According to a Business Standard investigation of the S&P BSE 100 businesses’ ownership data, shares worth at least Rs 13.02 billion are languishing unclaimed with them. Shares become unclaimed for a variety of reasons, including heirs being unaware of their inheritance and share certificates being misplaced or lost.

• By value, ITC, the world’s largest tobacco company, owns most of these shares. According to statistics analysed by Business Standard as of end-December, it possessed 13.71 million unclaimed dividends and shares worth Rs 3.6 billion. 
• Titan Company, the world’s largest gem and jewellery company, owns 1.71 million shares worth Rs 1.6 billion. Vedanta Mining has 3.4 million unclaimed shares and dividends valued over Rs 957 million.
• Ambuja Cements has the largest number of stockholders affected. 1.14 million shares worth more than Rs 271.1 million are unclaimed by 166,277 shareholders.
• In the instance of ITC, there are 7,083 stockholders, 1,502 in the case of Titan, and 3,980 in the case of Vedanta.
• The figures are significant in light of current legislation requiring such shares to be transferred to the Investor Education and Protection Fund (IEPF).

Based on the most recent holdings as of the end of December. Sources: BSE, Business Standard analysis; value is based on the share price as of April 9, 2018.

The transfer provisions were included in the Companies Act of 2013, according to Ankit Singhi, a partner at Corporate Professionals, an advice firm. Previously, companies were compelled to transfer unclaimed dividends to the IEPF after seven years. When a revised provision was issued in 2016, this rule was made applicable to transfers of shares as well.

According to Singhi, even if there are awaiting dividends, investors can prevent a transfer provided they have claimed dividends at least once in the previous seven years.

“If a dividend has been claimed in any of the previous seven years, shares are not transferred,” Singhi explained.

At the very least, some transfers have occurred. The following note was placed in Zee Entertainment Enterprises’ archives. “According to Section 124(6) of the Companies Act, 2013, 111,070 unclaimed equity shares owned by 2,124 owners were transferred to the IEPF authority’s beneficiary account during the quarter ended December 31, 2017.” It claimed 45,629 undelivered shares held by 116 owners were notified under Regulation 39 of the Securities and Exchange Board of India (Sebi) listing requirements.

After fraudulent transfers in such shares were discovered, the initiative to compel this was made.

In an order dated March 22, 2016, Sebi prohibited registrant and share transfer agency Sharepro Services (I) from the market. Unclaimed profits and shares of persons, including a deceased shareholder, were unlawfully stolen, according to the judgement.

The transfer should not be an issue, according to Hinesh Doshi of the Investors’ Grievances Forum, as long as the government acts as custodian and no attempt is made to sell the shares. They can now be returned by submitting a refund claim form to the IEPF.

According to Bhavesh Vora of the Investor Education and Welfare Association, companies should make it a routine to identify shareholders before making such transactions.

With N200 billion in unclaimed dividends, here’s how to get your money through the Securities and Exchange Commission’s e-Dividend Portal.

According to the House of Representatives Committee on Stock Markets and Institutions, unclaimed dividends in the Nigerian capital market totaled N200 billion in 2020.

Unclaimed dividends increased by 26% from N158.44 billion in 2019 to almost N200 billion last year, according to Babangida Ibrahim, chairman of the committee. On this basis, it is apparent that some Nigerian investors have yet to get returns on their billions of naira investments. 

In this post, we’ll walk you through the process of how to claim unclaimed dividends from firms in which you or your family members own stock.

1. Use the SEC’s e-Dividend Portal to submit your application.

To begin, go to the SEC’s e-Dividend site. To get started, go to the SEC’s official website and click on “Unclaimed Dividends Search Portal.”

2. Look for a list of your company’s stock.

Enter your first and last name, or the first and last name of the shareowner, in the search box on the site as directed. Then press “Search.” You may also look for a family member’s complete name.

3. Determine the number of unclaimed dividends you have.

• The system will provide search results that include your account number, all of the businesses in which you own shares, and the names of each company’s registrars. The list will include stockholders with similar names, but you can easily identify yours by looking up your or a relative’s precise middle name.
• Make careful to look through the full list to find any overdue dividends.

4. Fill out the e-Dividend Mandate form provided by your registrar.

• Click the blue-coloured registrar name in the “Registrar Name” column to obtain your Registrar’s e-Dividend Mandate form (s).
• Fill in all essential information, including your bank name, BVN, bank account number, and other personal data, on the relevant Registrar’s e-mandate forms after downloading. When you’re finished, print the completed form.

5. Claim Dividends by submitting completed paperwork.

• To register for electronic collection of your unclaimed dividends and subsequent dividends, submit completed e-Dividend Mandated forms to the nearest branch of your bank or Registrar.
• The required dividends will be credited to your selected bank account at the conclusion of the transaction.

Procedure for shareholders to seek unpaid dividends if they have not been transferred to the IEPF.

MUDS was founded with the goal of assisting investors in recovering unclaimed assets that had been lying dormant for years. There is a disconnect between the investors and the unclaimed investments that belong to them. We exist to bridge the gap between investors and their unclaimed assets for both Indian and international investors, ensuring that the investments reach their rightful owners.

When are the shares, as well as any unclaimed shares and dividends, transferred to the IEPF?

If a firm’s declared dividend is unpaid or unclaimed for seven years, the company is compelled to transfer it to the IEPF. Furthermore, all shares for which a dividend has not been paid or claimed for seven years or more must be transferred to the IEPF by the corporation.

Who has the right to claim the unclaimed shares and dividends that have been transferred to the IEPF Authority?

Any person whose shares, unclaimed dividends, or other amounts transferred to IEPF by the company, such as matured deposits, matured debentures, application money due for refund, or interest thereon, sale proceeds of fractional shares, redemption proceeds of preference shares, etc., may claim dividends/shares and/or apply for refund of amounts transferred from the IEPF Authority by submitting an online application in Web-Form IEPF-5 available on the IEPF website. Any successor, legal heir, or representative of the dead individual may file an application.

Is a PAN required for submitting Web-Form IEPF 5?

Yes, a PAN is required. PAN verification is required for submission of the Web-Form IEPF-5, without which the form cannot be submitted.

Is it necessary to include a cellphone number and an email address when submitting Web-Form IEPF-5?

The claimant must have an active cellphone number and a valid email address in order to submit the form, which needs OTP-based verification.

Is there money in your investment account that hasn’t been claimed? Here’s how to claim dividends and shares:

1. With billions of dollars in unclaimed funds at various companies and financial institutions, the Investor Education and Protection Fund (IEPF) was established with the goal of refunding shares, unclaimed dividends, matured deposits, debentures, and other securities to investors while also raising awareness.
2. The Investor Education and Protection Fund Authority (IEPFA) was established by the Ministry of Corporate Affairs in September 2016 under Section 125 of the Companies Act, 2013.
3. Investors’ money that has been unclaimed for 7 years or more in respect of shares in demat accounts, application money received by companies for allotment of any securities and due for refund, matured debentures/bank deposits, unpaid dividends by companies, interest accrued on debentures/bank deposits/securities, and money of investors recovered from fraudulent companies must all be transferred to IEPF, according to IEPFA provisions.

You cannot collect your shares, unclaimed shares and dividends, matured deposits, or debentures directly from the firm / financial institution if they have been transferred to IEPF.

You may request a refund for unclaimed shares and dividends by completing the procedures below:

Step 1: Create an account on the IEPF website (iepf.gov.in).

Step 2: Complete the new IEPF-5 Online online form.

Step 3: Include a scanned copy of any required papers with the form.

Step 4: Print the auto-generated advance receipt and indemnification bond (visit the IEPF website –> Forms –> WebForms IEPF-5 –> MCA Services)

Step 5: Send the firm all original paperwork.

Step 6: Within 30 days, the company must e-verify the claim.

Step 7: IEPFA will reimburse the shares and money based on the verification report.

Before submitting e-form IEPF-5, make sure you have all of the required papers on hand, since late submission of the documents may result in the e-form being rejected. 

We hope you have understood how to claim dividends in India through the simple process.

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“2,200% yield in ten years, and this 100-year-old brand still has moats”

Varun Berry, Managing Director, is a fervent believer. He sees two critical elements working in the company’s favour that are impossible to find in any of its competitors. This year, to commemorate the company’s 100th anniversary, 50 new goods are in the works.

If you had kept onto a few shares where companies had a competitive edge and profit growth on their side, you might have gained crores on a Rs 10,000 investment ” Every company has a lifespan. In addition to this lifespan, it is important to determine a company’s high profit-growth phase and longevity. Stock prices are mainly a reflection of the company’s fundamental value. So, if we want to see a multifold increase in stock prices, we must invest in companies that are seeing a multifold growth in earnings.”

What do these figures mean for the average investor? The main conclusion we can get from this data is that if someone had invested in stocks in the initial days of Britannia, they may have become extremely wealthy. This is when the importance of share recovery becomes clear. According to newly revealed statistics from Britannia, it has the largest amount of unclaimed shares or unclaimed dividends among Indian businesses.

What is the basis of this unclaimed dividend?

People typically invest their money in a range of firms to reduce the risk of losing money. This looks to be helpful to the public, yet individuals periodically forget about their small donations and do not realise the advantages. The bought shares have remained inactive for years, with no one to claim them. When elderly people buy stock, they may neglect to identify an heir to the shares before dying. Businesses may have unclaimed dividends or shares as a result of this.

IEPF unclaimed dividend: Any person whose unclaimed or underpaid money has been transferred by the firm to the IEPF authorities may collect their reimbursements.

In case of the death of shareholder, one can opt for the option of transfer of shares on death. When a shareholder dies, his right to his shares passes to whoever inherits them under his will or intestacy. The rights of the dead shareholder will be handled by his or her executors (if a will exists) or administrators of the estate if the shareholder died intestate. It is critical to provide share certificate information. The physical share can be transferred by the issue of duplicate shares certificate.

Status of Unclaimed Shares of Britannia

Between 1998 and 2001, the firm’s revenues rose at a compound annual rate of 16 per cent compared to the market, while operating profits reached 18 per cent. [citation needed] More recently, the company has grown at a pace of 27 per cent each year, compared to the industry’s growth rate of 20 per cent. Biscuits currently account for 90% of Britannia’s yearly sales of Rs 22 billion. Britannia is one of India’s 100 Most Trusted Brands, according to The Brand Trust Report. Britannia has a 38 per cent market share.

The details of unclaimed dividends of the shareholders can be checked in the following link:

https://economictimes.indiatimes.com/britannia-industries-ltd/infocompanydividends/companyid-13934.cms

The most profitable investment ever would be just owning a Britannia share from the 1980s. As a result, recovering Britannia shares is a profitable endeavour. When you consider the number of revenues that will be created in the form of unclaimed dividends, spending small money to get the lost shares is not a big deal. To recover all of the lost shares, obviously, legal help would be necessary. Especially if the elderly person dies without claiming the money and their family is seeking it. All of the descendants may begin to ask for a share of the wealth. This is where legal counsel may help, as they can encourage the elderly to resolve the claim problem among family members. A legal professional can also help you file your claims with the IEPF.

If you want to avail Dematerialisation or Demat in short is the process through which an investor’s physical share certificate gets converted to an electronic format which is maintained in an account with the Depository Participant. Through this, you can get a demat of shares certificate of Britannia. Those people who have Britannia physical shares can choose the process of transfer of physical shares, liquidate them.

Filing a claim with the IEPF

Unclaimed payments and gains were previously transferred to the government, which would use them for public purposes in accordance with government policy. However, the government ultimately opted to create an unclaimed dividend fund into which firms’ lost or unclaimed shares may be placed. Any heirs of the funds, or anybody remembering a long-forgotten investment, may file a report with the fund’s management authority to recover their lost money and shares. The Government of India established the IEPF, or Investor Education and Protection Fund, with this goal in mind.

Investor Education and Protection Fund Provisions

The regulations for the Investor Education and Protection Fund were published in 2017 by the Ministry of Corporate Affairs (IEPF). According to the rules, any money left in the company’s unpaid dividend account for seven years with no claimant during that period must be transferred to the IEPF. The money, along with the interest for the same time period, must be transferred to the fund.

A claimant may only claim the transferred money after filing an application with IEPF. As a result, the IEPF has evolved into a one-stop-shop for investors seeking to file a claim for lost shares. It streamlined the process of requesting a refund for lost shares and allowed investors to reclaim their long-lost investment.

In the case of lost shares, you should send the following documents to the company/registrars: affidavit, indemnity & surety bond, original copy of FIR of police complaint reporting a loss of share certificates, and voucher copy of advertisement released in the government gazette publication regarding loss of share certificates.

Let’s go through how to have lost shares or unclaimed dividends from Britannia shares transferred to the IEPF. The method outlined in the following section is a set of fundamental requirements for a common investor to request a share return from the IEPF.

The Method for Claiming a Refunds of Lost IEPF Shares

Any individual whose equity, unclaimed dividend, matured deposits, matured debentures, application money due for refund or interest thereon, sale proceeds of additional shares, redemption proceeds of preferred stock, or other property has been transmitted to the Fund may assert the shares or apply for restitution under the regulations of section 124 sub-section (6).

Step 1: Claim to Authority

• A claimant must submit an IEPF Form-5 to MCA detailing their particulars, firm, and shares to be claimed.
• Particulars of the Applicant Specifics of the Shares to be Claimed
• Company Specifics
• Specifics on the amount claimed
• Aadhaar or PIO Card No. (in the case of NRI/foreigners)/Passport/OCI
• Deposits and securities are broken down by year.
• Details of the Aadhar-linked bank account (in which refund of claim to be made).

Step 2: Claim to Company

After completing the online refund form, the claimant should submit it to the Nodal Officer of the relevant firm, together with attachments such as indemnification bonds, original receipts and certificates linked to matured deposits or debentures, and so on. These will assist the firm in verifying the claim.

The following documents are required:

• Original Physical Share Certificate/bond/Debenture Certificate

•  Indemnity Bond with claimant signature

If the claim is for more than Rs.10,000, a non-judicial Stamp Paper of the value specified by the Stamp Act must be utilised.

If the claim does not exceed Rs.10,000, it can be completed on plain paper. In the case of a share return, the amount specified by the Stamp Act must be stamped on a non-judicial Stamp Paper.

• Advance Stamped Receipt (original) with the claimant’s and two witnesses’ signatures
• A copy of the claimant’s Aadhaar card
• Print off a completed claim form (IEPF-5) with the claimant’s signature.
• Copy of acknowledgement
• Cheque Cancelled
• Passport, OCI, and PIO card copies (for foreigners and NRI)

Step 3: From Corporation to Authority

A business shall create a claim verification report and send it to the authority in the manner prescribed by the authority within 15 days of receiving the claim form and evidence. To carry out the claim verification procedure, the company must choose a nodal person.

The Nodal Officer is entirely responsible for the conduct of any officer designated as Deputy Nodal Officer: If a business fails to nominate a Nodal Officer, each of its directors is assumed to be a Nodal Officer and is responsible for any failure to comply with the requirements of these regulations.

Step 4: Claim Grant by Authority

The claim will be awarded to the claimant when the authorities have verified the papers and form supplied by the company.

Step 5: Verification report to the Authority

Within 30 days after receiving the claim form, the business must submit to the Authority a verification report in the manner required by the Authority, along with any documents provided by the claimant. Please keep in mind that sharing certificate information is quite important.

In addition to the e-verification report, the Company shall submit a scanned copy of both sides of the original physical share certificate or original bond, deposit, or debenture certificate/s that have been lawfully cancelled and certified:

If the claimant has claimed equities, the regulating body will order that a refund be sent into the claimant’s Demat account. If money is found, it will be sent to the claimant’s bank account. Typically, the authority settles disputes within 60 days after receiving the verification report from the firm.

Time: The Authorities shall consider any application for reimbursement of any claim under this regulation that has been duly validated by the relevant company before 60 days of receipt of the industry’s verification report.

Kindly Do Not Send an Incomplete Request

If the verifying authority finds that the application is incomplete or that another document is required to complete the verification, an email will be sent to the claimant explaining the flaws in the given form or data, as well as any further required papers. The claimant is then required to produce the refurbished papers or another set of documents within 15 days after getting the notification email from the authorities. If the papers are not submitted on time, the authority may reject the claim application due to their inadequacy.

All documentation needed by the verifying authority must be addressed to the verifying nodal officer of the firm. Ensure that the documents are provided to the officer within 15 days.

In conclusion, you understood the whole process of collecting unclaimed money or earnings from a company. Britannia shares have soared in value over the last several decades. As a result, if you lay claim to shares that have been lost or unclaimed for a long period, the current value of such shares will be substantially higher. This is analogous to discovering unforeseen treasure buried on your ancestors’ land.

Therefore, reclaiming this lost capital and recovering shares requires the filing of evidence as well as compliance with all of the requirements listed above. Hiring a law firm to handle all of the documentation and filing for you is a straightforward answer to this time-consuming operation. These firms may also guide you through the whole process, making the work of recovering shares easier. So, without further ado, if you have any concerns or questions concerning the recovery of shares/transfers, choose a reputable legal firm with specialists and seek aid in reclaiming your unclaimed investment.

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In another incident, the financial planning firm Bajaj Capital called a long-time mutual fund client who had abruptly stopped investing a few years ago. They were startled to learn that the investor had died, but they had no knowledge of the investments he had made.

Unclaimed Investors Wealth Overview

Such events are widespread throughout the country. According to ET Money, more than Rs 82,000 crore of investor wealth remains unclaimed in forgotten and abandoned investments. There are unclaimed deposits in dormant bank accounts, maturity proceeds of policies sitting in insurance firms, and even people’ life savings locked away in dormant provident fund accounts. There are also mutual fund investments that no one knows about, as well as dividends that have not been cashed in years.

“Such scenarios may be prevented if investors keep their family informed whenever they make a financial investment,”

A business that assists investors or their legal successors in locating and recovering lost or forgotten money. In exchange for a fee, they handle all of the paperwork and legwork.

The quantity of unclaimed money in banks is enormous, but more than Rs 12,000 crore, or 66 per cent of the total, is in 4.75 crore inactive savings bank accounts according to ET Money. If there has been no activity on a bank account for more than two years, it is categorised as inactive or dormant. It’s not a major problem, and the account holder may reactivate it by making a transaction.

If the owner has died, the nominee must present the account holder’s death certificate as well as confirmation of his identification. The bank will authenticate these, terminate the account, and pay any remaining money to the nominee. However, if the owner does not have a nominee, things become more difficult. Small sums less than Rs 25,000 are unimportant and are generally handled at the branch level by the bank. However, if the sum is more, the deceased’s legal heirs, which include the deceased’s spouse, parents, children, and siblings, will have to approach a court and get a succession certificate. In the event that another claimant comes forward to claim the money, the bank will also require an indemnification certificate.

Unclaimed bank accounts are a relic of a time when the banking infrastructure was not interconnected and everything was done on paper. Bank records are now not only digital and easily accessible, but banks also require the account holder to have a nominee. This aids in the transmission of the account balance to the legal successor in the event that the account holder dies.

Account-holders must also give a registered mobile phone number and email address so that the bank may reach them.

As things stand, the average amount in these savings accounts is less than Rs 2,600, rendering the endeavour unviable given the paperwork and legal complexities involved. In some circumstances, the cost of claiming the money may be greater than the account amount.

But the Rs 1,600 crore lying in 16.9 lakh fixed deposits is another story altogether. The investors obviously did not intend to keep them with the bank forever. Yet, this is what these investments have become. Worse, many of these deposits would no longer be earning any interest. Deposits with the auto-renewal option automatically get extended on maturity at the prevailing rate of interest. But if the investor had not opted for auto-renewal, the deposit stops earning interest after it matures.

SEBI’s Gift to the investors

The good news is that regulators have made efforts to make it easier for legitimate owners to recover their funds. The Insurance Regulatory and Development Authority of India (Irdai) has made it necessary for all insurance firms to publish unclaimed amount information if the value is greater than Rs 1,000. Sebi has mandated that mutual fund firms provide information about unclaimed assets on their websites. Simply enter the investor’s name and PAN to see whether there is any unclaimed money. In this article, we will explain how to recover your forgotten and lost investments.

If an account is left unclaimed for ten years, the funds are transferred to the Depositor Education and Awareness Fund. According to the RBI, the DEAF has around Rs 33,114 crore in its coffers as of March 31, 2020.

The RBI has instructed banks to provide information on unclaimed accounts on their websites. Investors can review the information on the website. If there is an unclaimed sum, the person can go to the bank branch with a properly completed claim form, proof of identity, and other papers to claim the money.

Desired Documents to Claim Unpaid Funds

The claimant can search for records using the following criteria:

• Name and date of birth
• Name and PAN
• Name and passport number
• Name and Pincode
• Name and telephone number.

Unclaimed Funds in Insurance Sector

Surprisingly, there is a large unclaimed sum with life insurance providers. Life insurance is regarded as the foundation of a financial strategy, and one would expect that when a policyholder purchases an insurance policy, he informs his family. Despite this, the maturity proceeds of millions of policies are sitting unclaimed with insurance firms, entirely unknown to the consumers who purchased this protection.

If the sum surpasses Rs 1,000, the insurance regulator has made it necessary for insurance firms to post details about unclaimed money on their websites. To learn about unclaimed sums with an insurance provider, go to their website and enter the policy number, PAN of the policyholder, name, and date of birth of the policyholder. If the information matches those in the firm’s database, the name and address of the policyholder who may have an unclaimed amount with the company will be displayed.

The insured, his nominee, or his legal heir might then seek payment from the business. They must follow the same method as bank deposits, however, it is easier in this instance because a policy must always have a nominee.

Will a person who has no knowledge of any such policy purchased by his parents or grandparents ever check on the unclaimed money sitting with an insurance company? Furthermore, the unclaimed sums are not just maturity profits. They might also include the surrender values of foreclosed policies or payments that have been delayed owing to litigation. Many policyholders abandon their policies when they realise they will be unable to pay the payment for the whole term.

Underlying Sum in Mutual Funds

The entire amount of unclaimed dividends and redemption sums is Rs 1,100 crore, according to the Association of Mutual Funds in India. This is a significant underestimate. We believe that over Rs 17,880 crore is sitting in dormant folios that have been ignored by the investor or have no claims. This is a conservative estimate that represents 1% of the total AUM held by retail investors.

In contrast to bank fixed deposits and insurance policies, which have a set maturity date, open-ended mutual funds are perpetual. In theory, a mutual fund can never become inactive or dormant.

Sebi adopted a regulation a few years ago that categorised a folio as inactive if there was no transaction for more than six months. This inactive condition was noted in the investor statement. The new regulation caused a commotion, with investors alarmed by the word “dormant” in their statements and distributors losing business as a result. As a result, the rule was repealed.

This aided the mutual fund industry in brushing the issue of inactive and dormant folios under the rug. If fund firms are serious about identifying unclaimed assets, they should look at folios that haven’t had a transaction in the last ten years, aren’t KYC compliant, don’t have nominees, don’t have a registered phone number or email ID, and don’t have an electronic bank transfer mandate.

True, not all of these folios are unclaimed, but folios that check all of the boxes are more likely to be forgotten and lost investments. 

The sector, on its part, claims Rs 1,100 crore in unclaimed dividends and redemptions. Many mutual fund investments trace back to a time when computerised bank transfers were not available. “You provided post-dated cheques for SIPs and dividends, and redemption cheques were addressed to your postal address,” Dhirendra Kumar, CEO of Value Research, explains. Some checks were lost in transit, and some investors’ addresses changed, resulting in unclaimed payouts.

SEBI’s Solution

• This issue has been resolved. According to a Sebi directive, unclaimed redemption and dividends might be redeployed in liquid or overnight funds. So, if a check turns stale, the fund company reinvests it in a liquid fund within the same folio.

• Though the issue of unclaimed mutual fund dividends has been resolved, the issue of unclaimed stock dividends is only becoming worse. Two years ago, in March 2019, the Investor Education and Protection Fund Authority had around Rs 2,000 crore (IEPFA). Despite the fact that over 15,000 claims have been resolved in the last two years, the unclaimed sum at IEPFA has risen to about Rs 4,100 crore as per ET Money.
• The issue stems from physical shares or demat accounts that are no longer connected to a bank account. As a result, the dividend on the assets cannot be moved to a bank account but must be paid to the investor by check. However, there are situations where the investor has died and his bank account has been cancelled. Address changes are a typical issue. Dividends that have not been claimed in seven years are transferred to the IEPFA. Aside from dividends, the IEPF holds matured non-banking company fixed deposits and debentures.

One bright spot is a new provision in the Companies Act 2013 that permits investors to collect the dividend amount from the IEPFA. Money that went unclaimed for a number of years was transferred to the government coffers under the old Companies Act. If no claimant ever showed up, the money became the property of the government. However, investors may now claim it from the IEPFA by visiting its website and submitting a claim.

Another issue is that the method and documentation necessary are so intimidating that many people will not submit a claim unless the sum is considerably high. The investor may have to pay a significant amount of money on the necessary legal papers. That is why businesses such as MUDS Management provides expert service to assist you in obtaining the company’s lost and forgotten dividend.

THE EPFO TALE OF UNPAID FUNDS

The Employees’ Provident Fund Organisation has the greatest stash of unclaimed money (EPFO). Before the EPFO made PF accounts transferable, employees had to create a new account if they changed employment. As a result, a large number of people have several PF accounts. Many of these employees may be unaware that another account has been opened in their name.

In 2011, the regulations of the Provident Fund were amended such that if the money was not withdrawn within three years of the previous payment, the account became inactive and stopped generating interest. EPFO transfers the money to the Senior Citizen Welfare Fund once it has been inactive for seven years. The investor or his legal successors can collect money from the Senior Citizen Welfare Fund within 25 years by providing the necessary proofs and documentation.

Claim Your Money From EPFO

• EPFO has made it simple for users to claim money from inactive accounts using the internet channel. 
• Log on to the EPFO website and navigate to the Inoperative Helpdesk. 
• Following that, he should fill out all of the data of the inactive EPF account and provide KYC information such as

1. the Aadhaar number,  
2. PAN number, 
3. bank account number, and 
4. IFSC code. 

• After that, the application will be validated and processed.

ACCESS YOUR PF IN THESE SITUATIONS

It’s advisable not to withdraw the PF if it’s your personal account and you’re still working. The provident fund is a long-term safety net that should be transferred to your existing account if feasible. Even though the EPFO has adopted the Universal Account Number (UAN), you must still move funds from your old to new accounts.

If the subscriber dies, his nominees will get the money in the percentage he selected. However, there is a time restriction in this case. Within 25 years of the money flowing into the Senior Citizen Welfare Fund, a nominee or EPFO member can apply. Following that, it will be directed to the government’s coffers.

If there is no nominee, the subscriber died intestate, or the PF is not mentioned in the will, the situation would be extremely difficult. His legal heirs will have to go through the same process as with other assets.

They must produce a succession certificate designating them as his heirs. One must seek a court for this. The applicant may also be required to post a bond with sureties or securities to cover any losses incurred as a result of the certificate’s abuse.

EPFO is now pushing for an Aadhaar update as well so that the subscriber’s identity cannot be utilised to get access to money.

Why do the nominees have to be alerted?

According to a recent analysis, there is a corpus of over Rs. 82,000 crore in unclaimed deposits in India. This is a cautious estimate that incorporates the following items:

• Unclaimed Provident Fund Accounts: Rs. 26,497 Cr. 
• Unclaimed Bank Accounts: Rs. 18,381 Cr.
• Rs. 17,880 Cr. in Inactive Mutual Fund Accounts
• Unclaimed Life Insurance Policies – Rs. 15,167 Cr.
• Maturity Fixed Deposits – Rs. 4,820 Cr.
• Unclaimed Dividends: Rs. 4,100 Cr.

“These are unclaimed, most likely because the nominees are unaware of their existence. 

  -SHWETA GUPTA, MUDS MANAGEMENT

Sebi permits AMCs to provide rapid access in night MF schemes.

In addition, the regulator has made changes to the framework for the handling of unclaimed redemption and dividend sums.

The markets regulator Sebi permitted asset management firms to give rapid access to overnight mutual fund schemes on Friday. Previously, Asset Management Companies (AMCs) could only offer such a service in liquid schemes.

The Instant Access Facility (IAF) allows the investor’s redemption funds to be credited to his or her bank account on the same day the redemption request is made. Sebi stated in a circular that “MFs/AMCs can provide Instant Access Facility (IAF) exclusively in the MF’s overnight and liquid schemes.”

The framework has also been modified by the regulator in terms of how unclaimed redemption and dividend monies are treated.

According to Sebi, unredeemed liberation and dividend amounts that are legally permitted to be deployed only in call money market or money market instruments can also choose to invest in an alternative way by overnight, liquid, and money market mutual fund plans floated by mutual funds especially for the deployment of the unrecovered sums.

This is subject to the condition that the unclaimed redemption and dividend sums be exclusively invested in overnight, liquid, and money market mutual fund schemes in the A-1 cell of the possible risk class matrix (relatively low-interest rate risk and relatively low credit risk).

According to the regulator, the framework for IAF will take effect immediately, while those for unclaimed redemption and dividend monies would take effect on December 1.

Overnight funds are debt funds that invest in overnight assets, or securities with a one-day residual maturity. CBLOs (Collateralised Borrowing and Lending Obligations), overnight reverse repos, and other debt or money market instruments with a one-day maturity are all investments in such funds.

A liquid mutual fund is a debt fund that invests in fixed-income assets with maturities of up to 91 days, such as commercial paper, government securities, and treasury bills.

HOW TO AVOID RISKS OF UNCLAIMED INVESTMENTS 

• Maintain financial transparency with your family.

Have you made all of the proper investments and saved diligently your whole life? It won’t assist if you haven’t informed your family about your money and insurance plans. The vast quantities of unclaimed cash held by banks and insurance firms attest to the reality that individuals overlook this crucial information. Not only should your immediate family be aware of your financial situation, but so should a trusted individual outside the family, so that if you are not present, they can assist the family in accessing your assets.

• Always have a nominee standing side.

Make careful to identify a nominee whenever you make an investment. Without a nomination in the deceased’s financial records, the legal heirs will have to go through a lengthy and time-consuming procedure of establishing their legal heirship and completing an indemnity bond. Many financial institutions now require a nominee in investments. For example, in mutual funds with a single manner of ownership, the nomination is required. Fund houses will no longer accept new folios without nomination.

• Finalise Your will today

Investing is essential, but so is ensuring that your legacy is passed on easily to your descendants. Legal wranglings that go for years may potentially diminish the value of your investment. No of your age or net worth, the best way to ensure the smooth transfer of your assets is to create an estate plan. In fact, having an estate plan is even more important if you have small children since you can appoint guardians or trustees to care for them. Mention your assets and how you want to divide them.

• Keep details up to date if there is a change

When there is a change, be sure to update your information. If your residence has changed, or if you have married, be sure to update the information in your investments. These are essential since your relatives will be unable to access your funds if their names and contact information are not given.

The post NEWS BROKEN: 82 THOUSAND CRORES UNCLAIMED FUNDS ROTTING FOR DECADES appeared first on MUDS.

“Every business has a lifecycle. In addition to this lifespan, determining a company’s high profit-growth period and longevity is critical. Stock prices are largely a reflection of the underlying worth of the company. So, if we want to witness a multifold increase in stock prices, it is apparent that we must invest in firms while they are experiencing a multifold increase in earnings.”

“In barely 4 decades, HERO MOTOCORP has grown from a little startup to one of the world’s biggest and most acclaimed corporations,” says the company.

According to industry experts, “a thousand rupees investment in HERO MOTOCORP shares in 1984 is worth lakhs in 2021.”

What do these numbers imply to the ordinary investor? The primary thing we can conclude from this data is that if someone had an invested stock from 1984, they may become quite wealthy. This is when the necessity of share recovery becomes apparent. According to HERO MOTOCORP’s newly disclosed data, it has the highest number of unclaimed shares or unclaimed dividends among Indian firms. 

What causes this unclaimed dividend to existing?

People usually invest their money in a variety of businesses in order to decrease the chance of losing money. This appears to be beneficial to the public, but occasionally throughout the process, individuals forget about their little contributions and do not reap the benefits. For years, the purchased shares have been dormant, with no one to claim them. When older individuals acquire stock, they may fail to name an heir to the shares before they die. This might result in unclaimed dividends or shares for businesses.

IEPF unclaimed dividend: Any person whose unclaimed or underpaid money has been transferred by the firm to the IEPF authorities may collect their reimbursements.

In case of death of the shareholder, one can opt for the option of transfer of shares on death. When a shareholder dies, his right to his shares passes to whoever inherits them under his will or intestacy. The rights of the dead shareholder will be handled by his or her executors (if a will exists) or administrators of the estate if the shareholder died intestate.

Status of Unclaimed Shares of HERO MOTOCORP

HERO MOTOCORP is one of the largest companies in India and according to a recent report released by MCA, it also has the highest amount in unclaimed dividends. Even till 2015, HERO MOTOCORP had almost 60 crores recorded as unclaimed dividends from investors. They have all the data of unclaimed dividends on its website. It has also urged most of its investors to claim their dividends and get the recovery of shares or refund of shares before they is forced to transfer the amounts to IEPF. The details of unclaimed dividends of the shareholders can be checked in the following link:

https://www.herofincorp.com/sites/default/files/Statement%20of%20Unclaimed%20&%20Unpaid%20dividend__Last%207%20years.pdf

Source: https://www.heromotocorp.com/en-in/dividend-details-pattern.html

Furthermore to elaborate on what will be the value of HERO MOTOCORP shares bought long ago in today’s scenario will be, let’s understand the following data,

• The market capitalization of HERO MOTOCORP has multiplied 5000- times from the year 1984 to 2021.
• Total assets increased from Rs. 48 crores to Rs. 6,425.00 Cr.

Simply holding a HERO MOTOCORP share from the 1980s would be the most lucrative investment ever. As a result, recovering HERO shares is a successful business. Spending a modest amount to get the lost shares is not a huge problem when you consider the number of earnings that will be generated in the form of unclaimed dividends. Obviously, legal assistance would be required to recover all of the lost shares. Especially in the case of an old person who died without claiming the amount and their family are demanding the money. All of the grandkids may begin to ask for a portion of the money. This is when legal assistance may come in, as they can aid to persuade the elderly to address the claim problem among family members. A legal professional can also assist you in submitting your claim with the IEPF.

If you want to avail Dematerialisation or Demat in short is the process through which an investor’s physical share certificate gets converted to an electronic format which is maintained in an account with the Depository Participant. Through this, you can get a demat of shares certificate of HERO MOTOCORP. Those people who have HERO MOTOCORP physical shares can choose the process of transfer of physical shares, liquidate them.

Making a claim through the IEPF

Previously, unclaimed profits were given to the government, which will use them for public purposes, in accordance with government policy. However, the government eventually decided to establish an unclaimed dividend fund into which businesses’ lost or unclaimed shares may be deposited. Any heirs to the funds, or anybody recalling a long-forgotten investment, might submit a report with the fund’s management authority to recover their lost money and shares. The IEPF, or Investor Education and Protection Fund, was created with this notion in mind by the Government of India.

Provisions of the Investor Education and Protection Fund

In 2017, the Ministry of Corporate Affairs released the regulations for the Investor Education and Protection Fund (IEPF). According to the rules, any money that has been in the company’s unpaid dividend account for seven years and has no claimant during that time must be transferred to the IEPF. The money must be sent to the fund together with the interest for the same time period. The transferred sum may only be claimed by a claimant after applying to IEPF. As a result, the IEPF became a one-stop-shop for investors looking to make a claim on lost shares. It simplified the procedure of seeking a refund for lost shares and gave investors the opportunity to recoup their long-lost investment.

In the scenario of lost shares, you should send the documents to the company/registrars for the issue of duplicate shares certificates accompanied by, affidavit, indemnity & surety bond and original copy of FIR of police complaint reporting a loss of share certificates and voucher copy of advertisement released in the government gazette publication regarding loss of share certificates.

Now, let’s go through how to collect lost shares or unclaimed dividends from HERO MOTO CORP shares transferred to the IEPF. The procedure described in the following section is a set of basic rules for a common investor to demand a refund of shares from the IEPF.

The Procedure for Obtaining a Refund of Lost Shares from the IEPF

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, or other property has been transferred to the Fund may claim the shares under the provisions of sub-section (6) of section 124 or apply for restitution.

Step 1: Claim to Authority

• A claimant must submit an IEPF Form-5 to MCA detailing their particulars, firm, and shares to be claimed.
• Particulars of the Applicant Specifics of the Shares to be Claimed
• Company Specifics
• Specifics on the amount claimed
• Aadhaar or PIO Card No. (in the case of NRI/foreigners)/Passport/OCI
• Deposits and securities are broken down by year.
• Details of the Aadhar-linked bank account (in which refund of claim to be made).

Step 2: Claim to Company

After completing the online refund form, the claimant should send it to the Nodal Officer of the concerned company along with attachments such as indemnity bond, original receipts and certificates related to matured deposits or debentures, and so on. These will aid in the company’s verification of the claim.

The following documents are required:

• Original Physical Share Certificate/bond/Debenture Certificate

•  Indemnity Bond with claimant signature

If the amount of the claim is Rs.10,000 or more, a non-judicial Stamp Paper of the value stipulated by the Stamp Act must be used.

If the amount claimed does not exceed Rs.10,000, it can be done on plain paper. In the case of a share return, on a non-judicial Stamp Paper of the amount stipulated by the Stamp Act.

• Advance Stamped Receipt (original) with the claimant’s and two witnesses’ signatures
• A copy of the claimant’s Aadhaar card
• Print off a completed claim form (IEPF-5) with the claimant’s signature.
• Copy of acknowledgment
• Cheque Cancelled
• Passport, OCI, and PIO card copies (for foreigners and NRI)

Step 3: From Corporation to Authority

Within 15 days after receiving the claim form and documentation, a firm must prepare a claim verification report and submit it to the authority in the format specified by the authority. The firm must select a nodal officer to carry out the claim verification procedure.

The Nodal Officer shall be solely liable for the actions of any officer appointed as Deputy Nodal Officer: If a company fails to appoint a Nodal Officer, each director of the company shall be deemed to be a Nodal Officer and shall be liable for any failure to comply with the requirements of these rules.

Step 4: Claim Grant by Authority

After verifying the papers and the form submitted by the firm, the authorities will award the claim to the claimant.

Verification report to the Authority

Within 30 days of receiving the claim form, the firm should provide a verification report to the Authority in the format prescribed by the Authority, along with any documentation presented by the claimant. Please note that share certificate information is of major concern. 

Along with the e-verification report, the Company should send a scanned copy of both sides of the original physical share certificate or original bond, deposit, or debenture certificate/s validly cancelled and certified:

If the claimant has claimed shares, the sanctioning authority will require a refund be sent to the claimant’s Demat account. If there is any money, it will be sent to the claimant’s bank account. Typically, the authority resolves disputes within 60 days after receiving the company’s verification report.

Time: The Authority will dispose of any application for reimbursement of any claim under this regulation that has been duly confirmed by the concerned company within 60 days of receipt of the verification report from the company.

Do Not Submit A Incomplete Application

If the verifying authority determines that the application is incomplete or that another document is necessary to complete the verification, they will send an email to the claimant indicating the deficiencies in the provided form or data, as well as any additional required papers. The claimant is then obliged to provide the refurbished papers or another set of documents within 15 days after receiving the authority’s notification email. If the documents are not presented on time, the authority may reject the claim application owing to the documents’ incompleteness. All papers requested by the verifying authority must be addressed to the company’s verifying nodal officer. Make certain that the documents are delivered to the officer within fifteen days.

As a result, we comprehended the entire procedure of obtaining unclaimed payment or profits from a firm. HERO MOTOCORP shares have skyrocketed in value during the previous few decades. As a result, if you lay claim to shares that have been lost or unclaimed for a long time, their current value will be significantly greater. This is like to discovering unanticipated wealth buried on your ancestors’ property.

However, claiming this lost money and recovering shares necessitates the submission of documentation and compliance with all of the above-mentioned conditions. The simple solution to this time-consuming procedure is to hire a legal company to handle all of the documentation and filing for you. These companies can also help you through the whole procedure, making your task of recovering shares easier. So, without further ado, if you have any inquiries or questions about the recovery of shares/transfers, locate a competent law company with specialists and seek assistance on the recovery of your unclaimed investment.

The post Recover Shares of HERO MOTOCORP from IEPF appeared first on MUDS.

Stocks of Oil and Natural Gas Corporation (ONGC) have always been a reliable asset for any Investor. One of the largest PSUs of India, ONGC has been a major fixture in the growth story of India post-independence. The state-owned PSU has also been quite prolific in giving heavy dividends to its customers over the years.

In this writing piece, we will study how ONGC has grown over the years to become one of India’s most profitable PSU post-independence. We will also understand via a hypothetical investment scenario how recovery a small sum investment made in ONGC in the 80s would have fetched huge returns in today’s terms? After that, we will understand the recovery of old and dormant shares of ONGC from IEPF.

History of the Oil and Natural Gas Corporation

Oil and Natural Gas Corporation (ONGC) is a State-Owned entity specialising in oil and natural gas refinery services. The general term used for such entities is Public Sector Unit. ONGC is not just one of India’s Largest PSUs but also the largest PSU after Indian Oil Corporation Limited. Oil and Natural Gas Corporation is a firm of global significance. The corporation specialises in the development, exploration, and production of petroleum and gas. The Company’s other segments include Exploration & Production of oil, and Refining. The Company’s geographical operations segment is divided into two categories: Onshore and Offshore. Onshore operations are conducted in the Indian territory. Offshore businesses are conducted in other countries. The Company’s business is spread in various areas including, oil field services, oil and gas transportation, production of value-added products, Liquefied Petroleum Gas (LPG), Petrochemicals, Power, and alternate sources of energy. The Company’s various subsidiaries include OVL (ONGC Videsh LTD.), MRPL (Mangalore Refinery and Petrochemicals LTD.), and ONGC Mangalore Petrochemicals LTD. The Company’s oil and gas reserves are situated in Russia, Vietnam, Columbia, Brazil, and Venezuela.

The company has been a profitable venture and leads the petrochemical business for Government of India from the time of its inception. Along with LIC, SBI, and IOCL, it has been one of the major money makers for the Government and headed many infrastructure projects. It has survived various economic slowdowns faced by the country and still managed to be one of the best PSUs. The company’s success has been largely due to its impeccable administration monitored by brilliant PSU managers. 

In the following section, with a hypothetical investment and related calculation we will demonstrate how a small amount invested in ONGC shares in 1990 would have grown to nearly by 2021. The following calculation will show why recovery of shares/dividends of ONGC is a profitable venture. 

Calculation related to ONGC Shares

• Suppose your grandfather had bought 800 shares of Oil and Natural Gas Corporation registered in April 1990.
• Now, the company has released bonus shares thrice, in the last three decades as given in the following table.

Bonus History

• The bonus released by the company in 2006 was in the ratio 1:2. This meant that for every two shares owned by the investor, the company gave one share. The bonus increased the no. of shares to 1200 (800 original + 400 bonus).
• In 2010-11, the company released bonus shares in the ratio 1:1. This took the net no. of shares to 2400 (1200 original + 1200 bonus) shares.
• In the same year, ONGC announced a stock split in the ratio of 1:2. This meant that every 1 share of value Rs.10 was split into 2 shares with value Rs. 5. A stock split is done by the company to reduce prices of shares but keeping the net value of stocks the same. This took the total no. of shares to 4800.

Split History

• Now, the company continued to grow and it announced bonus shares in the year 2016. The bonus was announced in the ratio 1:2 which took the original no. of shares to 7200 (4800 original + 2400 bonus).
• Now, in today’s time, the value of one share of ONGC is Rs. 117.60 in June 2021. Now, let us calculate the net value of shares as per today’s rate.

Rs. 117.60 x 7200 shares = Rs. 8, 46, 000 (Eight Lakhs Forty Six Thousand only).

• So, one can easily notice that a penny investment worth thousands would have become almost 8.5 lakhs rupees in 2021. This is a huge increase in net percentage. 

Source:

https://economictimes.indiatimes.com/oil-and-natural-gas-corporation-ltd/infocompanydividends/companyid-11599.cms

https://www.ongcindia.com/wps/wcm/connect/31cce834-fb8f-49c1-a2c4-38df2f712f7c/ONGC_AR_2019-20.pdf?MOD=AJPERES&CONVERT_TO=url&CACHEID=ROOTWORKSPACE-31cce834-fb8f-49c1-a2c4-38df2f712f7c-noD1QT5

With the above calculation, it is quite clear that shares of ONGC have grown tremendously in value over the past 2.5 decades. Remember, in the calculation done above we haven’t calculated the Dividends for the said period. If we add the amount of dividend, then the net return on investment will be even higher. The company has shown tremendous growth in all sections and has been India’s leading player in the domestic and international market when it comes to the petroleum sector. We will study more about the financial details of the company in the following sections.

In the upcoming sections, we have given some datasheets created for dividends released by the company in the past two and a half decades. We have also given information on the shares transferred by the company to IEPF. One can study the information given by ONGC in the table below to understand how much dividend has been given by the company. 

Dividends Shared by ONGC in Last Decades

Source: https://economictimes.indiatimes.com/oil-and-natural-gas-corporation-ltd/infocompanydividends/companyid-11599.cms 

https://www.ongcindia.com/wps/wcm/connect/31cce834-fb8f-49c1-a2c4-38df2f712f7c/ONGC_AR_2019-20.pdf?MOD=AJPERES&CONVERT_TO=url&CACHEID=ROOTWORKSPACE-31cce834-fb8f-49c1-a2c4-38df2f712f7c-noD1QT5

Data on Unclaimed Shares As Per Annual Report 2019-20

The following table shows the data released by the company in the financial year 2019-20 annual report. The data show dates of Dividend transfers made to the IEPF.

source: https://www.ongcindia.com/wps/wcm/connect/31cce834-fb8f-49c1-a2c4-38df2f712f7c/ONGC_AR_2019-20.pdf?MOD=AJPERES&CONVERT_TO=url&CACHEID=ROOTWORKSPACE-31cce834-fb8f-49c1-a2c4-38df2f712f7c-noD1QT5 

How Investor Education and Protection Fund Was Formed?

The IEPF was formed by the Central Government in the year 2016 to address the ever-increasing issue of dormant and unclaimed shares of companies. Earlier the shares were bought at smaller prices which led to them being overlooked by the stockholder in the following years. This was often due to non-substantial growth of shares in a time span of five or ten years. However, years later, once the shares made substantial growth then the same people came running to the company asking for dividends for their shares. 

However, before IEPF, there was no defined mechanism to address the situation mentioned above as after so many years, companies found it hard to verify the ownership and calculate net dividends for dormant funds. Some companies used to transfer these unclaimed dividends to the public welfare account of the government and so had no money after years to give to investors coming back for their dormant shares. Others would keep the dividends to themselves for years and use it for their benefit while telling the government that they are expecting the investors to come back and claim the dividends. 

But this shady practice gave rise to black money. Many companies kept the unclaimed funds as they won’t have to give a detailed account of the money. This was because they would simply say that these are dormant funds with no known claimant. To regularize the dormant funds and their associated dividends, the government came up with a regulatory body to enforce regulatory norms for such funds. This was the reason for establishment of a statutory body named IEPF Authority. The authority employed fund managers to handle the claims related to unclaimed funds. This authority was also responsible to frame rules related to transfer of dormant funds and unclaimed dividends.

Rules Related to Dormant Funds by IEPF Authority

IEPF authority regularly comes up with regulations regarding the unclaimed dividends lying dormant with listed firms. As per the current norms, the companies publish the list of unclaimed dividends of investors with details on their website every fiscal year. This has been made a mandatory practice for the companies to ensure transparency in release of data related to unclaimed dividends. Also, IEPF has made it mandatory for firms to appoint a Nodal Officer that hears and resolves complaints related to unclaimed shares and dividends. the claims. The transfer or nodal officer should also handle the firm’s special unclaimed dividend account. Under the IEPF regulations, this account is mandatory and must be created by each listed company. This account holds unclaimed dividends after 30 days for 7 years. Post the seven years period, the unclaimed shares gets transferred to the IEPF. 

It is also mandatory for a Nodal Officer to send a verification report to the IEPF’s fund manager. This report is sent along with other documents mandated by IEPF to the fund manager of the IEPF.  The documents also contain the claim application form and should be sent to authority within 15 days after receiving from the claimant’s end. Any failure in meeting the compliance norms could invoke compliance-related action against the company from the IEPF Authority. The companies need to keep IEPF informed about any changes made to the company’s Nodal or Deputy Nodal Officer’s positions.

Necessity of Legal Help to Claim ONGC’s Shares

In the previous sections, we explored how a small investment made in ONGC shares could increase to inflated values. We also looked at the annual report of the company to look at the previous dates of Dividend transfers to the IEPF the dividends released each year by ONGC for its stockholders. Now we will take a stroll through the process of claiming unclaimed shares from IEPF. This is so because, after understanding the complete process one can easily understand why legal help is needed to get the claimed shares from the authority.

If you have unclaimed dividends of ONGC that are unclaimed but not for more than o 7 years, then an investor can ask the status of the funds from the nodal officer of the company. An investor can search the details of their shares and simply contact the ONGC’s appointed agent and registrar with share ownership proofs and relevant documents. Following are the details of the Nodal officer appointed by the ONGC for such purposes.

Nodal Officer: Shri M E V Selvamm

Company Secretary

Contact.: +91 11 26754080

Deputy Nodal Officer: Shri S B Singh

Deputy Company Secretary

Contact.: +91 11 26754085

source: https://www.ongcindia.com/wps/wcm/connect/31cce834-fb8f-49c1-a2c4-38df2f712f7c/ONGC_AR_2019-20.pdf?MOD=AJPERES&CONVERT_TO=url&CACHEID=ROOTWORKSPACE-31cce834-fb8f-49c1-a2c4-38df2f712f7c-noD1QT5

The nodal officer has all the details regarding the shares owned by any investor. And thus, even old investors of the ONGC can ask for the status of their owned shares from its nodal officer. If the shares are older than 7 years then the process of getting the shares goes through the IEPF authority. The claimant needs to get his share details from the nodal officer and then apply on the IEPF’s portal with his details to place the claim. Post this, he needs to download the filled form and compile all the other prescribed documents from the authority. The compiled list of documents along with the form is sent to the Nodal officer who then creates a verification report. This report is created within 15 days of receipt of application from the claimant.

After receiving the application, the nodal officer verifies all the documents and creates a verification report for the claimant authorising his ownership. This report along with the claim form is sent to the IEPF authority for final verification. The fund manager at the IEPF authority verifies the claims and takes the final decision on the claim form. He can either accept the application and sanction the claim, ask for some more document for further clarity, or plainly reject the claim.

The strict scrutiny from the fund manager at the IEPF generally leads to furnishing more documents. Now, remaining in continuous touch with the authority for the claim resolution period could be hard for a common investor. This is why hiring a legal and financial consultancy firm is a good idea. The experts of these firms help a company in liaising with the authority and nodal officer to furnish any missing document. They also help the investor by claiming ownership of shares if the original shareholder dies. These are the reasons why hiring a legal and financial consultancy is necessary.

To Conclude…

So in this writing piece, we understood why hiring a financial and legal consultancy is necessary to get an IEPF unclaimed dividend. We also understood the rich history of ONGC to understand the mammoth growth it has been able to achieve since its inception. The company has also recently got into agreements with foreign companies to research for gas or petroleum mining sites. The company is also doing extensive research in the area of alternative energy. All of this stuff indicates the future of the company is bright. The trust of the investors has obviously grown in the past few years. The company has always released handsome dividends for its investors over the years leading to its shares showing significant growth. All of these reasons make the prospect of recovery of ONGC shares from IEPF a profitable decision.

With this we have come to the conclusion that recovery of shares with the help of a reputed financial consultancy can be really easy. The business owners need to get the help of these firms to save time and work hours of liaising with the nodal officers and IEPF authority. The immense growth in shares could give a healthy share of capital to investors who have just found old physical shares of ONGC from their grandparents or parents. We recommend the investors to immediately consult a legal and financial advisory firm if they have old physical shares of Ongc but transferred to the IEPF.

The post Recovery of Unclaimed Dividends of ONGC from IEPF appeared first on MUDS.

Hindustan Unilever Limited (HUL) is one of the largest Indian FMCG conglomerates and has constantly provided handsome returns and dividends on its shareholding to its investors.  With business growing continuously, Hindustan Unilever company has taken humongous strides in growth over the past two decades. Now, since the inception of IEPF, the company has started depositing a huge chunk of its unclaimed dividends to it as it has a lot of dormant shares due to long years of operation.

There are a huge no. of shares and dividends transferred by Hindustan Unilever Limited to the IEPF.  This might make some people scroll through their investment history to find if they have any unclaimed shares of HUL left dormant or not. To those who do have old shares (count 25+ years) of Hindustan Unilever Limited, have a permanent reason to smile. These shares would now have increased to tremendous values. We can say that finding dormant shares of HUL and raising a claim for the same from IEPF can make any investor rich. To get answers to queries like what is IEPF? and how old dormant shares of HUL are going to make someone rich in a short span? stay with us till the end of this piece.

Brief about Hindustan Unilever Limited’s History

Hindustan Unilever Limited is a leading name among Indian manufacturers. It is based in the country and is a market leader among consumer goods companies. Its consumer goods business comprises home and personal care products, foods, and refreshments products. Its other segments are Home Care products, detergent bars, and powders, cleaning liquids, scourers, and water business. It also has Beauty products in the categories of oral care, skincare and haircare, deodorants, talcum powder, color cosmetics, and salon services. The Foods & Refreshment segment includes staples, culinary products, coffee, tea, frozen desserts, and others. It’s nutritional products include infant care products, health food drinks like Horlicks, Boost, Maltova, and Viva.

HUL is one of India’s leading private sector FMCG companies and among the firsts to complete 75 years. Over the years, the shares of Hindustan Unilever Limited have shown tremendous growth leading to the company giving bonus shares and splitting its stocks. In this blog, we will understand how the value of even a small investment in Hindustan Unilever Limited could be worth millions at today’s rates.  We will also understand what will be the ideal way for the investor to recover such an amount? Let us understand the growth with the following hypothetical scenario.

Calculation

• Suppose an investor had 900 shares of Hindustan Unilever Limited registered in 1978 which would have cost approx Rs. 1200 considering the share price of HUL in 1997 was around 2.7 rs. Per share.
• Now, the prices of Hindustan Unilever Limited shares have kept on increasing since 1978 and the company had announced a decent no. of bonus shares for its investors over the years. Let us look at the bonus history of HUL in the following table.

Bonus History of HUL

• If we look closely, the bonus shares announced in 1979 were in the ratio 1:3 which meant for every three shares owned by the investor, HUL gave one bonus share. So the total value of shares in 1979 became 1200 ( 900 original + 300 bonus ) shares.
• Similarly, in 1983, the company announced bonus shares in the 3:5. This took the total no. of shares to  1920 (1200 original + 720 bonus shares).
• With bonus shares announcement in ratio 1:1 in 1987, the total no. of shares became 3840 (1920 original + 1920 bonus). 
• Lastly, in 1991, bonus shares were announced in the ratio 1:2 which took the total no of shares to 5760 (3840 original + 1920 bonus shares).
• The stock prices of HUL kept on increasing in the following years and hence the company had to cut down per share price by announcement of stock split in the ratio 1:10. This increased the existing no. of shares 10 times and decreased the per share price by 1/10th. Hence, the overall value of investment remained unchanged. Stock split decreased per share price of HUL and made the share affordable for small retail investors. The following table gives details of the stock split announced in 2000.

• Due to the stock split in 2000, which was in the ratio 1:10 took the total no. of shares to 57600. Each share had the same value of 1/10 of the earlier value of a single stock.
• Now the value of shares have kept on increasing over the years and the total value of investment as per the rate of May 2021 becomes:

57600 shares x Rs. 2,340.05 = Rs. 13,47,86,880 (Thirteen Crores Forty Seven Lakhs Eighty Six Thousand Eight Hundred and Eighty).

The above amount is obviously indicating a humongous increase in share prices in 40+ years. This data is enough to show why is it a good idea to go for the IEPF recovery of shares of Hindustan Unilever Limited.

As one can see, from the above calculation, the Hindustan Unilever shares from three decades ago can fetch a huge amount to its investors. The company has also given its investors huge dividends for the shares and has been a preferred stock of many people. If we add the returns made by the dividends to the total amount calculated in the previous calculation, then the corresponding net returns on the investment will be even more than the share growth. These huge figures are clear indicators which suggest that old shares of HUL are a hidden treasure. In the next section, we have shown the data of dividends released by HUL in the previous two and a half decades. Investors could easily calculate net dividends offered by the firm. We have followed it up with information on recovery of shares from IEPF.

Dividend History of Hindustan Unilever Limited

The following table has a detailed account of dividends released by HUL in the past 2.5 decades. Investors can simply run an analysis of the table and find out the corresponding dividends for the required year.

As per the IEPF rules a company is obliged to give details of the shareholders who have unclaimed dividends. Investors can refer to such lists to find out whether their old shares have been transferred to the IEPF by the company or not. After knowing the status of their share, they can choose the appropriate way to claim the shares. If the shares have not been transferred to the IEPF yet, then they can approach the nodal officer of the company to claim the unclaimed shares and dividends.

The HUL shareholders can reach its nodal officer with the prescribed set of documents to prove their ownership of shares and the dividends. Here are the details of the HUL’s Nodal officer.

Mr. Mr. Dev Bajpai (Nodal Officer)

Email: Comsec.hul@unilever.com   

Deputy Nodal Officer

Mr. Satheesh H K

Email: Satheesh.HK@unilever.com 

An investor can check the status of their unclaimed dividend of Hindustan Unilever Limited and associated returns on the following link:

Understanding IEPF Authority and its Rules

The GoI has set a target of making our country a 5 trillion-dollar economy before 2024. To achieve this target, it has to continuously reform the financial and other economic sectors of the country. Be it IBC 2016 or any other banking reforms, the Govt. has been taking decisions to make the Indian financial sector more organised. The introduction of IEPF or Investor Education and Protection Fund was also one such reformist step in the year 2016. Since Independence, the Indian stock market had no regulations for dormant dividends. Neither it had any statutory body that can oversee the problem of unclaimed dividends.

In 2016, the IEPF authority came up with the regulations associated with unclaimed shares and Dividend after its inception. The IEPF regulations along with the Companies Act 2013 made it mandatory for all listed companies to transfer dormant shares to its fund. These were the basic changes suggested in the rules and the subsequent amendments were made for transfer of unclaimed dividends to the IEPF fund.

• An investor can claim dividends from the company within 30 days of declaration.
• The companies need to create a separate unclaimed dividend account to transfer unclaimed shares older than 30 days. 
• If the investor wants to claim the dividends, they need to raise a request to the company’s transfer or nodal officer with the prescribed set of ownership documents.
• The company must inform the stockholders that their dividends have been transferred to the company’s unclaimed dividend account. The stockholders can claim it in the next seven years before they get transferred to the IEPF.
• The company must release the information regarding dividend transfers to the shareholders through email and letters.
• If the investor fails to claim dividends from the company’s unclaimed dividend account for 7 continuous years, then the dividends must be transferred to IEPF.
• The company has to release a list of investors whose shares have been transferred to the IEPF every year.
• After seven years, the stockholders must raise the claim to IEPF to get the dividends. The claim can be made with the help of a financial and legal advisory firm.

With these rules, the process of claiming the dormant dividend streamlined. The whole process has become more transparent. The process to claim dividends is also fairly organised and goes through a lot of scrutiny. This ensures that the dividends go in right hands and are free of any fraud.

Before the IEPF regulations, the businesses used to transfer unclaimed dividends or shares to the public funds for welfare schemes. Govt. then used such funds for various public welfare works and various development of infrastructure. Since the cases of people forgetting shareholdings in a corporation were increasing, the Govt. realized that the investors are facing huge losses which can be used for their own finances. Therefore, the Govt. decided to establish IEPF. It provides investors a simple solution to claim their dormant shares. All they needed was to apply online for their dormant shares and share their ownership documents to the nodal officer of the company. The rest of the work was to be done by the nodal officer and IEPF authority.

The Government took care of the unclaimed dividend through IEPF authority and thus got rid of the accumulating dormant share problem. Even the companies were regularised and the circle of black money was obliterated. This has obviously brought transparency to the existing system and led to increased trust among investors. With the IEPF rules, investors are rest assured that their valuable money won’t be lost even if they forget about their investment.

Process to Claim Dividends of HUL from IEPF

The process to claim dividends of HUL from IEPF might be a complicated venture. This is specially the case for business owners who don’t have much knowledge about the legalities involved in it. In the following sections, we have tried to explain the process in a simple manner in which even a layman could understand the process. Let us understand the claim procedure in a step by step manner:

1. The shareholder is advised to contact the company’s nodal officer and get all the details concerning owned shares and the claim process.  The nodal officer will give the investor a list of documents that are submitted with the claim form.
2. The investor then needs to file the IEPF claim form by visiting the IEPF website. This can be done by submitting personal details and details regarding ownership of shares.
3. After filing the claim form, the claimant should take a printout and compile the copies of necessary documents prescribed on the IEPF website and by the Nodal officer.
4. After compilation, the claimant should send the file to the Nodal officer who will verify the detail and documents. He will investigate the ownership of shares and verify the details.
5. The nodal officer creates a claim verification report based on the submitted details and sends it within 15 days of receiving to the IEPF Authority fund manager.
6. The fund manager after receiving the verification file starts scrutinising it along with the application form and other documents.
7. After verification, the fund manager takes one of the following decisions:

• He can ask for additional documents from the claimant through the nodal officer.
• He may reject the application due to any error or missing documents not furnished by the claimant.
• He can sanction the claimed shares or dividends after verification.

To conclude…

So, in this blog we have understood how the shares of the HUL bought in the late seventies could be worth more than crores in today’s values. We have also understood how recovery of these shares could prove immensely profitable for investors. However, the whole process of claiming the shares from the IEPF could take time. This is because the process requires constant liaising with nodal officers and IEPF fund managers. For busy investors this could prove to be a lot of work.

To ease out the process of claiming shares from the IEPF, a claimant can take help from any reputed financial and legal consultancy. These companies have experienced professionals who can help the investors in the recovery of shares in India. The investors can simply provide all the documents and relevant details to them and they will take care of the whole process. They will conduct regular liaising with the nodal officer and IEPF authority till successful transfer of shares.

The post Recovery of Unclaimed Dividends from IEPF of Hindustan Unilever Limited appeared first on MUDS.

Stocks of ICICI Bank LTD. floated at the per-share price of over Rs. 597.75 as of 02 Feb 2021. The bank is among India’s largest private sector banks with a business growing continuously. ICICI bank has taken giant strides in growth since its inception. Obviously, due to enormous growth, shares have also grown tremendously. This has led the company to come up with stock splits to make its shares affordable for the common retail investors. Of course, the enormous growth has led to the company depositing huge chunks of dividends into the account of IEPF for the unclaimed shares and dividends.

Now, what do the above facts tell us about the bank? The unprecedented growth shown by the company has done one more thing. It has led to its old investors or shareholders who invested a small amount in its IPO a millionaire in today’s terms. This is brilliant for those who have continuously claimed the dividends released by the company. But what about those who invested a small amount years ago and then thinking that it might never show growth forgot about it? Well…even for those investors we have got news! They can still claim those dormant shares and the associated dividends.

The Government of India has established an authority (IEPF) to take care of the dormant shares and associated dividends of investors.  In this blog, we will learn about the history of ICICI bank and demonstrate how its share grew with a hypothetical investment and calculations based on it. We will then move forward to study the data associated with the ICICI bank’s dividends released and funds transferred to IEPF over the years. At last, we will understand how an investor can claim the dormant shares of ICICI lying with IEPF. We will also understand how legal help can go a long way in claiming unclaimed dividends.

So, without further ado..let us start with the history of ICICI bank.

How ICICI Bank Limited Has Grown?

Earlier, ICICI Bank was established as the Industrial Credit and Investment Corporation of India. it was a financial institution specialising in lending credit to industries. This was a government’s financial institution and a wholly-owned subsidiary located in Baroda till 1994. Its parent company was established in 1955 as a joint venture among the World Bank, Indian PSBs, and public-sector insurance companies. The venture was aimed at providing project financing to India’s industries. The bank’s name was changed to ICICI (short for Industrial Credit and Investment Corporation of India) Bank when it was divested by the government to act as an independent entity.  The parent company merged with the bank and the ICICI Bank came into being. It launched Internet Banking services to customers in 1998.

The parent company’s shareholding in ICICI Bank was reduced to 46%, through an IPO in 1998. This was followed by an equity offering by the company in form of American depositary receipts on the New York Stock Exchange in 2000. Later, ICICI Bank acquired the Bank of Madura Limited in 2001 in an all-stock deal. It later sold additional stakes to institutional investors in the interval 2001–02.

In the 1990s, ICICI led a major transformation in its business by offering diversified financial services through its various products and services. These products and services were offered by its number of affiliates and subsidiaries. As a result, the parent company’s revenue base grew. The bank did not stop there and in 1999, it became the first Indian company and bank from the non-Japanese region in Asia to be listed on the New York Stock Exchange.

In 2002, in a mega-merger drive, all major subsidiaries of the ICICI group like ICICI, ICICI Bank, ICICI Personal Financial Services Limited, ICICI Capital Services Limited, and others became one in a reverse merger.

In 2008, after the financial crisis, customers rushed to ICICI ATMs and main branches in some locations of the country due to rumours suggesting the adverse financial position of the bank. RBI issued a clarification on its financial strength to dispel those rumours. In March 2020, its board approved an investment of Rs. 1,000 crores in Yes Bank Ltd. This investment has raised its stake in the bank up to 5%.

It has a widespread network of almost 18,210 branches and ATMs. The Bank also boasts approximately 110 Touch Banking branches in over 30 Indian cities. Its international banking is aimed at providing solutions for the banking requirements of its Non-Resident Indian corporate clients. The international services are also focused on leveraging economic corridors between India and other countries. The bank also caters to female entrepreneurs through the Self-Help Group (SHG) program which is part of its microfinance initiatives.

With such a rich history, one can safely assume that the Bank has offered rich growth on its shareholding for the investors. In the next section, we will take up a hypothetical investment made in the company in 1998 and see how it would have grown over the years.

The calculation for ICICI Bank’s Share Growth

• Suppose a shareholder had 600 shares of ICICI Bank Ltd. registered under his/her name in June 1998 at a per-share price of Rs. 4.99.

Now the general value of the investment is 600 shares x Rs. 4.99 = Rs. 2994.

• One can simply point out that this is a very small investment to make. Grandparents or parents might make such investments and forget to tell their family about it or forget it themselves because of ageing. This leads to shares remaining dormant for years.
• Now, the price of ICICI shares have kept on increasing since 1998 and consequently, the Bank had to announce a stock split in 2014 in the ratio of 1:5 to let the small-time retail investors gain access to the company’s shares.

• Due to the split in 2014, which was within the ratio 5:1 made the entire no. of shares 3000 (600×5). Each share had an equal value which was 1/5 of the entire value of one stock. This meant that the total value of ownership remained constant at that time with only the no. of shares increasing and the corresponding price decreasing.
• The company kept on growing and its share price also increased steadily since 2014. And in 2017 it announced bonus shares for its investors in the ratio of 1:10. This meant for every 10 shares of the client the company was offering 1 bonus share. The details of the bonus shares announced are given below:

Bonus History:

Source: https://in.investing.com/equities/icici-bank-ltd-historical-data?end_date=1615434498&interval_sec=monthly&st_date=884457000

https://economictimes.indiatimes.com/icici-bank-ltd/infocompanysplits/companyid-9194.cms

https://economictimes.indiatimes.com/icici-bank-ltd/infocompanybonus/companyid-9194.cms

• Now, because of these huge bonus shares announced by the bank, the net number of shares become 3000 + 300 bonus shares, that is 3300 shares.
• Now if we calculate the price of these shares as per the current scenario (per share price of Rs. 597.75) the total value of the investment would be:

3300 shares x Rs. 597.75 = Rs. 19, 72, 575.

• Now compared to the initial investment almost Rs. 3000, this return is tremendous. And we haven’t even added the dividends declared for all these years in this amount. If we add that, the net returns will skyrocket to multimillion rupees.

As you can see, from the above calculations that the ICICI bank shares from two decades ago could have fetched an enormous profit to their investors. The bank has also provided its investors’ huge dividends and thus, has been a preferred shareholding for several investors. Now we just want you to imagine a scenario where you suddenly found physical shares of your grandpa from the 90s related to ICICI bank. Even a small investment made in that era would have grown manifolds now. But, how to claim these shares? What will be the dividends on such shares? Let us find the answer to such questions in the next sections.

Dividend History of ICICI Bank LTD.

The following table provides a detailed account of dividends released by ICICI since 1998. One can simply study the table to do an in-depth analysis of what dividend any investment after 1997 would have generated?

Source: https://economictimes.indiatimes.com/icici-bank-ltd/infocompanydividends/companyid-9194.cms

Under the IEPF rules, the corporate is obliged to release the dormant shares of shareholders to the IEPF authority’s account. The bank releases the dates of transfer for the dividends and the last date to lay a claim on them before they get deposited into the government’s fund. One can read the next table to know the last dates of claiming funds for the subsequent financial years.

Dates for Unclaimed Dividend Transfer to IEPF by ICICI Bank

https://nli.icicibank.com/NewRetailWeb/showUnclaimedForm.htm

If the shareholders want to claim their old investment before the deadline ends then they must reach the nodal officer or transfer agency of the bank to get the details of their lost shares. The shareholders can reach the nodal officer with the requisite set of documents to prove the ownership of shares and therefore get the dividends if they are still not transferred to the IEPF fund. Here are the details of the Nodal officers of the bank.

Nodal Officer: Mr. Ranganath Athreya

Deputy Nodal Officer (Equity shares): Mr. Prashant Mistry

Deputy Nodal Officer (Bonds): Mr. Dinesh Chheda

Email: nodalofficeriepf@icicibank.com 

An investor can also check the status of their unclaimed shares of ICICI bank LTD. and associated returns on the following link:

https://nli.icicibank.com/NewRetailWeb/showUnclaimedForm.htm

Investor Education and Protection Fund – A Brief Insight

The introduction of the IEPF or Investor Education and Protection Fund in 2016 was a major reformist step. From the earliest time of Independence, the Indian stock exchange had no regulations or a statutory body that would oversee the difficulty of unclaimed dividends. In 2016, the Govt. founded the IEPF authority and came up with the regulations related to it. Here are basic changes suggested by the IEPF rules and therefore the subsequent amendments associated with the transfer of unclaimed dividends to the IEPF account.

• Investors must claim their dividends from the corporate within 30 days of its declaration.
• The companies were asked to make a separate account for unclaimed dividends where the dividends should be transferred in case they are not claimed by the investors within 30 days.
• If the investor wants to claim the dividends from the special account after 30 days, they must reach the company’s transfer or nodal officer with the prescribed set of documents.
• Companies should periodically inform their shareholders that their dividends are transferred to the unclaimed dividend accounts and that they must claim it before it gets transferred to the IEPF.
• Companies are also obliged to publish the list of investors whose dividends are transferred to their IEPF unclaimed dividend account.
• The company should communicate the data regarding dividend transfers individually to the investors via email or letters.
• If the investor fails to ask for the dividends from the company for 7 years after the transfer to an unclaimed dividend account, then the dividends must be transferred to IEPF.
• All companies should release the list of shareholders per annum whose shares have been transferred to the IEPF.
• After seven years, the shareholder must make the application to IEPF to claim their dormant shares.

With these rules, MCA aimed to streamline the method of claiming the dividends which are dormant. The entire procedure was aimed at making the dividend claim process regularised and transparent. The method to say dividends from IEPF is additionally organised and goes through tons of scrutiny to make sure that the dividends enter the hands of legal owner and are free from any fraudulent claim.

Process to Claim Dividends of ICICI Bank from IEPF

The process to lay claim dividends from IEPF might sound a touch complex as there are tons of documents and know-how involved. Here we have tried to elucidate the method in simple steps so that even a layman can understand the fundamentals of the IEPF claim of shares process. Here are the essential steps to say dividends from IEPF.

1. The shareholder is suggested to get in touch with the company’s nodal officer and obtain all the small details concerning his owned shares and therefore the related claim process. The nodal office also will give the investor the list of documents that require to be submitted with the form.
2. The shareholder then must visit the web site of IEPF and fill the IEPF form thereon by submitting his details and other details regarding his/her ownership of shares.
3. After filing the claim, the investor must take a printout of the completed form and compile all the copies of necessary documents as prescribed by the IEPF website and Nodal officer.
4. After compilation, the claimant must send the file to the Nodal officer who will check the documents to analyse the ownership of the claimant on the shares and verify the small details as per the form submitted.
5. The nodal officer will create a claim verification report supporting the claim file and send it within 15 days of receiving it (from the claimant) to the IEPF Authority’s regional fund manager.
6. The fund manager after receiving the file will scrutinise the claim verification report alongside the claim form and therefore the copies of other documents.
7. After thorough verification, the fund manager may take any of the subsequent three actions.

1. He can ask for some additional documents from the claimant or nodal officer, and they should be sent by them in 15 days.
2. He may reject the form thanks to some error within the application or missing documents that were not furnished on time.
3. He can sanction the claimed amount after successful scrutinization of the claim file.

Necessity of Legal Help to Claim ICICI’s Old Shares

You might have noticed within the previous sections that a thorough scrutiny of the claim form is conducted by the Nodal officer as per the rules of IEPF Authority. This is often done to make sure that there is zero chance of any fraudulent claim. The ownership documents of shares are thoroughly scrutinised, and the background of the subsequent documents is checked. Also, the claim form is verified thoroughly, and even small errors during filing should be rectified in time or failure to do so may lead to cancellation of the claim.

The long verification process makes the claim process a touch time consuming and tedious for a standard investor. To save valuable time and effort of filing and getting the claim approved by the authority, a shareholder must hire a reputed legal consultancy firm. These firms specialize in the filing of IEPF form and thus chances of any error in the application are reduced to zero. Also, most of these firms offer end-to-end liaising with the nodal officer and the IEPF authority in case of any missing document or other issues with the claim application.

Considering all the above reasons one can safely assume that the recovery of ICICI shares is indeed a profitable option for the investors and that they must check out the investment portfolio of their elders to seek for any dormant shares of ICICI Bank LTD. The investors can simply hire a legal consultancy firm and wait for the claim to be passed by the authority.  In the meanwhile, they can focus on their core businesses or day-to-day chores without worrying about their claim.

The post Recovery of Unclaimed Dividends from IEPF of ICICI Bank LTD. appeared first on MUDS.

Shares of the SBI have always been a reliable deal for any Investor. The largest bank of India has been there since 8 years after the independence and has been a major fixture in the growth story of India as a developing country. The state-owned bank has been quite prolific in providing heavy dividends to its customers over the years.

In this blog, we will study about the recovery of old or dormant shares of the State Bank of India from IEPF. Now, for those who don’t know what IEPF is, we have also added a section explaining in brief about IEPF, its rules, and regulation. By the end of the blog, the reader will have a clear understanding of why it is considered profitable to recover unclaimed dividends of State Bank of India shares from IEPF.

History of the State Bank of India

State Bank of India (SBI) is an India-based State-Owned banking and financial services firm. The term used for these entities is Public Sector Banks. SBI is not only India’s Largest PSB but also the largest bank followed by HDFC Bank Ltd. The various sectors SBI operates in include Corporate/Wholesale Banking, Treasury, Retail Banking and Other Financial/Banking Business. The Treasury segment comprises trading in foreign exchange contracts, investment portfolio, and derivative contracts. The Corporate/Wholesale Banking sector includes lending activities of big corporate accounts groups, stressed assets resolution groups, and commercial client’s groups. This sector also includes allocating loans based on the client’s history and transaction services to institutional or corporate clients. Retail Banking services encompass all the retail branches, primarily including Personal Banking activities like lending capital to corporate customers with a good background and history of working with the bank. Other Business segments of SBI include running day to day operations of all its Non-Banking subsidiaries or Joint Ventures other than SBI General Insurance Co. Ltd. and SBI Life Insurance Co. Ltd. of the group.  The bank has almost 22,100 branches across the country with 58,555 working ATMs.

The company has been a cash cow for the Government of India since its inception. Along with LIC, it has been the major financier for most of the Government’s projects and welfare schemes. The company has been a survivor of various economic slowdowns the country has faced and still emerged as the best PSB among all. The company’s success though is largely dedicated to its impeccable administration largely monitored by brilliant banking managers. 

The slowdown created by the COVID-19 lockdown in 2020 was not able to hinder the growth of its shares as the company’s shares showed a growth of 10.63% in June, 7.28% in July, and 10.73% in August. With the exception of a drop in prices in September 2020, the company’s shares have managed steady growth in the past 5 months. 

The company has been quite generous in giving its clients handsome dividends. This has also added to the reliability of the company in generating profits for its investors. The company shares used to trade at a lower price in the initial days also in the 90s when the slowdown of 1992 happened and India was just opening up its economy. During this period, many people have bought some shares at a lower price and thinking that it will not show growth, forgot about the investment. However, even that small investment would have grown big only if the investors claimed a dividend on it. 

In the following sections, we will demonstrate by a hypothetical calculation how even a small amount invested in SBI shares in 1995 would have grown to manifolds by 2021. This calculation will thus show why recovering shares or dividends of SBI is a profitable venture. 

Calculation related to SBI Shares

• Suppose your grandfather had 800 shares of State Bank of India registered in November 1998.
• Now, the price of 1 share of State Bank of India, as of November 1998, is Rs. 14.19. Thus, the total value of your grandpa’s shares as of November 1998 was,

Rs. 14.19 x 800 shares = Rs. 11352 (Eleven Thousand Three Hundred Fifty Two).

• The above amount is the net amount of money invested by your grandfather in November 1998 in the SBI shares. As you can see this is a relatively small amount and there is a chance that he could have stopped caring about dividends received on such a small investment compared to the other big ones. 
• Now in the year 2014, SBI announced a stock split in the ratio of 1:10. This meant that every 1 share of value Rs.10 was split into 10 shares of value Rs. 1. A stock split is done by the companies to accommodate small retail investors in its portfolio who couldn’t buy shares due to high price. 

• Now due to the shares, the total no. of shares which was just 800 at the time now became 8000 due to the stock split. 
• However, even after the split, the total price of the shares kept on increasing and the net amount associated with the shares increased in proportion. The total value of the investment as per February 2021 is,

Rs. 390.15 x 8000 shares = Rs. 31, 21, 200 (Thirty One Lakhs Twenty One Thousand Two Hundred).

• So, you can see on just a small investment of Rs. 11352 your grandfather’s shares would have fetched a return of Rs. 31, 32, 200. This is a growth of almost 27500%. And this is just the growth in share prices we are talking about. If we add the corresponding dividends provided by the company in the last twenty three years then the corresponding returns could have crossed more than fifty lakhs. 

Source for the data: https://in.investing.com/equities/state-bank-of-india-historical-data?end_date=1615268059&interval_sec=monthly&st_date=631823400 

https://economictimes.indiatimes.com/state-bank-of-india/infocompanysplits/companyid-11984.cms 

With the above calculation, it is quite clear that the values of money invested in SBI two decades ago have multiplied exponentially as per today’s value. Therefore, if you or any of your elders have any dormant shares left from age-old investments in SBI, then it could prove to be really profitable for your business to recover them. However, recovery via traditional means of reaching the company with the physical share certificate might not be possible in today’s scenarios. Government has come up with fresh rules claiming dividends which are older than 7 years and one must understand about these new rules and regulations before applying for a claim. 

In the coming sections, we have attached some data sheets and information related to dividends released by SBI in the last two decades and the unclaimed dividends. One can study the information in the sheets before moving on to understand the process of claiming a refund of shares from IEPF. 

Dividends Shared by SBI in Last Decades

https://economictimes.indiatimes.com/state-bank-of-india/infocompanydividends/companyid-11984.cms

Data on Unclaimed Shares As Per Annual Report 2019-20

Source: https://sbi.co.in/corporate/AR1920/pdf/SBI%20AR%202020.pdf

How Investor Education and Protection Fund Was Formed?

The IEPF or Investors Education and Protection Fund were established by the Central Government in 2016 to address the ever-increasing problem of dormant or unclaimed shares with dividends. The shares bought at a really small price or any small investment made in the share market by a small retail investor often tends to be overlooked due to small returns. However, years later once the returns grew significantly, these same people would come running to claim their dormant shares. 

Earlier, there was no defined mechanism to address the situations mentioned above where people came years after buying shares to claim the dividends on them. Some companies used to transfer their unclaimed dividends to the welfare account of the government to be spent in public welfare schemes while others would just keep the dividends to themselves saying that they are expecting the investors to come back and lay the claim on the dividends. 

But this gave rise to shady practice, as many companies had lots of dormant funds lying with them which they can use for their own advantages. So, to regularize the dormant funds and associated dividends the government had to come up with a regulatory body. This became the reason for the formation of the statutory body named IEPF Authority. The authority had fund managers who would handle the claims related to dormant funds. The authority was also responsible to frame rules and regulations related to dormant funds and unclaimed dividend transfer. 

Rules Related to Dormant Funds by IEPF Authority

IEPF authority consistently comes up with rules and regulations regarding the unclaimed dividends lying with companies. As per the current rules, the companies are required to publish the list of unclaimed dividends and shareholders details on their website every financial year. This is done to keep the unclaimed dividend data of the company for the previous financial year in the public domain. Also, companies are required to send timely reminders to all of its shareholders in writing and on-call/SMS/email to claim their declared dividends on time before they get moved to the IEPF funds. IEPF has also made it mandatory for the companies to appoint an officer (Nodal Officer) to address the claims or any other issue related to the claim of dividends. The Nodal or transfer officer should also handle the company’s special unclaimed dividend account where unclaimed dividends of more than 30 days lie for 7 years and later get transferred to IEPF if no one claims them. 

The Nodal Officer of the company is liable under the IEPF rules to send the verification report along with other documents and claim application form to the IEPF authority within 15 days of receiving the claim file form the claimant. Any failure in meeting this compliance could invoke compliance-related charges against the company by the IEPF Authority. The companies are also needed to keep IEPF informed about any new changes in the company Nodal or deputy Nodal Officer’s position. They should also keep the contact information for the nodal officers updated on their website. 

The Necessity of Legal Help to Claim SBI’s Dormant Shares?

So, in the previous sections, we explored what a small investment made in SBI shares in the 90s looks like in today’s value. We also looked at the data related to dividends released by the company and the unclaimed shares according to the annual report of the company. After understanding about the IEPF we must tell you why it is necessary to get a legal consultant by your side before you move on to the process of laying a claim on the dormant SBI shares. So before we tell you the importance of legal counsel let us first understand in brief the process of claiming shares from IEPF:

If you have unclaimed dividends of a company that are not older than 7 years, then they must be lying in the special unclaimed dividend account of SBI. You can search about the details of your shares and then simply contact the SBI’s appointed transfer agent and registrar with ownership proofs and relevant documents of the shares to claim the dividends on such shares. Below are the details of the appointed transfer agent of SBI.

M/s Alankit Assignments Limited – Registrar & Transfer Agent (RTA)

Head Office :

Alankit Heights, 3E/7, Jhandewalan Extension,

New Delhi-110055

Tel. No. 011-42541234

Virtual No: 7290071335

If the funds are older than 7 years or way too old (bought by your father or your grandfather) then the process to claim such shares begins at filing the Claim form 5 on the IEPF’s website. After raising the claim the claimant needs to send the printout of the filled claim form with all the relevant documents including the share ownership documents to the designated transfer AGENT/ REGISTRAR of the SBI. The verifies all the documents and prepares a verification report accordingly. This report is sent to the IEPF authority along with all the other documents. The authority then verifies these documents and takes its final decision on sanctioning the claim.

Now, you might have noticed that the scrutiny for the forms/documents takes place at both stages i.e. by the Nodal officer/transfer agent and by the Fund manager of the IEPF. Any documents missing will be asked to furnish from the claimant. Any mistake in the form will be sent for rectification by the claimant. Also if there is any glitch in the ownership documents or proving heirship over the age-old shares then the application could be rejected altogether. Because of all these reasons, the process to claim the dividends/shares become tiresome and time consuming for a normal claimant. They won’t find time every day to furnish documents or meet in person to clear any doubt or mistake. Also proving ownership/heirship could prove to be tough if multiple heirs are claiming for ownership. 

All of these issues could be easily avoided by hiring a legal consultancy firm to take care of the dividend claim from IEPF.  A consultancy firm will take over the job from you at a reasonable cost and will take care of all the hustle and liaising with the authority or Nodal officer related to any documents. Proving ownership for shares will also not be difficult legally with the help of expert consultants. So that is the answer to the big question: Why is it necessary to get a legal consultant firm by your side before applying to claim the money from IEPF?

To Conclude…

So that brings us to the end of this article. We have seen in this article how SBI shares bought in 1998 could have fetched a return of almost 27500 %, that too without adding dividends for the years. If this figure is not enough to convince someone that claiming SBI shares from IEPF is a good deal then no one knows what else can convince them. The fact is SBI shares have always been profitable as it has been India’s most prolific bank for years. Apart from LIC and Indian Railways, SBI has been perhaps the most valued public sector undertaking of the Government of India. 

The Finance minister in her speech on the occasion of the merger of 10 major PSBs in 2019 said that the Government of India is planning to have only four to five state-owned major banks with exceptionally high market capitalisation to work in the country. In that case, SBI will be the biggest bank even among those envisioned by the government. Therefore, the valuation of any holdings from any year in SBI is bound to grow manifolds. 

Investors should consider the money spent in hiring a legal consultant to get the unclaimed dividends as a small investment to fetch a huge jackpot. This is obviously due to the case of the unprecedented growth in shares of SBI and the higher dividends provided by it which has never stopped. So even recovering a small amount from the past could prove out to be really profitable. With the current grim times of economic slowdown initiated by the COVID-19 Pandemic, any amount of monetary help could do wonders to any business. If you are a small business owner and an investor then recovery of SBI shares could prove to be especially useful for you as it might bring the necessary capital needed to give your business the much-needed push. And because the money would be your very own, you will avoid falling into any debt trap.

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