Under Section 124 of the Companies Act, 2013, shares and dividends unclaimed for seven consecutive years are mandatorily transferred to the Investor Education and Protection Fund. The transfer does not extinguish your right of ownership. FISC assists rightful owners and their legal heirs in recovering such assets through the prescribed legal process.
Under Section 124(6) of the Companies Act, 2013, read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, any shares in respect of which dividend has not been claimed for seven consecutive years are transferred to the IEPF. This transfer is mandatory and applies regardless of whether the shareholder is aware of it. The transfer does not, however, extinguish the shareholder's title to the shares.
Any shareholder who has not claimed dividends on a company's shares for seven or more consecutive years, or whose folio shows no activity over that period, is likely to find that the shares have been transferred to the IEPF. Legal heirs of deceased shareholders are similarly entitled to initiate a recovery claim in respect of shares belonging to the deceased.
The recovery of shares from the IEPF requires the filing of an application in Form IEPF-5, available on the MCA portal. The application must be accompanied by a prescribed set of documents and submitted to the Nodal Officer of the company whose shares are being claimed. The Nodal Officer verifies the claim and forwards it to the IEPF Authority with a verification report. The IEPF Authority issues a sanction order upon satisfaction, and the shares are credited to the claimant's DEMAT account.
FISC prepares the complete application, compiles the supporting documents, coordinates with the company's Nodal Officer at every stage, and follows through with the IEPF Authority until credit of the shares and any dividend amount is confirmed.
FISC identifies the shares transferred to IEPF across all companies in which the client holds or held shares. We verify the client's title to the shares, advise on the documentation required for the specific case, prepare the Form IEPF-5 application and all annexures, liaise with the company's Nodal Officer, and attend to any queries raised by the IEPF Authority. Where the claim involves a legal heir, we advise on the transmission process that must be completed before or alongside the IEPF claim.