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Shares Recovery
Pricing for Shares Recovery
Recovery of Shares for value upto Rs 5L Per Folio
- Unclaimed Dividend Covered
- All Legal Expenses Included
- Only Basic Documents & Signature needed
- Dedicated project Manager
- Search of all unclaimed investments covered
Rs 25000/- only
End To End Recovery Process for value above Rs 5L
- Unclaimed Dividend Covered
- All Legal Expenses Included (Except Succession Certificate)
- Only Basic Documents & Signature needed
- Dedicated project Manager
- Search of all unclaimed investments covered
Custom
Filing Assistance (IEPF-5 Form Filing)
- Value of Shares Upto Rs 10 Lacks
- Unclaimed Dividend Covered
- Unclaimed Dividend Covered
- Instruction Kit Included
- No Legal Expenses Covered
Rs 9999/- only
Recovery of Unclaimed Shares and Dividends
Unclaimed Dividends and Shares Transferred to IEPF Authority
There is a countless investors who invested in companies during the era of physical share certificates who have either lost track or are no longer aware of such investments due to various reasons such as:
- Loss of share certificates
- Forgotten shares
- Change of address/name
- Death of Investor
- Non-functional bank accounts & demat accounts
As per Section 124 (5) of the Companies Act 2013, any dividend which has been unclaimed in a company for seven consecutive years shall be transferred to the IEPF Authority. Any shares whose dividend has been unclaimed and unpaid for seven consecutive years shall also be transferred to the IEPF Authority.
As per the latest “Consultation Paper on refund process at IEPF Authority,” a staggering amount of dividends amounting to INR 5,685 Crores have been transferred to IEPF and ~117 Crores have been transferred to IEPF.
We help investors & legal heirs in claiming back their unclaimed investments in shares & dividends with complete end-to-end support including:
- Updation of KYC, signatures, address, bank & demat A/c details
- Procurement of duplicate shares in case of loss of shares
- Correction of the shareholder’s name in case of a name mismatch
- Transmission of shares in favor of Legal Heirs / Successors in case of Death of the Shareholder
- Dematerialization of Physical shares
- Claim of shares & unclaimed dividends from IEPF Authority
- Obtaining succession certificate/probate of will/letter of administration from courts
IEPF Claims and Refunds
IEPF stands for Investor Education & Protection Fund. IEPF was established under Section 205C of the Companies Act, 1956 by the Companies (Amendment) Act, 1999 to promote investor awareness and protect the interests of investors. Later, the IEPF Authority was established under Section 125 (5) of the Companies Act, 2013 to administer the IEPF Funds and provide refunds of shares, unclaimed dividends, matured debentures and other deposits. to the investors and to promote investor awareness.
As per Section 124 (1) of Companies Act 2013, companies are mandatorily required to transfer any dividends which goes unclaimed or unpaid for a period of 30 days from the declaration date to a special bank account created by the company i.e. Unpaid Dividends Account, within a period of 7 days after the expiry of the said 30 days.
Under section 124 (5), any money transferred to the Unpaid Dividend Account of a company, which remains unclaimed or unpaid for a period of seven consecutive years, needs to be transferred or sent to the Investor Education and Protection Fund established. This means that any investor who has not claimed any dividends for a period of seven consecutive years will have to claim back his/her dividends from the Investor Education and Protection Fund (IEPF).
Further, as per section 124 (6) of the Companies Act 2013, the shares in respect of which dividends have not been paid or claimed for a period of seven consecutive years or more shall also be transferred by the company to the Investor Education and Protection Fund (IEPF) along with the unclaimed dividends. So any investor who has not claimed the dividends for a period of consecutive seven years will have to claim back the unclaimed dividends from the Investor Education and Protection Fund (IEPF) after following the complete procedure of filing the claim with the IEPF Authority.
It is startling to know that as per the latest “Consultation Paper on refund process at IEPF Authority” a staggering amount of dividends amounting to INR 5,685 Crores have been transferred to IEPF and ~117 Crores have been transferred to IEPF. As per various estimates these shares are worth ~50,000 Crores in current market value which are lying unclaimed with the IEPF Authority.
To get the shares back from the IEPF authority, an investor has to go through numerous procedures and formalities to get the entitlement letter and then he / she can reclaim his shares / dividends from the IEPF Authority by following the below-mentioned steps:
- A claimant has to submit Form IEPF-5 on the Ministry of Corporate Affairs portal for which he / she needs to information like – Demat account number, applicant information, company information from which the amount is due with CIN number, details of share to be claimed and details of dividend amount to be claimed.
- After submitting the Form IEPF-5, the claimant should send the copy of the form in an envelope labelled “Claim for a refund from IEPF Authority” to the company’s IEPF Nodal Office / Registrar with the online application Form IEPF-5 with the claimant’s signature, copy of the acknowledgement with SRN number.
- The company must prepare a verification report within 15 days of receiving a claim form from a claimant and submit it to the IEPF Authorities along with the claimant’s documentation.
- The IEPF Authority must decide on the claimant’s reimbursement application within 60 days after obtaining the verification report from the relevant company that has validated the claimant’s application.
Government is trying to simplify the process for claiming back shares & dividends from the IEPF authority however for senior citizens, foreign citizens, NRIs & legal heirs the process is still very complex, cumbersome & time consuming. Investors or the legal heirs have to deal with multiple parties involved in the process including companies, their registrars, courts & IEPF authority to complete various compliances & documentations. IEPF authority keeps disseminating a lot of information for investor awareness through its websites & other channels however claimants still tend to make several mistakes in the process because of which the process is either stuck or delayed. Some of the common mistakes made by the claimants includes:
- Name of the applicant not matching with the PAN database.
- Date of birth of the applicant not matching with the PAN database.
- PAN No. not verified.
- Wrong Aadhar Card No. filled in the form.
- Wrong passport and OCI /PIO card details in case of foreign citizens.
- Whether Rule 7 of IEPF Rules is applicable or not is wrongly selected. It is to be selected as “Yes” in case the original shareholder is deceased
- Rule 7 is wrongly selected as “Yes” in case of deletion of name cases. In case of a joint holding if one of the joint holder has passed away it is only a case of “Name deletion” and does not get covered under IEPF (7)
- Details of name of the original security holder (deceased shareholder) and their beneficiary wrongly mentioned.
- Wrong folio number or numbers of folios filled in the form.
- No. of shares wrongly filled in the form.
- Wrong dividends details filled in the form which have been transferred to IEPF.
- Wrong financial year filled in the form.
- Wrong bank account or demat account details filled in the form. Bank account should be the one which is linked to the demat account.
- Wrong attachments or absence of compulsory attachments.
Tracing Unclaimed Investment
Shares & dividends worth several crores are lying unclaimed either in the form of physical shares or have been transferred to the Investor Education Protection Fund Authority due to dividends lying unclaimed for several years. These shares belong to lakhs of investors or deceased shareholders who hold them either in physical form or in dormant Demat accounts.
Some very important numbers about unclaimed investments:
- Dividends worth ~INR 5685 Crores are lying unclaimed with the IEPF authority
- ~117 crore shares are lying unclaimed with the IEPF Authority
- ~Shares estimated to be worth ~50,000 crores are lying unclaimed with the IEPF Authority
- Our estimate of investments in physical shares is estimated to be worth ~2 lakh crores
You could be a legitimate owner or claimant / legal heirs to such unclaimed investments which are worth several lakhs or crores today. These investments could be lying unclaimed because of one of the following reasons:
- Frequent changes of address
- Loss of the shares certificates
- Investors & families move abroad
- Dormant bank accounts & demat accounts
- Forgotten investments
- Sudden demise of the shareholder in the family
Demat of Physical Share
There was once a time when the Indian Share Market followed the open outcry system where the investors had to make themselves physically present in order to carry out the buying and selling of shares. In that era, everything used to be on papers and the trading of shares could only be done in physical form i.e., with the help of the physical share certificate which was used as a proof of ownership of physically transferred shares.
With our ever-evolving technology, this process of physical trading of shares became out-dated and redundant. Gradually, this process got overshadowed by the new trends of online trading and got replaced by the technology-backed trading platforms. Now the Indian stock market has evolved to offer better features and ease of trading through online platforms.
Now, as per the new regulations laid down by the governing board i.e., Securities and Exchange Board of India (SEBI) has made it mandatory for the investors to convert their shares and securities in Demat form in order to continue investing, buying or selling of shares. These reforms in the stock market have taken place in order to ensure a smooth and efficient way of trading with the shares viz-a-viz has made it easy for the authorities to maintain a true account of all the transfers of shares.
However, not everyone holds a Demat Account. Some people are still the owners of physical shares. As it is compulsory for all the investors to hold shares in Demat form in order to continue investing and trading, the shift in trends has raised a question that “How can the investors convert their physical shares into Demat form?”
To understand the process of Conversion / Dematerialization of Shares better, we should first take look at some important terms:
1. DEMATERIALIZATION
Dematerialization refers to a process by which physical share certificates of a particular company are converted into an electronic format.
2. DEMAT ACCOUNT
When physical shares are converted into Demat form, then they are held in electronic form. In order to hold them in electronic form, there is a requirement to open a depository account, i.e. called as a Demat Account.
3. DEPOSITORY PARTICIPANT
A depository participant (DP) is an agent of the depository through which the Demat Account is made, maintained and operated. A DP acts as a middle-men between the account holder and the depository. Any financial service provider, like banks, state financial corporations, stock-brokers, NBFC, etc., can get themselves registered as a DP.
4. DEPOSITORY
A depository in an entity that holds securities like shares, debentures, bonds, government securities, mutual fund units etc. of the investors in electronic form on behalf of the investors or security holders. For instance, in India, there are two depositories named National Securities Depository Ltd. (NSDL) and Central Depository Services (India) Ltd. (CSDL) that are registered with SEBI.
STEPS TO CONVERT YOUR PHYSICAL SHARES TO DEMAT FORM
- The first step is to open the Demat Account in the depository registered with SEBI with the help of Depository Participant (DP) by submitting the application form and other KYC documents.
- Thereafter, the investor/shareholder will be obligated to read and sign the terms of agreement mentioning the rights of potential account holder and the DP along with the scheduled charges for the same. A Demat account number will be provided and the Demat Account will be opened.
- Once the Demat Account has been opened, the investor has to send a form called the Dematerialization Request Form (DRF) along with his physical share certificate of the company to the Depository Participant (DP). In cases where the investor holds physical shares of more than one company, then he must submit physical share certificates of all the companies along with a completed DRF form for each of the companies.
- The DP will check and verify the completeness and veracity of all the documents submitted by the Investor. Meanwhile, a Dematerialisation Request Number (DRN) will be issued to the investor as an acknowledgment receipt till the time DP verifies his documents.
- After verifying the documents, DP will send the request of dematerialisation to the company of which the share-holder wants to get his shares converted to Demat format.
- After the approval, the physical shares will be converted to Demat form. Thereafter, the physical shares will be destroyed for the purpose of avoiding misuse or duplicity.
- Once the physical shares are dematerialised, the monetary value of the physical shares will be credited to the Demat Account which can, later, be used for buying or selling with the ease of online trading.
After following the above-mentioned steps, the Physical share certificates will be said to be converted to Demat format.
Transmission of shares
The word “transmission” is defined as the passing of a property /asset by operation of law. In the case of the death of a shareholder, the process of transfer of ownership / right of shares to the legal heirs or successors is called as Transmission of shares. If a person dies and leaves a Will, it is referred to as testamentary succession. However, if a deceased person did not leave a will, it is called intestate succession. In the case of testamentary succession, the legal heirs must turn to the competent courts to obtain the probate of the will. In the case of intestate succession, a certificate of inheritance must be applied for at the court in which the deceased had his or her permanent residence which is referred to as the Succession Certificate.
Difference between Transfer & Transmission of shares
The fundamental question that raises in the field of shares is the difference between the transfer of shares and the transmission of shares.
| Transfer of Shares | Transmission of Shares |
| Refers to the transfer of ownership of shares from one person to another. | Refers to the transfer of ownership of shares due to the death or incapacity of the current shareholder. |
| Can be made at any time and frequently. | Occurs due to the death or incapacity of the shareholder. |
| It is a voluntary transfer. | It is an involuntary transfer governed by the law of inheritance. |
| Requires completion of a stock transfer form and payment of any applicable stamp duty. | Requires a court order in form of Succession Certificate / Probate of Will / Letter of Administration or a Surviving member certificate / legal heir certificate depending upon case to case. |
| Can be made by an individual or a legal entity. | Is usually made by the legal heirs or executors of the deceased shareholder or by a court-appointed guardian for a shareholder who is incapable of acting. |
| The transferor must hold a valid title for the shares. | The acquirer must prove his relationship to the deceased or incapacitated shareholder. |
| The transfer is subject to compliance with the provisions of the Companies Act and SEBI regulations. | The transfer is subject to compliance with the provisions of the Companies Act and the SEBI regulations and the laws of succession / inheritance as applicable. |
Probate of Will:
When a person dies after leaving a will, it is called testamentary succession. In this case the executor of the Will needs to obtain a probate of the Will from the court for the transfer of the deceased’s property / assets.
Succession Certificate:
A Succession Certificate is issued to the successor of a deceased person who has not made a will, to establish the rights of the successor. Succession Certificate gives the holder of the certificate the authority to dispose of the debts and securities of the deceased. It is issued by the district judge of the competent court.
LOA (Letter of Administration):
An official court document issued to give power of attorney to a person to administer the entire estate of a deceased person. It is issued when a person dies at death (without leaving a will). The letter of administration gives the person the right to administer the estate of a deceased person. If there is no executor, the beneficiary can apply to the court for a letter of administration.
Legal Heir Certificate or Surviving Member Certificate:
In the event of the death of a family member, his legal heirs might require an authentic document to determine who are the legal heirs or surviving members to the deceased in the form of a Legal Heir Certificate or Surviving Member Certificate.
LEGAL SUPPORT SERVICES
Legal support services encompass a spectrum of assistance provided by legal professionals to enhance and facilitate various aspects of the legal process. These services may include legal research, document preparation, case management, and administrative support. By collaborating with attorneys and law firms, legal support services contribute to the efficient functioning of the legal system, ensuring accuracy and compliance with legal standards. This comprehensive support enables legal practitioners to focus on core aspects of their work, ultimately leading to more streamlined and effective legal outcomes.
ESTATE PLANNING
Estate planning is the strategic and legal process of arranging for the management and distribution of an individual’s assets and wealth during their lifetime and after their death. This comprehensive planning involves the creation of wills, trusts, and other legal documents to ensure that the individual’s wishes regarding their estate, beneficiaries, and healthcare directives are clearly articulated and executed. Estate planning aims to minimize potential tax implications, provide for loved ones, and safeguard assets, offering individuals peace of mind regarding the future handling of their affairs.
NRI SERVICES
NRI services, or Non-Resident Indian services, cater to individuals living abroad who maintain financial, legal, and investment ties to their home country. These services often include assistance with financial planning, investment management, legal matters, and property transactions. NRI services aim to address the unique needs and challenges faced by individuals residing outside their home country, ensuring effective management of their assets, compliance with regulations, and seamless connectivity to their roots. Providers of NRI services offer guidance to help clients navigate cross-border complexities and make informed decisions concerning their financial and legal affairs.
Unclaimed Deposits
Unclaimed deposits refer to financial assets, typically held in banks or financial institutions, that have not been accessed or claimed by the account holders for an extended period. These deposits can include dormant bank accounts, unclaimed dividends, or abandoned safe deposit boxes. Financial institutions often have procedures in place to identify and manage unclaimed deposits, which may involve attempts to locate and notify the rightful owners. In some cases, if efforts to reunite the deposits with the owners are unsuccessful, the funds may be turned over to relevant government authorities in accordance with legal requirements.
