Consequences of Short delivery – NSE/BSE

August 29, 2013


T+2 Delivery

T+2 Delivery

What is Short Delivery?

Equity delivery based trading in India works on a T+1 rolling settlement cycle. What this means is that when you buy shares on, say, Monday (also called T day), you get the shares on Tuesday (T + 1 day). Similarly, if you sold the shares on Monday, you are required to give delivery of the shares on Tuesday after which you will get the proceeds from the sale (cash) to withdraw on Tuesday (T+1 day).

Let us take an example, you bought 100 shares of Reliance on Tuesday, September 3, 2013 at Rs. 800 and the seller of these 100 shares was Mr. X (although in the markets you don’t get to know who you have bought it from). On T+1, i.e., Wednesday, September 4, you will get delivery of the stock to your demat account and Mr. X will get the sale proceeds equivalent to Rs. 80,000 (800*100).

But what if you had one of the following situations on hand:

1. What if you don’t have Rs.80,000 in your trading account to buy the 100 shares?

An exchange doesn’t directly interact with a client. When you as a client make a purchase of any worth, the exchange debits the money from the brokerage firm’s account that you are trading with. So if a brokerage has let you buy stocks for delivery with no money in your trading account, then the brokerage is obligated to pay for these purchases to the exchange. The broker would then recover the money from you and would also charge you an interest for the money that he has paid on your behalf to the exchange if you delay in payment.

2. What if Mr. X doesn’t have the 100 shares in his demat account, but he still sold them?

As mentioned earlier, if you sell any stock on T day, you are obligated to deliver the shares on T+1. But sometimes it may so happen that you sell some stocks but these stocks are not present in your demat account and hence you would not be able to give delivery of these stocks on T+1 and would end up defaulting. This default is called “Short Delivery“.

Now you’d be wondering how/why anyone would sell a stock and not deliver it? Well it can happen for various reasons. Here are a few common ones:

a) You sold 100 shares of Reliance for intraday expecting the price of Reliance to go down. If you sell any stock for Intraday you are expected to buy it back by the end of the day to close your position. Now assume you forgot to buy it! Now you’re left with no option but to deliver these 100 shares of Reliance on T+1. Since you don’t have any shares, you would not be able to deliver and would default, thereby causing a Short Delivery.

Now this may not happen with your account at Zerodha because we let you buy/sell equities with 2 product codes: MIS (for Intraday) and CNC (for Delivery). Zerodha’s RMS system will attempt to square off all Intraday trades (bought/sold with the product code MIS) at 3:20 pm even if you haven’t squared it off yourself. When you try to sell Reliance with the product code as CNC, the systems will check if you have these shares in your demat account and let you sell only if you do, thereby ensuring that there is no short delivery.

b) You sold 100 shares of Reliance at Rs.800 for intraday expecting Reliance results to be bad. However, news was out that Reliance had done exceptionally well and hence the stock went up and hit the upper circuit at Rs 880 (when a stock hits the upper circuit there are no sellers, so if you’ve short sold the stock, there is no way that you can buy it back unless it gets released from circuit. This won’t happen on a stock like Reliance but can happen on a lot of illiquid stocks that don’t trade on Futures and Options). Assuming the circuit is never released during the day, you’d be forced to hold your short position and would have to deliver the shares, failing which the shares would be short delivered.

The role of the Exchange is to ensure that if you buy shares, you get credit of the shares. Assuming you buy 100 shares of Reliance from Mr. X and if Mr. X fails to deliver these shares to the exchange on T+1, it’s quite obvious that you would not get these shares. So what happens is the exchange conducts an Auction and buys these shares for you in the Auction market and gives delivery of these shares to you on T+2 (Thursday, September 5) instead of T+1.

Note: In the case of physical settlement of derivatives, if the seller defaults on the delivery, the exchange conducts an auction on T+1 day. In such a case, the settlement time will be T+2 days.

Short delivery is the risk you take when trading BTST (Buy Today, Sell Tomorrow), read this blog for more.

What happens in an auction market?


Auction Market

In the Auction session, the exchange invites offers from fresh sellers for quantities short delivered (100 shares of Reliance in the above case)

When does the Auction happen and who can participate in the Auction market?

It is a special market where only members of the exchange can participate as fresh sellers and sell shares which are short delivered. The Auction market is conducted every day between 2:00pm and 2:45 pm. To make sure that there is no conflict of interest, the exchange doesn’t allow the member whose client has defaulted in delivering to take part in the Auction market.

At what price are the shares sold?

There is no fixed price for the Auction to happen. The exchange specifies a range within which the auction participants can offer to sell their shares.

Upper cap of the range: 20% higher than the price that it closed on the previous day of the Auction (T+1 day of trade). For example, if you sell a stock on Monday, the auction happens on Tuesday with the closing price of Monday used to determine the auction price.

Lower cap of the range: 20% lower than the price that it closed on the previous day of the Auction. For example, if you sell a stock on Monday, the auction happens on Wednesday with the closing price of Tuesday used to determine the auction price.

So in the Reliance example above, a fresh seller can offer to sell 100 shares of Reliance in the Auction market in the range of 664 (assuming Reliance closed at Rs.830 ; 20% below 830) to Rs.996 (20% above 830).

What next?

Coming back to the example, you bought 100 shares of Reliance from Mr. X at Rs.800 and Mr. X defaulted in giving you the shares. The exchange will now buy these 100 shares in the Auction market and give it to you.

Assume that in the Auction market the fresh seller is offering to sell 100 shares at Rs. 920 only. What now?

The Exchange is obligated to buy it at whatever price and give delivery of these shares to you. The Exchange would hence buy these shares at Rs.920/- and give you the shares. Since Mr. X has defaulted he would have to pay the difference of Rs. (800-920)*100 = Rs. 12000/- to the exchange. Along with this, the Exchange also charges an additional penalty of 0.05% of the value of stock per day that Mr. X failed to deliver. The sum of both the above together is called “Auction Penalty“.

So, typically, in the books of accounts of Mr. X, he would have received a credit of Rs. 80, 000 (800*100) as sale proceeds, and since he failed to deliver the debit on his account would be Rs. 92,000 (920*100) thereby resulting in a loss of Rs. 12000/- on the transaction.

Hence it is very important that you short sell a stock for delivery only if you have it in your demat account or you could end up paying a considerable amount of money as Auction penalty.

The entire process:

a) On T Day Mr. X sells the stock.

b) On T+1 Mr. X fails to deliver the stock.

c) On T+1 when the shares are not delivered, the exchange blocks a sum of money from the brokerage’s account which is called “Valuation Debit”. The Valuation Debit is the closing price of the stock on the day preceding the Settlement day (basically, closing value of stock on T day, as settlement happens on T+1).

d) On T+1, the exchange conducts the auction and purchases the stock from the auction participants on behalf of the defaulting seller.

e) On T+2, the exchange gives the shares to the buyer and sends an Auction note to the defaulting broker. The broker then passes on such auction charge to the defaulting client.

What happens if, on Auction day, the price of the stock comes down considerably? Can a client benefit in an Auction market?

An interesting scenario:

Assuming that after Mr. X sold the stock (at Rs. 800) the price of the stock dropped to Rs. 780 (on T+1). The valuation debit that would be debited from the brokerage’s account would be Rs. 78000/- (780 closing price on T+1 * 100 shares).

On T+2 the Exchange conducts the Auction and in the Auction market buys Reliance at Rs.750/-.

On T+3 when the Exchange sends the Auction note to the Broker, the price in the Auction note would be

“The higher of Valuation debit or the price at which the stock has been bought in the Auction market.”

In the above example, the Exchange would debit the brokerage’s account with a sum of Rs. 78,000 even though the stock was bought at a value of Rs.75, 000. The difference of Rs. 3000 (780-750)*100 would be transferred to the Investor Protection Fund.

If, in the Auction, the stock gets bought at Rs.850/- then the Exchange would debit an additional Rs.70 (Rs.850 – Rs.780 which was earlier blocked as Valuation Debit).

What happens if the Exchange finds no fresh sellers in the Auction market?

In such a case, the exchange settles it in cash on the basis of Close out Rate. Close out rate is the higher of the highest price of the stock from when you sell to the auction day or 20% above the closing price, on the auction day (T+1).

So in the above example, the exchange would close out the trade at Rs.960 (20% higher than 800) and Mr. X, the seller of the stock who defaulted, will have to bear the auction penalty of Rs.16000 (960-800*100).

It is a tough topic to simplify, but hopefully this clarifies your queries on “Short Delivery.” Also do read the blog on BTST(Buy Today Sell Tomorrow).


Happy Trading,

Founder & CEO @ Zerodha

Post a comment

  1. Rv singh says:

    Yesterday I sold 15 shares of ireda in intraday but it was circuit up. Today I bought,15 shares in cnc. Will these be adjusted against each other.
    Thanks and regards

  2. D_p says:

    I short sell IREDA on 11 dec (Monday) at an average of 83 rupees per share and it hits upper circuit.
    When I contacted Zerodha they told it will go for auction and post that it will be settled. They blocked the margin by calculating price at 102 from my account.
    On Wednesday I got a contract note of stating the price settled on 122 per share. And I have to occur a loss of 40 rupees per share.

    When contacted Zerodha they told my auction didn’t happened and also their RMS system not able to buy shares on 12 dec (Tuesday) and I have to settled on 122 (Closing price + 20% ) per share.

    The share of IREDA was trading between 9:15- 3:04 on Tuesday i.e. very next day.

    I am in deep shock why it is not auctioned on t+1 day or Zerodha RMS not able to buy. When asked for clarification they said that it has been settled on “Close out” price.

    Now my account is in minus and they are asking me to pay the negative amount? I have requested for auction report data or any data which can support Zerodha’s statement in my case but no luck so far.

  3. Venkatachalam Siddarthan says:

    Hi, I have a query regarding short selling. Recently i sold some 100 stocks, however, the stocks were not transferred to the buyer due to some technical snag in the broker’s side. I even got an email, from them that they would refund any auction penalty. Please check the below email from the broker. However, on the next day when I checked my dp account, there was a buy trade transaction for 100 shares at higher price , which incurred a loss of around Rs. 5000. Now when i enquire about it to broker, i am not getting any straight answer or neither any refunds for the loss. Now who is fault here. how i go about the situation? Pls , kindly advise.


    We appreciate your continued trust in us!

    We are contacting you regarding a short delivery issue in your recent sell trade of XXXXXXXXXX, that occurred on 21st November 2023. Due to a technical error, the trade involving 100 shares was not completed, and these shares are still in your Demat account.

    In case of an auction penalty due to this short delivery, we will ensure that any such charges are fully refunded to your account. We apologize for the inconvenience and are actively working to rectify this situation.

    What You Need to Do:

    Please check your Demat account to confirm the shareholding.

  4. dhiraj says:

    what happend in index bank nifty option

  5. AY says:

    Good work! Very NICE!!
    If this issue is cleared properly, many newbies will happily trade with no worries, AND TRADE MORE!!
    Newbies will just factor-in this short delivery issue in their risk mitigation. Major issue is people get a sudden rude shock.

    As I understand, the worst case is, short delivery happening when you short-sell and price hits upper circuit and does not come out, and there are no sellers on T day.

    But article can be much better. Please RE-EXPLAIN or update explanation with flowchart (must) and an excel table (must). Such a difficult concept should be very transparently explained. Doubts will be and should be cleared easy.

    In the hope of simplifying, the article confuses more; looks like a lawyers document.

    Please give 3-5 scenarios each, for say, a short sell position leading to short delivery.
    Just an example:
    Short sell price: 100 INR.
    Upper Ckt: 5%, 10%, 20% scenarios.
    Auction: Three price level scenarios – low, mid, high.
    Close-out No-seller: 20% higher of what price, of 100 INR, or of T+2 closing price? Excel will clear all issues.
    Please correct ASAP, so we can all short in peace.
    Have a nice day!

  6. Pooja Garg says:

    I short sold one stock today in intraday…but it hit upper circut and hence could not be squared off…
    i want to ask.. in case that stock comes in availbility toorrow.. wil i be able to square it off tomorrow. or do i need to wait for auction itself?

    • Shubham says:

      Hi Pooja, no, you will not be able to square-off the position tomorrow. We’ve explained this scenario in detail here.

      • Pooja Garg says:

        Thank you for information @shubham , can you also confirm me.. if i will be buying from auction myself. or will zerodha do it for ?

        • Shubham says:

          Hi Pooja, in the auction, the shares are bought by the exchange and delivered to you. If the exchange is unable to procure the shares in the auction, your trading account will be credited with cash on the basis of the close-out price. Please check this article for more information.

          Btw, we’ve also launched auctions feature on Kite. If you have any shares in your holdings that have been short-delivered, you can sell them in the auction market if you wish to. We’ve explained about auctions in detail here.

          • Pooja Garg says:

            Thank you for your prompt reply.
            also just to confirm.. say i short sold shares on monday…and couldnt buy back due to upper circuit.. auction will be on wednesday right?

            • Shubham says:

              Yes, the auction is held on T+2 day.

              • Pooja Garg says:

                Thank you @Shubham for answering all my questions
                i have one last question
                How and when will i know about auction result..
                its 2pm and i do not see anything on my auction screen..
                i shorted the stocks on tuesday, so auction should be today.. but i do not see anything on auction screen.. so how will i come to know about result of the auction.
                Thank you

  7. Krishnan says:

    I bought ndtv shares. It was delivered to me on T+3 day, after NSE acquiring it thru auction. NSE would have levied penalty from the short seller. I believe that NSE must compensate me(buyer) by sharing atleast 50% of the penalty as I was denied the promised number of shares on T+2 day.

  8. Lalan Desai says:

    One of the best explanation of ‘short delivery’ I ever found on the internet.

  9. ROHIT JAIN says:

    A well explained article, but i agree that NSE should do something on potential loss. Until and unless the shares are provided to buyer the whole objective of buying the share is lost.

  10. Khushwant says:

    Complex Topic is well Explained , But want to know , How the TAX P&L will work in zerodha for Short Delivery shares . suppoe there was a short delivery from on 7 July & i got the settlement after 3 Days ..But in contract note of 7 Jul , no profit or loss ca be calculated as auction happen T+3. and Zerodha dont specify that in contract note after 3 days . How Tax can be calculated here for short delivery?

  11. Kaliannan Umaraj says:

    I sold 2100 IRB at a price of 280/- on 23-10-2021 Friday (T day ) and on that i am not able to square off . on Monday 25th (T+1 )day the closing price of IRB is 278. on Tuesday (T+2) , on the time of auction it is 281 and the closing price was 300. How much money i have to pay as penalty. is it 281 or 300 0r more than that?

  12. Anoop says:

    I also have similar situation. I sold shares (MIS) of future retail and now it hits upper circuit. I am not able to buy same. Sandeep can you tell me how much loss did u incur in percentage?

  13. Sunny says:

    I sold 2000 shares of Sudharsan Chemicals in intraday on Friday 27th Aug’21 hoping it would come down… however the stock hit the upper circuit and i could not squareoff my position.
    Now my ledger shows two things:
    1. Short delivery margin blocked for sale of Sudarchem EQ till exchange auction settlement on 27th Aug’21 itself with a huge debit amount.
    2. Net settlement for equity with settlement number XXXX …and this too on 27th Aug’21.
    My account shows negative balance. I am not able to understand what happened to all my money. I should have left with 2.5 lakhs after my intrday loss but instead it says -89K. My entire amount is wiped off along with -89K pending. Now my question is will how it happened and if the settlement is to happen on T+3 days why it happened on the same day becoz the stock opened on discount on monday. Pls let me know what all happened and when will i get my money.

  14. Mallappa Patil says:

    I shorted (sold) Sudarshan chemicals at 686/- on Friday 27-08-2021. The share hit upper circuit at 710.40 and could not square off the trade on 27-8-21. My all credit / funds/ margin was blocked. Today on Monday stock was dropped to 676/- which i would have easily purchased and covered myself had the funds were made available to me in my account. Alternatively, the Zerodha Risk Management Team could have covered the transaction for such customers as it is a routine matter because the system or Risk team could not do it on Friday to minimize the loss to the helpless client who is trying to do trade to make some profits.

  15. Anand says:

    The in-the money call that I sold (Call writing) on a scrip is illiquid and I am unable to square off at a reasonable price. I dont hold the shares in my demat account. So, can I buy an ITM put on the last day of expiry so that the netting off (of ITM call writing position with ITM put long position) will allow me to close without physical delivery obligation?

  16. Vikash Kumar says:

    In the example cited above auction take place on T+2 day and price is based on T+1 day closing price (with in 20% range of T+1)

    But I called to zirodha customer care executive he say acauction take place on T+3 day and price is based on T+2 day closing price (with in 20% range of T+2)
    So who is correct
    And in my case suppose T+2 day is settlement holiday what which day price will be consider as base price on auction day

    Pls reply

    • sandeep parate says:

      bhai hakikat bateo toh zerodha key owner hai inko bhi nahi pata hai ki short selling hoti hai kiya maine kitni baar tiket raise ki hai same jawaab aata hai ki nse hi iskey barey main bata sakta hai pheli baat toh ye short selling ko ban kar denaa chahiye ye sab kameney ke liye bethey hai inko kisi key paise sey lena dena nahi hai

  17. sandeep parate says:

    today mis position not square off so what can i do
    1900 share shot in VIPIND
    so nse how many charge for penaly this position

  18. KMS says:

    I had sold 340 strike price call option of DLF with July maturity. The closing price was 340.05. THe option was not unwound. I did not have 3300 DLF(lot size) in my demat account. I have 2 queries:
    1) how do I know if the buyer of the call exercised the option
    2) If the buyer did not, what is the implication and if the buyer did and I didnt have deliver of the securities, what will be the treatment in case:
    a) there is a market auction on the NSE for DLF (as available on the NSE website)
    b) there is no market auction on the NSE

  19. Hardik Mashru says:

    Today I got message that your stock with 95 quantity was short delivered. Actually I already sold the shares in BTST with 10% profit. Now what happens in this case ? Do I lose money ?

  20. Samurai says:

    Hello, If I sell on T+2 morning, is it certain that there won’t be short delivery?
    Since I will get delivery by T+3 evening after auction and have to give delivery of my sold stocks on T+4.

  21. Sudhanshu says:

    Sir , I used margin and short sell a stock worth 2,00,000 and got it for 35k
    But the stock hit upper circuit and I am unable to buy the stock
    How much would I be charged

    • Matti says:

      Hey Sudhanshu, this entirely depends on the stock. The way this is settled is explained in the post above.

  22. Ishant says:

    Did u get the answer? Please let me know too.. is it 900*100?

  23. ankita khanna says:

    I had put GTT order for Adani power. The GTT triggered on 14th of June 2021. But i did not get a chance to authorize it via TPIN of CDSL. Now the stock is showing as Trade to Trade stock in Zerodha account. Please let me know what will happen to my stock or anything i can do ?

  24. Ishant says:

    I short sell 20 shares of route mobile at 1975/share. It hit the upper circuit so couldn’t square off.
    And @3.30 it slipped back 20 points from the upper circuit but still it didn’t sqaure off.
    Now , my account shows 50k debited? So please let me know my losses? The amount debited is my loss or after this auction, it will be adjusted?

    • sandeep parate says:

      bhai apko yaa kio answer nahi milegaa aapko 5 din intezaar karna padegaa uskey baad ledger check kar lenaa agar aapki kismat acchi rahi toh kam penalty lagegi nahi toh poora piesa saaf mere saath bhi yahi hau hai bhai aapsey request hai ki kabhi bhi short karna ho toh f&o stock main hi karna cash main nahi karna apni hard money ko barbaad mat karna mera saath hua hai bhai isliye bata raha hoon agar kio query ho toh call karna 9827217030 i am every time available

  25. udit says:

    when can i exit from the short delievered position

  26. Krishna says:

    I have faced the short delivery here. I have bought the share at 360 and sold for 380 in CNC. But still it says short delivery and my 11K got debited.
    In the tradebook it shows proper buy and sell price but when you see profit and loss its showing wrong numbers.
    bought at 570 and sold at 380. this cannot be happen because that share which i bought neven went upto 570.
    Let me know how can i get my 11K back?

  27. Abhishek soni says:

    Sir i short stocks of Motherson Sumi Systems Ltd and its upper circuit hits and i loose my money due to hit this and according to rule its stopped for 30 min then why it is not stopped. i losse 6000 rs in this case….
    plz do solution as early as possible…
    mob 9413271236

  28. B GHADEI says:

    Respected Zerodha Team Member,
    Same problem happens to me today…
    Today I short sell Redington at Rs. 210 (6000 Shares)… I had in my fund Rs. 2,29,000/- so I sold (morning at 9:16 AM) it in leverage… Then the stock hits Upper Circuit at Rs. 219.75. Now It shows me Losses of Rs. 58,000/- in my position… Now I can’t square off bcoz there is no Seller….
    My humble question is….
    a) What can I do Now? How to close the position?
    b) How many losses to bear me?
    c) Can I settle this position tomorrow? I mean can I buy tomorrow?

  29. Abhinav says:

    What if i have a long stock futures and i have sold a call option which expires in the money but couldn’t sell it due to illiquidity issues as it is common in stock options. So in this case if i just have the future contract and no holdings of that particular share. Due to illiquidity i could not cover the option even though it went my way. What happens after expiry in this case?

  30. Ankit Agrawal says:

    Hi Nithin,

    For eg. I have 100000 in my fund account and I short sell an option with margin requirement of 90000.
    Now on the next day the margin increases to 115000. Now I have 2 question her:
    i) Do I have to add extra 5000 in my fund account ?
    ii) If yes, what happens if I don’t ?

  31. Mahesh Chavan says:

    i m confused a bit. below is my e.g
    i have done shorting yesterday of HESTERBIO 230 SHARES @2968/- ( Hits Upper circuit ), in meanwhile i was in profit of Rs.7555/- when it hits upper circuit it was showing loss of R.5600/- by the end of day i won’t able to buy shares bcz of upper circuit, now what will happen ?
    1) can i make profit if share value goes down, like today HESTERBIO price is 2828/- what will happen will i get profit from it or will i get penalty for the same ?

    • Matti says:

      You will lose money on this trade and be liable to pay the auction penalty.

      • BG says:

        Respected Zerodha Team Member,

        Same problem happens to me today…
        Today I short sell Redington at Rs. 210 (6000 Shares)… I had in my fund Rs. 2,29,000/- so I sold (morning at 9:16 AM) it in leverage… Then the stock hits Upper Circuit at Rs. 219.75. Now It shows me Losses of Rs. 58,000/- in my position… Now I can’t square off bcoz there is no Seller….
        My humble question is….
        a) What can I do Now? How to close the position?
        b) How many losses to bear me?
        c) Can I settle this position tomorrow? I mean can I buy tomorrow?

  32. Raghavendra M S says:

    Hi Nithin,
    I need some clarification on my below scenario.I need to know whats my situation here now and weather I should continue to do what I did in the below explained scee.
    I (thought) was using he new feature which would automate my whole buy and sell process with a buy price, Stoploss, Target all in one window.
    Correct me if my understanding is wrong here & what care should be takne here. I dont ant to end up in BTST short delivry situation also.
    On 11-May-21, I placed an order to buy GodrejCP using below method in Kite web.
    1. Watch List–>Hover on Godrej CP-Select “Buy” option
    2. Regular Order — Price @ 710 Qty-83, Long term CNC, & used checked GTT SL–5% & GTT Target 15%
    My Buy order got triggered the same day & next day on the Target was met and it was sold as well.
    On 12th the prices of GODREJ CP went high in morning session and my Target (GTT) ordered got triggered and it was sold.
    However, till 13th afteroon, I didnt get a clear picture of my portfolio and P&L. It was showing -83 in my positions & my overall P&L was at loss ev though I made a profit that day.
    At the same time my holding was showing with Godrej CP but the qty was Zero.
    The entire proess confused me and caused huge stress as my first huge profit of 9K was abuot to loose.
    Can you please help me how to interpret this…
    Also confirm if I can continue to use the above method forswing trade for delivery.

    I have raised a ticket on support #20210512767441 where you can see the screenshot also.
    Thanks in advance…

  33. Vishal Arora says:

    Hi Sir,

    I did MIS for Hindcopper shares(sold 1000 quantities @168/-) but then the stock hit the upper circuit of 171.85, i tried taking the delivery but i wasn’t able to do that..i also spoke to the customer representative but he also said that it might have been freezed and now would be settled on T+ 2days in the auction market..And on the next day it again had hit the upper circuit of appx 192..So i wanted to know in case of short delivery, what would have been the cost implication & to what extent..and in case, during the auction session, it would have been bought at a price of 192/- so in all probability the cost implication would be to the extent of 24k( 1000×192=192,000- 1000×168=168,000/- shares) . Pls let me know if my understanding is right or not!!

  34. Basheer says:

    I short sell in mis when stock is in upper cercuit . Buyers are in lakhs . What next . Please tell me

  35. Mayank Dhaked says:

    Hello nithin,
    This is mayank I have place a sell mis or der and sell 1800 shares of angel broking yesterday at the price of 512.20 and the stock hit the upper circuit so I’m not able to square off the position.
    What do you think? What will happen now.

  36. Sandhya Mehta says:

    I couldn’t see where a buyer of those shares are getting benefits?
    Recently I face this issue, Had bought ABC company and on T+3 day, the stock was not there in my holdings. Upon asking, I was told there was a short delivery.
    On T+3 day, stock went down hitting my desired level of stoploss, but as my holding was not showing any shares, I couldn’t exit. Resulting in additional loss. By EOD my holding showed down those shares.
    Where is the investor protection here??
    They charged , penalty/rate difference etc to the sellers, but not been passed on to the buyers(investors).

    If on the very 1st day, the exchange has come to know about the short delivery, then why the auction accont take place on the same day or atleast next day?
    I believe, as this is the auction market, the delivery of the shares would be instant, the buyer of the shares must have got the shares by T+3.
    Here entire 1day is lost which a buyer of the shares has to suffer.

    ..And they say they are protecting investors/traders.

    • Sandhya Mehta says:

      ..Just to add on to my above message.
      You(Zerodha) being a medium between us and sebi, you should put this point forward.

  37. Vishal Mahale says:

    I received mail from zerodha that your shares are short delivered yesterday, and today I could not find those shares in my demat account. what will happen with those shares? Is it my loss since market price are continuously increasing and I am loosing opportunity of making more profit?

    Also yesterday I buy some share and today it is showing (ex. Reliance(T1:10)) in holding, means that shares will go into short delivery in coming days. Please let me know that how to prevent our share from going into short delivery.

  38. Manish Shukla says:

    While all efforts being made to penalize the short seller, What happens to the opportunity cost of the buyer, whom the stock is short delivered? How is he being compensated?

  39. Anish Kumar says:

    Sir i buy 100 shares of justdial on same day i sell my 75 shares but pending 25 shares is not visible in my demat account

  40. Pinal shah says:

    I am not able to see my RCF share in 2nd March, why?

    pls guide me.

  41. Vikash says:


    I have couple of points to clarify:
    1. The calculation of Close out Rate needs some further explanation
    2. What happens if I sell some of the units purchased on T+1 and T+2 and the Exchange fails to deliver it on T+3 as part of auction. Assuming the price of the Equity raises 20% each day on T+1 and T+2, will I end up losing money for no fault of mine?

  42. Indirani Karthik says:

    I have an ITM of DLF 310 CE which expires today – As I understand this requires large margin for expiry day which I do not have in my account right now

    When I sell it on expiry day before the market close hope there will not be an issue – Please advise
    During this Expiry -2days since I did not have enough margin – will there be any penalty charges

    Please advise

  43. Naina says:


    I had already created ticket on 19/02/2021 highlighting the issue with 2 shares as follow-

    I am facing the following issue with 2 shares as below –
    1) I bought 2700 quantities of shares of CENTRAL BANK at 15.70 and 3160 quantities of shares of IOB(INDIAN OVERSEAS BANK) at 12.86 average cost respectively on 16/02/2021. Both were clearly reflecting in my account in HOLDINGS till 18/02/2021.
    2) On 18/02/2021, received 2 mails stating as follows-

    Dear Naina,

    Your purchase of 3160 quantity of IOB was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2021/02/22. You will be able to see the stock in your Kite holdings one trading day after it is delivered. You can read the consequences of short delivery here.

    Team Zerodha

    Dear Naina,

    Your purchase of 2700 quantity of CENTRALBK was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2021/02/22. You will be able to see the stock in your Kite holdings one trading day after it is delivered. You can read the consequences of short delivery here.

    Team Zerodha

    3) However, on 19/02/2021, I cannot see both CENTRAL BANK and IOB quantities of shares in my HOLDINGS. Both are missing. Why?

    I need clarification on the above issue as soon as possible.


    I got a mail regarding the issue on the same day but still as per the mail, I cannot see Shares or Funds in my account today which is T+5 days. Why being a buyer who had bought the shares by making full payment towards shares needs to suffer because of this?

    I need further clarification on the queries mentioned below –

    1) Why did you sent the mail informing the buyer that your bought shares were short delivered on 3rd day after buying transaction and why not the same day? Why did you delay?
    2) What would have been the effect on the following transactions done by the Buyer who is totally unaware of the fact that his/her shares are short delivered(As there is a delay in informing the Buyer about their shares being short delivered)-
    a) If the Buyer does an intraday transaction of those short delivered shares?
    b) If the Buyer does a BTST transaction of those short delivered shares?
    c) If the Buyer sells those short delivered shares anytime before receiving the mail from you informing about shares short delivered?

    Eagerly waiting to get reply from your side at the extreme earliest.
    How long will it take to resolve my issue? I can neither see shares nor funds in my account.
    I hope you clearly understand the importance of timing in trading.


  44. Prashant says:

    Why not my sell order complete in delivery

  45. fizfy says:

    Fizfy is social proof app that displays real user activity on your site to influence & convert your visitors into Customers

  46. Yaswanth says:

    Hi I had sold certain 1200 shares on intraday and obviously kept the buy order as well if price comes down then i can book the profit.

    But since the price sit in higher circuit both order didn’t get executed and got cancelled.

    Now i can see it as short delivery kind of msg.

    Do i need to buy those shares again?


  47. Subhit Vijay says:

    Dear Subhit,

    Your purchase of 1100 quantity of IOB was short delivered. You will either have your purchased shares delivered to your Demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2021/02/22. You will be able to see the stock in your Kite holdings one trading day after it is delivered. You can read the consequences of short delivery here.

    when I check my portfolio today, all my shares and profit gone.

    can someone please explain to me in a very simple way, what is this situation and what to do next?

    please help me understanding, As I am still learning.

    Many Thanks
    Subhit Vj

  48. Bhavi says:

    Hi, I Sold 100 shares of Reliance in MIS at 800 on Upper Circuit but i can’t BUY them as it never came down. On T+1 day price of Reliance was 900. So, on T+2 day if i don’t have those shares in my account then how much i would have to pay during auction? (900-800)*100 or 900*100 ?

  49. Swarna says:

    Hi, how much loss you bear after it

  50. Puneet Kedia says:

    Dear Sir, I have bought 5 quantity of VMART. However i received the following email on Feb 15, 2021. Neither the shares are reflecting nor the cash. Please clarify.

    “Dear Puneet,

    Your purchase of 5 quantity of VMART was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2021/02/16. You can read the consequences of short delivery here.

    Team Zerodha”

  51. Sailen says:

    I had shorted 500 BOM stocks but unfortunately, it didn’t square off since it hit the upper circuit. As it short delivered, do I need to do anything for the auction process or Zerodha will take care of it?


  52. Vikram says:

    I received a mail that my purchase of NCC shares on 8th Feb 2021 was short delivered. It is T+5 today and the account has not been credited as yet with the total amount

    Kindly clarify.

    • Vikram says:

      Just checked my kite account and it appears the shares have been credited. I was looking at the Console for the credit of the amount. Apologies for the same

  53. Amit says:

    I received email saying short delivery and stock which i bought was appearing till yesterday , when now today rate of the share is high but i t is not appearing in the list of portfolio holding. What to do ?

  54. srinu says:

    on monday i sold 200 SKF india shares and it went to upper limit so there are no sellers and it went to short deliery. on tuesday it went down than selling price s.p RS 2416 and tuesday closing price RS2330 so when will it go to auction and what range will they sell shares to us.

  55. Aditya says:

    Hi, In yesterdays intraday I have sold 2500 shares of NCC at 95 rs by the end of the day it touched the upper circuit 99.65 and i have been debited half of the amount what i had can you please let me know when will i get the remaining amount back ? and what are calculations used for it ?

  56. mangesh kumar says:

    hi team

    whats does its means now a time it is up by 3% more at whats price it will credit in my account
    Your purchase of 1 quantity of AFFLE was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2021/02/10. You can read the consequences of short delivery

  57. MD MAHTAB ALAM says:

    Sir I did shortsell 1329 shares of Bajaj electricals and Bajaj electricals hits the upper circuit and closed at 922.05 due to which I was unable to square off.
    What will be the loss?
    Sir please please please please reply sir 🙏🏻🙏🏻😭

  58. Sakib mulla says:

    I short sell bajaj electricals after n hours it goes on upper circuit what will happen next

  59. Manish Dave says:

    hello sir,
    I shorted bajaj elec at an upper circuit of 922.05 today in mis 300 qty by mistake, now what will happen sir? i’m not able to buy and square off my position, will i face any huge losses?? or what exactly will happen please reply sir i even mailed the zerodha support but no reply was given, please help sir!

  60. Ranjit Powar says:

    Improve your support system. It sucks

  61. Peg reddy says:

    How to withdrawal it is

  62. Subhit says:


    Sorry for the silly question, but can someone help me understand this.

    Dear Subhit,

    Your purchase of 500 quantity of JKTYRE was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2021/01/25. You can read the consequences of short delivery here.

    when I check my transaction history, I sell what I buy only, no short selling.

    and nothing is showing in my Demat account regarding short sell, can someone please help me with whats need to be done next.

    Subhit Vj

  63. Mohankumra G says:

    My client code JU7256 i have purchased 30000 shares of Bil Energy System Ltd om 15.01.2021 but its not updated in my holdings and the company symbol suddenly disappered from zerodha..please clarify..

  64. Bhakti says:

    Can any one help me to calculate maximum lose/profit in my short sell delivery position of India cement.

    Date 30th Dec Sell India cement @ 174 than stuck on buyer circuit 174.05
    31st Dec – T-1 closing on 169.20
    1st Jan – T-2 closing 180.75

    Please help & suggest

  65. Mallik says:

    If short delivery happens would the sale proceeds gets unblocked in Zerodha account on T+2 or T+3 ?

  66. Ankit Garg says:

    Buy 15 Share @ Rs 1490 and sold these share on T+1 day @1515 Rs and On T+3 Exchange purchase Share @1490 Rs then What should be the amount of penalty in that case.

  67. Yogesh Patil says:

    Did short selling on adani power then it went and hit upper circuit so couldnt buy back until 3.20 so had to bear the losses of 1090 which was reflected but next day i was having a sudden amount of nearing -3000 debit unexplained i had 1423 rs present in account earlier
    No clear statement of charges by zerodha cannot understand exactly what charges vr taken please clarify @Nithin0dha

  68. Tejas says:

    I have purchased 100 share of RBL bank and and I sold the share on T+2 day and as per my understanding now i should sell it only after T+2 day but i did not got money, what could be the reason. Can anyone please let me know, I am also new in trading so not have much idea

  69. Nikhil says:

    I am unable to view 300 qty of Adani power stocks in my account trade ID is : 3731466. Please help me resolve this issue.

  70. Chandrashekhar Patil says:

    I got following message from zerodha and my shares are not showing in my account.

    Your purchase of XXX quantity of ADANIPOWER was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2020/12/08. You can read the consequences of short delivery here.

    Please any one help on this issue.

  71. Yogesh says:

    I have Buyed 50 shares Adani Power On Thursday 03/12/2020 But it is not shown in my Holdings. and i have Received Message as short Delivery…. Then would i receive my shares back and when ?

  72. Raja says:

    Your purchase of 100 quantity of ADANIPOWER was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger…. But amount is not return or receive.. So any one help to solution?

  73. Kausthub says:

    Hello, I Bought some Shares on 3rd December 2020.
    Today on the 7th of December 2020 I Sold them But today evening I got notified that my purchase was short Delivered.
    So will I have to pay for anything or have any consequences?
    Please Help Someone

  74. Rakesh says:

    today i sell 100 shares of force motors but unable to exit by me or zerodha ,now what will happen , whether i have to pay extra amount or vice versa . Can you pl. explain me.

  75. Subhra Bikash Behera says:

    I want to ask why Mr. X is a defaulter. He was trading on any regular day and his stocks get stuck in upper circuit. Who’s the defaulter here? Why exchange and broker are blaming common man? Why Mr. X is defaulter? And not the exchange, for not making the trading system foolproof??

  76. Ram says:

    Hi, I understand you would either give money (with the difference) or shares in case, of short delivery.
    Assuming there is no holidays/weekends, if my seller has short delivered on the transaction day, when would I be getting the shares/money to my account ? on T+3 day or more ? what is the max date that a zerodha customer would have to wait ?

  77. Adhu says:

    Hi Nithin, When will I be notified of Short Delivery of shares ?
    E.g. lets say, on 1st January, purchased 200 shares of X company & the seller has short delivered.
    So Will I be notified (via a Email from Zerodha or sms) on 1st January itself or should I wait till 3rd of January to know if he has short delivered.
    Say, If I had been notified on 1st of January itself then I would be careful enough to not do a BTST on 2nd of January, right ?

  78. Ashok says:

    Hi Nithin sir,
    I have also same problem like above , Now I Lost all My all capital and I am in Big trouble, last two day I can’t sleep properly, As like Ahmed I had also short delivery 3000 shares of Route mobile with a price of 891. 37 as MIS ORDER. and it hit the upper circuit on the same day 28th of October. It settled in T+5 days. like 28th to 3rd November.
    I lost my all capital 631000/- and till my account in -198698.94. now I am in Big trouble. pl take proper action.

  79. Ahmed says:

    Hi Nithin,
    As I had bought 1100 shares of Route mobile with a price of 892. 96 as MIS ORDER. and it hit the upper circuit on the same day 28th of October. It settled in T+5 days. like 28th to 3rd November.

    Curious to know about the below queries.

    1. Why Zerodha is opened the. Intraday trading for only a few minutes for Route mobile.
    2. Settlement got delayed took 5 days.
    3. Where is the auction contract?
    4.: My Total loss here is 3 lakhs.
    5. All the time Route mobile is blocked only opened for some time..why?
    6. I see in the statement that route shares have been traded the next day on the 29th.
    7. Nobody had called or tried to explain my queries when I had opened tickets and asked multiple times to set up a call to clarify these doubts. For 7 days the ticked got opened. Only. I was getting some generic responses via email.Hi Nithin,
    As I had bought 1100 shares of Route mobile with a price of 892. 96 as MIS ORDER. and it hit the upper circuit on the same day 28th of October. It settled in T+5 days. like 28th to 3rd November.

    Curious to know about the below queries.

    1. Why Zerodha is opened the. Intraday trading for only a few minutes for Route mobile.
    2. Settlement got delayed took 5 days.
    3. Where is the auction contract?
    4.: My Total loss here is 3 lakhs.
    5. All the time Route mobile is blocked only opened for some time..why?
    6. I see in the statement that route shares have been traded the next day on the 29th.
    7. Nobody had called or tried to explain my queries when I had opened tickets and asked multiple times to set up a call to clarify these doubts. For 7 days the ticked got opened. Only. I was getting some generic responses via email.

  80. nishad says:

    i have purches jet airways 900 shares at price rs 40 and paid all money and daily upper circket hit now after 10 days broker says that delivery not recived now jet price is more than rs 60 what can i do

  81. Ashok says:

    Sir, My MIS Short Sale of Route Mobile Scrip 3000 share at average price 891.50 , but on 28 Oct Scrip hits upper circuit so i can’t buy back these 3000 share. now in ZERODHA statement showing message Being Margin blocked for sale Route-EQ . now what next

  82. Raghu says:

    i bought icicibank 440 ce 4 lots without having knowledge of compulsory physical delivery. I don’t have money to buy shares and i’m ready to lose my premium which i paid. what can i do now ?

  83. Avinash says:

    I didn’t do any short selling on route mobile but zerodha wasn’t able to give delivery of 200 shares of route mobile(which I was not knowing that zerodha didn’t give me delivery) and I sold those 200 shares now i got a mail that I have 200 quantities of short delivery of route, can you tell me what is my fault and why I will have to bear all losses when zerodha wasnt able to provide me those 200quantities of route mobile
    I will be in great trouble with hefty penalty, plz help I got mail today from zerodha.

    Plz help

  84. Nitin Singh says:


    I short sell 125 shares of Just Dial (MIS Order) at an average price of 553 on 20th Oct 2020.

    The stock hit the upper circuit at 606.75, therefore the system couldn’t square off my position.

    Just Dial Share:

    Closing Price: T Day(20 Oct): 599.45
    Closing Price: T+1 Day(21 Oct): 565.65 (Highest Trading price of the day: 632.45)
    Closing Price T+2 Day(22 Oct): 560.45 (Trading Price was between 549-565 during 2:00 PM – 2:45 PM)

    Zerodha has deducted 20% of T Day amount (i.e., 599.45*1.2 = 719.34) on T day.

    Today is T+3 day, I received statement about the auction transaction and it says that buying amount in Auction is 614.01 per share.
    I want to understand that how this is possible?? Coz as per the stated rule, price of share never reached at 614.01 on auction datetime(22 Oct during 2:00 PM – 2:45 PM).

    Why shares are auctioned at such higher rates??

    Could you please help!

    • Nakul says:

      Hey Nithin, when there’s a short delivery from the seller, the clearing corporation first tries to procure the securities through the auction market and give the delivery of shares to the buyer. The seller will be charged whatever amount was paid for procuring the securities in the auction market.

      Say the clearing corporation wasn’t able to purchase the securities from the auction market as well, then the trade is deemed closed out and the close out will be at the highest price prevailing in the NSE from the day of trading till the auction day or 20% above the official closing price on the auction day, whichever is higher.

      In your case, the auction buyin price would have been Rs. 614.01/share. Say the clearing corporation wasn’t able to buyin the securities in the auction market and the trade was deemed closed out then, you would have been charged Rs. 672.54/share which is 20% above the closing price on the auction day i.e., 22nd Oct (560.45+20%).

      You can go through the procedure for shortage handling as prescribed by the NSE here.

  85. Siddharth says:


    I want to know the list of stocks allowed for shorting in spot market. Is there any list of stocks mentioned in website?

    Best Regards.

  86. Vinod K says:


    I’m new to stocks . Yesterday, during trading hours, I put two limit orders and got through. But the holding is still showing 0 quantity even after 24 hours. However the money is debited from trading account, and it shows as T1:1 for one stock where I bought 1 share and T1:20 for the another stock where I bought 20 shares. I read the above article relating to short delivery, but somehow I’m not able to relate to my scenario. What action should I take? Kindly clarify. Thanks

  87. Kiwt says:

    If I convert Intraday sell to Delivery 100 shares of a stock XYZ and if already have 100 shares in Demat account do I need to buy the 100 stocks next day or is not required as these were already there in Demat account. Please clarify.

  88. aditya gupta says:

    I have bought 3 sgb march 2028 gold bond on 31 august 2020 but it has not got credited till date. Customer care says it was short sold from seller side. In how manys day it will get reflected in my account or in how many days i will get my miney back

  89. Sajid says:


    I was holding 5 Shares (CNC) of Reliance Industries on 28/08/2020 (Friday).

    30/08/2020 (Sunday) – Sell Order for 5 Shares of Reliance (AMO Order)
    31/08/2020 (Monday) – Reliance made a Gap up Opening & my 5 Shares (CNC) were Sold at the Price of 2174 each.
    31/08/2020 (Monday) – Market crash down & subsequently Reliance came down too, so i buy 5 shares (CNC) of Reliance at 2121.15.
    31/08/2020 (Monday) – Got email from Zerodha ‘Short Delivery Intimation’

    Experts can Please guide & comment if i have done error with it…

    I have been doing Trading with Zerodha since 4-5 Years & this was done many times earlier too….

    It has come to me as a Surprised ..

  90. Loganath says:

    As per this article, If the auction is happening on T+2 day for short selling, Is it allowed for the short seller to amend his short selling by purchasing the shares next day(T+1day) for settlement.

  91. Loganath says:

    Hello Nithin,

    If possible, could you please implement to push notifications in the browser on monthly expiry days to remind open F & O positions especially if the trader has short positions or provision in the settings/preferences to square off all open F & O short positions on monthly expiry days post 3.15pm automatically.

    I agree that traders has to exercise extreme caution while shorting any stocks when they don’t have it in their demat account, hope that implementation of above will help traders associated with zerodha.

  92. Vivek Bharadwaj says:

    Sold Call option Indusindbank and it got short delivery, is this applicable to stock option also?

  93. Ponkumaran R says:

    I have sell lauruslap on 1124.5 @ 28 nos in mis. But end of the day not able to buy due to price in upper circuit.not able to square off on same day. So what happened in next

  94. Adarsh Agrawal says:

    Hi Nitin/ Support Team,

    I short sell 370 shares of Unichem labs (MIS Order) at an average price of 263.1 on 3rd Aug 2020.

    The stock hit the upper circuit at 282.1, therefore the system couldn’t square off my position.

    Unichem Labs Share:

    Closing Price: T- Day: 282.1
    Closing Price: T+1 Day: 265.9 (Highest Trading price of the day: 305.1)
    Closing Price T+2 Day: 260.0 (Trading Price was between 260-263 during 2:00 PM – 2:45 PM)

    Zerodha has deducted 20% of T Day amount (i.e., 282.1*1.2 = 338.52) on T day.

    Today is T+3 day morning. I have not received any money/statement about the auction transaction yet.

    Could you please help!

  95. Chandrakant says:

    PS: Please note that I only do delivery based trading.

    I have received a notice from Zerodha, saying that my order for Stock A is short delivered.

    Appreciate if some expert can help me to understand what does short delivery mean for a buyer.

    Will I be getting the shared delivered at the settlement date or my fund back to my trading account?

    If its the fund, will I get the original amount or the current amount as per the price of Stock A?

  96. RKD says:

    I sell stock n Friday with MIS option, at 3:20 stock hit upper circuit and stock could not square off. after that I am not able to see that stock on my account and there is money deduction in my account. please guide me here

  97. vishwesh says:

    i shorted a stock(MIS “intraday”) 2days ago , some how the stock halted for a day , there was all buyers no seller even if I couldn’t make it through to be exited from my MIS order multiple time that day, so I thought as zerodha also terminates the MIS order so my order will be automatically terminated but not it didn’t get terminated automatically, mu fund is gone or what I didn’t no at all, it isn’t my fault either , please help

  98. Pallavi says:

    Sir, i had purchased 90 shares of GMRINFRA on 13/7/20, and my money also got deducted. but on 16th I am not able to see my 90 shares of GMRINFRA and my money also not returned back to me. What should i do?

  99. Chirag Jakhodia says:

    I had placed an order for shares on Monday, but due to the short sell, I didn’t receive the Shares on t+2. Now the support team says it may take upto t+5 for settlement. But if I get the shares on t+5, I will loose out on the opportunity for dividend as well as incurred heavy loss on shares as it dropped by 25%, And I was intending to get the dividend and then the loss could have break even. But now if I receive the shares, I will loose money as well as the dividend. I would need some more insights on this as I couldn’t talk to any of Zerodha’s executives due to low workforce in COVID-19

  100. Prateek says:

    Very disappointed with this service. Lost 1300rs of dividend.

  101. Bineet Dubey says:

    who is penalized ? if i buy 10 share (short selling ) and sell it T+1 days to trader B. trader B sell it T+1 Days to Trader C. trader c also sell it t+1 days.

    • Matti says:

      As long as you deliver the shares on T+2, nobody is penalised.

      • Bineet says:

        Short selling replace by Short delivery in previous question … who is penalized ,if i am buying 10 share (short delivery- may be penalty ) and sell it T+1 days to trader B. trader B sell it T+1 Days to Trader C. trader c also sell it t+1 days to D. trader D also sell it T+1 Days.

      • Bineet says:

        Previous question another condition …
        Q. 2 who is penalized ,?if i am buying 10 share from A (short delivery- may be penalty ) and sell it T+1 days to trader B. trader B is not sell. who is penalized in ( A ,i,)

  102. abhishek says:

    On 26 June I did short sale 60000 stocks of IOB and in few minutes it hit the upper circuit. The trade is not squared off and now I am worried about the consequences. As per the document document it is +-20% and some other charges. Can someone share his real experience with Zerodha.

    • abhishek says:

      In respect to the above scenario, today the market has down, does it mean i will earn something from the short sale i did on friday. Please confirm i am waiting for your response.

    • Abhishek Kumar Singh says:

      I checked with the customer care today and they told they do not have information for the same. They said settlement will be done on Wednesday. I must be gaining as per today’s market and auction was supposed to happen today. But the auction did not happen today. This may cause loss to me tomorrow. Please

    • abhishek says:

      today the IOB is again down. will i not be losing anything.

      • Sudhanshu says:

        Hi Abhishek,

        I got involved in a similar kind of situation just today (Friday), can you let me know what happened in your case.

        Sudhanshu Joshi

  103. sunil says:

    Hi ,

    I sold Adani green at price of 454 on 24th June by mistake it was short delivery as I was not using Zerodha and not aware of this excellent feature .

    Now since that day there is no buyers in this share ,all sellers . So how it will settled down on T+2. Yesterday it was closed at 440 and today it again in LC at 418 , tomorrrow as well we are expecting lower circuit .

    So please help me to understand this case ?

    Thank you

  104. Anil Patil says:

    What should be done in this case?

    As i received the short delivery email from zerodha..
    Dear A…. l
    Your purchase of 20 quantity of CREDITACC was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2020/06/25. You can read the consequences of short delivery here.

    Team Zerodha

    Zerodha Broking Ltd., 153/154, 4th Cross, Dollars Colony, JP Nagar 4th Phase, Bangalore – 560078

  105. Gaurav says:

    I bought shares in CNC of ITI limited on T… On T+2 i sold my shares in CNC and that day evening i received an email from zerodha stating that “Your purchase of 950 quantity of ITI limited was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger( in case of non-receipt of stock) by 2020/06/23”
    So my question is that
    1)When i sold my shares on T+2 that too will cause short delivery?
    2)Will i face any kind of penalty for this case… will i have to go through auction process?

    • Gaurav says:

      In this case i defaulted the person who bought from me because someone defaulted shares to me… This way the cycle will go on like this if person who buyed from me also sell at T+1. How it get settled?

  106. Guntaka Karteek Reddy says:

    What happens if i take a MIS trade and with in few minutes if the strip hits upper circuit, i can’t sell the strip at that day. What will be the consequences.
    For example if i take a stock with share price of 100 and upper circuit of 105. I made a MIS buy at 102 and in few minutes without my notice it hit the upper circuit . What will be the consequences

  107. Anil Kumar says:

    Hi, I read your complete blog but still don’t understand one thing.
    What happens if the Exchange finds no fresh sellers in the Auction market?

    Let’s suppose I sorted a stock like Ruchi Soya and it went continuous on UC for 3 to 4 months. In that case there is no seller and how exchange will settle it?

    Q-1) As there is no seller, how stock will be delivered to buyer?
    Q-2) Will exchange give cash money (20% above the closing price) to buyer and no shares will be given to buyer?

    If stock exchange gives money to buyer not the shares, is it not against the rules. As buyer has bought the shares already and he/she can make more profit than 20%.

    Please explain in detail. It will help many people. As it is really tough to understand in cases like Ruchi Soya.

  108. Deepak Singh says:

    Hello Sir,

    I have bought 20 shares of RBL bank and 10 shares of IndusInd bank on 10/06/2020 (Wednesday) . On 13/06/2020(Saturday) , I got mail from Zerodha that it’s shares got short delivery. But today (15/06/2020, Monday) on ,it is not yet credited to my account.

    Sir, Please Have a look into it ,

    warm regards,

    Deepak Singh

  109. Abhi says:

    Hello Sir,

    What happens if i have Delivery of Stocks in my Account let say today.
    And after 15 days say 25th June i sold the stocks on delivery basis.
    Again on the same day 25th June i want to purchase same stocks, then what will be the scenario?
    Is it considered Intra-day? or It is considered Delivery for different stocks?
    Bit confused Request you to help me out please!

    Thanks in advance

  110. Vignesh R says:


    I have sold one 400 shares at 21.90 but i forgot to buy at the end of the mark and balance showing as in deep negative -60000 (minus 60K) . so what will happen now .

    Before i have 15k in my trading account . what will be the minimum amount i will get

  111. Ghanshyam says:

    Hi, I have confusion, which is still not clearing, let me share in the example, what if I bought the stock on Friday (CNC) and sold as BTST on Monday? Because as I read about the blog where you mentioned that if someone does, the auction penalty can be levied up to 20% .. and the other concern is how to find out. In which shares, we can do the BTST, so that we can be safe from penalties.

    Help me big confusion is going on in my mind….!!!

  112. Selvam says:

    Dear Manoharan,

    Your purchase of 4500 quantity of SOUTHBANK was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2020/06/08. You can read the consequences of short delivery here.

    Team Zerodha

    Hi, i got a doubt on this mail i had got enough money in my account then why this mail is coming out?

  113. Kusum says:

    Hi, I have got the below message for my CNC delivery stock. This was not a BTST so please explain why this happened and why should I have 2 options here of either receiving the stocks or receive the money. I am expecting the shares and not the money. Please explain this..

    Dear Kusum,

    Your purchase of 46 quantity of KSCL was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2020/06/04. You can read the consequences of short delivery here.

    Team Zerodha

  114. Deepti says:


    I have a question, Suppose I buy 100 shares of Reliance on 28th May, 2020. I again buy 10 shares of Reliance on 2nd June, 2020 and sell all of them (100+10) on 3rd June, 2020. As the shares bought on 28th May 2020 already got delivered in my DMAT account (100 Shares), so will the Auction Penalty still be applicable on all 110 shares or just on the 10 shares bought 1 day before selling?
    Also, do we have any such penalty in case of a scenario where I sell shares today and again buy the shares of the same company tomorrow morning?

    Thanks & Regards,

  115. Shrenik Shah says:

    I bought IDFC Limited at 14.2Rs, 2000 shares on Friday 29th May 2020. Till yesterday it was showing in my holdings and today it has disappeared from my holdings. I received an email from your side pertaining to something called “Short delivery intimation” yesterday. I can see my credit has been withdrawn for the shares that I bought since the time I bought the shares on 29th May 2020, but the holding is not available since today morning. Should I be worried? Should I raise a ticket? This is the first time I have encountered such a problem.

    This was your email: Dear Shrenik,

    Your purchase of 2000 quantity of IDFC was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2020/06/03.

  116. Abhilash Gadekar says:

    Can there be a penalty if I sell a stock before settlement and add it back the same day at lower levels?

  117. Hari says:

    Hi Nithin Kamath,
    I have short delivered 150 stocks of birla corporation yesterday and I have lost all my money of 15k and I may lose more because the share price is moving up fast. I have taken all of this money from my college fees and I have to pay my college fees of 86k next month when the college reopens and I’ve lost 5k(my pocket money I saved for several months) and 15k(part of the college fees) and In the auction market I may lose more money in the auction market.Now my account is in -3k. If my family knows about it my father will beat me up. Now I am feeling suicidal and I am literally crying while writing this.please help

  118. SURESH BHAT says:

    I have a query…i have purchased 200 shares of Dr lal path lan on 22nd may and now it is showing as T 1 at my holding…can i sell these shares on 26th may… is there any risk ? if so what is that ?

    • Matti says:

      You can sell them. However, there is a risk that you don’t receive these shares on T+2 and so end up short-delivering your sale.

  119. Amrit says:

    I short sold 100 IRCTC shares at 1368.7 under MIS and stock hit upper circuit.

    what do I do now ? I have not been able to buy these shares back today ( intraday )

    HELP PLEASE 9810137308

    • Matti says:

      This stock will go to short-delivery. You will then have to buy the stock at auction and deliver as explained above.

  120. Mohankumar says:


    I bought 10 shares from Lykalabs last week. It is listed in my holdings.
    But it is listed as “LYKALABS T1:10”. Under Qty. it is showing as ‘0’.

    What happened to those 10 shares which I bought a week ago?

    • Matti says:

      Shares are settled on a T+2 basis. It takes 2 working days for the shares you purchase to hit your demat. Until then, they are shown as T1.

  121. RAMU says:


    I sold Tata shares on thursday lastweek ,

    I forgot to buy the shares equivalent

    What will be the way forward .

  122. sachin says:

    i am not able to sell my 91 sbi shares & all shares are in my demat account what to do ?how can i sell my sbi share
    thanks in advance

    • Matti says:

      What is the error you’re seeing when you’re trying to sell?

      • Sarav says:

        My client id GA3726, I had sell tata motors stock at 91.5 1500 stock on 30th April, stock hit upper circuit so unable to close t+3 days,I didn’t not receive any mail regarding for short delivery case ,I already create a ticket for this, how to check my status in auction market. Is thr any process to do from my side, amount also debited from my account on t day’s, can you check the details for my stocks is in auction or not.


    I purchased 100 shares of shriram transport finance and today is t+3 still neither funds not shares credited. please tell me asap as i could not sell the shares as well today

  124. Shubham says:

    I purchased 10shares of shriram transport finance at rate of 805. then I purchased 20shares of same @699.20rs. Now 22K rs is deducted from my account. but Only 20shares and 14k rs investment is showing now. first 10 shares is not in my portfolio account. although p&l statement and tradebook shows my 22k investment. Kindly explain me why it is happening and my money is safe or not???

  125. Raj Narayan Singh says:

    I purchased 300 shares of muthersun sumi on 20/04/2020 but they are not added in my portfolio… please refund my money.

  126. Vishal gupta says:

    Hello Sir,

    The article is very informative in all aspects, but I do have a query as stated below:-

    Suppose someone shorted 100 stocks of RIL on “T” day (due to upper circuit post his trade it was force short delivered by him). So, in case the upper circuit breaks in T+1 or T+2 day is there any remedy available to him so that he can square off his trade in the normal market and the buying leg of his trade is not pushed to the auction market. Simply speaking, can he purchase on CNC @ T+1st or T+2nd day to cover up his short delivery position and protect his trade from going to the auction market?

  127. Sai Vignesh Sivaraman says:

    I bought the stock on 13th April and I got a mail on 16th April that it is short delivered. Now its already T+4 day still I didn’t get either the stock back or the money.
    Please let me know when can I get that back. And when I am calling customer care they say me to read the blog. Now after reading I got to know I should get it back by T+3 day but still there is no sign for it.
    Please support..

  128. Ajaz Siddiqui says:

    I sold share in intraday and missed settling it by end of day. In simple term i want to know the consiquences.
    1. as trade made on friday and didnt settle do i need to but the shares on Monday to settle the same?
    2. As i am customer of zerodha will i end up doing auctions? or zerodha will settle the same by implying penalty on rs 50+gst

  129. Shahbaaz Syed says:

    I had short intraday position in GUJALKALI, and it went for auction. Zerodha deducted huge amount from my account and did not share auction note from NSE/SEBI even after requesting the transaction details of auction from NSE. My zerodha id is RS5644. I had sent multiple followups/email to zerdha.

  130. Bimlesh Kumar Ray says:

    Dear Zeodha Team ,
    I have purchased 9 shares of HDFC Bank Ltd but in my portfolio , it is showing 6 shares only.
    Why it is showing Wrong details.

    Due to this , Total Investment is being showing Wrong .
    Request you to provide the Short delivery & resolve the problem.

  131. Gourav says:


    Purchase of 141 quantity of HSCL was short delivered, but funds not credited in my ledger.

    please resolve asap.

    • Matti says:

      When did the short delivery happen? What is your account ID? We will need more details to answer queries like this. Best create a support ticket here instead of posting a comment on a public forum for such account specific queries. This isn’t a support forum.

  132. Yedla raja sekhar says:

    I took jindalsteel shares on last week tuesday but still not reflecting in my account

  133. Ashish says:

    I have purchased 40 axis bank share cnc on 07.04.2020. price 354.70 paid.
    But I got email short delivery intimation about axis bank share. Axis Bank shares remove from my dashboard and holding why? I had sufficient balance in my fund before I placed buy order then why It is short delivery? I want shares back to my account rather than money.

  134. Rahul Namdeorao Gawai says:

    Sir I have purchased 1 axis bank share cnc on dt. 07.04.2020. price 357.30 paid. .
    But I got email short delivery intimation about axis bank share. Now my axis Bank share remove and still have not received money . I have loss money

    • Matti says:

      Since you were the buyer, there is nothing to worry about. This trade will be settled by the exchange at auction and you will receive the stock or funds.

      • Nishit Shah says:

        Same here, I bought 25 Axis Bank @374 on 7th April 2020 and I received an email of short delivery. May I know, when it will be delivered to my demat account or when the auction will happen.
        When will I come to know about the stock or funds delivery?

  135. Rohit Dua says:

    Let’s say I short sold some shares and I bought the same amount of shares back at the end of the day. Now let’s say the shares that I bought do not get delivered to my account on T+2 day because the seller defaulted, I will not have enough shares in my account on T+2 which I was supposed to have. In this case, will I be penalized?

  136. Saugat Pati says:

    Sir, Today i shorted Jindal steel. I was not able to square off my position before 3:20 and after 3:20 i was not allowed to do.

    The stock price hit upper circuit @ 3:28 PM and there is short delivery of these shares. But Zerodha can square it off before 3:28 in which case there will be no case of short delivery.

    Because of the mistake of Zerodha i ma staring at unlimited losses. Please tell who will bear these losses and
    please do something so that i will be able to square off my position in the morning itself instead the exchange doing auction.

    Please help me, sir.


    • Matti says:

      Saugat, the onus of squaring off positions is on you. If we are unable to square-off the position, it will be because of a lack of liquidity or the stock not trading owing to circuits.

    • Saif says:

      Bro.. how much loss you faced? I’m in same situation..

  137. Raj says:

    On 26th march expiry,I did not square off (buy back)my IBUL 80 CE sold at Rs 26. Ibul closed at Rs 93 at march expiry.
    About 1 lakh 37 thousand was deducted from my account as margin for physical delivery.
    However today is 3 April,almost a week has gone but I did not get my settlement.
    As mentioned above auction happens within T+2 days.Where is my money?

  138. Faiyaz jaliwala says:

    Dear Nithin

    I have a very simple question…..How are profits / losses in the short delivery / auction / close out …to be treated for tax
    Is it a STCG / Loss or business profit / Loss or speculation .

    Also if I have sold Reliance at Rs. 800 and failed to deliver and my broker is debited at Rs. 780 on T+1 as valuation debit and
    auction takes place at Rs. 750 on T+2 …then Rs. 30 ( 780 – 750 ) will go to the investor protection fund Yes ..but what about the
    Rs. 20 ( 800 – 780 ) difference the broker makes on my short delivery …should i not receive that credit

  139. SDP says:

    I have couple of units of SGB OCT25IV bought in secondary market on 18 Mar 2020. These are not delivered and neither is the cash returned to account. Where are we stuck?

    • SDP says:

      Ive already created a ticket etc. but not relief. So, pls dont respond by saying create a ticket.

      • Matti says:

        I see that an agent has already responded to your ticket. We’re working with the exchange to have this trade settled.

        • SDP says:

          Thanks, but the agent happily closes the ticket, blaming the exchange. Please note my money is deducted and shares not delivered. So, issue still persists, 2 weeks on and still waiting, getting frustrated with your agent closing the ticket repeatedly.

  140. Maheswara says:

    I had brought 269 shares of TATAMOTORS on 18th March, 2020 and received a mail that it was short delivered and that I would receive either stocks or the corresponding amount by 23rd March, 2020. But, I haven’t received wither the stock or money.
    I’ve raised support ticket (20200325235803) for the same, but, no response so far..
    Kindly act upon it ASAP.

  141. kamleshwar says:

    I had bought 30 SHARES for MOTHERSON SUMI ON 18-03-2020 and received a mail that it was Short delivered and that I would receive either the stocks or corresponding amount within three days. But I haven’t received either the stock or money. How do I proceed from here

  142. Prashasti Shankar says:

    Hi, I have not received the shared bought 5 days before, neither I have received a refund.
    Pls update since I had received a message on Friday that my shares are short delivered and you will receive refund. But by when ?

  143. Jerry says:

    I had bought stocks for maruti and received a mail that it was Short delivered and that I would receive either the stocks or corresponding amount within three days. But I haven’t received either the stock or money. How do I proceed from here

  144. Aman says:

    Sir, what would happend, if i short sell a stock and suddenly sebi imposed halt due to lower cicuit hit, in that case would i have to face auction penalty?

  145. Hariharan says:

    I had brouht GAIL after T+2 / 3 days i got a mail from zerodha that short delivery has happened and now today 23rd Mar the shares are not visible in my Holdings…
    May i know when will i receive the money???

  146. Sri says:

    Got 5 of these messages on one day – never faced this problem before… Is this specific to Zerodha ? I bought for delivery, not trading.
    “Your purchase of XXXXX was short delivered. You will not be able to see/sell these stocks on Kite tomorrow. You will either receive the shares to your demat account or the funds credited to your ledger by the end of 2020/03/23.

  147. Kamlesh says:

    What happens if I bought stocks on Monday in CNC and sell on Wednesday? Are these still considered short selling or would be settled on closing as I suppose to get the delivery on T+2.

  148. Srinivas says:


    Will there be a Risk of “Short Delivery” for Non-MIS/only CNC equities like (HEG and GRAPHITE etc)


  149. DHANRAJ JAT says:

    same mail received when i bought 0ne share of muthoot saying You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2020/03/20. You can read the consequences of short delivery.please clarify what to do

  150. Thirupal says:

    I have bought 32 ITC Shares but not delivered in my Dmat account
    I have received mail from zerodha I.e short delivery. And when was deliveing above shares in my Dmat account. Please settle the transaction early

  151. Dilip Tahiliani says:

    I have received short delivery in 6 transactions on 18-Mar-2020.

    Ceat – 6 shares
    Havells – 8 shares
    ICICI Bank – 12 shares
    Marico – 16 shares
    Muthoot Finance – 7 shares
    TVS Motors – 11 shares

    Is this acceptable? Is this a Zerodha problem? Will I be intimated when the shares are credited to my demat account or if the amount is credited?

  152. mohammad Ehtesham khan says:

    Dear sir,
    I have received below mail but still i didn’t understand please clarify

    Your purchase of 270 quantity of YESBANK-EQ was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2020/03/20. You can read the consequences of short delivery

  153. ARUNA says:

    Dear Sir,
    I have received the above mail
    ‘your purchase of 9000 quantity of YESBANK-EQ was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 2020/03/20. You can read the consequences of short delivery here.’
    I put sufficient amount in my account. & NSE circular says, Auction settlement trade & settlement date as 19/03 & 20/03 respectively. I put order on 16/03 & it has to be credited on 18th Eve.
    Please reply

  154. Pinky S says:

    on 18th I sold HDFC AMC under MIS for an average price of 2302, after 0245 I tried to place buy order but all the orders went into open>pending validation state and i was also not able to convert my position to CNC from MIS, I was assuming in there is a technical glitch at least Zerodha would square off at the end of the day but to my surprise, the position was left open.
    On 19th Morning I was shocked to see that Zerodha has liquidated 38 shares of HDFC AMC from my Demat causing me a loss of 38k, you sold my 38 shares which were 3300 per share at 2300. Now my question is how can brokerage firm take out shares from Demat unless i place a CNC order, why these shares did not go for auction?

  155. Satya says:

    I think people should stop using Zerodha. For some reason system has become very fragile. Charts don’t appear. Orders are getting delayed, which is causing unexpected trades. I have even experienced short delivery due to this issue.

  156. kavit says:

    On 18th march, i have shorted bajajfinserv and maruti under MIS position but did not squared off in intraday due to order pending issue. Now, both sell position goes into settlement at exchange. Let’s take scenario, if both stock increases by 20% in T+3 days then i will be in huge loss. Can i buy both stocks in CNC today to minimize impact of stock price change in T+3 days?….Please reply on priority. Thanks

  157. Sahana says:

    Hi …I did a short sell in MIS today and tried squaring off before time but it couldn’t due to some technical glitches and now it has been short delivered . Please help

  158. Prateek says:

    I had short sell indoco yesterday. The stock didn’t square by the end of the day and now my free cash is reduced by whopping 60%. What is the issue? Can someone please help me.

  159. Pure Minds and Noble Thoughts says:

    Excellent Article.

    Nice to read.


  160. Milind Brahme says:

    I was intrested in effects of this before 2 days of expiry in the market. Do the options trade at discount because pepole are in hurry to square off positions. Can anyone please share the experience.

  161. Joshua Nadar says:

    Hi Zerodha team,

    I placed a couple of short sell order of HINDCOPPER (480 shares@48,48.10 &48.50) on 2nd Jan 2020, which later reached its upper circuit and was not trade-able for the rest of the day. I see that its trading today(T+2) at 44.55 per share. what should i expect in this case??? please help….


  162. Adnan says:

    Dear Nitin & Zerodha team,
    Please clarify on the below scenario :

    X no of shares bought on 20th Nov in order to be eligible for buy back with record date of 22nd Nov.
    However instead of crediting shares in the d-mat account , mail comes for Short delivery.

    So buyer loose out on buy back due to in-eligibility plus fall in price in both trading sessions ie on 21st & 22nd Nov.

    What would be the remedy and solution from either broker or regulator side since there is no fault from buyer.


    • Nakul says:

      In case of shares traded on cum basis, short deliveries if any will be directly closed out (cash-settled) at the highest price prevailing in the exchange from the day of trading till the day of closing out or 10% above the official closing price on the auction day, whichever is higher, or as declared from time to time. You can refer to this circular for more information.

  163. Kay says:

    Hey Nithin,
    The article mentions a point that, when the client doesn’t have the sufficient funds in the account to buy shares, and if the broker let’s the client buy those shares, then it’s the brokers obligation to pay for the purchase to the exchange, and later the broker can recover the money from the client with intrest, do you think a similar option is available for the client to sell shares that are not in client’s account and when the exchange wants those shares the broker delivers these to the exchange on behalf of the client and the client can then buy back these shares for the broker later on, and also pay an interest

  164. Chandrakant says:

    Dear Sir ,
    I Bought 1000 Shares of Raymond with short sell with avg price Rs 746 on 8th of Nov 2019 . Since Raymond Hits upper circuit i.e Rs 808 and am unable to buy stock, so as per terms my trade enters into auction market.

    Day T-1 : Stocks hits 751
    Day T-2 : Stocks hits 791
    Day T-3 : Stocks hits 743

    My Opening balance was 38.53k on 8th of Nov. on same trading day i sold my other stock (Mother&Sumi) i.e 60k Released amount. May i know at what price my stock bought since prices hits lower than what price i bought on 1st day(746), which supposed to give me profit of 746-743 = 3k (for 1000 stock). Kindly provide me breakdown how auction market sets marigin and where my money goes for “mother and sumi” sold prices (i.e 60k). also i have conversation with one of your representative which told me you should earn profit only if stock hits below your prices on T-3 day which it is and if hits above that then loss .

    Please adhere to policy that your mentioning on blog .which i needed to know is how my account debited loss of 63k in auction market even after stock hits below my average prices for Rs 3.

    Client Code : MM8451

  165. AMIT says:


  166. Akhil Jain says:

    Mr. Kamath,

    Your article is very informative. Thanks. In the last case you mention where there is no delivery of shares as the exchange has found no fresh sellers, the penalty (20%above the closing price on auction day) of Rs16000 (960-800)*100 that has to be paid by the seller, does it go to the buyer to protect him from upward fluctuation in price of shares for shares not delivered or the broker?

  167. Venu says:

    What happens if, on Auction day, the price of the stock comes down considerably? Can a client benefit in an Auction market?

    Can you please simplify the explanation provided against above question?

    Will the trader of zerodha benefit, if the price goes down? And would that difference amount be transferred to the trader? And what do you mean by Investor Protection Fund?

    • AMIT says:


  168. Sameer says:

    Same here raymond.. Bro..

  169. RAVICHANDRAN BR says:


    Today I shorted Raymond in MIS mode. But Raymond reached Upper Circuit. So I have short delivery of 240 Stocks.
    I learned that Zerodha will get the 240 Raymond stocks from auction market after T+2 days and deliver it to buyer.

    But my question is – why do you want to go Auction Market to buy the shares? You can buy in the market only right? which opens at 9.15 AM and closes at 3.30 PM. If you are not able to buy in the open market after T+2 days then only you can go to auction market.

    And also you are not buying in auction at a fair price.You are saying it could be 20% higher than the CMP. Most corrupt thing is – only brokers(who seem like a Mafia to me) are allowed. Why cant you allow the traders as well if it is auction?

    Who uses Investor Protection Fund? How much is their currently in Investor Protection fund?

  170. Anirban Chatterjee says:

    I have been a victim of short delivery. Bought DHFL @17.75 but didn’t received the delivery. After my purchase its on UC and don’t know when the circuit will be open. Hence missed significant profit even after paying legitimate amount . Not sure what regulator does and keep lot of loopholes in the system.

  171. Sushma says:


    Despite best efforts, I was not able to close 2 ITM call contracts on October 31st. Whenever I would place an order, the bid-ask values would change immediately and my order would not get filled. Now my account has been debited by more than 2.5 lakhs and despite raising a ticket, I have not received explanation about the computation logic of this penalty. I am writing here to draw Zerodha’s attention on this issue and help in explaining the reason for this high penalty amount in accordance with exchange rules and policies.


  172. Akanksha says:

    I have bought 200 shares of BAJAJ Consumer on 16 oct. Then i have sold 100 quantity on 18th October. Today i saw a mail from zerodha that i have not received credit of 200 shares on my demat account due to short delivery. Now what should I do to give delivery of 100 shares that i have sold on 18th Oct. I dont want to pay any penalty as I am not at fault here. Zerodha allowed me to sell stocks on 18th . All the trades were done in CNC segment. I dont have access to BTST segment.

    • Nakul says:

      The settlement for the 200 shares bought on 16/10/2019 will be today (T+3). In case you have got the delivery after the auction, there won’t be any short penalty for your sale transaction.

  173. sonu says:

    Sir,what happens if i short sell in MIS and then the stock hit upper circuit,Do i have to pay the penalty?

    • Matti says:

      Yes, if you short sell and aren’t able to cover the short, you’re liable to pay the short delivery penalty.

  174. NitinM says:

    Observed, I bought 50 shares on 4/9/19 (cash), which is not yet credited to my account. Normally, when anyone sells, you block those many shares and if I buy (you block the amount) then how such situation arise. I can understand the situation if I am doing trading future and options but, that’s not the case. Request to look into and resolve the issue on priority

    • NitinM says:

      Sorry, I missed to specify the name of share
      Observed, I bought 50 RBL shares on 4/9/19 (cash), which is not yet credited to my account. Normally, when anyone sells, you block those many shares and if I buy (you block the amount) then how such situation arise. I can understand the situation if I am doing trading in future and options but, that’s not the case. Request to look into the issue and resolve it on priority

      • Matti says:

        While we block stocks when someone sells and funds when someone buys, there is no guarantee that the person you’re buying from is also a Zerodha customer. In case a trader sells stocks and isn’t able to deliver them for whatever reason, this trade results in short delivery, as explained above. As a buyer, this will result in no loss for you, as you’ll either receive funds or shares after an auction is done as explained above.

  175. Ravi says:

    can you do short selling when you are delivery ( not intrday, i know short is available with intraday). How about short selling with delivery. thanking you in advance.

  176. Santanu Pradhan says:

    I bought trhee stocks on friday(28th june, 2019).But i can see them neither in my position nor in my holdings on the very next day(29th june,2019).

    • Matti says:

      You’ll need to send your PoA in order to see the stocks on the trading platform. In the meanwhile, you can still see the stocks you’ve bought on Console.

  177. A.Rajaraman says:

    Your last para you say exchange is unable to get share and penalise the seller. What benefit the buyer gets to compensate loss of opportunity is not explained. Does he get only the money back or something more?

  178. Ashwani Kumar Rai says:

    i had face short delivery ,i got my shares (thank you for that ).

    sir what will exchange do if the person who sold the stock failed or unable to pay the penality coz he/she don’t have money and the stock price is now much much high now .

  179. Laxmi Shaw says:

    I have not received the delivery of reliance share on T+2 day. I can’t see it anywhere. Even amount is also not visible. Even I can’t see as T+3. What should I do. Please reply with email.

    • Matti says:

      Hey Laxmi, have you submitted the PoA for your account? You wouldn’t be able to see shares on the trading platform without PoA.

  180. Vaman says:

    Although your app won’t allow buying shares if there is no sufficient amount in the account. Then how come the share falls into short delivery!!

    For Ex: I have added X amount before buying Y shares. Now in the app it shows X amount in PAYIN section. Then i place buy Y shares which is equivalent to X amount.
    After two days i receive a mail stating that purchase is short delivered..

    Will you please this to me?

    • Nakul says:

      Short delivery happens when the seller of the stock fails to deliver the shares on T+2 day. The person who sold the shares to you could be anyone in the market and if he fails to deliver the shares, you will not receive the shares. The exchange will conduct an auction in such a case to give delivery to the buyer. The auction mechanism is explained above.

  181. Pratik says:

    If the Auction seller fails to give delivery in the auction market then what are the penalty charges.

  182. Aman says:

    I have bought 32 shares of ruchira papers on8april.. On 9 it credited to my account but on 10 is debited… what to do

  183. Prabin Ojha says:

    I brought 35000 shares of UVSL on friday morning and i was trying to sell those shares since friday but i am not able to sell the shares till today is showing “Insuffecient holding or you are placing a short sell order using CNC.Try placing MIS/BO/Co”.Please help me

  184. equity blues says:

    Thanks for the information and posts

  185. Mohammadarif momin says:

    PD0282 is my ID. I bought 100 shares of torrent power for intraday on 22nd Feb…
    I have not sold it that day.
    Zeroda also not sold during market hours… Zeroda sold 200 shares after market hours 15.53pm…. thus it was mistake of zeroda… I have to bear loss in auction process…
    What is my fault….
    I also raised query at support portal but still not got any sensible reply.
    Pls do something….

  186. prathamesh ak says:

    sir why short selling is not allowed for positional delivery ??

  187. Shahid says:

    I short sold 500 shares of yesbank on Thursday at 206. I didn’t cover and it went into an auction. On Monday and Tuesday the prices fluctuated 198-192. However the broker is telling me I won’t get any profit and said 350 was deducted from my demat. I havent even got the contract note. Could you please explain this how it works in my case

    • Matti says:

      Hmmm… The chances of you making a profit here are low. However, Rs. 350 per stock at auction for a liquid stock like Yes Bank seems too steep. Please check with your broker and ask for an auction contract note. It is mandatory to send one in case of auction.

  188. Vaibhav says:

    Hi i have did BTST trade many times but i just came to know about short delivery
    But what happens if i buy 100 shares of A on monday and sells all 100 shares on Tuesday and i withdraw my all balance on Wednesday and after if i get my funds of even share i sold on tuesday and after i came to know that there was short delivery. As iif i have zero funds and zero shares with me now how the penalty will be settled? Will it be settled when ever i will add money or how it is?

  189. Shalini says:

    I bought 120 shares of ELECTROSTEEL STEELS LTD on 25th and 26/09/2018- on Kite app. Now all the 120 shares not shown in my holding list. kindly help and fix this issue.

    Thank you.


  190. Sanjay Kumar says:

    Hello Sir,
    1. Can i buy ACC in CNC and sell it same day before 3.20 PM if rate will increase ?
    2. Can i buy ACC in CNC today and sell it tomorrow if rate will increase ?
    or i will be victim of short sell ?

  191. mayur umathe says:

    hello nitin ,
    thanks for the all the patience of answering all the queries just want to give suggestion here
    After going through all the “Auction Saga” why can’t broker auction these short delivered stocks instead of exchange at some fair tariffs or % so it will nice to both the clients and save huge amount of loss to any trader
    i don’t know if zerodha is having any protocol for this but if u have plz share .
    It will definitely differentiate zerodha from other players & will provide the edge


  192. Rushikesh says:

    Hi Zerodha,

    In my portfolio share was shown but after 2-3 days now they are not showing 110 shares out of 136. not sure whats the issue. any help will be appreciated my client id is LD9414

  193. Cholarajan M says:

    Sir ,what will happen to the stock i bought after a short?
    Means while i am buying a stock for which i sold,some one has to sell me at point of my exit or buying.but as a intraday trader,i am not holding the stock?
    So what happens to that particular stock which i bought?
    Can you explain please?

  194. shakti Sahoo says:

    Nicely Explained Zerodha Team. Thx for your Explanation

  195. harsh chudasama says:

    lets say,
    i placed an order for sell. I’m going short on reliance , selling 100 stocks at 1000 rs,
    it goes down as expected,
    i booked partial profit by selling 50 stocks.
    I’m still short on 50 and I’m watching it drop. Suddenly it dropped to 850, hitting lower circuit.
    I placed MIS order. What happens now. Will i be able to square off? will be able to buy it back around 850 to book profit on remaining 50 stocks?

    • Matti says:

      If the stock is at lower circuit, that means that there are no buyers available. You would still be able to buy since there are sellers available.

  196. KM SUGAR says:

    KM SUGAR My Purchase Quantity short Saw In Zerotha Online In My Id Pl. Check And Reply Urgent.

  197. vinod kumar says:

    I bought 2250 share in 24-8-18 Thursday and sell 2250 on 27-8-2018 monday I got amessage there is 18 short share what willl i have to do

  198. Kunal says:

    So, basically what I read and understood is that BTST should be done on stocks with high volume stocks.
    Also, short delivery won’t happen with clients who are trading through Zerodha. Right?

  199. ABUNA C SANKER says:

    I purchased 25 shares of PVR DETAILS AS BELOW
    PVR 13-07-2018 1200.00 5Nos. 6000
    PVR 13-07-2018 1224.00 5Nos. 6120
    PVR 13-07-2018 1232.00 5Nos. 6160
    PVR 13-07-2018 1242.75 5Nos. 6213.75
    PVR 26-07-2018 1113.00 5Nos. 5565
    EXPECTING YOUR RESPONSE VIA [email protected]

    [email protected]

  200. Rakesh Singh says:

    I purchased 200 shares of BanarBead and on T+2 i got message from zerodha about the short Delivery , when i call the customer support (Anoop) on T+3 they said it will done by today by 6PM and dont worry ,their will no loss and I didn’t rx fund or share by T+3 . On T+4 i can see share and running with loss of approx 12% and i called today then customer Care ( Pratap) says- this is not problem of Zerodha , its exhange issue. That’s means i have to bear the loss which i could have avoided by selling on time when i was in profit .

    Mr Nitin in your first comment in this post you say don’t worry about Short delivery unless it BTST which was not my case . I think your team need to move that statement down or remove .

  201. Dinesh Parikh says:

    should not broker give auction bill with contract note as per SEBI format?

  202. Kushagra Panwar says:

    $22Bn Short on Europea Market, by Bridgewater..
    Kindly enlighten with the concept of Short Sell in International Markets.

  203. vikas sinha says:

    No sellers at UC is over simplification, UC can be hit in a day, multiple times, so price can fall and rise, and there can be sellers at the UC also. But, yes true for 90% of cases, when UC is hit the share trading typically freezes, no sellers can be found.

  204. venu says:

    hello sir

    i placed sell order (GATI) in day trading 118.4 and it closed at higher price 120.90 (20%) and i am unable to exit the position end of the day…. what happens …… please gv me ans

  205. AR says:

    I have purchased (CNC) 25 shares of company X on 13/04/2018. Today, on 17/04/2018, my holding is still being shown as T1:25, Qty:0. I have placed a sell order and the order has been executed.
    So should i suppose that the shares have actually been transferred to my demat account and it is just a bug in Kite that has made incorrect display?

  206. Rushabh Dugad says:

    Hello Sir,
    When you say ‘members of the exchange’ participate in the auction process, where do they exactly get the shares from?

  207. archana says:

    hi nitin,
    plz answer this and dont post a link as ur customer care ppl are also not clear.
    suppose i bought one lot ob bank nifty say at 24800 fut in mis and at the end f the day i converted it to cnc.
    now when next day if i sell it its mis or cnc?
    if i sell them after 3 days at 24900 then what all charges will b deducted?
    plz reply? i am already facing issue because of other future contract where out of 21000 rs profit 15000 rs got deducted on the name of brokerage/stt/and sebi charges. ur calculator contract note doesnt shw this much charges?
    even after having margins my option orders got squared off when i was converting it to cnc.
    coupla of times i placed limit order and it got executed at CMP, it spe matters in options.
    in last few days i am facing huge losses b/c of zerodha and already opting for other demat acc now but is that going to recover my losses????

    • Matti says:

      Hey Archana. The brokerage+taxes per lot for this trade-pair would come up to about Rs. 200 per lot (brokerage is constant at Rs. 40, only the taxes would change). The remaining amount is unrealised profit/loss for the postion left open in the same contract.

  208. ElanSha says:

    What is the purpose of giving a link to the article instead of answering clearly the issue. Your customer care doesn’t even pick up the call. Your may be a good one but it is very bad when it comes to customer relationship.

    • Matti says:

      Hey Elan, the idea is to let you know that your question has already been answered. Since a lot of the questions we get are repetitive, it seemed a good idea to pre-answer the most frequently asked questions that are of a generic nature here, thus enabling the support desk to answer other questions more efficiently.

  209. Umamaheswar says:

    Why only clearing members can participate in auction of short delivery?
    Why members will show interest to sell short delivered stocks less than the current market price?
    Why the name buy in auction actually?

  210. hemant waghmare says:

    Mr nitin i had bought 100 shares of geetanjali gems 2-3days back,,,today i when i opend mine demat account,,,its not showing any records of geetanjali gems,,,
    had it vanished,,had i lost all of geetanjali gems shares??,,or zerodha had taken it all…
    i checked mail,,,,plz help

  211. Nikhil Tendulkar says:

    Hello Mr. Kamath,

    I sold shares of Sunpharma at 562.10 which I don’t hold, happened by mistake. And since I was unaware about Short Delivery/Short sell, I didn’t buy them back before market closing. I spoke to my dealer and he told me that NSE will buyback on T+3 and etc as you have mentioned in your post.

    But what will happen to me in this case as I am the seller who didn’t deliver. Will I be able to benefit in any way if the price goes down as it was a short sell. Sunpharma closed at Rs 535.35 today, So I need to understand where do I stand in this case and what are the odds of my benefit in this trade. Please reply as soon as possible, I have also mentioned my email address. I read the whole post and it was helpful but I was only able to grasp little. I will be more than obliged if you can simplify it for me

    Nikhil Tendulkar

  212. Anuj says:


    I have buy 100 shares in 351 and now current price 300 and i got mail regarding short delivered. if exchange credit fund, what amount i receive.

    Can someone explain.


  213. Rakhi De says:

    I bought 30 share of URJA GLOBAL and sold same day(on 07.02.2018) but ZERODHA debit 30 share from demat account and 30 shown T1 holding.
    Can anyone explain it.

  214. VIJAYAKUMAR N L says:

    I bought 36 share on ELECTROSTEEL STEELS LTD-INE481K01013 on Kite app . But that 36 shares not shown in my holding list. kindly help and fix this issue

  215. Khalid says:

    I bought 1000 shares of ITC using the funds I had in my trading account. When the prices started going high and I made a profit of 2k and wanted to sell the shares; it continuously got rejected claiming the margin funding is required. I didn’t get it, if this is the case how do i make profit in the market?? Do i have to keep additional funds in the market to sell the stocks too. As a result of this, the prices again went down and I experienced loss. Very bad experience! How will I earn then??

  216. Bhavik says:

    If i bought share on monday then can i sell the share on tuesday ?
    Because i get a delivery of share on Wednesday then without delivery of share, is it possible to sell the share on next day as cnc order?

  217. sanjiv kumar says:

    i hv 550 shares of XYZ-BE company on 22.12.17 in my demat account and i sold all shares @Rs 25.4 on 22.12.17 and after some time on the same day i.e. 22.12.17 again bought @Rs 25.5
    being holiday on 23,24,25 i found 550 shares in my account as showing T1 on 26.12.17
    now on 27.12.17 i got a message that your shares are short delivered and amount will be credited in your account.
    But i was not willing to sell the shares then without my permission how it is possible?

    • Matti says:

      Sanjiv, the seller, when you buy, has 2 days to deliver the stocks to you. If they don’t, it’s considered short delivery. There is nothing the broker can do in such cases. This is the normal mechanism.

      • sanjiv kumar says:

        Actually I bought these shares on 07.11.17 and on 22.12.17 these were in my demat account.

        Also these were in my account as T1 in 26.12.17

  218. Milan sarkar says:

    Zerodha send me a mail that the shares that i purchased was short delivered also telling me that the shares will be delivered to me on 24th november 2017 or I will get the credit in my ledger, however nothing happened on 24th November 2017. I waited entire day nothing happened. Please explain?

  219. mahesh says:

    Can you someone answer please???

    mahesh says:
    November 8, 2017 at 12:43 pm

    Dear sir thanks for the nice explanation.
    please clarify me on this.
    1)What is the point of delivery of shares required in intraday trading? It is understood that whoever shorted that day needs to buy by end of the day but due to upper circuit or any other reason could not do it so. lets say X shorted and Y bought it. by end of the day X could not bought in the market. So what happens to Y if he tries to sell before?
    2)There won’t be any delivery of shares in intraday trading if done through MIS and there is need of delivery of shares if done through CNC. is it correct?
    3)Whoever is buying in intraday trade MIS, they can sell it whenever they want irrespective of other person shorted it?


    Matti says:
    November 8, 2017 at 9:48 pm

    1. X would short deliver on T+2 so Y wouldn’t get any shares on T+2. So even Y would short deliver and both would end up in an auction.
    2. MIS/CNC don’t matter. If you buy and sell same day, no delivery is expected.
    3. Yes, you can buy & sell at any time during the same day using the MIS product type.

    mahesh says:
    November 8, 2017 at 11:14 pm

    Thanks for reply.
    For first one still it is not clear.
    1) Lets say in intraday trading, X1 shorted 10 shares of ABC company at 09:30AM which randomly bought by Y1. And at 09:45AM Y1 sold those 10 shares to Y2. Then Y2 sold them to Y3, and so on to Y100 by 13:00 hrs. By this time share price of ABC company touched lower circuit. And trading stopped at 14:00 hrs. In this scenario only X1 shorted shares which is not known to any of Y1,Y2,…,Y99 and they just bought it and sold it which is not shorting in same day. And also Y100 just bought it and yet to sell. As far as my understanding there is no way Y1, Y2, …., Y99 are short delivering so only X1 is doing short delivery which he needs to deliver to only Y100 through auction on T+3 day because on T+2 day auction happens.
    Is my understanding correct? If correct Y1 here or Y from your answer is not doing short delivery only X is.

    Please help me to understand…


  220. Sameer K says:


    Would like to know about the consequences of Short Selling in the following scenario:

    I already hold 1000 shares of XYZ company in my DP from last 10 days

    The today I short sell 1000 shares of same XYZ company and I was not able to buy again 1000 shares of same XYZ company at lower price.

    So will i still default and will have to face Auction & Penalty or my 1000 shares which are in my DP will be delivered.

    Please help me understand.

    Sameer K

  221. mahesh says:

    Dear sir thanks for the nice explanation.
    please clarify me on this.
    1)What is the point of delivery of shares required in intraday trading? It is understood that whoever shorted that day needs to buy by end of the day but due to upper circuit or any other reason could not do it so. lets say X shorted and Y bought it. by end of the day X could not bought in the market. So what happens to Y if he tries to sell before?
    2)There won’t be any delivery of shares in intraday trading if done through MIS and there is need of delivery of shares if done through CNC. is it correct?
    3)Whoever is buying in intraday trade MIS, they can sell it whenever they want irrespective of other person shorted it?

    • Matti says:

      1. X would short deliver on T+2 so Y wouldn’t get any shares on T+2. So even Y would short deliver and both would end up in an auction.
      2. MIS/CNC don’t matter. If you buy and sell same day, no delivery is expected.
      3. Yes, you can buy & sell at any time during the same day using the MIS product type.

      • mahesh says:

        Thanks for reply.
        For first one still it is not clear.
        1) Lets say in intraday trading, X1 shorted 10 shares of ABC company at 09:30AM which randomly bought by Y1. And at 09:45AM Y1 sold those 10 shares to Y2. Then Y2 sold them to Y3, and so on to Y100 by 13:00 hrs. By this time share price of ABC company touched lower circuit. And trading stopped at 14:00 hrs. In this scenario only X1 shorted shares which is not known to any of Y1,Y2,…,Y99 and they just bought it and sold it which is not shorting in same day. And also Y100 just bought it and yet to sell. As far as my understanding there is no way Y1, Y2, …., Y99 are short delivering so only X1 is doing short delivery which he needs to deliver to only Y100 through auction on T+3 day because on T+2 day auction happens.
        Is my understanding correct? If correct Y1 here or Y from your answer is not doing short delivery only X is.

        Please help me to understand…

  222. Bhushan saindane says:

    I had short of Banknifty 25200CE on 195 and failed to buy on expiry , can you please tell me , what will be happen

    • Zerodha Social says:

      The intrinsic value of the option at expiry is 227. So it will be bought back at 227. And 32 bucks is your loss.

  223. vivek says:

    zerodha thank u very much , it so happened that on 30th i managed to sell punjlloyd 5000 quantity @23.00 so i would be calculating the profit keeping in mind the original purchase of 20.65 or the auction purchase of 22.15, if i calculate from 20.65 than there is a profit of 11750 rupees . now will i be allowed to keep this profit or no. kindly clear the air and i wud be very very thankful to u.

  224. NIKHIL KHANNA says:

    Dear Team,
    Suppose i have holding Srei Infra 50 stock in holding. As of now share is falling on Daily basis.
    1. Can i do Intra day trading in this stock?
    2. If i do intra day trading then, does anything would happen in my holding share for long time view?

    Nikhil khanna

    • Zerodha Social says:

      Nikhil, yes, you can trade intraday. The value of your holdings will remain the same since the trades are for intraday.

  225. vivek says:

    kindly help me.on 23rd oct 2017 i purchased 5000 quantity punjlloyd [email protected],next day sold it @20.75.i was intimated it got short sold and after auction those were purchased @22.15. now suppose if i sell those at 22.15 whats my loss in this case including any penalty that the exchange may levy.kindly also tell me whether my initial purchase trade @20.65 would be honoured or would it be deemed as null and void . thanking you in anticipation.

    • Zerodha Social says:

      Vivek, in this case, Rs 5000*1.40 will be the penalty and will go to the exchange. Your initial purchase @20.65 will be delivered to you on T+3.

      • vivek says:

        zerodha thank u very much , it so happened that on 30th i managed to sell punjlloyd 5000 quantity @23.00 so i would be calculating the profit keeping in mind the original purchase of 20.65 or the auction purchase of 22.15, if i calculate from 20.65 than there is a profit of 11750 rupees . now will i be allowed to keep this profit or no. kindly clear the air and i wud be very very thankful to u.

      • Naga Rakesh E says:

        Hi Nitin,

        I got a mail form Zerodha on 24th October 2017 regarding “Short delivered”. Till today 30th I haven’t received any sort of units or money to my account.
        I have called to customer care several time. But the response was “EOD” End of the day I will be receiving my units.
        But it was not happened.
        I was totally unhappy with what is happening.
        Could you please have a look and help me on this.

        Thanks & Regards,
        Naga Rakesh E

  226. Amar says:

    Hello Team,

    What will happen if do SHORT SELL in intraday trading using Bracket Order under MIS with Stop loss as 5 rupees and Target as 5/-?

    example – Stock A ; no. of shares = 100 ; sell price = 50/-, buy price = 45/- ;

    Scenario 1 : Stock buy price is Success ; Will I get 500/- ?
    Scenario 2 : Stock buy price is failed ; will I loose 500/- ?

    In simple terms, when I use the stop loss option ; is there a chance of missing it and reaching upper circuit?


  227. Anish K Jain says:

    i Shorted a Stock today and before i could close my position, the stock hit the upper circuit and so i couldn’t close my position. What if i buy back those stocks next morning itself? Will it save me from the auction?

  228. JP says:

    I shorted 1000 shares of swan energy at 158, and stock hot uc at 163.35. this moved to short delivery which will get auctioned tomorrow. stock currently trading at 154 levels. what is the maximum loss which i have to need bear once it is auctioned?
    Does it benefit if tomorrows trading price is below that i shorted?

  229. Prasun Jha says:

    This is really awesome blog …very thoroughly explained in easiest way possible…loved the blog as any other from Zerodha…amazing.
    Reason for picking this is…this happened to me last month, I ended up paying penalty, short delivered 100 shares of a stock and it hit upper circuit and it went for auction. ended up with loss of 5000/-.
    No more Short-Selling , I decided. 😀
    Thank you team. It’s enlightening. Request you to keep sending a daily mailer for individual topics so that we keep learning slowly. Regular mailers will help a lot.


  230. Madhu says:

    In case of the situation of cash settlement at close out rate, does the buyer get the highest price from the date of purchase upto date of auction or 20% whichever is higher as settlement? if so, what will be the tax treatment of the profit the buyer makes out of this process, will it be STCG or speculative income?

    • Yes, in case of cash settlement. This STCG or speculative bit is tricky. I know almost everyone shows it as STCG. But it is debatable, since delivery never was taken, hence maybe should be shown speculative. Best to consult a CA.

  231. Punita says:


    What if purchased stocks and is short delivered to me ?

    Whether I will get full amount back ?

    Also whether delivery charges will be refunded to me ?

    • Zerodha Social says:

      Punita, there will be an auction on T+3 and the exchange will try to buy these shares for you. If there are no sellers then the exchange settles it in cash on the basis of Close out Rate. Close out rate is the higher of the highest price of the stock from when you sell to the auction day or 20% above the closing price, on the auction day. This has been explained towards the end of the post, would suggest you go through it again. 🙂

  232. Venu says:

    Why does’t zerodha block selling a share in BO when it is already on upper circuit?
    I think this will make investor more safe. As mentioned , BO also places a squareoff order , but when we sell on upper circuit , No order can be placed at (uppercircuit + x rs as stoploss) and the stoploss is same as uppercircuit . Why does zerodha allow the whole BO order execute and let the client bare the penalty?

  233. Anu says:

    I bought X shares on 29th SEP and got short delivered notification email on 3rd OCT saying the credit will happen on 4th OCT. But till now the shares (200 ) were not credited .. The stock is reaching upper circuit everyday .. Will i get the same share credited ? Pls clarify

  234. Rudresh says:

    Hello Team,

    I have a query, I have done a Short Sell under BO Order type on a stock(20 qty) and it hit the upper circuit by EOD, as a result I was not able to square it off.

    As BO order is completely intraday, will the “Short Delivery” concept applies the same way.

    May I know how much penalty I have to pay.

    Thanks in Advance.

    • Zerodha Social says:

      Rudresh, yes it applies even to BO. The auction will be on T+3 day, so on T+3 evening, you will get to know.

  235. Aishani says:

    I have a doubt regarding short selling. What if I enter into a short selling intraday deal and forget to square off the deal. what would the consequences be and how do I settle the obligation? Please do reply since your reply would be really helpful.

    Thanks 🙂

    • Matti says:

      If you’re shorting a stock, you’d necessarily have to choose the MIS product type. All MIS positions are squared off at 3:20 in the afternoon. If you forget squaring off, the team here would do it for you. (You wouldn’t be able to use CNC if the stock isn’t in your holdings)

  236. Keerti says:

    Hello Nitin,

    Kindly clarify the following :
    Suppose i place an order today for buying 100 shares of reliance but as of now i don’t have money in my account.
    Will I be called defaulter ?
    If not , How much time do I have to put money in my account ?

  237. pravinkumar says:

    why short sell is not possible for iti ltd i have fund in my accounts but order cant placed

  238. raja says:

    Dear Nithin,

    1- For example, if I purchase and sell CNC order within T+2 days (T or T+1 or on T+2) to someone, unless the seller become default to me, I will not become default to the buyer.
    Am I right?
    2- As per previous communications if I am right, in zerodha we can sell MIS order, thereafter can buy and balance the short in cash market. Right?

    Thank you for varsity and z-connect.

  239. Mudit Narang says:

    What if I buy share as a CNC and sell it on same day at higher price. And later in the day I buy same quantity again as a CNC product.

  240. Deepak says:

    I sold 1780 shares of religare under MIS and couldnt square off due to upper circuit.. It took the amount of 71K from my account… This is short delivery default.. How much will be the penalty in Auction? Will I need to pay more than my capital.? I am worried because my account value is showing -2.9 lakhs.. I just traded for 71K…. Please help….

  241. Saurav kumar says:

    Well explained.
    Hat’s off

  242. Eshwar Pawar says:

    Nithin Kamath ji, I must say you have got a very nice way of explaining this complex matter. I really appreciate it.

  243. Imran says:

    Now this cannot happen with your broker as Zerodha is because we let you buy/sell equities with 2 product codes: MIS (for Intraday) and CNC (for Delivery). All Intraday trades (bought/sold with the product code MIS) would automatically get squared off at 3:20 pm ensuring that even if you have not squared it off yourself the system does it for you.

    There is a big fraud in this statement. You must have to mention that for doing this you will charge Rs.23.6 per scrip.
    So suppose i just have one share of xyz company @Rs 10 and one share of abc company @Rs 5, then Zerodha will charge 23.6 x 2 = 47.2 for doing this great favor. And most interesting part is that there is no bill for that, you will never ever know this until you see your trade book and really understand whats there in the trade book.

    They must mention it in the contract notes, or they should send a separate mail with the details of this charge but they do not do as they are doing a fraud. We need to check with SEBI whether this is really allowed to charge customer without their knowledge (bill) ?

    • Imran, DP charges is an industry norm. We charge among the lowest, you can compare with all brokerages. You would have signed DP charges doc when opening an account.

      • Imran says:

        Well Nitin, I am not talking about the DP charges. You are charging call and support charges without any call.
        1) you have mentioned here that zerodha do auto square off for MIS order but you have not mentioned that you charge over 20 rs per scrip for that.
        2) you charge this amount in the name of call and support charges but there is no call for this and there is no manual work for this.
        3) I do not get any info that you charge this amount if I don’t see my trade book. Ideally whatever you charge you need to provide me a bill for it. If I buy a share of few paise even that is reflected in the contract notes then why not this amount.
        4) this amount is not even shown in the profit and loss page.

        First you need to mention that you charge this amount for your automatic square off of MIS orders. Second you need to provide a bill for it.


        • 1. We have in multiple places, including here: All orders executed through our dealer terminals are charged Rs 20 extra.
          2. There is an additional overhead for us and hence we charge. You can avoid this by squaring off yourself.
          3. Go to and click on ledger under reports. All additional charges show up there.
          4. P&L page not showing, can you email [email protected], we will check that out.

          • Imran says:

            Thanks for the Answers, Yes now i see that its mentioned at But its not easy to go thru all the links zerodha have. So ideally if its reflected in my P&L page, i can look for it and i can find out that i can do a squareoff myself or if i can get a bill of this in my email i can know about it. But currently there is no bill and no info in P&L details. This does not looks good.
            I will send a mail regarding this to [email protected], please take care of that.

            Other then this issue i have no complaints from zerodha, and you are doing a great job with good services.


      • Ranjan J says:

        Hello Nitin,
        Could you please let me know on this:
        If I have short sold a stock today (MIS) but there were no sellers afterwards and I am stuck with this short position. Now, today the stock closed at upper circuit of 20%.
        QUES: I wanted to know if the stock’s upper circuit/band gets revised the next day to lower limit, say 15% or 10% or the limit stays at 20%.
        I am worried because my position will result in a bad delivery and exchange will go to auction on T+3 and if the stock keeps rising, I am gonna end up with a heavy loss.

      • Abdul Samad says:

        @Nitin ,

        Your team has been deducting a BSE Margin(23.6) for the past 1 and half month i have raised countless tickets on this issue ,every day regardless of trade done or not can you explain why deduction , i have a demat with another broker and they are always transparent

        why is there always this hidden angle in case of Zerodha ??

    • Abdul Samad says:

      @Nitin ,

      Your team has been deducting a BSE Margin(23.6) for the past 1 and half month i have raised countless tickets on this issue ,every day regardless of trade done or not can you explain why deduction , i have a demat with another broker and they are always transparent

      why is there always this hidden angle in case of Zerodha ??

  244. Imran says:

    I did a short selling on 14th Aug, and i was not able to buy back the shares as no sellers were available at eod.
    In that case i might need to pay a penalty of max 20%, but my full amount is gone.
    Please help. My client code is ZF7502

    5 16/08/2017 EQ Call and Trade Charges for 2017155 ₹23.60 0.0 ₹1,677.27
    6 14/08/2017 EQ Being margin blocked for sale of CIGNITITEC-EQ ₹2,383.26 0.0 ₹1,700.87
    7 14/08/2017 EQ Call and Trade Charges for 2017154 ₹47.20 0.0 ₹4,084.13

  245. Ravindra says:

    I am facing this same issue and got mail from Zerodha.
    Can you please let me know in how many days I will get my money back?


  246. vicky says:

    sir what type of settlement process does options goes through ??

  247. Poonam says:

    I short sold Parsvanath on July 25. However, it hit Upper circuit that day and I could not close the trade. It seems to have got auctioned. How do I get to know the rate at which the scrip was auctioned? It does not display in the P&L statement, nor does it list in my Tradebook.

  248. Chandan says:

    If I buy a stock on Monday and sold it on Wednesday morning.
    1) Will it lead to a short delivery if I get my delivery by Wednesday evening,as I have to deliver it by Friday evening.
    2) If I couldn’t get my share and I get it through auction on Thursday.will it lead to short delivery

  249. AVINASH says:

    Sir I bought say 100 shares of Company A on Monday for rs. 100 each and then sold the same shares on Tuesday at rs. 105 each suppose before close of day I buy them again when their price is rs 98 each, what is the actual price i pay to buy the shares.

  250. Sandeep Desai says:

    Sir I bought Hindustan tin works 100 shares on Monday but still not got delivery or cash settlement from exchange my zerodha client Id is ZT 4422.

  251. S M Rao says:

    Pls clarify my doubt.. yesterday I did short sell 100 shares of stock X.Due to circuit limit, I couldnt suareoff by end of the day. Today I dont see the shares in my account as support tea says that it went into auction. It’ll be released after 4 days. Lets say if I buy 100 shares today and take the delivery then also my short sold shares will go to auction? Please let me know.. And also whats the percentage exchange charges as penalty for short selling?


    • Yes, if you buy today, u will get shares in 2 days, but you will have to delivery tomorrow. So this trade will be settled in auction.

      • S M Rao says:

        “you will have to delivery tomorrow” means what? Do I need to do specific thing?

        • Ah my bad. what you short sold yesterday, has to be delivered to exchange tomorrow. Even if you buy today, you will get the stock only day after (T+2). So you will default tomorrow even if you buy today. Nothing much you can do in this case, exchange will buy back the stock in auction on your behalf.

  252. Pawan says:

    I have question here.

    i had shorted some shares at price at rs442 and then it logged in 10% upper circuit which is rs444.4. So i could not bought it back on T day. Now on T1 day it goes high of 485 and at end of day it logged in 10% lower circuit which was near rs400. Now on T+2 day share price was below rs400.(In range of 370 to 395).
    Now, i just wanted to know in auction what could be maximum price at which my share could have been bought back by NSE?

  253. Sutum says:

    I have 2 queries wrt my zerodha ac.

    1. Suppose I had bought 200 shares of Reliance at 100. current market price is 120. Now I already sold 200 shares @120, booking profit. After that I also want to short @120. but I do not want to buy the same day. Can I buy next day or day after two.

    2. Suppose I had bought 200 shares of Reliance at 100. current market price is 120. Now I want to short 250 shares @120 intraday without touching my 200 shares bought @100. Is this possible.

    • 1. Not possible, that would be like a fresh short, not allowed for overnight position in equity.
      2. No. At a time, you can have essentially one position. A work around is that you bought using MIS and short using BO or CO.

  254. JOVIN JACOB says:

    Last Friday(14.07.17) i bought 24 shares of CDSL at 483. Monday evening i got a notification from your side notifying me your purchase was short delivered.
    What is the meaning ? how this happened ? Today morning i found my account squared off & lost around Rs.11500 . If any mistake from my side?

    Jovin Jacob

  255. Kiran T says:

    I have had 30 shares of CDSL @403.32/share in delivery , now shares have been blocked, brokers said it will take 2 days to reflect in your account.
    the price is going down and down, i wanted to sell those share today, i had also tried to sell after it hitting lower circuit, what will be the result. what if price of CDSL share will be 350 or 360 after 2 days?

  256. Nitin says:

    Sir, by mistake I made a short Sell Share 240 shares of of CDSL @ Rs. 443.30 on 13/07/2017 stock hits upper circuit @ Rs. 443.30/-. but today that share hit lower circuit i.e 399.90, then what is my position in that case.

    Sir Please Reply

  257. Pavan Patil says:

    I had bought unitech @7.40 on Friday but short deliverd. On Next trading day I.e. monday it went to 9.35 but i couldn’t sold that day. On wednesday i was unable to see in my holdings. Now it was trading at lower price which I had bought at. I’m suffering loss now. What should I do now?

  258. SUBARNA says:

    i place a sell order from demat a/c. my triger price is 6 but on day trigger price was not hit, when you give my share back to my demat a/c.

  259. ashwini says:

    Dear Nitin,

    Please clarify my below query.
    I did one BO sell trade of Unitech at 7.8 on 7th July but Unitech share closed with upper circuit on that day because of that I was not able to close position. Now what is next ??
    I think ideally I have close this position by T+2 days. Nut it seems Zerodha already initiate closing process for my open position and that is on 20% upper price compare to 7th July’s closing price. Because of that my margin is reflecting in negative now, I think Zerodha should close this position with in T+2 days. Today scripts price is 8%-9% above. So there is around 11%-12% difference between the prices, what zerodha has consider for closing the position.

    Please let me know will I get this difference back in my available margin or I need to pay Zerodha the amount which is right now coming as negative in my margin available ?? And when I will get settlement note for this trade so that I can go through the actual settlement process ??

    • Ashwini, if there is a short delivery, brokers can’t close out any position. Short delivered quantity is settled by exchange auction mechanism as mentioned in the post above It happens on the T+3 day, 3rd working day after you took the trade.

      • ashwini says:

        Yes, it was short delivery but now it is not coming in my open positions…where I can track it now…and to me it seems that it is already settled at 20% up price(9.36) of 7th July’s price(7.8), even though it never reach till 9.36 in today’s trade. For your info..It was Unitech BO sell trade at 7.8 but because of Upper circuit on that day I was not able to square off this trade. And now when I am seeing in my positions there is no open position there.

        • 7th July was a friday. So this will be settled by the exchange on 12th july (T+3 day) in auction. Settlement will be done at auction price on wednesday. It won’t show in positions as this was a short delivery. Exchange will give us an auction debit note, which we will send it to you.

          • Venu says:

            Ashwini, when you sold stock, you received credit against such stock. Since you didn’t own the stock & weren’t able to give delivery of such stock, the credit that you’ve received against such sale, doesn’t belong to you. This is why we’ve blocked the credit + an additional 20% to account for any increase in prices when the Exchange posts auction. The Auction for the Unitech shares will be posted to your account tomorrow and the funds that were blocked by Zerodha will be reversed.

            • ashwini says:

              Thanks Venu for clarification.
              It means maximum loss can be this 20% blocked amount right ?? If auction will be settled somewhere less than this 20% then remaining amount I’ll get back in my account this is what I understood. Please correct me if my understanding is wrong.

              • Venu says:

                Doesn’t mean 20% is the max loss, we block 20% as a buffer to cover if the auction gets settled at a higher price; theoretically it could get settled at higher than 20% also.

                If auction will be settled somewhere less than this 20% then remaining amount I’ll get back in my account this is what I understood

                : Yes, you’re right.

          • We will get to know the exact value only on T+3. Usually a 20% + sell value is blocked to ensure client can’t withdraw the funds. Your auction note + margin release will happen after exchange settles auction.

          • ashwini says:

            Yesterday night I have raised one query and on top of that Venu has provided his comments but now that comment chain is not reflecting here. Why I am not able to see that comment ??

  260. Umang Raval says:

    I sold 5000 Unitech On Friday at price of 7.8 with Mis order and can’t able to buy unitech on friday and i don’t understand why i’m not able to adjust on monday and it directly goes on auction

  261. vikrant sharma says:

    Dear IXXXXX,Your traded value for 07-JUL-17 CM Rs 14502 Check your registered email. For details contact broker. Is thier any thing wrong what is the meaning of this msg do i need to worry or not please clerify

  262. Hasmukh Trivedi says:

    Hello Sir,

    why Zerodha get additional charges for auto settlement by system after 3.20 p.m. Why the time limit not increased until market close?


  263. Farooq ahmed baig says:

    Sir I bought one share idea on 020617 in my account now 1.84k so pls clarify me is this any problem short delivery i got a mail from zerodha

  264. ADITYA WADHAWAN says:

    Sir, how can we determine whether a stock is more volatile or less volatile?

  265. kirankumarr says:

    I have following doubt
    1)Let say,I am having 50k amount in my account and I did an intraday transaction.For e.g. I sold X scrip of 500 quantity @ 100 Rs each share which is equivalent to 50K. Unfortunately the price of scrip X went high and trading @ 105 Rs and which I dont want to buy @ 105 Rs.
    In this situation can I convert my intraday positions of 500 quantity to Deliver? And what are the consequences?

    • No you can’t convert it to delivery. If you have short sold, to convert you already need to have these 500 shares in your demat.

      • kirankumarr says:

        So in short,the shares that I sell in intraday cannot be convertible to Delivery though I am having enough funds in my account.
        To make it more precise, Short selling can be done only in Intraday and cannot convertible to Delivery.
        In case of Delivery,short selling is not at all possible as we doesn’t have shares in our account to place the sell order.Are my statements are correct?

  266. KAPIL NAGAICH says:

    What will happen if the option segment stock is not cut the position till the stock expires ?

    • Akshay.A says:

      Kapil, If you have bought options and they are expiring in the money, you would rather sell it on the exchange than letting it expire/exercise and having to pay much higher STT.If the options are expiring worthless (with 0 value), you don’t have to sell it to save STT because STT on options which have no value is zero.
      Read more here

  267. Pritan says:

    Dear Sir,

    Account Number ZX7733, Yes I am Beginner Started Trading 2+ Months Ago With Zerodha,
    As I am No Aware Regarding Circuit Limit I Sell 296 Share Rs 60-64 Per Share and After End of the Day Except this all Positions Square Off.

    After 3-4 Hour I Check Account in Minus Rs -1,347.37 from 17400/- In Ledger Mentioned that Being margin blocked for sale Rs 18,351.36 (But As Per Contract Notes and I Checked Manually Rs 15277.55 then How they Debit Rs 18351/- Don’t Know Why Even I Send Email They Replied Please note the closing balance is showing correct as per the settlement no Other Explanation Given By Them)

    In Today 17 May In My Ledger They Again Debit Rs 16,376.04 and 18,351.36 and Account Shows Minus Rs -26,025.74. Have No Idea What To Do, Whom to Ask In Short Line this is Really a Heart Failure for Anyone.

    • Akshay.A says:

      Pritan, You should have received the details on your email. Please write such account specific request to [email protected]

      • Pritan says:

        Yes I Send 1+ Mails and They Corrected, Want to Suggest Zerodha need to also share the details with Customer in Upper/Lower Circuit Type Cases, Price of Auction/Debit Amount/P&L Etc.

        Still Don’t Know Anything regarding How they calculated in My Upper Circuit Limit Type Case.

  268. Abinash Senapati says:

    Hello bhai great fan of urs anyway just want to know that ….Am i able to short a stock using CNC to get extra time leverage 15:20 to 15:30 for buy back the stock on the same day. That would be great as 10 minutes more to decide…. 🙂

  269. Suraj Singh says:

    Hello Mr. Kamath,

    I am new to the trading world, hardly having any knowledge about it but yet to learn so many things.

    I have received an email about “short delivery” & further as I read the article I can understand that either the shares or the funds will be credited to the account after T+3 days during short delivery process.

    Further, my doubt is how can a person sell the share without having them? even though if he sells such shares whether proceeds from such sale will be credited to his account? Before purchasing such shares, can Zerodha show an alert?

    Hope you clarify the same.

    Thanks & regards
    Suraj SIngh

  270. Gautam Prakash says:

    Is short delivery possible in T segment stocks as intraday is not possible in those stocks? We could only sell share’s which we already in our accounts. \

    And if short delivery is possible then how could it happen (as we couldn’t place sell order untill and unless we have that quantity of shares in the Demat A/c)?

    • Akshay.A says:

      No Gautam, it’s not possible for a Short deliver in T segment stocks. You’ll be selling from your holdings.

      • Gautam Prakash says:

        But it happened as I had bought the shares but later there was a mismatch as actually in my DP account there were less shares than what my contract notes showed for which I got money credited in my account 3-4 days later.

  271. hitesh says:

    my client id is zt0524.
    few days back i sold 100 shares of idea,but didnt received the payout.then i received a mail from from your operation executive sonia,that i could sell those share because of today she informed me that there will be an auction once my account gets unblocked bcos of short delivery.
    now whose fault is this?
    how could have i known about?
    you people should have told me earlier before i bought those shares or your sales guys should have intimated me before opening of the account.
    i m not happy .
    very poor performance from you guys .
    didn’t expected this from a company like zerodha.
    now who will be responsible for the penalty imposed on me
    pls clarify

  272. Varun kumar upadhyay says:

    hi! Sir.My client ID is RV2404, i have purchased GTL Infra 10000 Shares in Which 799 shares are short delivered, then at what time these shares will be delivered to me or if not delivered than my money will be refunded to me.????

  273. Kiran says:

    I have opened my demat account long back ago may be done with two years. But I didn’t do any trading with my account. My query is can I get back my money which I have deposited.

  274. Robin kumar says:

    Suppose I buy a lot for intra day future . May I sell it any time or only at the end of market time?

  275. Arjun says:

    Is there a way that in Zerodha’s demat account – there are 100 shares of a stock lying from 100 investors, and at point of time not more than 20 stocks from 20 investors are bought and sold from the inventory. Is it possible to short lets say 5 stocks out of those 100 shares and carry it on for more than T+2 days at a premium the broker.

  276. sknair111yo says:

    hey there…got this msg from zerodha on 29 mar 2017
    ” Dear Shree Kumar Nair,
    Your purchase of CIMMCO-EQ was short delivered. Short delivered quantity: 660. You should have the shares delivered to your Demat account or the funds credited to your ledger (in case of non receipt of stock) by 30/03/2017.Please click here to know the consequences of Short delivery.”
    the purchase was done on 24 mar 17 ( client ID PS8597 )
    what happens next??

    • You should most likely get the stocks one day later, i.e today evening. If exchange can’t find shares in auction, they will credit money (around todays price of the stock)

      • Devesh says:

        I got the similar message “`Your purchase of 2 quantity of RELIANCE was short delivered. You will either have your purchased shares delivered to your demat account or the funds credited to your ledger (in case of non-receipt of stock) by 3/23/2020. You can read the consequences of short delivery“`

        who is at default here, did i missed something while placing the order, or other party is not able to deliver the share?
        if it’s the other party then why should i be worried about consequences of short delivery ?

  277. Abhilash says:

    Hi Nithin,

    I come to know about Short Delivery after this article. My queries,

    1. If I choose MIS, if anything happen the position will be squared off @ 3:20 PM right ? ( we don’t need to worry about this penalty ), right ?

    2. Instead of choosing MIS , I take CNC option and doing the BUY and SELL on the same day many times, Scalping. ( May be I am fresher and not aware of MIS and CNC ). On this scenario still I have to face the same Problem by paying Penalty ?

    3. Buy on T-Day, Sell on T+3 rd day on CNC segment , is this the only option to be safe from Short Delivery and Penalty problem? what if we see a good profit on T-2 Day before delivery to DMAT account, can’t we sell ?

    4. Is the same applicable for MCX NRML delivery ( I mean doing a trade on same day without taking Delivery but choosing NRML )?

    Thanks in advance

    • 1. Yes it will be squared off. But assume a stock hit upper circuit, if it does, you will not be able to square off your short positions. So there is always a risk.

      2. You can trade using CNC without risk. But to buy you will need 100% cash, and to short you will need to have stocks in your demat.

      3. Yes, to be completely safe. Wait for delivery to your demat and then sell.

      4. In MCX there is only futures and options trading. There is no concept of short delivery on F&O. You can trade F&O intraday or overnight without any risk.

      • Abhilash says:

        Thank you Nithin,

        1. We better take Huge volume stocks to avoid Upper Circuit problem, isn’t it ?

  278. Aniruddha says:

    I bought CNC ALBKeq yesterday before 3:20 and sold it today morning for 7rs profit then after a while I cancelled the CNC order to sell ALBK eq. and now it is showing in positions…but then in orderbook it shows cancelled… i am incurring losses for something i didnt order. what is the matter ? can anyone help?

    • The day you buy or sell stocks from holdings, it shows up in positions. Ignore that, by end of the day it will go away from holdings. The reason it shows in positions is if you are an intraday trader and want to sell/buy that back again.

  279. Chander says:

    Hi Nithin,

    I have few queries related to stock future trading.
    1) In any case, can the situation of short delivery occur in stock future of mid or far month contract, weather I am long or short in the contract?
    2) At what price my order will be executed, If I place a BUY or SELL MARKET order of future contract on LTP basis?
    3) I am unable to find Spread Order option in Pi. Is it disabled now, If yes then please suggest any alternate or how soon we can get this back live.

    Thanks & regards,

    • 1. No
      2. If market order, buy will get bought at best offer and sell at best bid.
      3. You can place two orders, once you take both the orders, it acts as a spread.

  280. VIJAY KUMAR says:

    Dear Sir

    I Have purchased Sundaram Clayton 1 share on 2nd March 2017 in BSE & further
    purchased Sundaram Clayton 10 shares on 15 th march 2017 in BSE &
    sold Sundaram Clayton 11 shares on 16 th march 2017 in BSE

    You have send me mail on 17th march 2017 that Sundaram Clayton 10 shares which was purchased on 15th march 2017 was short delivered.

    1. As a client how will i come to know that the delivery was short delivered & u delivered the quantity in auction on T+3 day ie 20th March 2017 & u made auction for sell qty of 10 shares which i sold on 16th march 2017.You have said to me bear the loss in auction.

    2.Moreover i purchased further 75 shares on same day on which i sold 11 shares then how come u made the auction.

    3.Till now you have not have sended the auction note which you have told when i contacted over telephonic conversation.Why you have not sended the auction note till today 22nd march 2017 though u have said auction was made on 20 th march 2017.

    • Venu says:

      Hi Vijay,
      There’s an inherent risk with doing BTST transactions. When you sell stocks, without taking delivery, you run the risk of auction. That’s why it’s best to take delivery and sell. Here’s more info on this:
      The contract notes were sent, we’ll have it resent to you.

      • VIJAY KUMAR says:

        Dear Sir,

        If it is according what you say then i want to know why the delivery charges has not been debited to account for 1 share ie [1 holding on 2nd march 2017+10 i purchased on 15th march 2017(short delivery)] .I sold share on 16 th march 11 shares not 10 shares . As per you only 10 shares went as BTST .Then why delivery charges is not debited in my account.

        The fact is delivery charges is not made since i purchased 75 shares on the same day when i sold 11 shares.Though it is different segment delivery goes for all T+2 days.

        Now dont debit the delivery charges in my account backdated & send me the ledger sir.

        It is really painful to debit appx Rs 3500 auction charges to my account when there is no mistake from my side.

        Please consider from the angle of retail investor & reverse the auction charges .

        Kindly oblige & do needful .



        • Venu says:

          Dear Sir,
          DP charges of Rs.15.53 has already been charged on your account towards the 1 share that was debited from your demat account. You may verify this on your ledger. Also your purchase of 75 shares was on a different Exchange; which can’t be adjusted against the sale made on a different Exchange. Trading on 2 different Exchanges creates 2 independent positions, positions aren’t netted off.

  281. vijaykra65 says:


    If there are no sellers on auction day too, how cash settlement happens?
    will it be settled with latest price of share (i.e., on T+3 day closing) or purchase price??

    • Venu says:

      In such a case, the exchange settles it in cash on the basis of Close out Rate. Close out rate is the highest price of the stock from when you sell to the Auction day or 20%, whichever is higher.

      In the case where there are no sellers available in the Auction market, the Exchange settles it by way of a cash credit on the basis of the ‘Close out’ rate. Close out rate is the higher of the highest price of the stock from when you sell to the auction day or 20% above the closing price, on the auction day.

      • vijaykra65 says:

        thanks for the reply.

        Recently one of the shares which i have bought were short delivered and i got a email from zerodha that cash/shares will be delivered on T+3

        On T+3, i haven’t received the shares and now, i would like to know how much money i got from exchanges, how can i find that?

  282. Fouzia says:

    Yesterday i bought some stock as Cash and Carry, and the stock is transferred to my demat account on the same day. today i sold that stock, but that money is not credited to my Kite account till now. Will it take sometime to get fund transferred from my demat to my Kite account.


    • When you sell shares the money can be withdrawn only after two days. Exchange settlement in India takes T+2 days. But for selling stocks, you should have gotten credit that allows you to buy more.

  283. Subhankar says:

    HI Nithin,

    I have two questions,

    1. If I buy in a intraday trading and forget to sell it in the same day and trading platform do not have automatic square off. what will happen ?(assuming I have enough balance in trading account for buying it)

    2. If I do a short shell of 100 of EQx in intradday trading and it hits the upper circuit and could not buy back but in my demat account I already have 100 of EQx… will it be still a short delivery for me or those 100 shares from my account will be delivered to buyer?


  284. Yuvaraj says:

    Hi Nithin,

    I bought NCDs few days back but was later informed of short delivery. I have been refunded the old amount plus the excess amount from the auction which means I have profited from this transaction. I am an investor (do not trade) so under what category should I treat this income? Since it is a debt instrument and ST gain I guess it will be applied at 30% slab rate as my total income will be in that slab.

    Am I right?


  285. Anivesh says:

    Sold intraday short, share hit upper circuit with no sellers, Zerodha sold the stock automatically at day close, what will happen?

    • If you are short intraday and stock hits upper circuit, you will end up short delivering. Your short will get covered by the exchange in the auction market on T+3 as explained in the post above.

  286. RAKESH says:

    1)i don’t understand, how is it possible to not get stocks if i’ve put a buy order. How is it even possible? The exchange runs on strict rules, right? so, if i place a buy order it’s the responsibility of the exchange to give me stocks on T+2 day.

    2) “If you sell any stock for Intraday you are expected to buy it back by the end of the day to close your position. Now assume you forgot to buy it!”
    How can i forget to buy it?…it’s intraday right, so all positions are squared off by the end of the day. so with zerodha this is not possible. so, please remove this from point a (which is one of the reasons why stocks don’t get delivered after an order – short delivery.)

    3) when a stock hits the upper circuit there are no sellers,………..i don’t understand this, if there were no sellers how would the stock even go up, because for the stock to go up it has to be bought heavily, right and for it to be bought, there must be people selling it, right……….i don’t understand short delivery.
    can someone please answer all three questions. Please be explanatory as i am a newbie.

    • Hey Rakesh, I have explained all of this in the post above.

      2. Not every broker runs intraday square offs like we do. Some of them give the onus on the client to do it. There could also be technical problems when squareoffs at brokers don’t work. There are many offline brokers who allow people to sell first and then ask them to transfer using DIS slip next day.

      1. All the reasons above make it impossible for exchanges to determine if you will get the share on T+2 or not. Look at this like exchange is a bank, and you are a person who has written a cheque and given tosomeone based on the money you think you will receive from a cheque deposited in your account. If the cheque you have deposited bounces, your cheque will automatically bounce.

      3. Hmm… a stock could be trading normally and if some good news suddenly comes out, stock can hit upper circuit instantly. Suggest you to read this post as well.

  287. Mehamood lal says:

    Hi nithin,

    Is there short delivery and penalty in future and option , since there is no delivery??

  288. DV0662 says:

    I bought Ashiana Shares 150 quantity on Feb 1 using CNC. It should be delivered be Feb 3 EOD. But i sold the shares on Feb 3 (It shows T1:150) in my holding, and i got the message that the stock is Short Delivered.

    Please clarify what’s the impact (do i need to pay any penalty) for the same.

    • Yeah, since the person who sold you the stock didn’t deliver, you in turn will no default on delivering the 150 u bought. What happens when short delivery is explained in the post above.

  289. Aritra Sarkar says:

    Yesterday (06.02.17) i sold 100 shares of Ludlow Jute at CNC. But i was not able to buy it back as my account was showing margin exceeded. Please tell me what i have to do? What happened to the fund?

  290. dharmesh says:

    hi sir
    i sold the sun tv in intrady in margin base but i forgot that share buy in intraday so can you tell me how much the penlty I take it plz reply me

  291. Chandrasekar R says:

    Hi Friends,
    I have a basic doubt… can someone please clarify?

    I have accumulated 60 shares of company X at an average price of 820. I sold the same today at 960. And i bought an equal amount when it went down to 945. Now my questions are:

    1) Will my DP reflect a debit and a credit of the above shares (or)
    2) will this trade be treated just as a day-trade, meaning no changes to my DP..

    Can someone kindly clarify this?

    Chandrasekar R

  292. Michael says:

    Hi Mr Kamath,

    I recently opened a trading A/c with zerodha, i am trying add some low priced stocks on my watch list, but once i add them it shows only 0 values & 0 increase & decrease & i cannot buy those cheap stocks. Can you please tell me what is the issue?

    Thanks In advance

  293. Syamala Pankajakshan says:


    I received a short delivery notification from you for Kajaria ceremaic 25 shares purchased in CNC. The notification says it is due to insufficient margin? How come it possible if we we buy in CNC ? Could you please clarify.


    • Short delivery would mean the person who has sold you the scrip failed to deliver the stock. I am going to check on the reason what is sent to you and get someone to call back.

  294. Sandeep Tiwari says:

    HI Team,

    Today I have purchased a share (PMC Fincorp) in CNC at 0.47 and Sell it today only at 0.49. After which I come to know the concept of short delivery. Please help me, I am worried about it.

    Do I have to face any legal Penalty?


  295. sourav says:

    Hi Nitin ,
    I got one mail from Zerodha..
    “Dear Sourav Pramanik,
    Your purchase of ADHUNIKIND-EQ was short delivered. Short delivered quantity: 1. You should have the shares delivered to your Demat account or the funds credited to your ledger (in case of non receipt of stock) by 12/01/2017.Please click here to know the consequences of Short delivery. “..
    So what should be my action tomorrow .Pls suggest ..

  296. Vikash Kushwaha says:

    myself vikash.
    I had purchased 100 shares of JKLAKSHMI on friday 30th Dec 2016 and sold on Monday 2nd Jan 2017. I guess this could be a case of short delivery however I have a question regarding credit of funds that was from sell proceeds. Same amount was not credited and showing negative balance in my trading account. In this case when my funds will get credited?
    Hope for solution.
    Thanking you.

  297. Kamesh dubey says:

    Sir, by mistake today i sold 250share@316 of lt food. can you tell me how penalty should be covered from me…
    is there any positive sign to avoid this penalty

    • Venu says:

      Which broker are you trading with? If you’ve sold, then you’ve to deliver the shares else it’s liable for auction and the penalty will get posted. No way to avoid.

  298. Manoj says:

    Thanks sir, for this awesome blog. Please sorry for this stupid question. (1) If I bought idea cellular 100 share @72.05 under cnc delivery. And sell them on the same day at 100*73. Is there any way for short delivery.
    (2) In mis intraday trading, is there chance for short delivery.

    I am new on this. Please reply.
    Thanks sir…..

    • Venu says:

      1. No, since it’s an Intraday trade, there’s no risk of short delivery.
      2. Yes, if you short sell and the stock hits circuit, you’ll not be able to buy it back. In such cases, the stock gets short delivered.

      • Manoj says:

        Thanks for quick reply.
        In 2nd question, I mean if we buy stock for intraday trading under margin i.e (MIS) at 10a.m, and we sold this stock before closing market then, Is there is any way for short delivery.
        But in actually it is intraday trading. And according to your 1st answer, there is no risk. BUT Why In 2nd Question????
        Sir, I am Novice. I need some help. Your blog gives me huge knowledge. I am thankful to you.
        Thanks in advance

  299. Sawan ghetia says:

    I bought and sold Tmrl on same day in trade to trade segment(t2t) 100 shares @224 now share is on lower circuit, hw much penalty i have to pay??

  300. Arpit says:

    I shorted some share at 15.85 and then it reached circuit on that day at 16.02 and next day it also reached circuit at 19.22 so what can be my maximum loss here. And one more thing we would love to have in Kite is to have some fundamental details of company and sector wise data and some filter criteria for stocks.

  301. MANISH SABNANI says:


    FIRSTLY Sorry for asking such silly question.

    I had bought PNB (35 Shares) at 137.30 on 23 November (Wednesday). using CnC, and sold them on 25 November (Friday) at 139.50. In the evening of 25th, i got mail from zerodha saying that there is short quantity of 20.

    Also when i looked at CDSL holding, it is showing only 15 quantity and not 35. Why?

    All i want to ask is that, whether am about to face auction. ?????? help me , am new to it.

    • Manish, what this means is that, the person who sold you shares defaulted. So instead of 35 shares, you got only 15 shares. Exchanges will conduct auction on 28th (since 26th/27th is sat/sun) and give you those 20 shares. Since you sold the shares on 25th and not 24th, there is no auction risk. If you had sold it on 24th, yeah, you would have defaulted on giving 20 shares to the person you sold to.

      • Manish Sabnani says:

        Thank you sir for your earliest reply.

        Could you please tell me , when that amount of sale can be withdrawn?. I had sold it on 25th, as stated above. But the withdrawal balance is not yet including the amount of sale.
        Please, tell me the time ususally taken for crediting the amount of sale, when sold using delivery stock.

        In my case brokerage had been charged as 0.01 rs. For taking the delivery and again 0.01 for selling it off. Whereas, zerodha quotes that delivery charges are flat 0.

        Albeit, 0.01 is indeed very trivial. But i just wanted to be sure of this, whether it just 0 or not. Is everything okay with my account. Help.

  302. Nayab says:

    Please clarify this problem because my friend facing this….
    Let us consider he sold 180 shares of Tata metaliks for Rs.411 (411*180=Rs.73980) and cant buy because it stop at Rs.464.. ans sayes only selling today

    After two days he got message that he bought 180 shares for Rs.615.24
    That means (615.24*180=110743)
    In that case he have only Rs.8000 in his account
    And he have to pay nearly Rs.28763

    How much time he will get to pay that money or
    What will happen if he doesn’t pay that money till for 6 months or 1 year….

    Will they take action against him or will they wipe out money from his personal bank account???

    Please clarify this to me because l know this problem is facing many peoples and dont know what will happen

  303. MOTILAL SINGH says:

    sir, i am use kite web. i purchase share from BSE but i want sell i always show rejected why?

  304. Ashish says:

    What if I buy a stock on monday in cnc and sell that on tuesday. By the end of the wednesday the stock does not come into my account so can I buy that same stock on thursay morning in intraday and then give it to prevent myself from auction penalty

    • Venu says:

      No. Stocks are settled on T+2 as per the settlement cycle. When you buy stocks on Thursday, you ll receive them on T+2 and hence auction can’t be avoided.

      • Ashish says:

        But intraday doesn’t take t+2 days to the best of my knowledge!
        Can anyone else help out.

        • Venu says:

          When you sell stock, you’ve to give actual delivery of shares. When you sold the shares on Tuesday, you ll have to give delivery of such shared by Thursday. If you buy shares on Thursday, they get delivered on Monday, so you can’t settle these against shares sold on Tuesday. Shares sold on Tuesday can’t be intraday adjusted by buying shares on Thursday.

  305. Dip patel says:

    Thanks for reply. Please tell me about turnover charges because there is some ambiguity on zerodha charges page regarding turnover charges.

  306. Dip patel says:

    You should list dp charges at the zerodha brokerage calculatior for the CNC because new trader like i who learn stock market by dealing with too much low quanyity(hardly 1 or 2)never get details about this charges at the time of buying and finaly end up with loss at the time of selling. So please list this charges at brokerage calculator.

  307. Dip patel says:

    I have confusion in DP charges. If i bought one share at 100 rupees in CNC and sell it aftet one week. here my profit is around 9.4 after tax . i want to know that what is the dp charges scenario in this trade. Is there charge of 13 ruppes ? Is i am in lose of 3.6 ruppes?

  308. Goblin says:

    So, If I sell some shares that I hold in my Demat account. Do I need to do anything extra to make them available for delivery (besides not selling more shares than I own) or does the trading software of the broker takes care of things for me automatically?

  309. Rakesh kumar says:

    Thank u sir.
    27/9/2016, this happening with me. i sold vivimed [email protected] & take upper circuit in intraday & ther is no seller so waiting for what happening.

  310. Hardik Pokal says:

    what is the reason that we can’t do intraday(buy and sell share on same) day for IPO on listing day/same day?
    (Note: we didn’t get IPO)

  311. Siddharth says:

    I have received email stating,

    Dear ,
    Your purchase of INDIAN ACRYLICS LTD was short delivered. Short delivered quantity: 500. You should have the shares delivered to your Demat account or the funds credited to your ledger (in case of non receipt of stock) by 22/09/2016. Please click here to know the consequences of Short delivery.

    What does this mean? I have bought these shares on delivery basis.

    • This means that the person who sold the stocks to you defaulted. SO exchange will run an auction tomorrow and buy this for you. If they can’t, they will settle it in cash tomorrow evening.

  312. suresh kumar sharma says:

    issue reg.short delivery has been well explained and it help new investors

  313. ajit says:

    sir, i’m buy 200@ntpc 14/09/2016. and today not show in my a/c … please help me

  314. Andy says:

    I have short sell a share and it went to UC. Margin statement showing that entire amount is debited. What will happen next. Does it mean, entire money is lost. I am worried. happen to me first time so not sure.

    • Venu says:

      Margins get blocked since you would have received extra credit on account of having sold shares you don’t own. On the auction day, auction amount will get debited and the blocked margins will get reversed.

  315. NareshS says:

    So if I have a view that Stock price is currently trading @ Rs 1000, and its likely to fall to Rs 900/- after a week/month/year, there is no way of me earning in this scenario by selling today at Rs 1000 and buying it after a week/month/year at Rs900?
    I need to buy it latest by 3:20pm today it self or it will automatic squared off…is it?

  316. Gautam says:

    1) is it possible to short sell in equity delivery??
    2) I am learning stock market should i wait to learn completely or should i start investing??
    3) Which book do u suggest me to study, ( i dont know many things about stock market)
    4) How do u find Good stock in among, that you feel it would give u profit??
    waiting for answer
    🙂 🙂

  317. Philip says:

    Is a contract note a guarantee of share delivery?

  318. Philip says:

    T 0 stock price closing at 69.15,
    T 1 stock price closing at 72.6,
    T 2 stock price closing at 76.2,
    T 3 stock price closing at 80.05.
    Above is a UC case.
    Since I have not got delivery ( short delivery). 20 percent of which price I am eligible to get credited to my account? Is It T3 plus 20 percent as cash settlement? Any risk for future LC to buyer (me)….

  319. Murali Krishna says:

    Hi Nithin Sir,

    On 20july2016 short sold 5000@56 Anant Raj company shares after few minutes share got locked in upper circuit @56.45. due to no seller 58,700 deducted from my account on the same day. and
    on 22july2016 2,80,000 deducted ( total 3,38,700 – Being margin blocked for sale of ANANTRAJ ).
    Closing price was 62.75.

    Sir how much possible penalty will be imposed?
    Will I get shares of Anant Raj or rest of the amount after penalty?
    Please help me to understand.

  320. Jagan says:

    Is it possible to track short delivered stocks. Can we have page in zerodha where we can see the list of short delivered stocks(date, qty, stock) and action been taken( amount credited or short delivered stock been purchased) for the short delivery. Presently we are getting email on regarding this, which is bit difficult to track. /holdings API in Kite also doesn’t provide the short delivered stock qty information.

  321. dan_xyz says:

    I bought delivery of Store one 2600 shares at 205 (excl taxe and brokerage) but am credited with 2596 shares and for the shortfall of 4 shares I am credited with cash at 205.08 per share. Is this price not less than the 20% that NSE has suggested. the closing price of Store on from T – T3 were bet 194-202.

  322. gulzamakhan says:

    Sir if I buy today equity delivery share of Maharashtra scooter at 1320 on 19/07/16 and sold it at 1430 on the same day i.e. 19 July 2016 so is it called short selling and whether I would have to give give its delivery on 21 July, kindly reply me I am your account holder of Zerodha account.

  323. Tanmay says:

    In case of short delivery, if there are no sellers for the shares. What amount is credited to my account? 20% higher, close price?

  324. Tanmay says:

    So in the case of short delivery buyer never benefits 😛 and seller always loses. Can I sell the share on T+2 in case of short delivery or only on the third day?

  325. Asish says:

    Hi Nithin,

    Its really surprising to see you answering the queries on a blog that is almost 3 years old. Hats off to your patience and dedication.
    I came across this blog recently, please correct me if I am wrong, lets assume somebody sold a share at Rs 80,and the upper circuit(UC) was hit at Rs 100 (~20%) leading to short delivery, and say the UC for next day(i.e T+1) was also 20% and it hit the UC again leading to the T+1 closing price to be Rs 120. Now on the auction day (T+2) the range of the auction price will be again +/-20% of T+1 closing price, so worst case scenario if the bid happens at +20% leading to buying price of Rs 144(i.e 20% of Rs 120) , then the person would incur a total loss of (144 – 80 = Rs 64) + 0.05%(lets ignore for now) . So its like around 75% as auction penalty. Is that correct ?

    Thanks in advance.

  326. Naeem says:

    Sir, on 15th June I purchased 8 SBI NCDs at 11000 but have 50000 cash in my trading acct, later on T+2 day (17th) as one of my family member was hospitalised, I forgot abt the trade obligation resulting in 38000/ shortage. On 20th I moved 45000/ to my trading account, but still NCDs not credited to my DPaccount.
    No response from the broker, I want to know usually, what % charged as penalty in such cases and why the NCDs not credited still ?

    • Venu says:

      You’ll have to get in touch with your broker and figure out Naeem. We wouldn’t know what kind of settlement he’s following. At Zerodha, if you had purchased these units, then we wouldn’t have allowed you to withdraw any money since the money would have been used. You can contact the broker and tell him to credit the NCD’s to your account and settle the obligation out of the credit balance available.

  327. Shreyas says:

    My account had 100 shares. By mistake I told my broker to sell 600. He sells 600 and later informs me that I did not have 600 shares and there is short delivery. Isn’t it the brokers fault that he didn’t check my account before selling? What’s the purpose of a broker if he is this careless? Is it my liability or his?

  328. Subhajit Sarkar says:

    I bought say 100 shares on Monday. It is showing in my Holdings as T+1 (inter-settlement condition) on Tuesday; I sold it on Tuesday morning and bought it back on the same day evening (quantity is same). So I am a net buyer, right? Today it T+3, Thursday and now I am not having it in my Holdings. What is the situation Can you explain? Furthermore, in the above mentioned scenario can I get any info on which day the “short delivery” have taken place?

    • Venu says:

      The trade you made on Tuesday will be considered an Intraday trade and your 100 shares from Monday’s purchase will continue to show under T1 holdings till it gets delivered to your demat account.

      Would help if you could give us the stock name so we could check and revert.

  329. PRADEEP says:

    sir ..i bought 100 shares of SBI and sold one share on the same day after sometime in CNC. will it result in SHORT DELIVERY,

  330. Venkat says:

    Question about Short delivery.
    I bought some shares of GOACARBON-EQ on 9/6 (yesterday) and the shares are visible under holdings and even I tried to sell today. However, I got a mail few minutes back saying the shares are short delivered and I should get wither the shares / money by 13th. My questions is if the shares are short delivered, why are they appeared as holding stocks? and what happens if they are sold today by me? will I be the defaulter?

    • Venu says:

      The settlement cycle in India is T+2 which means on T+2 you get credit of these shares on your demat account. To discount the possibility of missing out on any opportunity to make gains, we allow our clients to sell such stock even before the actual delivery of stock has happened which is why they appear under your holdings with a tag called “T1”. If you sell such shares and there’s subsequent short delivery, you’ll be considered defaulter for having sold it without taking actual delivery. This is a risk that comes with doing BTST (Buy today, Sell tomorrow) transactions. More has been explained on this link here:

  331. Chirag says:

    I have bought 20 shares of all cargo logistics on 31 may but same has not been credited even after t+3 and even my money has not been refunded to me that’s too unprofessional on the part of Zerodha.Please sort this problem out at the earliest.

  332. Vivek says:

    You need to worry, even if its Zerodha.
    My positions were not closing at 3:20pm and it was around 3:22pm. I started closing my position at market rate. It was BO. Without placing any further order through order window I ended up with short position of around 800 shares. It was horrifying as I got to know through a call from Zerodha. This was my first experience with such situation.
    It can be avoided by simply closing all position before 3:15pm or letting it happen automatically. Or else consequences can be bad in terms of penalty.
    I really like Zerodha and it will be my brokerage firm always. I simply wish I knew it beforehand.
    Happy trading.

  333. Akhilesh says:


    I am new to Zerodha.
    I have few questions: –

    1. Do we have the buy option of margin trade with t+2/3/5 or similar format? If yes, how to use it?

    2. Can I sell the stocks without owning them and instead of getting them squared off the same day, wait for T+3/5 days for the square off?


  334. Shashank says:

    Hi..very informative article for new investors like me….I have a query…i mistakenly short 1000 x voltas at 298.5 on 03 May and unfortunately cant buyback it at the last moment. now it will go into auction…can any idea be given about my loss and also pls tell me the auction day for this trade…plz help…i think i will be at huge loss, because my quantity was 1000…plz help..thanks…

  335. SANATH says:

    Hello sir,

    can u pls explane me clearly about intraday and delivery i am new here


  336. Mathes says:

    Suppose if the share falls on T+5 and I still dont have the shares to sell, do I hv any avenue to demand compensation for the losses I incurred for no fault of mine? Mind you, Zerodha should have delivered on atleast T+3.

  337. Mathes says:

    Mr. Nithin Kamath,

    I bought 400 shares of Ambuja Cements on 26th April and when I checked my account today on 2nd May, ie on T+4, the shares are not in my account. When I sent a mail to Zerodha Support, they replied it is short delivery and went for auction. Was it not supposed to be automatically taken up by Zerodha on T+2? Suppose if I didnt take up today and checked only after a week, still Zerodha would not have done anything on their own to deliver my stocks for which I paid on 26th April? Very strange and a big let up for a new client like me. Any justification for this?

    My Client ID is RM4027.

  338. Sadab ahamad says:

    Plz help me I am a new invested I have 32 ptl for long time but now it is not my account where it is plz help me

  339. Suresh says:

    This is reg the short selling and auction.
    I had bought 3000 shares from NSE and by mistake sold it to BSE – ON THE SAME DAY
    Now I got intimation for auction from BSE for 3000 shares as it was a shortage.
    Will I have to lose 20% as penalty ? Is there any immediete work around that I can do?

    • It is not really a penalty, it is essentially the auction price at which exchanges buy back the stock on your behalf. Depending on what price exchange is able to buy this 3000 shares on your behalf in auction, the difference amount (your buying price – auction price) is charged as penalty. If an auction is already done, nothing much you can do now.

  340. Bhavani says:

    Please have a look at this ticket #972259.

    It’s regarding my positions, the avg price of my positions have changed and is showing a loss which is NOT CORRECT.
    I want my positions revised showing the correct amount of profits ASAP.

    • Venu says:

      We believe one of our agents has explained to you the basis of computation of average rates and your issue has been resolved.

  341. Satyabrata Pal says:

    Reply not complete. Request intimate the procedure how I transfer all of holding share from my SBI Demat account to existing Zerodha demat without closing SBI Demat.

    • Venu says:

      When you opened your demat account with SBI, you would have got a DIS (Delivery Instruction Slip) booklet. Its similar to a check leaf. You have to fill in details of the shares that you wish to transfer & your Zerodha Demat account number in the DIS Slip and submit it to SBI who will initiate a transfer and move securities to your Zerodha Demat. Charges are applied by SBI for making the transfer.

  342. Satyabrata Pal says:

    I want to transfer all of holding share from my SBI Demat account to existing Zerodha demat without closing SBI Demat. What is the procedure and what is the charges from SBI and your side?

  343. Satyabrata Pal says:

    In which date I can buy to complete the position?
    (ii) If I buy today before 2 PM in CNC it will be round off?

    • You can’t buy it back to cover it. Do read the blogpost above. Exchange will buy it on your behalf on T+3 day and deliver it to the buyer whom you defaulted. Whatever is the difference in your shorting to the auction price, it will be deducted from your account.

  344. Satyabrata Pal says:

    In which date I can buy to complete the position?

  345. Satyabrata Pal says:

    I have short sell 15 Marksans Pharma on dated 19/01/2016 and I have sufficient money for Buying 15 Nos Marksan Pharma. What can I do?

    (ii) And how can buy? In Android app.

  346. DR4079 says:

    Hi Nitin,

    I have some queries related to linking between CNC and MIS stocks at Zerodha. can you please help to answer.

    1. Is it possible to do a Short Sale (MIS) of a particular symbol, even when holding a CNC stocks of the same, without affecting the CNC holdings?
    2. If my short sale is defaulted in above case, will my CNC stocks be used for compensating the MIS deficit?

    • Venu says:

      1. Yes, it’ll be considered as an Intraday and will be covered back at 3.20 pm
      2. Yes, CNC stock will be used to cover the default

  347. Abhishek says:

    Hi Venu
    i had 93 short deliveries of yes bank today was t 3 day i did not get any update.please let me know the status.

    my id is da1601

  348. siddhesh says:

    i have shorted pipavav def share @90.20 800shares on 24th dec 2015 shall i get profit ??

    • Venu says:

      Its extremely rare that an Auction results in a benefit. Depends on how the stock price has moved after you’ve shorted. If it was a short delivery, your broker should have already posted the auction on your account by now.


    sir hum 2 share buy kiya tha cnc pe .. after 2 day not showing in my profile holding . i call zerodha support but cant given positive respose. please help me.

  350. Rohan says:

    Sir I’ve shorted allsec tech 1200 shares on Monday at 83.17 and on tuesday the uc continues and took the price to 98.25 on wednesday it was mahurat trading and the price went up to 5% uc and price went up at 103.05.. Will the auction consider the price on the second day or on the third day because I’ve the short delivery for last two days can u please give me a rough idea at what price I’ve to calculate my losses?

    • Rohan, auction will be end of day on T+3 day. So it will be based on closing price of that day. Very tough to figure out on stocks like these (hitting UC), on what the actual auction settlement price will be. Liquid pedigree stocks, it will be within 1% range of the T+3 day closing price

  351. aftab k khan says:

    Hi i buy tata shares as given below

    Buy-427 date 9-10-2015 / Buy-230 date 16-10-2015 total :- 657
    Sale-330 date 20-10-2015 Sale-100 date 21-10-2015 total:- 430


    1) so which one shares executed first ? old one or new one.
    2) my account in negative now,0 shares shows in holdings and account shows negative
    no funds credited in account after selling shares, it’s very frustrating when you buy shares and it’s disappears and account shows negative,
    i am using cnc for trade, whenever you update software make sure please don’t change holding
    positions and margin.

  352. uday kumar.S says:

    I bought hindalco share on last week but still it is not delivered into my account recently I got a mail as your order got short delivered

    • Basically the person who sold u the shares would have defaulted. In this case exchange will do a square off transaction, and cash will be credited to your trading account.

  353. Dhananjay says:

    Suppose, I buy shares today (Monday) using CNC. Will I be able to sell them on next day (i.e. Tuesday)? Are there any risks in this transaction?

    Thanks in advance.

  354. mennon says:

    Also, if you guys have a prop book with L&T on it; pls show up for the auction! And be kind 🙂 Friday is T+2.

  355. mennon says:

    Thanks for your reply, Nithin. I’ve heard all sorts of versions of what may or may not happen – but your view is certainly the one I trust most. I guess I’ll find out what happened on Monday and will let you know. Striking lack of transparency all around this process.

    Also, surprised that the auction market isn’t used more aggressively by members to capitalize on arbitrage opportunities. That would seem like an obvious use; and one that would mitigate failed to deliver scenarios. Mystified by it all! But thank you very much for your insightful response.

  356. mennon says:

    Hi Nitin,

    Really helpful post; but I find myself in a real soup and would appreciate your help.

    Essentially, I had 100 L&T Shares; I was looking to sell them; I inadvertently made a fat finger error – sold 1000 instead and am now stuck with a massive short delivery liability. On T L&T was down .5% from my selling price; on T + 1, it’s down an additional 1%. However, I understand a failed auction would leave me with a massive liability of the highest price over the three days + a 20% penalty on top of that.

    So, I’d really, really appreciate answers to the following:
    1. This transaction was with Kotak; what are the odds that they will be able to do an internal auction and help me out?
    2. Any idea what the odds of a failed auction for something like this would be?
    3. Any clue whatsoever of what I should expect as an auction price?

    While I definitely made an error and take responsibility for it; this really seems like an obscure procedure, lacking transparency and the consequences of the ‘crime’ far outweigh it’s seriousness. Surely, an active SLBM or some such is desperately needed. Is there any solution at all, you might be able to offer?

    I called Zerodha asking to speak with you or Venu sir; but was told this wasn’t possible. Any help, ASAP would be really, really appreciated.


    • 1. Hmm.. don’t think they will be able to do any internal auction as such. If they as a broker on sitting on L&T stocks on their prop book, they could make good of the delivery. But don’t think it will happen. But what you need to find out from them is that how did the platform let you shortsell for 1000 when u had only 100 shares in the account. Ideally their systems should have blocked this order.
      2/3. Don’t think you have to be worried much about this, especially since L&T is like a pedigree stock. My guess is that if any impact will be minimal. Let us know once u get the auction note on what was the price at which the auction happened.

      Yep SLBM is still a few years away from becoming popular in India.

  357. Adit says:

    Hi sir,

    Could you please clarify my stupid doubt about short delivery? In November 2013, I shorted 1000 shares of ABAN OFFSHORE at an average of 306 Rs. The stock hit the upper circuit that day. I traded with 1 lakh in my account. The stock must have been auctioned on T+3 day, and my broker deducted additional 15,000 from my linked bank account. I didn’t open my trading account for a long time. I kept thinking that all that 1.15 lakh is my loss. My doubt is whether all that money is my loss or do I have all these stocks in my short delivery and can I buy it back at the current price of 243. I hope it makes sense. Thanks in advance.

    • Adit, depends at what price the auction would have happened. You short at 306, if it was bought back at 406, then u would have lost 1000 x Rs 100 = Rs 1lk. So u would be left with no money/stock in ur account. So u need to login to your trading account or ask the broker at what price the auction happened.

  358. Sourav says:

    Thank you for your reply sir. I’ll try to get my pan card and address proof as soon as possible.
    thank you.

  359. Sourav says:

    hello sir,
    I am doing year) Along with company secrataryship(cs). I have keen interest in stock trading and investing. Bt i am unable to open a dmat and trading account due to lack of documents especially my voter id and pan card. Bt i want to start trading from an early age to gain experience in market. I shall be very thankfull if u kindly help me out regarding the documents and as i am new to the field of trading, it would be a great help if you can enlighten me with some trading tips.
    Another thing i wanted to ask that is there any job scope for cs students in stock broking firm, especially yours.
    thank you

    • Sourav, there is no getting away from minimum documents required. So you would have to go get yourself a PAN, and an address proof. Yeah, company secretary are needed for our finance department.

  360. ravi says:

    Hi sir,I have done short sell yesterday at Rs.1430 and closing price was Rs.1428 and today closing price was Rs.1408 .As you said Friday (tomorrow holiday) will be auction day.I want to know the auction price ?

  361. chirag says:

    Hi buddy,

    two days back I have purchased 1000 shares as Intraday and convert it to deliver around 2pm , next day price was up I tried to sold 1000 but could sell only 518, when I check I found that 482 shares was sold out as part of Intraday, broker told that transaction done but could not get shares, hence 482 shares squareoff occured automatic because of position open. I could not understand that how it’s possible as my transaction was successful to convert delivery. My report also appear that I have bought 1000 shares yet to recieve but finaly amount of share it appeared as 518. Broker told that seller could not provide delivery, so I would get shares + penalty or difference + penalty at T+3 days. But I did not get any notification from exchange.

    tomorrow is T+3.


    • Chirag this risk always exists when you sell before delivery. Since the market has fallen today, you might not loose any money on this. Exchange won’t notify you directly, the broker on T+3 will send u an auction note.

  362. Pavan says:

    Hi Nithin,
    Lets say, one has 1000 shares of X company at 80 Rs and he sells at a price of 100s (CNC option) and buys back (CNC option) on the same day at 95 Rs. So he makes 5000 Rs profit. Would it be short term capital gain or speculative trading (for tax calculation ). Thanks in advance.

  363. santosh says:

    what if i already hold shares at 850

    But even when the market has not reached a high , i would short sell it for 900

    But deliver it later in the day successfully, is this even possible

  364. pradeep says:

    Hi Nithin,

    i bougth the 40 stocks of PNB on monday @ 157.92 and sold it on thusday @ 157.2 before getting delivery
    through CNC option.
    but the price went upto to 162.2 so what will be my Buying price, its 162.2 or 157.92.
    in my postion it is showing -200rs.

    • My guess is that -Rs 200 you are seeing is the charges for your trade. As long as there was not a short delivery , you should get back 40*157.2. But if there was short delivery and since you sold before delivery, there will be an auction and you will be forced to buy shares at auction price on T+3 day. Auction price will be near the market price on thursday evening (T+3 from selling day of Tue).

  365. says:

    Hi Nithin,

    In case of short delivery, if the closing price of the stock on T + 1 day is significantly lesser than the shorted price, Mr X will still be in profit as the auction on T + 2 day considers closing price on T + 1. right?

    Shankar MR

  366. Sushil says:

    Dear Sir,

    In case of short covering, If i sell a share @ Rs. 100 by selecting product type as ‘MIS’ at 10AM,

    1) By 1 PM I wanted to buy share @ Rs. 90, to place the order for buying should I use MIS (Intraday) or CNC (Delivery) as product type?

    2) If I didn’t buy at by 3:20 I hope zerodha will buy the stock at CMP[Current Market Price]. Please comment on this

    3) At this square off time if share is reached to it’s circuit limit [even though its rarest case] What happens to the shares that I already sold? Will I get any penalty on this?

    Thanks in advance

  367. Manohar says:

    Hi Nithin,

    Could you please confirm that can i buy futures under Normal Margin today and sell anytime on or before Expiry date.

    Thanks in advance for your help.

    Your help is very much Appreciated.

    Kind Regards,

  368. Jayraj says:

    Hi Team,

    If I buy a stock with MIS and don’t square off,system will auto square it after 3:20. But will there be some additional charges if system does the auto sqaure off.

  369. Pretty nice post. I just stumbled upon your weblog
    and wantged to mention that I’ve really loved surfing around your weblog posts.
    In any case I will bee subscribing on your rss feed and I
    ope you write again soon!

  370. Riswan says:

    Today (27.02.15) I bought 750 wonderla at 283fortunately I sold 1000 at 289 that means 250 short sell.. is there any way to cover my position

  371. Sachin Jagtap says:

    I want to know that suppose I want to buy (delivery) a share whose value is Rs 0.05 per share and I want to buy 2000 shares of it and I sell these shares when it reaches Rs 0.10 per share. How much Zerodha will charge for this transaction.

  372. Vikas, ideally tradebulls should have squared off this position for you as you don’t hold these stocks in your demat. Like mentioned in the blogpost, on T+3, that is the 26th there will be an auction where these 300 shares will be bought on behalf of you and delivered to the person whom you short delivered. At what price can this auction happen at, depends on market condition on 26th. Assuming that stock price remains around the same, you might end up losing 1 to 2%.

  373. vikas says:

    I sell 300 share @1526 on 23.2.15 nd closing price is 1536 of wockard
    bt i didnot much penalty i have to pay or can i buy on 24.2.15 or anyother way out pls tell me
    i am new
    My accont is on tradebulls

    • Vikas, ideally tradebulls should have squared off this position for you as you don’t hold these stocks in your demat. Like mentioned in the blogpost, on T+3, that is the 26th there will be an auction where these 300 shares will be bought on behalf of you and delivered to the person whom you short delivered. At what price can this auction happen at, depends on market condition on 26th. best to speak to your broker.

  374. Nishant says:

    I short sold 15000 [email protected] on 16/02/2015(mon) and couldnt cover it as it reached upper circuit of 23.How would it now be settled and when,alos can u tell me how much i have to bear the loss

    • Nishant, there will be an auction on T+3 days, 20th Friday. It will depend on that day at what price the auction happens for these 15000 Suzlon shares then. The other option you have is to figure out if any of your friends/family has suzlon shares. IF they have, get it transferred to your demat before 18th evening.

    • Manohar says:

      You will be huge loss

    • Nick says:

      Hey Nishant,

      You never short a stock that is up so much. I am very sure your losses would be huge as hell because Suzlon went up another 16% today.


  375. Deepak Khetan says:


    I short sold a stock today unknowingly, its like I had 200 shares in my account under CNC and sold 500 shares under CNC which i need to cover within 2 days. Suppose I buy it tomorrow would it help me to save from auction.

    Can you suggest me a way out from this, I have inquired from all the people I know, non of them have the stock i have short sold.

  376. Advait Shah says:

    Good explanation with example. Thanks

  377. Jitender kumar nagar says:

    This is all time good explanation for me because I fell in short sold

  378. karthik says:

    oh okay.. thanks nithin.
    here is my question..
    1.) If i execute a ‘buy’ order with MIS(intra day) code and got ‘xyz’ company’s 100 qty shares @ Rs.150. And in the end of trading day, i can’t able to square off orelse i don’t want to square off that day(T day). Is it possible to take delivery ? if yes then any penalty there other than usual fee of delivery based options.
    2.)In the same above condition, what will happen or what i’ve to do if i used margin?

    That’s off Nithin,
    Thanks in Advance.

  379. karthik says:

    hi Nithin,
    Thanks for the wonderful short and crisp article 🙂 kindly clarify my doubts with explanation in your words…
    1.)just consider i ‘buy’ reliance share 100 qty @ Rs.800 on Monday(T day) in delivery based option. so the share will be delivered to my demat account on Wednesday(T+2) right ? if there is no short delivery from my seller side and if there was, then will be delivered to my account on Thursday(T+3) right?
    2.)ok now just consider, i ‘buy’ reliance share 100 qty @ Rs.800 on Monday(T day) in delivery based option and it shows my order got executed successfully. now coming to my question… can i able to sell those 100 shares on the same day(means monday which is T day) ? (which are currently not in my demat account but i just bought and expecting delivery on Wednesday which is T+2 day ) or i have to wait at-least for T+2 days to get delivery of the shares into my account?
    3.)ok if i bought shares in delivery based option on monday(T+day) it will reach my demat account on wednesday(T+2) morning or evening? means the share will be delivered to my demat account on the closure of trading on wednesday(T+day) ?

    thanks in advance…

    • 1. Yep
      2. You can sell it the same day. It will be considered as an intraday trade, and there is no risk of short delivery also.
      3. Stocks are usually delivered around mid afternoon, before closure. But the risk of auction is reduced drastically if you sell on wednesday before taking delivery. Because even if someone short delivered to you, you will get it on Thursday through auction (T+3), and the shares that you sold wednesday anyways has to be given to the exchange on Friday.

      • karthik says:

        Thanks Nithin.. i didn’t expect your answer @ a short time. Anyhow just now i seen.
        here is my another question..
        if i’m buying some ‘xyz’ share 100 Qty @ Rs.20 with product code CNC(means carry and cash=delivery based) on monday(T+day) and my order got executed successfully. but later i change my mind to sell those 100 shares on the same day (monday itself) instead of carry over. so the complete(both=buy+sell) transaction will be considered an ‘Intraday or Delivery based one’? because i made the purchase with CNC code. so i’m in need to clarify?

        Thanks in advance nithin

        • I thought I just explained u this. Product type is only internal to Zerodha, as long as you buy and sell within a day, it is considered as intraday. It doesn’t matter if you use CNC or MIS.

  380. Sukesh says:

    Hi Nithin,

    This question is in continuation with the question i had asked in Trading F&O;


    Asking here as now my question is now specific to Zerodha 🙂

    So are there any cases of defaults in F&O at Zerodha? What measures have you taken in such cases?


  381. Vivek says:

    I am sorry for the really silly question.

    Just wanted to ask:

    I shorted 100 stocks on Friday
    missed to cover them by eod
    When will the auction happen?

    Do I need to have the stocks in my Demat Account on Monday to avoid Auction
    Just buying them before Auction will be fine?

    • Auction will be on T+3, so Wednesday. You need to have the stocks in your demat latest by tuesday morning, failing which you will be taken to auction. If you buy them before auction, it will hit your demat on T+2, so that will not be good enough.

      • Vivek says:

        Thanks Nithin 🙂
        I was short on FRL.
        They went to Auction on Tuesday…
        I feel saved purely BY LUCK.
        The losses are minimal.
        As the exposure was not big the losses are less and FRL also didn’t appreciate before Auction.

        Learnt my Lesson.


  382. Sidharth Kumar says:


    I had shorted 1800 ONGC (CO) on 2-12 at around 385.15 if I remember right.

    I expected the system to square it off at 3:20, when it was trading about a point lower; however as this did not happen I attempted to manually square it off by clicking (exit) in the order book. However, the order was rejected citing a server error (I do not remember the exact error however it was something along the lines off ‘Server is unable to take request at this time’). I hoped that since Zerodha has systems in place to avoid such scenarios it must have been squared off automatically and perhaps there was a problem displaying it on my side, and let it be.

    However yesterday, I received an e-mail from Zerodha stating that since an MIS position was not squared off my Margins have been blocked, and a similar SMS from NSDLDP informing me that there is insufficient quantity in my demat account and ‘available quantity will be delivered’ by 04-12.

    Since then I have not been able to log into my backoffice, and any attempts to reset the password fail. The Zerodha trader displays my current positions as none, despite me holding two long option positions in SBI and JSW Energy. I hope these are unrelated incidents but I would like to know how the matter of short delivery will be dealt with since at this time I can’t access any reports, and the last time I checked (yesterday) it displayed my withdrawal balance as approx. negative 8 lakhs.

    Also, despite an overall positive experience with Zerodha, such occasional bugs are both frustrating and sometimes scary. I should have ideally made about a grand in profit from my position had it been squared off at 3:20 as it should have been, but now it’s not certain at what price will my position be resolved.

    I would be grateful for some light on this matter and how Zerodha plans to avoid such complications in future and/or compensate it’s clients if they do arise.

  383. SP says:

    I short bhel at 282.80 and and unfortunately cant buyback it at the last moment. now it will go auction…broker tell me. t+1 day closing price is 282.10 and 2mrw (t+2) it may be below what price is taken for auction t+1 day’s closing price or t+2 ??plz help…i think i will be at huge loss, because my quantity was 1000…plz help..thanks…

    • SP, Auction actually takes place on T+3 days. Because the stock is liquid like BHEL, it shouldn’t cause you any much damage in auction penalty. But the risk you carry is that for two days you are short on BHEL, so if BHEL stock price goes up, it can cause a damage.

      • sp says:

        thanks for the valuable reply nithin….one more query is in auction to be held on t+3 days i.e. on tuesday…as in case of bhel, like u said its liquid…is the auction price will be market price on that time or something else..??..thanks bro..very helpful blog..much lesson learnt..

  384. Sanjay says:

    Sir if i sell shares in my account (in delivery) and buy them back ON THE SAME DAY,then for this type of trade what brokerage i will be charged? Intraday brokerage(as i bought my shares back on the same day without taking delivery) or delivery brokerage…example i have 100 shares in my account and i sold them at delivery & after selling them i squared off my position(buyed them back) ON THE SAME DAY…Then for this trade i will be charged for low brokerage-intraday (AS i did’nt took delivery) or high brokerag(delivery brokerage)…sir please answers this

  385. Madan says:

    Hi Nitin,
    May i know what are the settlement time lines for Options. Stock Option & Index Options.

    If i sell my Index Options today which i have bought yesterday. When will be my funds ready to be withdrawn.

  386. mahantesh says:

    i tarded with margin amount for 800 lot silmic when the risk came the RMS auto square of all the lots but selling 800 lot has taken the price suddenly up by 400 points,now my account is -1,40,000 what are the penalty charges,pls guide i thing i need atlaest 1 month to repay the ledjer negative balance

  387. chitra says:

    Suppose I buy shares of company A, however i get shares of company B in my demat account by broker’s mistake. Can I sell them if I am in profit? Is it legal to do so since I am anyways selling shares present in my own demat account?

    • Ideally you shouldn’t, best to inform the broker and have this corrected.

      • chitra says:

        This was a first time experience, i did not do what to do so I sold company B and bought shares of company A again with the sale proceeds. Now i get a message from my broker that I have shorted company B since it was not there in my demat acc and will be liable for auction. My doubt is, how did the trade get executed in the first place if shares were not there in my demat account since I had sold my holdings and had not taken margin from the broker. It should have been cancelled right? Agree that I shouldnt have sold them, but is my broker trying to play the game by saying that I have shorted?