CLAIM OF UNCLIAMED DIVIDEND AND SHARES TRANSFERRED TO IEPF AUTHORITY

CLAIM OF UNCLIAMED DIVIDEND AND SHARES TRANSFERRED TO IEPF AUTHORITY

  

(A)   BRIEF NOTATION

 

Dear Reader,

In this Article, we aim to create a Platform specifically for the Investors whose investments were transferred to Investor education and protection fund. We came across several cases, where a General mass of people stand un-aware of their shareholding/investments lies with the Company due to Non-updation of KYC and other several reasons. Once they came to know that their shareholding/investment have been transferred to IEPF, in some of the cases they stand helpless regarding the practical aspects  and the procedure to claim the same though online portal i.e, IEPF website which is currently a web-based Form and much easier as compare to the earlier situation.

After transfer of shares, shareholder seeks the reason of transfer and wish to claim the same form the IEPF authority for which form is available on IEPF Website. Here is responsibility of the Company Secretary cum Nodal Officer of the Company to provide solution and guidance to the concerned claimant/shareholder.

(B)   STATUTORY ASPECTS AND PROVISIONS IN BERIF

MCA has issued Investor Education and Protection Fund Authority Rules, 2017. As per these rules, any money transferred to the Unpaid Dividend Account of a company in pursuance of this section which remains unpaid or unclaimed for a period of seven years from the date of such transfer shall be transferred by the company along with interest accrued, if any, thereon to Investor education and protection fund. Recently MCA has amended The Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Second Amendment Rules, 2019 dated 14^th August, 2019 which was effective from 20^th September, 2019.

Any person, whose unclaimed or unpaid amount has been transferred by the company to IEPF may claim their refunds from the IEPF authority. For claiming such amount, claimant needs to file web based Form IEPF-5 along with requisite documents. Access link to the refund webpage of IEPF Authority is www.iepf.gov.in/IEPFA/refund.html

Hence once again we came here with the detailed and updated procedure to claim the shares and dividend from the IEPF authority and practical aspects of the same from the point of view of shareholder.

 

(C)   STEP-WISE PROCEDURE FOR REFUND OF SECURITIES FROM IEPF (UNCLAIMED DIVIDEND AND SHARES)

 

1.     Initially Claimant need to create a Login ID from the Link viz http://www.mca.gov.in/mcafoportal/login.do and Click Register Now, fill the details and submit.

 

2.     Login with the Portal and Click on Form IEPF-5 from the Tab MCA Services – Investor Services, a web based Form IEPF-5 shall be open

 

3.     Fill the complete and correct details in web Form IEPF-5 for claim of Shares, dividend or any other investments which have been transferred to IEPF. Read the instructions provided on the website/instruction kit along with the e-form carefully before filling the form.

 

4.     For filling-up the details in web Form IEPF-5, Claimant should be ready with the following information / documents:

 

a)     Name as per PAN and Fill accordingly as in First, Middle and Last Name and Copy of PAN

b)     Father’s name as per PAN

c)      Date of Birth as per PAN and Click on VERIFY PAN

d)     Enter Address, Mobile No,

e)      Aadhaar number if the applicant is an Indian citizen and passport/OCI or PIO card number if the applicant is NRI or foreigner

f)       Details of the company including the CIN no.

g)      Particulars regarding the shares to be claimed

h)     Particulars about the amount of dividend to be claimed

i)       Particulars of deposits and securities mentioned year wise, if any

j)       Details of bank account and in which the refund of the claim will be made in case of a Resident Indian.

k)     Details of Demat Account Number

 

5.     After filling the form, make requisite attachments and proceed further;

 

6.     Enter the Mobile No and email id for the OTP Verification, enter the OTP and submit.

 

7.     On successful submission / uploading an acknowledgement/challan will be generated indicating the SRN. Please note the SRN for future tracking of the form.

 

8.     Download the filled Form IEPF-5, generated Indemnity Bond and Advance receipt.

 

9.     Get the documents signed and notarised as per the requirement and submit the same with Nodal officer of the Company along with KYC and other documents. 

 

(D)  STATUTORY PROVISIONS:

As you are aware, dividend declared by the Company is remitted either electronically to the designated bank account or by sending dividend warrant to the registered address of the shareholders. 

As per Section 124(5) of the Companies Act, 2013, any dividend remaining unpaid/unclaimed for a period of 7 (seven) years is required to be transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government. The Company has regularly uploaded on its website and also on the website of the Ministry of Corporate Affairs, Government of India, full details of such unpaid or unclaimed dividends before transferring to IEPF.

 

(E)   PRACTICAL ASPECTS / PROCEDURE ON THE PART OF SHAREHOLDER / CLAIMANT:

 

Hence concerned shareholder/ claimant is required to claim the aforementioned shares and dividend amounts from the Investor Education and Protection Fund Authority by following the below mentioned procedure:

 

1.     Shareholder is required to Open a Demat Account with NSDL/ CDSL as shares will be released by the IEPF Authority in favor of claimants only in the Demat Account of the claimant. (ignore if already opened)

 

2.     Applicant has to send the attachments prescribed below to Nodal Officer (IEPF) of the Company at its registered office in an envelope marked “claim for refund from IEPF Authority” for initiating the verification for claim

 

3.     Documents required to submit to nodal officer of the respective Company / RTA

 

a)    Print out of duly filled claim form with claimant signature.

b)    Copy of acknowledgement

c)    Indemnity Bond (original) with claimant signature (As per format given in Annexure II-Refer page 9 of instruction kit) to be executed :

ü  On a non-judicial Stamp Paper of the value as prescribed under the Stamp Act (according to state) if the amount of the claim is Rs.10, 000 or more. Please ensure to enter date, place and Signature of claimant and witness. Or

ü  On a plain paper if the amount claimed does not exceed Rs.10,000.

ü  In case of refund of shares, on a non-judicial Stamp Paper of the value as prescribed under the Stamp Act.

 

d)    Advance Receipt (in original with Revenue Stamp of Re 1) with signature of claimant and two witnesses.

e)    Self attested copy of PAN Card

f)     Self attested copy of Aadhaar Card (For Indian Nationals)

g)    Proof of entitlement (certificate of share/Interest warrant Application No. etc.)

h)   Cancelled Cheque leaf

i)     opy of Passport, OCI and PIO card in case of foreigners and NRI

j)     Latest Client Master List

k)    Transaction statement showing debit/transfer of shares to IEPF if shares were held in Demat Form

l)     Original Share Certificate

m)  Letter from the RTA stating that claimant is entitle to  such number of shares and dividend.

n)   Copy of transaction statement duly certified by Depository Participant (for Shares in Demat Form)

 

4.     Documents required for securities held in DEMAT mode:

 

a)    Where the shares are held singly with nomination:

(i)        Duly signed transmission request form by the nominee.

(ii)      Original or copy of death certificate duly attested

(iii)     Self-attested copy of PAN card.

(iv)     Copy of transaction statement duly certified by Depository Participant.

(v)       Any other government ID proof of the nominee.

 

b)    Where the shares are held singly without nomination, the following documents in addition to the documents specified at paragraph 1 are required:

(i)     Affidavit from all the legal heirs made on appropriate non-judicial stamp paper- to the effect of identification and claim of legal ownership to the securities. Provided that in case the legal heir(s) or claimant(s) is named in the succession certificate or probate of will or Letter of Administration, an Affidavit from such legal heir(s) or claimant(s) alone would be sufficient.

 

(ii)   For value of securities upto Rs. 2,00,000 (Rupees Two lakh only) per issuer company as on date of application, one or more of the following documents:

Ø Succession certificate or probate of will or letter of administration or court decree, as may be applicable in terms of Indian Succession Act, 1925.

Ø In the absence of the documents as mentioned at above,

   No objection certificate from all legal heir(s) executed by all the legal heirs of the deceased holder not objecting to such transmission (or) copy of Family Settlement Deed duly notarized and

   An Indemnity bond made on appropriate non-judicial stamp paper-indemnifying the STA or Issuer Company.

 

(iii)  For value of securities more than Rs. 2,00,000 (Rupees Two lakh only) per issuer company as on date of application: Succession certificate or probate of will or letter of administration or court decree, as may be applicable in terms of Indian Succession Act, 1925. (39 of 1925)

 

c)    Where the shares are held jointly with nomination:

(i)        Duly signed transmission request form by the nominee.

(ii)      Original or copy of death certificate(s) of all the joint holders duly attested.

(iii)     Self-attested copy of PAN card.

(iv)     Copy of transaction statement duly certified by Depository Participant.

(v)       Any other government ID proof of the nominee.

 

d)   Where the shares are held jointly without nomination, the following documents in addition to the documents specified at paragraph above are required:

(i)        Affidavit from all the legal heirs made on appropriate non-judicial stamp paper- to the effect of identification and claim of legal ownership to the securities: Provided that in case the legal heir(s) or claimant(s) is named in the succession certificate or probate of will or Letter of Administration, an Affidavit from such legal heir(s) or claimant(s) alone would be sufficient.

(ii)      For value of securities upto Rs. 2,00,000 (Rupees Two lakh only) per issuer company as on date of application, one or more of the following documents, namely:-

Ø  Succession certificate or probate of will or letter of administration or court decree, as may be applicable in terms of Indian Succession Act, 1925. (39 of 1925)

Ø  In the absence of the documents as mentioned above,

      No objection certificate from all legal heir(s) executed by all the legal heirs of the deceased holder(s) not objecting to such transmission (or) copy of Family Settlement Deed duly notarized and

      An Indemnity bond made on appropriate non-judicial stamp paper – indemnifying the STA or Issuer Company.

(iii)     For value of securities more than Rs. 2,00,000 (Rupees Two lakh only) per issuer company as on date of application: Succession certificate or probate of will or letter of administration or court decree, as may be applicable in terms of Indian Succession Act, 1925. (39 of 1925).

 

5.     In case of death of a shareholder:  A legal heir/claimant is also required to follow the procedure of transmission of shares in addition before following –up as mentioned in Clause C by sending the following documents along with above documents:

 

a)  Require request letter for transmission of shares duly signed by all deponents and mention full address, Contact no, Email ID &  Also full Bank details such as Bank name, Branch address, SB A/C No. MICR No (9-digit code no.)    

b)  Affidavit & Indemnity bond 

c)   Copy of death certificate duly attested 

d)  Legal heir certificate issued by competent authorities

e)   Original share certificate

f)    Signature Verification Certificate 

g)   No objection certificate (NOC) from all legal heirs who do not object to such transmission

h)  For value of securities more than Rs. 2,00,000 (Rupees Two lakh only) copy of probated will / succession certificate/letter of administration (Hindi/English version) duly

 

6.     On receipt of documents, completed in all aspects will be verified by the Nodal officer of the Company and on the basis of company's e-verification report, refund will be released by the IEPF Authority in favor of claimants' bank account through electronic transfer and shares in the Demat Account of the claimant.

 

(F)   MOST IMPORTANT THINGS TO BE NOTED:

 

Following points should be kept in mind while submitting the documents with the Nodal Officer of the Company. This will help the Claimant to avoid objections at later stage. Feel free to discuss the undersigned if anyone has any query regarding the same and compliance thereof.

 

1.       The claimant can file only one claim for a company in one financial year. Even details of multiple Folios of one company need to be included in the same consolidated claim.

2.       In case if the claimant is the legal heir or successor or the nominee of the registered shareholder, then he or she has to ensure that the transmission procedure is completed by the company and an entitlement letter is issued to the legal heirs and then only file the IEPF Claim with the authority.

3.       In case if the claimant has lost the Original Copies of the Share Certificates, then he or she has to ensure that the Procedure for Duplicate Issue of Shares is completed by the company.

4.       In case of loss of shares, ensure to provide Copy of advertisement in one regional language daily newspaper published in the place of registered office of company if the market value of the shares is greater than Rs 10,000/-, Surety Affidavit along with his Proof of identity like Pan Card of sureties duly attested by Notary & Indemnity bond by security holder that shares are not sold / disposed off or acted in any manner by which any interest of third party would have been created.

5.       All the KYC documents of the applicant like PAN Card, Aadhar Card are self-attested. Documents of all the holders are required in case of joint holding.

6.       Advance Receipt and Indemnity Bond are duly stamped and details of the witness are mentioned. Revenue stamp on the Advance receipt is duly affixed.

7.       Proof of Entitlement (Original Certificate in case of matured deposits/debentures/bonds and Share certificate in case of shares) is attached.

8.       Client-Master List of the claimant should be duly attested by the concerned DP (Depository Participant) along with self-attestation.

9.       Submit the Original Cheque leaf instead of photocopy.

10.   Indemnity Bond must be on Stamp paper as per state stamp act & Advance Receipt having revenue stamp affixed both as per latest instruction kit format duly signed & dated by claimant & 2 witnesses

 

(G)  FAQS ON IEPF CLAIM PROCESS

 

1.  Whether the claim has to be made online?

Yes, the claim needs to be made online through web-form IEPF 5. This is new form which has become effective from 20th September, 2019. Claims filed in physical mode are summarily rejected.

 

2.  Do Claimant need to register on IEPF website before filling of form IEPF-5.

Yes, registration is required on IEPF website under the link `Forms’.

 

3.  Do I need to have PAN mandatorily for filing e-form IEPF 5?

Yes, PAN is mandatory. The new e-form IEPF 5 is a PAN verified form and in case of any variation, the system will not allow filling/submission of such e- Form. The form requires OTP based verification for submission, for which claimant should have an active mobile number and a valid email id.

 

4.  When are the shares OR unpaid/unclaimed dividend transferred to IEPF?

If the dividend declared by the company remains unpaid / unclaimed for a period of seven years, the company is required to transfer the same to IEPF. Further, all shares in respect of which dividend has not been paid/claimed for seven consecutive years or more is required to be transfer by the company in the name of IEPF

 

5.  Who can claim the shares / unclaimed dividend transferred to IEPF Authority?

Any person whose shares / unclaimed dividend or other amount such as matured deposits, matured debentures, application money due for refund, or interest thereon, sale proceeds of fractional shares, redemption proceeds of preference shares etc. have been transferred by the company to IEPF may claim the shares and/or apply for refund of amounts transferred, from the IEPF Authority, by submitting an online application in Web-Form IEPF-5 available on IEPF website. Application can also be made by any successor, legal heir / representative of the deceased person.

 

6.  Whether mobile number and email is mandatory for filing Web-Form IEPF-5?

The form requires OTP based verification for submission, for which claimant should have an active mobile number and a valid email-id.

 

7.  What is the required value of the stamp paper for the indemnity bond?

In case of refund of dividend amount of Rs. 10,000 or more and/or market value of shares, non- judicial stamp paper of appropriate value as prescribed under Stamp Act according to state is required. For claim of only amount of Rs. 10,000 or less, indemnity bond can be executed on a plain paper.

 

8.  In case of non-availability of Aadhar Card, what other documents can be submitted as proof of identity?

In case of non-availability of Aadhar Card for super senior citizens or some specific states, other ID Proofs issued by government clearly mentioning the address of the claimant needs to be submitted.

 

9.  Is original Share/Deposit/Bond/Debenture certificate required to be submitted?

Yes, original certificate is required to be submitted. In case of loss of original, documents as required under Schedule III need to be submitted.

 

10.  What happens if the name on original certificates is not matching with the PAN or address on the Proof of Identity is not matching with company’ records?

In such case as per SEBI Guidelines, an affidavit explaining the above deviation needs to be submitted.

 

11.  In case of mismatch in name, proof of name as on share certificate or change of name viz. marriage certificate, gazette notification etc. needs to be submitted.

In case of mismatch in address, new address needs to be updated with the company.

 

12.  What are the documents required to be submitted with IEPF claim?

The list of documents as specified in Clause E of this Article are required to be submitted with IEPF claim after making an application in Web-Form IEPF-5 and send to the Nodal Officer of the Company for verification of the same.

 

13.  Important links:

 

Ø IEPF Website Ø Web-Form IEPF-5 and instruction kit Ø For Uploading Web-Form IEPF-5 Ø FAQs on claim procedure from IEPF Authority

: : :   :

http://www.iepf.gov.in/ http://iepf.gov.in/IEPF/corporates.html http://www.mca.gov.in/mcafoportal/showEformUpload.do http://iepf.gov.in/IEPF/pdf/FAQsIEPF5.pdf

Click here to review our previous posts on the Same topic.

-:Note for Investor:-

Feel free to discuss any query related to Claim of Shares and Dividend from IEPF Authority.

 

Regards,

CS Ravi Garg

(Company Secretary & Compliance Officer)

E-mail : csravi2014@gmail.com

Mob.: +91-7838 20 4665

 

Disclaimer:

IN NO EVENT THE AUTHOR SHALL BE LIABLE FOR ANY DIRECT, INDIRECT, SPECIAL OR INCIDENTAL DAMAGE RESULTING FROM OR ARISING OUT OF OR IN CONNECTION WITH THE USE OF THIS INFORMATION.

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