What happens if your Delivery Instruction Slip gets Rejected

5 mins read
by Angel One

Whether you are a newbie trader or have been into stock market trading for a while now, you may have heard of the term delivery instruction slip and wondered what it means and why it is significant.

The delivery instruction slip is important because when you sell shares from your demat and trading account, you would need to authorize the sale with a signed delivery instruction slip. A DIS slip is like a cheque that acts like authorization to the depository participant (DP) to debit securities from your account and make the transfer to the recipient’s account. When you carry out transactions online, you can give the power of attorney (PoA) to the broker who will then debit from your demat account when you sell securities.

What are the elements that make up a DIS slip format?

The delivery instruction slip comes with the following elements:

  • Client ID: The DIS slip has the client ID space, which is pre-sealed and is on top of the DIS slip format. The client ID comes with eight digits.
  • Client Name: You have to fill this in but ensure that you fill in the same name as it appears in your demat account.
  • Date: This is the date when you are submitting the delivery instruction slip.
  • ISIN number: This is an alphanumeric code that is issued by SEBI to securities. You may have to quote this number when you transfer shares from one demat account to another or when you need to dematerialise your physical share certificates to the electronic version.

For each DIS, you can transfer five ISINs but you may use multiple delivery instruction slips if you want to transfer more. You can verify the ISIN from the websites of the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).

  • Security name: The name of the security that you wish to transfer.
  • Quantity: The quantity in both words and numbers need to be filled in
  • Consideration amount: This is the value of the securities on the date of transfer or any other amount that seems suitable.
  • Reason for transfer: You will be provided with some options that you would need to choose
  • Date of execution: You would need to specify the date on which instructions would have to be executed.

Reasons for rejection of DIS slip

Now that you know what makes up a DIS slip, it is time to understand why a DIS slip may get rejected.

  • Any mismatch in details mentioned in the form and the details mentioned in the demat account may lead to rejection. Also, if the DIS slip is received after the date of execution is mentioned, it may lead to rejection.
  • You would also need to be careful while entering the ISIN numbers. It’s best to cross-check the numbers before entering the ISINs.
  • If they are not legible too, there are chances of rejection of your DIS.
  • You would also need to mention the mode of transfer clearly. If it is a deposit that is intra, ie, within the depository, you would need to choose off-market transfer, while if it is between depositories, you must choose inter-depository. If you don’t take this step properly on the basis of the target and debiting accounts, your DIS may be rejected.
  • Any overwriting on the delivery instruction slip could also lead to rejection.

What happens if your DIS slip gets rejected?

For any or all of the reasons cited before, your DIS could get rejected. As the markets typically function on a T+2 settlement basis, your DIS would need to be submitted to the broker before the first half of T+1. Ideally, you should submit the slip on the day of trade because it allows the broker leeway to let you know about any errors in the form. You also get some time to fix the errors in your delivery instruction slip. But this may not happen sometimes. The result could be a short delivery.

To put it simply, the shares you bought on Monday or T Day get settled by Wednesday or T+2 day. An investor can withdraw funds only on the date of settlement and not on the date of sale. For instance, you have bought 100 shares of X company but you don’t have those shares in your demat account and won’t be able to give them to the buyer. Because the buyer is genuine and is willing to pay for the shares, they are entitled to the same. In this situation, the exchange will auction the short delivery shares where a third party will make up for the shortfall in shares. The short seller will have to make up for the shortfall and bear additional expenses for selling the shares without actually owning them. Essentially, short delivery is a risk and may lead to some losses.

Rectification of DIS slip format errors

You can rectify rejection of delivery instruction slip in off-market transfers easily because there is no risk of auction triggered by the exchange in such transfers. The depository participant or DP may call you and get the error fixed.

In market trades, you may have to appeal to the broker to try and adjust the debit. The broker may oblige if you have stocks with enough liquidity.

The best solution is to carefully look at your DIS slip format, fill it in accordingly and ensure there are no errors before you submit the same to the broker.


The delivery instruction slip is like a cheque issued to the bank with instructions to debt securities to a recipient account. It is important to fill the form in carefully by cross-checking all the elements. Any error may lead to rejection, which has consequences. One of the consequences is that it may lead to your stock going into auction and you having to bear losses.