Some people are saying they are filing multiple applications of an IPO. Family members are okay, but is it okay legally if you apply IPOs in many other accounts of friends and nonfamily relatives and transfer to your dmat and sell?
It is perfectly legal. You don''t transfer the allotted shares. It is just as if they are applying individually and sell from their respective accounts. There is nothing illegal or immoral. Everyone has a right to participate and each member or friend is an individual.
applying in family name is legal even transferring between them is legal. applying in friend name without any consideration is not legal however if some consideration then it is all legal.
however presently we have many benami demat accounts which r run my nexus of brokers in Gujarat and Mumbai however this does not have that much effect on IPO however secondary market is plagued with this issue. however on individual front some people have cleverly used other peoples PAN with or without permission to apply IPOs
SEBI HAS FOUND GUILTY IN MANY CASES ONE SUCH CASE WAS AGAINST KARVY HOWEVER NOTHING HAPPENED ONE PERSON HAD CONTROL OF 15000 BENAMI ACCOUNTS
It is legal to apply from several demat account as per relative definition in Income tax act. Those not covered under Income tax act, 1961, a consideration needs to be paid. Though if consideration is not paid does not make it illegal. its just that Income tax will penalise for intentional lowering of value. So consequences are more in terms of Income tax act.