Procedure for transferring unclaimed or unpaid dividend to Investor Education and Protection Fund (IEPF) in brief
Applicable Provision: Rule 5 of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 r/w Section 125 of Companies Act, 2013.
Below-mentioned is the procedure as given under Rule 5:
1. The amount of unclaimed or unpaid dividend required to be credited by the companies to the Fund shall be remitted online along with a statement in Form No. IEPF-1 containing details of such transfer to the Authority within a period of thirty days of such amounts becoming due to be credited to the Fund.
2. The amount may also be remitted by Electronic Fund Transfer in such manner, as may be specified by the Central Government.
3. On receipt of the statement, the Authority shall enter the details of such receipt in a Register maintained physically or electronically by it in respect of each company every year, and reconcile the amount so remitted and collected, with the concerned designated bank on monthly basis.
4. Each designated bank shall furnish an abstract of such receipts during the month to the Authority within seven days after the close of every month.
5. The company shall maintain the record filed under sub-rule 5(1) as above in the same format along with all supporting documents and the Authority shall have the powers to inspect such records.
Every company shall within a period of sixty days after holding of the Annual General Meeting or the date on which it should have been held as per the provisions of section 96 of the Act, whichever is earlier and every year thereafter till completion of the seven years period, identify the unclaimed dividend, as on the date of closure of financial year the account of which are to be adopted in the Annual General Meeting, separately furnish and upload on its own website and also on website of Authority or any other website as may be specified by the Government, a statement or information of unclaimed and unpaid amounts through Form No.IEPF-2, separately for each of the seven financial years, containing following information, such as:- the names and last known addresses of the persons entitled to receive the sum, the nature of amount, the amount to which each person is entitled, the due date for transfer into the Investor Education and Protection Fund, and such other information as deemed necessary.
Note: The above-mentioned points and procedure are Ad Verbatim as per the cited Rules, and readers should supplement this with Section 125 of Companies Act, 2013.
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