Section 123(4) provides that the amount of the dividend, including interim dividend, shall be deposited in a scheduled bank in a separate account within 5 days from the date of declaration of such dividend if the articles of the company do not authorize so, it has to be amended accordingly.
According to Section 126(1) of the Companies Act, 2013 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 in that behalf in any scheduled bank to be called the Unpaid Dividend Account.
Any person claiming to be entitled to any Dividend transferred to the Unpaid Dividend Account of the company may apply to the company for payment of the Dividend. After declaration of Dividend, the company has no beneficial interest in the amount so declared, but is merely a custodian in the nature of a trustee until the amount is paid to a special account. (Section 124 of the companies act, 2013)
The company should enter the details of unpaid or unclaimed Dividend in a register and reconcile the amount of Unpaid or Unclaimed Dividend Account, with the concerned bankers, periodically.
A listed company should ensure such reconciliation through its Share Registrar and the Dividend banker on a fortnightly basis during the initial validity of the Dividend warrants and thereafter on a quarterly basis till transfer of funds to the Investor Education and Protection Fund.
PROCEDURE FOR CLAIMING SHARES FROM IEPF
The procedure is explained as under:
STEP 1: Apply for refund to the Authority by submitting an online application in Form IEPF-5.
STEP 2: Simultaneously, the person shall send application to the company duly signed by him along with, requisite documents as enumerated in Form IEPF-5 to the nodal officers of the concerned company at its registered office for verification of his claim.
STEP 3: The Company shall, within 15 days from the date of receipt of claim, send a verification report to the Authority, along with all the documents submitted by the claimant.
In case of non-receipt of documents by the Authority after the expiry of 90 days from the date of filing of Form IEPF-5, the Authority may reject Form IEPF-5, after giving an opportunity to the claimant to furnish response within a period of 30 days.
STEP 4: After verification of the entitlemen0t of the claimant
a) To the amount claimed, the Authority and then Drawing and Disbursement Officer of the Authority shall present a bill to the Pay and Accounts Office for e- payment as per the guidelines,
b) To the shares claimed, the Authority shall issue a refund sanction order with the approval of the Competent Authority and shall credit the shares to the DEMAT account of the claimant to the extent of the claimant’s entitlement.
STEP 5: An application received for refund of any claim under this rule duly verified by the concerned company shall be disposed off by the Authority within 60 days from the date of receipt of the verification report from the company, complete in all respects and any delay beyond 60 days shall be recorded in writing specifying the reasons for the delay and the same shall be communicated to the claimant in writing or by electronic means.
STEP 6: In case, claimant is a legal heir or successor or administrator or nominee of the registered share holder, he has to ensure that the transmission process is completed by the company before filing any claim with the Authority.
STEP 7: In case, claimant is a legal heir or successor or administrator or nominee of any other registered security or in cases where request of transfer or transmission of shares is received after the transfer of shares by company to the Authority, the company shall verify all requisite documents required for registering transfer or transmission and shall issue letter to the claimant indicating his entitlement to the said security and furnish a copy of the same to the Authority while verifying the claim of such claimant.
STEP 8: The claimant shall file only one consolidated claim in respect of a company in a financial year.
Author Bio
