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Why was an SMS and email sent by CDSL informing about the block mechanism for payin of securities?

CDSL sends the SMS and email to comply with the SEBI guidelines (WEB). As per the regulations, depositories shall validate the depository transfer instruction details with Clearing Corporation (CC) obligation details. An obligation is the shares that have to be given to the CC for delivery, against the sell orders executed. If the transfer and obligation details match, the transaction goes through. However, if the details don’t match, the transfer is rejected.

The clients are not required to take any action because the depository participant (Zerodha) ensures that the CC obligation details based on the Unique Client Code (UCC), Trading Member (TM) ID, Clearing Member (CM) ID, Exchange ID, ISIN, quantity, settlement details, etc. all match for the securities to be successfully transferred.