Escrow payment mechanism not applicable to the company, BSE told
Sashwat Technocrats has told BSE that the Escrow Payment Mechanism requirement does not apply to it.
What the company has told the exchange
Sashwat Technocrats Ltd has written to BSE stating that the requirement for submission of an Escrow Payment Mechanism does not apply to it. The company's stated position is that it has not issued, and does not have, any instruments or arrangements for which the said mechanism is applicable under the relevant SEBI regulations.
The letter is addressed to the Manager, Department of Corporate Services, BSE Limited, and is signed by Prakhar Singh Taunk, Company Secretary and Compliance Officer. The company has requested the exchange to take the clarification on record.
What an escrow payment mechanism means here
- In simple terms, an escrow arrangement is a structure in which money meant to be paid to investors is routed through a designated account, so that the payment obligation is kept separate and secure.
- The requirement the company is referring to comes up in the context of continuous disclosures and compliances by listed entities under the SEBI (Issue and Listing of Municipal Debt Securities) Regulations.
- The company is telling the exchange that this requirement does not apply to it because it has not issued, and does not have, any instruments or arrangements of that kind.
Why a company files this
- Where a regulation sets out a continuing requirement, a listed entity is expected to either comply with it or explain why it does not apply.
- This update is that explanation, submitted so that the exchange's record is complete.
What investors can take away
- This is a clarification about the applicability of one regulatory requirement. It is not an update on the company's business operations, orders, earnings or shareholding.
- It confirms the company's position that the specific requirement does not apply to it, based on the instruments and arrangements it says it has not issued and does not have.
- The letter does not set out any commercial terms, transactions or payments; it addresses only the applicability of the escrow mechanism requirement.
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