As per Section 124 of Companies Act, 2015
Where a dividend has been declared by a company but has not been paid or claimed within 30 days from the date of the declaration to any shareholder entitled to the payment of the dividend, the company shall, within 7 days from the date of expiry of the said period of 30 days, transfer the total amount of dividend which remains unpaid or unclaimed to a special account to be opened by the company to be called the Unpaid Dividend Account.
Any person claiming to be entitled to any money transferred to the Unpaid Dividend Account of the company may apply to the company for payment of the money claimed.
Any money transferred to the Unpaid Dividend Account of a company in pursuance of this provision 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 the Fund established under sub-section (1) of section 125
All shares in respect of which dividend has not been paid or claimed for seven consecutive years or more shall be transferred by the company in the name of Investor Education and Protection Fund.
How to claim the money/shares transferred to IEPF Account?
Any person whose shares, unclaimed dividend, matured deposits, matured debentures, application money due for refund, or interest thereon, sale proceeds of fractional shares, redemption proceeds of preference shares etc., has been transferred to the Fund, may claim the shares under proviso to sub-section (6) of section 124 or apply for refund under clause (a) of sub-section (3) of section 125 or under proviso to sub-section (3) of section 125, as the case may be, to the Authority by submitting an online application in Form IEPF-5 available on the website www.iepf.gov.in along with fee specified by the Authority from time to time in consultation with the Central Government.
Upon submission, Form No.IEPF-5 shall be transmitted online to the Nodal Officer of the company for verification of claim:
Provided that the claimant after making an application in Form No. IEPF-5 , shall to send the attachments Prescribed below to Nodal Officer (IEPF) of the company at its registered office in an envelope marked “claim for refund form IEPF Authority” for initiating the verification for claim
Attachments to Send
- Copy of acknowledgement generated on online submission of e-Form IEPF – 5 bearing a unique serial number (SRN)
- Indemnity Bond (original) with claimant signature
- Advance Stamped receipt (original) with revenue stamp and signature of claimant and witnesses
- Original matured deposit / debenture / share certificate (in case of securities held in physical form) or copy of transaction statement in case of securities held in Demat Form
- Self-attested copy of Aadhaar Card
- Proof of entitlement (certificate of share/Interest warrant Application No. etc.),
- Cancelled Cheque leaf
- Copy of Passport, OCI and PIO card in case of foreigners and NRI.
The company shall, within 30 days from the date of receipt of claim, send an online verification report to the Authority after verification of details in Form No. IEPF-5 along with all the documents submitted by the claimant and shall attach the scanned copy of all the original documents submitted by the claimant in physical form duly certified by its Nodal Officer along with the e-verification report along with a scanned copy of both sides of original physical share certificate or original bond or deposit or debenture certificate/s duly cancelled and certified
Where the Authority, on examining any application for claim, finds it necessary to call for further information or finds such application or e-form or document to be defective or incomplete in any respect, the Authority shall give intimation of such information called for or defects or incompleteness, by e-mail on the email address of the claimant and the company, which has filed such application or e-form or document, directing him or it to furnish such information or to rectify such defects or incompleteness or to re-submit such application or e-Form or document within fifteen days from the date of receipt of such communication, failing which the Authority may reject the claim or e-form No. IEPF-5
Provided that if such information or incompleteness is called from the claimant, he shall file the e-form and shall send such documents as called for within fifteen days, duly signed by him, to the Nodal Officer of the concerned company at its registered office for verification of the claim and company shall send a revised verification report:
Provided further that if any such information or incompleteness is called from the company, the company shall file the revised verification report and shall send such documents as called for within thirty days
What are the documentary requirements in case claimant is a legal heir?
(i) In case of legal heir – the claimant is required to register transmission with the company by providing requisite documents as per SEBI Guidelines. According to SEBI Guidelines for registering transmission, company may require copy of death certificate, Affidavit from legal heirs, Indemnity Bond, Succession Certificate or probate of will or letter of administration etc. for share with market value greater than 2 Lakhs, NOC from other legal heirs and relinquishment deed in favour of claimant etc.
(ii) In case of death of any of the holder in joint holding of securities, but not covered in the family hierarchy – the claimant is required to get the name of the deceased holder of security deleted from the register of the members/other records, if any, in the company immediately after the death of a joint security holder before filing claim application. The claimant is also required to obtain NoC from other holders of securities, if any, and submit the same along with claim application. SEBI Guidelines may also be seen before filing claim application. Company is required to issue entitlement letter under rule 7(9) of IEPF Rules 2016 in favour of claimant and send it along with copy of documents submitted by claimant with its verification report.
Penalty
Any fraudulent claim by the claimant shall be deemed to be fraud within the meaning of section 447 of the Act and the claimant shall be liable accordingly.
If any person deceitfully personates an owner of any security or of any share warrant or coupon issued in pursuance of this Act and thereby files any claim to obtain or attempts to obtain any such security or interest or any such warrant or coupon due to the lawful owner, he shall be punishable under sections 57, 447 and 448 of the Act.
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