Pursuant to the provisions of section
124 of the Companies Act, 2013, any money transferred to Unpaid Dividend
Account of a Company which remains unpaid or unclaimed for a period of seven
years is required to be transferred to Investor Education and Protection Fund,
(IEPF). Further alongwith the monies, even those shares are also required to be
transferred to IEPF.
As per Rule 6 of IEPF (Accounting, Audit, Transfer and
Refund) Amendment Rules, 2017 where the seven year period provided under
sub-section (5) of section 124 has been completed or being completed during
period from September, 7, 2016 to May 31, 2017, the due date of transfer of
such shares by companies is May 31, 2017.
To complete the processes of transfer of shares to
IEPF, MCA vide General Circular 03/2017 has clarified the following:
- Special Demat Account shall be opened by IEPF Authority in NSDL
- The said account shall have features and functionality to support IEPF operations
- Companies are required to transfer shares (whether held in Demat or Physical form) to demat account of IEPF Authority by way of corporate action.
- NSDL will prescribe the file formats and operational procedures for transfer of shares to special demat account of the IEPF Authority by 30th April, 2017 and 15th May, 2017 respectively.
- NSDL shall levy charges to the companies for uploading and maintaining of records pertaining to shares transferred to the special demat account of the IEPF Authority which would be in addition to the fees which NSDL levy for corporate actions.
The circular can be downloaded from following link:
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