresolved banking grievances after a 30-day period without charging any fee.
• IGMS Portal: Integrated Grievance Management System operated by IRDAI for insurance complaints.