1.

Employees, including Directors, when in possession of any unpublished price sensitive information, as defined in the Regulations, pertaining to the Company, shall not:

• Buy / sell securities of the Company, either on their own behalf or on behalf of any other person.
• Communicate, counsel or procure any unpublished price sensitive information to / from any person.

RESTRICTION TO BUY / SELL SECURITIES BY 'DESIGNATED EMPLOYEES'

The Designated Employees shall cover the following:

• Directors, Executive and Non-Executive;
• Managers at Levels 1 & 2, or its equivalent;
• Employees in Finance and Secretarial functions located at the Corporate Headquarters@; and
• Such other employees as may be determined by the CMC from time to time.

• Designated Employees shall not buy / sell securities of the Company during Closure of the 'Trading Window', i.e. the period during which trading in the securities of the Company is prohibited.

Trading Window shall be closed during the following periods:

1. From 15th March up to twenty-four hours after the announcement of the annual financial results (and dividend, if any) to the Stock Exchanges.

2. From 15th June up to twenty-four hours after the announcement of the first quarter financial results to the Stock Exchanges.

3. From 15th September up to twenty-four hours after the announcement of the second quarter and half-yearly financial results to the Stock Exchanges.

4. From 15th December up to twenty-four hours after the announcement of the third quarter financial results to the Stock Exchanges.

5. From the date of circulation of the agenda for the meeting of the Board of Directors, in which any material, price sensitive and unpublished event, including the following, are proposed. The closure of the Trading Window for these events will be advised by the Compliance Officer appointed by the Board of Directors for the purpose of this Code:

• Proposal in respect of issue of securities by way of public/ rights/ bonus etc.;

• Proposal in respect of significant expansion plans or execution of new large projects;

• Proposal in respect of amalgamation, mergers, takeovers;

• Proposal in respect of disposal of whole or substantially the whole of the undertaking;

The Trading Window shall open 36 hours after close of the Board meeting at which decisions in respect of the above events are taken.

• Designated Employees shall require prior clearance for purchase of securities of the Company, exceeding 50,000 shares in a calendar month (either in one transaction or in a series of transactions). Exercise of Options under the ITC Employee Stock Option Scheme (ITC ESOS) shall not require any such clearance. Prior clearance shall also be required for sale of securities of the Company in a calendar month (either in one transaction or in a series of transactions) exceeding 50% of the shares acquired under the ITC ESOS and held or 50,000 shares, whichever is higher. Such prior clearance shall be required from the Compliance Officer and a Director. Purchase / sale of securities by the Compliance Officer beyond the aforesaid limits shall require prior clearance from the Chairman. Purchase / sale transactions, for which prior clearance has been obtained by Designated Employees, shall be executed within seven days of such clearance.

• Designated Employees shall hold the securities of the Company for a minimum period of 30 days from the date of purchase ('Minimum Holding Period'). In case of personal emergency, the prior approval of the Compliance Officer shall be taken for relaxation in the Minimum Holding Period. In respect of the Compliance Officer, such relaxation shall require prior approval of the Chairman.
   

Designated Employees shall make the following disclosures of shares and other securities held in the Company by them and their dependant family members, to the Compliance Officer:

• Initial disclosure of number of shares and other securities held as on 31st March, 2002. This disclosure shall be made by 30th April, 2002.

• Annual disclosure of number of shares and other securities held as on 31st March, including details of purchase / sale of shares and other securities during the financial year. This disclosure shall be made within 30 days from the close of each financial year.

• Changes in shareholding, when such change exceeds 50,000 shares. This disclosure shall be made within 4 working days of such change.

• Disclosure shall also be made of the number of shares and other securities held, upon becoming a Designated Employee, at any point of time. This disclosure shall be made within 4 working days of becoming a Designated Employee.

'Dependant family members' for this purpose means dependant parents, dependant children under the age of 21 years, dependant spouse and any other person(s) dependant on the Designated Employee.
 

Violation of this Code will invite severe disciplinary action. Such disciplinary action will be irrespective of action that may be taken by SEBI under the Regulations.
 

A copy of the Regulations is enclosed. Employees are advised to peruse the Regulations carefully and acquaint themselves with all the provisions contained therein. The Compliance Officer will be available for clarification / assistance that may be necessary.

 
By Order of the Board
B. B. Chatterjee
Compliance Officer