SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999
10. Consequence of failure to exercise option
10.1 The amount payable by the employee, if any, at the time of grant of option:-
(a) may be forfeited by the company if the option is not exercised by the employee within the exercise period; or
(b) the amount may be refunded to the employee if the option are not vested due to non-fulfillment of condition relating to vesting of option as per the ESOS.