RANEN GANGULI

Ranen Ganguli, one of the promoters of WEALTH TROVE is a Post Graduate in FINANCE. He has also done Post Graduation in COMPUTER APPLICATION & SOFTWARE MANAGEMENT. Mr. Ganguli has more than 25 years of experience in marketing Financial Products and worked with some reputed companies like Centurian Bank, MetLife India, Bajaj Auto Finance, and India Infoline at the Managerial and AVP levels.

He has a thorough knowledge of the recovery of invested monies that are lying unclaimed in IEFP, Shares, Mutual Funds, Banks, Post Offices, Life Insurance, and Provident Funds.

He also has excellent knowledge and expertise in WEALTH MANAGEMENT and has a large number of satisfied client bases in the RETAIL and HNI segments.

CA ANIMESH MUKHOPADHYAY

CA Animesh Mukhopadhyay is a fellow member of the Institute of Chartered Accountants of India with the standing of around 25 years.

He has a post CA qualification in the field of Information Systems Audit. He is a qualified INSOLVENCY PROFESSIONAL and member of INDIAN INSTITUTE OF INSOLVENCY PROFESSIONALS – ICAI.

His main area of expertise includes Social Sector Audits & Impact Assessments, Corporate Laws, Merger & Acquisitions, matters connected to US Corporate laws and Investment Opportunities. He has served and represented various companies on issues relating to erstwhile Company Law Board and presently at various NCLT benches and investigation matters situated in West Bengal, Bihar, Jharkhand, North Eastern India, Orissa, Mumbai and Delhi. He is a trainer on corporate laws and compliances and serves companies based all over India. He is also involved in the mentoring process of various MSMEs and Start Up ventures.

Mr Mukhopadhyay is the Past President of Accountants’ Library, one of the oldest associations of CAs since 1947. He is also the member of the panel of Mediator and Conciliator of Ministry of Corporate Affairs, Eastern Region.

SOUMITRA BHATTACHARJEE

Soumitra Bhattacharjee, a seasoned professional with a rich background in the educational domain and finance sector. Holding a B.Tech degree from Bangalore, Soumitra brings a unique blend of technical expertise and extensive industry experience to our team.

With an impressive 25 years of hands-on experience, Soumitra has established himself as a stalwart in the field of education and finance. His journey in these sectors has equipped him with a deep understanding of the intricacies and dynamics that drive success in both domains.

PROBAL KUMAR MUKHERJEE

A designated Senior Advocate in the High Court at Calcutta with an expansive practice in CIVIL and CONSTITUTIONAL matters. His father is still practicing as CIVIL LITIGATION lawyer at Alipore Court, Kolkata.

Mr. Mukherjee believes that the lawyers have a responsible role to play in the society and to shape it as social engineers. During his long career of more than 28 years, he has the privilege to work with doyens of Calcutta High Court and always offer his sincere gratitude to them.

He is an earnest proponent of using the advancement of information technology in judicial system, particularly artificial intelligence, which should be actively put in use in legal process.

KANAK KUMAR DAS

A Retired Faculty Member of Life Insurance Corporation of India. During his long career of 35 years with LIC of India, Mr.Das has worked at Managerial levels in different departments like Policy Servicing, Administration, Claims Settlement, Legal etc.

He was posted at various locations, especially at Northern & Eastern part of our country, which helped him to gather practical experience about the difficulties or harassments faced by policyholders or claimants due to varied reasons from deficiency in service, delay in settlement of claims, mis-selling of insurance products etc
He gained thorough knowledge about the activities of Insurance Forum & Insurance Ombudsmen, which helped us to solve many critical Life Insurance cases.

FCS NUPUR CHOUDHURI

FCS Nupur Choudhuri has been practicing as a Company Secretary since May 2014. She has a team of young and resourceful hands who through their repertoire of knowledge and experience have earned the confidence of clients.

She is experienced in conducting secretarial audit, audit under Sec 92(2) of the Companies Act 2013 and catering to Corporates including Sec 8 Companies as consultant.

Apart from the core areas of Corporate Law and Business Advisory Services including Merger and Amalgamations and buyback of shares, she is also specialised in INCOME TAX laws, SME advisory services and advisory services on FCRA and compliance of various laws relating to setting up and running of business.

GENERAL INSURANCE

Stuck Claims Recovery, Ombudsman Settlement, Consumer Forum / Court Settlement

Before buying, renewing, or porting an insurance policy, the most basic aspect one needs to check, among many other things, is how the insurer settles claims. The claim settlement track record of a general or a health insurance company gives an idea of how many claims it pays out during a financial year as a percentage of the total number of claims it gets.

An insurance claim is a formal request to an insurance company asking for a payment based on the terms of the insurance policy. The insurance company reviews the claim for its validity and then pays out to the insured or requesting party (on behalf of the insured) once approved.

The claims process is the defining moment in a non-life insurance customer relationship. To retain and grow market share and improve customer acquisition and retention rates, insurers are focused on enhancing customers’ claims experience. In a highly competitive insurance market, differentiation through new and more effective claims management practices is one of the most important and effective ways to maintain market share and profitability.

Today all General Insurance companies have a built-in CLAIM PROCESS system

Simplified Claim documentation
Content management tool
Smart phone-based technology solutions
Third-Party / In House dedicated claim processing team to minimize delay
Modern claim processing platform which is seamless & robust

Motor insurance Claim

Third-Party Claim

In a third-party claim, where an insured vehicle is involved, it is important to ensure that the accident is reported immediately to the police as well as to the insurance company. On the other hand, the insured is a victim, that is, if somebody else’s vehicle was involved, he must obtain the insurance details of that vehicle and make an intimation to the insurer of that vehicle.

Own Damage Claim

In the event of an own damage claim, that is, where the insured vehicle is damaged due to an accident, the insured must immediately inform the insurance company and police, wherever required, to enable them to depute a surveyor to assess the loss. The insured must not attempt to move the vehicle from the accident spot without the permission of the police and the insurer. Theft Claim

If the holder’s own vehicle is stolen, he must inform the police and the insurance company immediately. In addition, you must keep the transport department also informed. As soon as the Policy Holder receives the policy document, he must read about the procedures and documentation requirements for claims.

If the holder has to make a claim, he must ensure that he collects all the required documents and submits them along with the requisite claim form duly filled in, to the insurance company. There may be certain specific documentation requirements for specific types of claims. For instance, with respect to a theft claim, there is a special requirement that the policyholder should surrender the vehicle keys to the insurance company.

Property insurance claim

There could be several types of policies that cover property and the property itself could be stationary – like a building, or moving around – like your household goods being transported.

Policy Holder on receipt of policy document must familiarize himself with the documents required for a claim as well as the procedures to be followed. Whether or not a claim arises Policy Holder must follow the various dos and don’ts in respect of his property for the duration of the policy. These dos and don’ts are termed warranties and conditions in the policy document. In general, losses and damages, including those due to theft, fire, and flood need to be intimated to the relevant authorities such as the police, the fire brigade, and so on. It is important to ensure that the Policy Holder informs the insurance company to enable it to send a surveyor to survey and assess the loss.

Travel insurance claim

A travel insurance policy is generally a package policy that includes different types of covers like hospitalization, personal accident, loss/ damage to baggage, loss of passport and so on.
The procedure and documents required for a claim would vary from cover to cover.

For ease of procedure and convenience, insurers normally attach the claim form with the policy document. This will contain the list of documents required in case of a claim and also the contact details including phone numbers of the claims administrator either in the destination country to which you are traveling or in another country that is designated to receive and process your claim intimation.

Formalities for a health insurance claim

Policy Holder can make a claim under a Health insurance policy in two ways:

Cashless basis and
Reimbursement basis

Claim on a Cashless basis: For a claim on a cashless basis, treatment must be only at a network hospital of the Third Party Administrator (TPA) who is servicing your policy. Policy Holder must seek authorization for availing the treatment on a cashless basis as per procedures laid down and in the prescribed form. He must read the policy document as soon as he receives it, to understand the claim process and not read it at the time the claim arises.

Claims on a Reimbursement basis: Policy Holder must read the clause relating to claims in the policy document as soon as he receives it to ensure that he understands the procedure and the documents required for making a claim on a reimbursement basis. When a claim arises he should inform the insurance company as per procedures required. After hospitalization, he has to ensure that he obtains and keeps ready documents such as claim forms, discharge summaries, prescriptions, and bills that he should submit for a claim.

When is a General Insurance claim rejected by the insurer?

It is very crucial to collate all the required documents before filing a claim. If your claim has been rejected once due to improper documentation, you can file it again with all proper documents. In general, there are 4 main reasons why a claim got stuck. They are Reason 1 – If your claim is found to be non-genuine

Reason 2 – Inability to produce the required documents

Reason 3 – Delay in filing the claim

Reason 4 – Non-renewal of insurance policy

But denial of the claim is not the end of the road. If your claim is either not entertained or is denied, you can approach the insurer and even the IRDAI. Claims rejection, delays in settling claims, and lack of proper communication with the policyholder are very common. Documentation is the most important thing in insurance, whether it is buying a policy or making a claim. After you file a claim and provide the company with all the documents it asks for, they should accept or reject the claim in two weeks. If this TAT is not adhered to, you can complain to the grievances officer by quoting the details of the policy and the claim.

Complaints to the grievance officer can be about dissatisfaction with the insurer, distribution channels, intermediaries, insurance intermediaries, or other regulated entities about an action or lack of action about the standard of service or deficiency of services. It is mandatory for all insurance companies to resolve a grievance within two weeks of its receipt.

If any complaint is not resolved, or resolved to your dissatisfaction, you can escalate your complaint to IRDAI which will take it up with the insurance company and facilitate a re-examination of the complaint and resolution.

If the company does not respond even after 15 days or if you are not satisfied with the action taken, you can escalate the complaint to the Insurance Ombudsman or seek other legal remedies if the insurance company’s response is not to your satisfaction.

All the above procedures require a professional approach and thorough knowledge on the subject, otherwise, your complaint will not be entertained by the higher officials. In case you need proper guidance we can help you to get your legitimate claim.

IEPFA CLAIMS

IEPFA was been established under Section 205C of the Companies Act, 1956 by way of the Companies (Amendment) Act, 1999. The Authority is entrusted with the responsibility of promoting awareness among investors and protecting the interests of the investors by making refunds of shares, unclaimed dividends, matured deposits/debentures etc. to investors.

Investor Education and Protection Fund (IEPF) was established under Section 205C of the Companies Act, 1956 by way of the Companies (Amendment) Act, 1999 for the promotion of investors’ awareness and protection of the interests of investors.

The act provides that no claims shall lie against the Fund or the Company in respect of individual amounts which were unclaimed and unpaid for a period of seven years from the dates that they first became due for payments and no payment shall be made in respect of any such claims. The following amounts remained unpaid and unclaimed for a period of seven years from the date they became due for payment and are credited to the IEPF.

IEPF Awareness Programmes:

In the urban and semi-urban areas, the Authority organizes investor awareness programmes in association with the Institute of Chartered Accountants of India, Institute of Cost Accountants of India and Institute of Company Secretaries of India, through their chapters or through the resource persons engaged for the purpose. The programmes conducted by these institutes focus on various subjects viz. importance of investing, Primary and Secondary Capital Markets, dos & don’ts of investing in the Capital Market, various types of investment options available like mutual funds, debentures, equity, company fixed deposit, pension funds, investment policies etc.

LIFE INSURANCE SETTLEMENT

Stuck Claims Recovery, Ombudsman Settlement, Consumer Forum / Court Settlement

There is a general perception amongst common people that insurers do not settle claims properly. They find ways to reject claims in some way or others. However, one should not give up. If you feel your claim is genuine, you should fight for it or seek help.

In most of the cases, we found that the insurers get their way to reject claims by involving legal languages and tedious paperwork. This makes things complex for the policyholders to understand and find a proper solution to convince the insurers. It can be very dispiriting to have an insurance claim rejected. It hurts financially and your peace of mind and trust fades.

There may be three types of claims in life insurance policies–

Survival Benefit Claim
Maturity Benefit Claim
Death Benefit Claim

Survival Benefit

Survival benefit is not payable under all types of plans. It is payable in endowment or money-back plans after a lapse of a fixed period say 4 or 5 years, provided firstly the policy is in force and secondly the policyholder is alive.

Maturity Claim

It is a final payment under the policy as per the terms of the contract. Any insurer is under obligation to pay the amount on the due date. Therefore the intimation of maturity claim and discharge voucher are sent in advance with the instruction to return it immediately. If the life assured dies after the maturity date, but before receiving the claim, there arises a typical problem as to who is entitled to receive the money. As the policyholder was surviving till the date of maturity, the nominee is not entitled to receive the claim.

Death Claim

If the life assured dies during the term of the policy, the death claim arises. If the death has taken place within the first two years of the commencement of the policy, it is called an early death claim and if the death has taken after 2 years, it is called a nonearly death claim.

A death claim may get rejected in the following situations –

Concealing pre-existing diseases
Delay in premium payment
Withholding information about existing insurance policies
Absence of updated nominee details
Fraud made by fraudsters by taking out a life insurance policy for someone who is terminally ill

Facing a term insurance claim rejection can be distressing, particularly when the policyholder is the primary financial provider for the family. Although the policyholder might not be present to address a denied claim, it’s vital to understand and avoid common pitfalls that can lead to term insurance claim rejections.

Grievance Redressal mechanism :

If you think the insurer rightly rejects your claim without giving you any valid reason, you can approach the Grievance Redressal Officer. Most insurers have multiple modes of access for policyholders and nominees.

The claim settlement ratio is crucial in guaranteeing your family’s financial security. The primary goal of purchasing life insurance is to safeguard against unexpected events. However, the objective becomes futile if the insurer fails to fulfill its obligation.

Firstly, nominees can approach the insurance company from where the policyholder has purchased the insurance coverage. Every insurance company has a dedicated grievance handling cell as mandated by the Insurance Regulatory and Development Authority of India (IRDAI). The Insurance Company usually lists the details of its grievance cell in the policy document. The first thing that a nominee should do is visit the insurer’s website and go to the customer service or claims section, as appropriate. There, the company lists all the ways to contact them, typically including a WhatsApp number, Email Address, Chatbot, a Toll-Free number to call, and sometimes the nearest branch. These services are available even if you purchase the policy through an agent.

The nominee can call on the number or write a letter or mail mentioning the issue. Suppose the nominee does not get a response within 15 days. In that case, he can contact the insurance company’s regional or central office’s grievance cell, stating that the grievance has not been acknowledged or addressed.

In case the issue gets directed to IRDAI, one can reach out to a Grievance Redressal Officer (GRO) to register a complaint at a higher level. There is also a cell for the redressal of grievances at IRDAI, where policyholders can register their complaints with the regulator under the “Bima Bharosa system” (bimabharosa.irdai.gov.in).

Even after that, the nominee can approach the ombudsperson if the nominee does not receive solutions. The ombudsperson will hear the case and pass judgment, which can finally help a nominee solve the issue.

POST OFFICE INVESTMENT (NSC / KVP) RECOVERY

POST OFFICE runs different savings schemes like from time to time kile NSC, KVP, National Savings Recurring Deposit Account(RD), National Savings Time Deposit Account (TD), National Savings Monthly Income Account (MIS), Senior Citizens Savings Scheme Account (SCSS) etc.

Nowadays, Post Offices in India have adopted the CBS platform. Investors can encash their Post Office Savings after maturity in a hassle-free way if the post office branch is operating under CBS connectivity. In order to make Maturity Claims, Investors will have to submit the original Investment Certificates and Identity Proof. The officials will verify the credentials of the investor from the issuing branch via the CBS channel. Once that is done the amount will be encashed.

If however you’ve lost your Investment certificate, you’ll need to obtain a duplicate certificate before you can encash it. In case of Death of a Single holder, the nominee can claim maturity. If no Nominee is mentioned, then a legal heir can claim the maturity by providing a Succession Certificate.

PF RECOVERY FROM EPFO & PRIVATE PF TRUST

There are many instances where PF Trust / EPF have not settled claims which are due to the employees. The EPF / PF Trust may cause issues for employees across the country. The mere notion of the difficulties of legal processes causes individuals to give up. The Government of India has made it simpler for the working class to access their PF account. However, the EPF still retains up to ₹ 27,000 Crs in PF accounts that are dormant / Unclaimed EPF.

CAUSES OF REJECTION

Withdrawals from EPF can get rejected for various reasons. Once you have filed a claim for withdrawing money from your EPF account, the EPFO will verify the details as mentioned in the claim with its records and also whether your claim satisfies the requisite conditions, before disbursing the amount.

Incorrect Bank details

The claim withdrawal is credited directly into a bank account which is registered in the EPFO records. Therefore, before filing your EPF withdrawal claim, you must check your bank account details registered in the records. Incorrect bank account details will delay the credit of the funds withdrawn.

Incomplete KYC

Another reason for the rejection of your EPF claim withdrawal can be due to incomplete KYC. If your KYC details are not complete and verified, then the EPFO can reject your EPF withdrawal claim.

Incorrect Date of Birth (DOB)

If there is a mismatch between the date of birth in the EPFO records and your employer’s records, then it can lead to the rejection of your claim for withdrawal.

Recently, through a circular issued on April 3, 2020, the EPFO eased norms for correcting the date of birth in the EPFO records thereby linking UAN with AADHAAR. As per the circular, EPF members can now correct their date of birth up to plus-minus three years instead of one.

However, if the EPF withdrawal claim is filed due to any other reason such as job loss, marriage, etc. then there are additional conditions that must be met. If the claim is filed after leaving the job, then one must ensure that the claim is filed after one month of the last contribution date. Only 75 percent of the amount lying in the PF account can be withdrawn. Also, the exit date must be updated in the EPFO database. Similarly, if you want to withdraw from your EPF account to buy a house, then ensure that you have completed 5 years of service.

In the event of a member’s Employees’ Provident Fund (EPF) amount not getting settled within a span of 20 days, he can approach the Regional PF Commissioner in charge of the grievance. The Employees’ Provident Fund Organisation (EPFO) also recommends filing the complaint online on the website using the EPFiGMS feature.

In case you are looking for proper guidance and want to hire professionals to settle your PF account, we can help you to get your legitimate claim.

FREEZE ASSET RECOVERY

FREEZING OF MUTUAL FUND Folios / DEMAT Accounts

Approximately 2.5 million PAN card holders have not yet updated their nomination information, as reported by the Registrar & Transfer Agent (RTA) and CAMS.

Why is nomination important?

Mutual Fund / DEMAT nomination is a process through which investors designate a nominee to receive their investments in the event of the investor’s demise. This process holds significant importance, as it ensures that the nominated individual can claim the investment without encountering any legal complications.

IMPORTANT CIRCULAR

In a circular on March 28 this year, the Securities and Exchange Board of India (SEBI) said, “Based on representations received from the market participants, it has been decided that the provision mentioned at Para 4 of SEBI circular dated June 15, 2022, with regard to freezing of folios, shall come into force with effect from January 1, 2024, instead of September 30, 2023.”

According to this, failing to nominate may result in the FREEZING of your MUTUAL FUND folios / DEMAT accounts.

PROCEDURE for NOMINEE Updation

Mutual Fund / DEMAT nominations can be updated through either online or offline channels. For those who have initiated their account offline, the process involves completing a nomination form, providing the signature, and subsequently delivering it to the Registrar and Transfer Agent (RTA) or the mutual fund company.

For DEMAT accounts nominations can be updated by submitting the prescribed form duly signed by all account holders to the Depository Participant (DP).

BONUS SHARE RECOVERY

Bonus shares are additional shares given to the current shareholders without any additional cost, based upon the number of shares that a shareholder owns. These are company’s accumulated earnings which are not given out in the form of dividends, but are converted into free shares.

The issue of bonus shares is a common phenomenon in corporate world. When the Company has accumulated large surplus of profits and it decides to convert this surplus into share capital, then the Company can issue bonus shares to its shareholders in proportion to their respective holding.

Why company issues BONUS SHARES?

Bonus issue of shares is the allocation of additional shares to stockholders.
Bonus shares increase a company’s share capital but not its market capitalisation.
A bonus issue of shares is funded by a company’s earnings or share reserves.
Bonus issues don’t dilute shareholders’ equity because they are issued in a constant ratio that keeps the relative equity of each shareholder the same as before the issue.
Companies issue bonus shares to make their stock more attractive for retail investors, provide an alternative to a cash dividend, and/or reflect a position of financial health.

Bonus shares are automatically getting transferred once you DEMATERIALISE physical securities.

DIVIDENDS RECOVERY

Dividends are declared out of profits made by a company and distributed to shareholders. Many companies declare dividends multiple times in a year namely interim or final dividends. But if such dividends remain unclaimed for more than seven years, they are transferred by the company to Investor Education and Protection Fund Authority (IEPF). As per IEPF, the value of unclaimed dividends is more than ₹5000 crores as of now.

There could be multiple reasons for dividends being left unclaimed. Some common factors contributing to unclaimed dividends are (1) Change in address, (2) Misplaced or damaged physical share certificates, (3) Non-updation of KYC details, (4) Non-updation of bank details, (4) Death of the primary holder with no information to inheritors.

A rightful claimant or legal representative of a deceased person can claim dividends from IEPF. As per Rule 7 (1) of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the unclaimed dividends that have been transferred to the IEPF can be claimed by submitting the IEPF-5 Form.

Despite multiple efforts from the authorities concerned, the refund rate remains extremely low at 1.8%. The primary reason for this low refund rate is the shareholders’ lack of awareness. Wealth Trove is providing professional guidance so that one could become more aware of the channels and methods available for them to claim what rightfully belongs to them. Dividends are accumulated over a period of time for long-term investors and hence this amount could be much higher for a few individuals than they would think. Hence, it is of utmost importance that investors should ensure that claims are made for the dividends on time which they are rightfully owed. One can connect with the respective company or their registrar agents to check on the unclaimed dividends under their holdings or can seek help from us.

BOND RECTIFICATION

There are lots of instances where BOND certificates issued in Physical forms got misplaced and investors are unable to retrieve the details. In such case, you can approach the corresponding RTA and request a duplicate Certificate.

But as per SEBI Circular dated 25th January 2022, the issue of Duplicate Bonds Certificate in physical mode is discontinued. On submission of the above documents and verification by RTA, the RTA shall issue a “Letter of Confirmation”. This letter shall be valid for 120 Days.

You can approach RTA for rectification of issues in BOND Certificates like Signature Mismatch, Name Mismatch, Change of Address, Transmission, KYC updation etc. After rectification / updation of your certificates, it will be transferred to your DEMAT account. Then only you can do encashment of the same. In case you are not confident enough about the procedures, we can help you to realise your money.

MUTUAL FUNDS RECTIFICATION

In India, Mutual Fund has a long history, dating back to 1963. It happened when the nation’s first mutual fund UNIT TRUST OF INDIA (UTI) was introduced as a collaborative initiative by the Government of India and the Reserve Bank of India. UTI was founded to encourage modest investors to participate in the stock market. It was established in order to promote saving, investing, and participation in the revenue, profits, and gains generated by the Corporation through the purchase, holding, management, and sale of securities.

UTI was cut off from the RBI in 1978, and the Industrial Development Bank of India (IDBI) replaced the RBI as the body in charge of regulation and administration.

In the year 1987 Public Sector Bank (SBI), Life Insurance Corporation of India (LIC), and General Insurance Corporation of India (GIC) established mutual funds and began their operations.

In the year 1992 SEBI (Securities and Exchange Board of India) was formed to protect the interests of investors in the securities market and to support the development of the Indian securities industry. SEBI also regulates how the stock market and mutual funds function.

In the year 1993, the first Private Sector Mutual Fund Kothari Pioneer was registered, which was later since amalgamated with Franklin Templeton Mutual Fund.

In the year 2002, KYC compliance became mandatory under the Prevention of Money Laundering Act, 2002. Before the year 2002, Mutual Fund certificates were issued without PAN.

There are lots of instances where Mutual Fund certificates issued in Physical forms got misplaced and investors are unable to retrieve the folio number. In such a case, you can approach the Asset Management Office by sharing your PAN details with the AMC. You can request a duplicate Consolidated Annual Statement containing the necessary investment information. You can approach AMC for rectification of issues in Mutual Fund Certificates like Signature Mismatch, Name Mismatch, Change of Address, Transmission, KYC updation, etc. After rectification/updation of your certificates/folios, you can do encashment of the same. In case you are not confident enough about the procedures, we can help you to realize your money.

SHARE RECTIFICATION

All Physical Shares were issued before 1997 and need various rectifications like Signature Mismatch, Name Mismatch, Change of Address, Transmission of Share (Death Cases), and finally Dematerialisation if you want to sell and realize your money.
In order to transfer the Physical Sharers to electronic form, ie. dematerialized form, one has to fill out a Demat Request Form, or DRF. According to SEBI requirements, an investor’s physical share certificates must be dematerialized before they may be sold.
Various steps and procedures are involved in the dematerialization of shares. One has to know the process thoroughly, otherwise, the entire time and money spent for the purpose will go to waste if the DRF is rejected. Rejection of DRF is an unpleasant experience people often face due to poor knowledge. Once a DRF is rejected one has to re-apply in proper process to avoid further rejection.

There are various situations where the dematerialization of shares is carried on by different laid down rules & procedures –

Procedure for Dematerialisation where Demat Names do not match exactly with Physical Certificate

Demat requests received from the client(s) with name(s) not matching exactly with the name(s) appearing on the certificates merely on account of initials not being spelled out fully or put after or prior to the surname, should be processed, provided the signature(s) of the client(s) on the DRF tallies with the specimen signature(s) available with the Issuers or its R & T agent.

Procedure for Transposition cum Demat

If the names of the clients appearing on the security certificates match with the names in which the account has been opened but are in a different order, such securities can be dematerialized by the procedure laid down in the relevant Business Rules

Procedure for Simultaneous Transmission and Demat

In the case of joint holdings, on the death of any one or more of the joint holder(s), the surviving joint holder(s) can get the name(s) of the deceased deleted from the physical certificate(s) and get the securities dematerialized.

Procedure for Dematerialisation of Government / Corporate Securities

Various bonds issued by Govt of India or Corporate bodies for a longer tenure, need to be kept in dematerialized form, in order to eliminate the chances of bonds being lost, forged, damaged, or misplaced.

In all the above-mentioned procedures, one has to fill up a Demat Request Form (DRF) and update KYC before proceeding with dematerialization.

DEMATERIALISATION OF SHARES

Physical SHARE CERTIFICATES are redundant in today’s time. This is high time to rectify the physical SHARE CERTIFICATES. No one can buy or sell existing shares anymore, if they are kept in paper share certificate format. If you are still holding paper share certificates then it is high time to rectify them immediately.

Till 1996 paper share certificates were issued or transferred every time a share of stock was issued and traded. These physical share certificates, however, came with their own set of risks as they were susceptible to fraud, being misplaced, or simply lost. In 1996, the Securities and Exchange Board of India (SEBI) introduced Demat accounts in the country, and it revolutionised investing by making it a digital process. As per the regulations laid out by the Securities and Exchange Board of India (SEBI), one can only trade and invest in shares if they are in dematerialised (Demat) format.
Dematerialisation is the process by which PHYSICAL CERTIFICATES of investors are converted to an equivalent number of securities in electronic form and credited into the DEMAT accounts.

Advantages of Dematerialised Shares

Safety : Dematerialisation of shares eliminate the chances of shares being lost, forged or misplaced and thus increases the safety of holding company shares / bonds.
Cost-efficiency & Time : Electronic trading doesn’t require any cumbersome paperwork and thus reduces a lot of expenses and saves time.
Convenience : Dematerialised shares negates the problems related to physical shares like their storage and maintenance. You won’t have to deal with lost or damaged certificates anymore.
Accessibility : All the records of shares are stored electronically and online. This allows you to access dematerialized shares from almost anywhere and anytime using the internet.
Flexibility : Dematerialisation led to increased flexibility and therefore improved access for small investors. Now, one can buy/sell even a single share without any restriction on the numbers.

Procedure for Dematerialisation of Physical Shares

In order to DEMATERIALISE physical securities, DEMAT REQUEST FORM needs to be filled up. The forms are available with the DP. One has to submit filled up and signed DRF along with physical share certificates that are to be dematerialised. Separate DRF has to be filled for each ISIN. The complete process of dematerialisation is outlined below:

Surrender certificates for dematerialisation to your DP.
DP intimates to the Depository regarding the request through the system.
DP submits the certificates to the registrar of the Issuer Company.
Registrar confirms the dematerialisation request from depository.
After dematerialisation, Registrar updates accounts and informs depository regarding completion of dematerialisation.
Depository updates its accounts and informs the DP.
DP updates the DEMAT account of the investor.

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