Refund

Section 125 (3)(a) of the Companies Act, 2013 (‘Act’ for short) provides that the Investor and Education Protection Fund (‘Fund’ for short) shall be utilized for the refund in respect of unclaimed dividends, matured deposits, matured debentures, the application money due for refund and interest thereof.

The proviso to section 125(3) provides that the person whose amounts referred to in clauses (a) to (d) of Section 205C (2) of the Companies Act, 1956 transferred to the Fund, after the expiry of the period of seven years as per the provisions of Companies Act, 1956 shall be entitled to get refund out of the fund in respect of such claims in accordance with the rules made under section 125.

Claim of shares

Section 124(5) provides that 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 along with a statement containing such details as may be prescribed.

The proviso to this section provides that any claimant of shares transferred above shall be entitled to claim the transfer from the Fund in accordance with such procedure and on submission of such documents as may be necessary.

Nodal Officer

Every company which has deposited the amount to the Fund shall nominate Nodal Officer for the purpose of coordination with IEPF Authority and communicate the contact details of the Nodal Officer duly indicating his designation, postal address, telephone and mobile number and company authorized email id to the Authority within 15 days from the date of publication of these rules.  The company shall display the name of the Nodal Officer and his email ID on its web site.

Access Link

Each company shall provide an access link to the refund web page of IEPF Authority website on their own website so as to facilitate the easy refund procedure for its investors/claimants.

Procedure

• Any person claiming to be entitled the amount may apply the Investor Education and Protection Authority (‘Authority’ for short) for the payment of money claimed.
• 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 or apply for refund to the Authority in Form No. IEPF- 5.
• The said form may be applied to the Authority by submitting the application.
• The said online application is available on the website www.iepf.govin.
• The applicant is to pay the fees specified by the Authority from time to time in consultation with the Central Government.
• The claimant shall send the application duly signed by him along with the requisite documents as enumerated in Form IEPF – 5 to the concerned company at its registered office for verification of his claim.
• The following documents are to be submitted along withForm IEPF – 5-

• Print out of duly filled claim form with claimant signature
• Copy of acknowledgement
• Indemnity Bond (original) with claimant signature
• Advance Stamped receipt (original)
• In case of refund of matured deposit or debenture, original certificate thereto
• 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
• Other optional document,(if any)

• The company shall send a verification report to the Authority within 15 days from the date of receipt of the claim in the specified format by the Authority along with the documents submitted by the claimant.
• In case if the Authority does not receive the documents after the expiry of 90 days from the date of filing IEPF – 5 form, the Authority may reject IEPF – 5.The claimant shall be given an opportunity of being heard before such rejection.
• After verification of the claim of the claimant the Authority-

• present a bill to the Pay and Accounts Office for e-payment to the claimant;
• 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.

• The Authority shall record of the details of payments made to the claimants.
• The application shall be disposed by the Authority within 60 days from the date of receipt of the verification report from the company, complete in all respects.
• Any delay beyond 60 days the Authority shall record the reasons for the delay and the same shall be communicated to the claimant in writing or by electronic mode.
• Where the application is incomplete or not approved, a communication shall be sent to the claimant and the concerned company by the Authority giving the details of deficiencies of the application.
• In case of non receipt of rectified documents by the Authority after the expiry of 90 days from the date of such communication, the Authority may reject the IEPF – 5 after giving a reasonable opportunity to the claimant to furnish response within a period of 30 days.
• If the claimant is a legal heir or successor or administrator or nominee of any registered security or in cases where request of transfer or transmission o 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 document.
• The claimant shall file only one consolidated claim in respect of a company in a financial year.
• The company shall be liable under all circumstances whatsoever to indemnify the Authority in case of any dispute or law suit that may be initiated due to any incongruity or inconsistency or disparity in the verification report or otherwise and the Authority shall not be liable to indemnify the security holder or company for any liability arising out of any discrepancy in verification report submitted etc., leaving to any litigation or complaint arising thereof.