When it comes to investment returns, nothing is more frustrating than discovering your rightful dividends and shares have been transferred to a government authority because they remained unclaimed. At MUDS Management, we’ve guided numerous investors through the complex process of reclaiming their financial assets from the Investor Education and Protection Fund (IEPF).

Why Understanding the IEPF Recovery Process is Critical

At MUDS Management, we’ve helped investors recover substantial amounts from the IEPF, and we consistently see claimants making the same mistakes:

• Filing incomplete documentation that leads to immediate rejection
• Missing critical verification steps in the multi-stage process
• Failing to track claim status effectively
• Using outdated forms and procedures
• Overlooking crucial supporting evidence requirements

We dedicate ourselves to addressing these common pitfalls, offering comprehensive guidance on the IEPF claim process specifically designed for investors facing this challenging situation.

What This Guide Will Show You

In this detailed guide, we’ll walk you through:

• The complete mechanism of how dividends and shares get transferred to IEPF
• Step-by-step procedures to verify if your assets are with the IEPF
• The exact documentation required for successful claims
• Common reasons for claim rejections and how to avoid them
• Practical timelines for the recovery process
• Special considerations for different types of claimants
• Post-recovery actions to prevent future transfers

Whether you’re dealing with unclaimed dividends, transferred shares, or both, this guide provides the knowledge you need to navigate the IEPF claim process with confidence.

What is the IEPF?

• Promote investor awareness and education
• Refund unclaimed dividends, shares, and other amounts to investors
• Fund investor protection initiatives
• Utilize unclaimed funds for the benefit of investors

The 7-Year Rule: How Assets Get Transferred to IEPF

The transfer process works as follows:

1. Companies send reminder notices before transfer to the last known address
2. After seven years, unclaimed dividends and corresponding shares are transferred to IEPF
3. Companies file Form IEPF-4 for dividend transfers and IEPF-7 for share transfers

Common Reasons Assets Become Unclaimed

In our experience at MUDS Management, investors lose track of their investments due to:

• Change of address without updating records with the company
• Forgotten investments made decades ago
• Shares received through inheritance without proper knowledge
• Lost or misplaced physical share certificates
• Bank account changes without updating dividend mandate instructions
• Non-encashment of physical dividend warrants
• Corporate actions like mergers or demergers creating confusion

Step 1: Verify If Your Assets Are With IEPF

Before initiating the claim process, you need to confirm if your dividends or shares have indeed been transferred to the IEPF. Here’s how:

For Transferred Shares:

1. Check Your Demat Account: Verify if shares are missing from your holdings
2. Review Annual Statements: Look for any reduction in shareholdings
3. Use the IEPF Portal Search Function: Search specifically for shares transferred to IEPF
4. Contact the Company Secretary: Request verification of any share transfers to IEPF

Step 2: Prepare for the IEPF Claim Process

Once you’ve confirmed your assets are with IEPF, preparation is crucial for a successful claim:

Essential Documentation to Gather

Before starting the online process, collect these documents:

• Aadhar Card, PAN Card, and Passport
• Voter ID, Passport, or Utility Bill (not older than 3 months)
• Bank Account Details: Cancelled cheque leaf and bank statement
• Original Securities: Physical share certificates (if applicable) or demat statement
• Previous Correspondence: Any communication with the company regarding your investment
• Legal Documents: Succession certificate, death certificate, or probate (for legal heirs)

Creating a Complete Claim File

Organize your documentation according to the IEPF Authority’s preference:

1. Arrange documents in the order specified in the IEPF claim checklist
2. Include a comprehensive cover letter explaining your case
3. Create an index of all enclosed documents
4. Make multiple copies of the complete file (for your records and follow-ups)

Step 3: The IEPF Claim Filing Process for Unclaimed Dividends and Shares

Online Form Submission

1. Register: Create an account at www.iepf.gov.in if you don’t have one already
2. Login Claim Section: Select “File a Claim” from the menu
3. Select Claim Type:
   • Form IEPF-5 for shares and dividends
   • Specify the claim category (dividends, shares, or both)
4. Enter Required Information:
   • Personal details 
   • Company details (name, CIN, folio number)
   • Dividend details (years, amounts)
   • Share details (number, type, certificate numbers if physical)
5. Upload Supporting Documents:
   • All documents must be properly scanned and in PDF format
   • Each file should not exceed 2MB
   • Documents must be clearly legible
6. Review and Submit: Verify all information before final submission
7. Download the Acknowledgment: Save and print the system-generated acknowledgment with the Service Request Number (SRN)

Physical Submission of Documents

After online submission, you must send physical documents to the company:

1. Print Form IEPF-5: Take a printout of the submitted form
2. Prepare Document Set:
   • Signed copy of Form IEPF-5
   • Acknowledgment copy
   • Self-attested copies of all uploaded documents
   • Original indemnity bond (on non-judicial stamp paper as specified)
   • Advance receipt (as per format provided)
3. Submit to the Company’s Nodal Officer:
   • Send the complete set via registered post/speed post
   • Address it specifically to the company’s IEPF Nodal Officer
   • Include your SRN number in all correspondence

Step 4: Verification and Processing by the Company

Once the company receives your documentation, several verification steps follow:

Company-Level Verification

1. The company’s Nodal Officer verifies your claim against their records
2. They check the authenticity of all submitted documents
3. The company may request additional documentation if needed
4. Once satisfied, the Nodal Officer files an online verification report

What to Watch For at This Stage

Common issues that arise during company verification include:

• Signature Mismatches: Current signature differs from company records
• Name Discrepancies: Minor variations in name spelling across documents
• Incomplete Bank Details: Missing IFSC codes or incorrect account information
• Outdated Contact Information: Making it difficult for the company to reach you

How to Follow Up Effectively

1. Contact the company’s Nodal Officer 15 days after submission
2. Request the status of your verification process
3. Provide prompt responses to any queries or additional document requests
4. Maintain a log of all communications for reference

Step 5: IEPF Authority Approval Process

After company verification, your claim moves to the IEPF Authority:

IEPF Authority Review

1. The Authority examines the company’s verification report
2. They review all submitted documentation for compliance
3. A decision is made to approve, reject, or request more information

Approval and Transfer Process

If approved:

1. For dividends: The IEPF Authority issues a refund order to the company
2. For shares: The Authority approves the transfer back to your demat account
3. The company processes the refund/transfer within 30 days of receiving the order

Handling Rejections or Delays

If your claim faces issues:

1. Review the rejection reasons carefully
2. Address each point specifically in your resubmission
3. Consider seeking professional assistance for complex cases
4. File an appeal if you believe the rejection was incorrect

Special Considerations for Different Types of Claimants

For Legal Heirs and Nominees

If you’re claiming as a legal heir:

1. Include death certificate of the original shareholder
2. Provide succession certificate, probate, or letter of administration
3. Submit an affidavit confirming your legal right (as per prescribed format)
4. Include NOCs from other legal heirs (if applicable)

For Joint Holders

When shares were held jointly:

1. All surviving holders must sign the claim form
2. If any joint holder is deceased, include their death certificate
3. Provide an affidavit explaining the claim scenario
4. Submit fresh nomination forms for future reference

For Corporate Entities

When the shareholder is a company:

1. Include board resolution authorizing the claim
2. Provide specimen signature of authorized signatories
3. Submit company identification documents (Certificate of Incorporation, PAN)
4. Include GST registration if applicable

Common Reasons for IEPF Claim Rejections

Based on our experience at MUDS Management, these are the most frequent reasons claims get rejected:

Documentation Issues

• Incomplete Forms: Missing information in IEPF-5
• Inadequate Supporting Documents: Missing or expired ID/address proofs
• Improper Attestation: Documents not properly self-attested
• Inconsistent Details: Information mismatch across different documents

Procedural Errors

• Incorrect Claim Amount: Discrepancy in dividend amount claimed
• Wrong Company Details: Incorrect CIN or company identification
• Multiple Form Submissions: Creating confusion in the processing system
• Missing Original Documents: Not providing original documents when required

Technical Challenges

• Poor Quality Scans: Illegible document uploads
• Oversized Files: Documents exceeding size limits
• Incorrect File Formats: Not adhering to PDF requirements
• Timeout Issues: Not completing the submission process

Tracking Your IEPF Claim Status

Stay informed throughout the process:

How to Check Status Online

1. Login to the IEPF portal
2. Navigate to “MCA Services” > “Track Status/View”
3. Enter your SRN number to check current status
4. Review any remarks or comments added to your claim

Understanding Status Notifications

Common status updates include:

• Pending with Company: Under verification by company Nodal Officer
• Pending with Authority: Under review by IEPF Authority
• Deficiency Letter Issued: Additional information requested
• Approved: Claim has been accepted for processing
• Rejected: Claim denied with reasons
• Amount/Shares Released: Refund/transfer process initiated

Realistic Timelines

Based on our experience, expect:

• Company verification: 30-45 days
• IEPF Authority review: 45-60 days
• Transfer after approval: 30 days
• Total process: 3-6 months (for straightforward cases)

After Successfully Recovering Your Assets

Once you’ve recovered your assets, take these important steps:

Immediate Actions

1. Verify the Recovery: Confirm all dividends and shares have been received
2. Update Your Records: Ensure all contact and bank details are current
3. Consider Dematerialization: Convert any physical shares to demat form

Preventive Measures for the Future

To avoid future transfers to IEPF:

1. Set Calendar Reminders: Track dividend declaration and payment dates
2. Maintain Current Details: Regularly update your address, bank account, and contact information
3. Opt for Electronic Payments: Choose direct credit of dividends to your bank
4. Consolidate Folios: Merge multiple folios to simplify tracking
5. Review Annual Reports: Check unclaimed dividend sections in company annual reports

Professional Assistance for Complex IEPF Claims

While many investors can handle straightforward claims themselves, complex cases may require professional help:

When to Consider Professional Assistance

• Multiple rejected claims despite corrections
• Legal heir claims with complicated succession issues
• High-value claims worth substantial amounts
• Claims involving corporate actions like mergers or demergers
• International claimants facing jurisdictional challenges

What Professional Advisors Provide

At MUDS Management, our IEPF claim assistance includes:

• Preliminary assessment of claim viability
• Complete documentation preparation and verification
• End-to-end process management
• Regular follow-ups with companies and the IEPF Authority
• Resolution of technical and procedural obstacles

Case Study: Successful IEPF Recovery with MUDS Management

Consider this real-world example (with identifying details changed):

Client Situation:

• Inherited shares from grandfather who passed away 15 years ago
• Multiple companies with shares transferred to IEPF
• No original share certificates available
• Complex family structure with multiple legal heirs

Challenges:

• Establishing legal heirship across two generations
• Reconstructing the investment history
• Dealing with companies that had undergone mergers
• Coordinating NOCs from family members in different countries

How MUDS Management Helped:

• Created a comprehensive succession map with supporting documentation
• Reconstructed shareholding history through company registrar records
• Developed a custom indemnity structure acceptable to all companies
• Coordinated apostille of foreign documents for IEPF acceptance

Results:

• Successfully recovered shares worth ₹42 lakhs
• Retrieved unclaimed dividends of ₹3.8 lakhs
• Completed the entire process in 7 months
• Established systems to prevent future transfers

Preparing for Your IEPF Claim Journey

To make the most efficient progress with your claim:

1. Start with Research: Determine exactly what assets are with IEPF
2. Gather All Possible Documentation: Even seemingly unrelated investment records can help
3. Create a Timeline: Understand when and why transfers occurred
4. Prepare for Multiple Submissions: Complex cases often require several attempts
5. Set Realistic Expectations: Recognize that the process requires patience

Conclusion: Reclaim What’s Rightfully Yours

Recovering your unclaimed dividends and shares from IEPF may seem daunting, but with the right approach and persistence, it’s entirely achievable. At MUDS Management, we’ve guided investors through this complex process and have seen firsthand the satisfaction of successfully reclaiming financial assets.

Remember that unclaimed dividends and shares transferred to IEPF remain rightfully yours – the process is designed to return them to legitimate owners, albeit through a structured verification system.

Whether you pursue the claim independently or seek professional assistance, understanding the complete process as outlined in this guide will significantly improve your chances of success.

By taking action today to recover your unclaimed assets and implementing preventive measures, you not only reclaim what belongs to you but also ensure better management of your investments going forward.

For personalized assistance with complex IEPF claims or to discuss your specific situation, contact MUDS Management today to begin your recovery journey with confidence.

The post Unclaimed Dividend IEPF: A Comprehensive Guide to Recovering Your Money appeared first on MUDS.

Can you believe that shares of a company can provide a return of almost 3700%?

Yes, you read it right. This unbelievable milestone is achieved by Larson and Toubro Ltd. It has provided a return of 3700% to its shareholders. In January 1995, the shares of Larson and Toubro were floating at a price of ₹ 35 per share on the stock exchange. As of December 2020, the share price is more than ₹ 1288 per share. This simply means that if you had bought 500 shares of Larson and Toubro in 1995, then the current value of those shares would be in Crores.

Introduction to the Company

Larsen & Toubro Limited is a firm specializing in engineering, technology, construction, financial, and manufacturing services. The Company’s other segments include Infrastructure, which encompasses engineering and construction of the new buildings, factories, transportation-related infrastructure, or heavyweight civil infrastructure. It offers Power station solutions for gas-based and coal-based thermal power plants and Heavy Machinery Engineering where it manufactures, and supplies engineered critical equipment and systems. Defense Engineering is also one sector where it is engaged in designing, development, multi-level production and support of kit, systems and platforms of defense and aerospace engineering sectors.

Other additional works include communication projects (including military communications), marketing and servicing of construction and mining machinery and parts thereof, hydrocarbon, and manufacture and sale of rubber processing machinery. The Defense Engineering segment is additionally involved in designing, constructing, and repairing Defense vessels.

Even during the grim times of the COVID-19 pandemic, it continued to generate profits which led to its share price keep on increasing. The company has been quite generous over the years in providing bonus shares to its investors and also provides healthy dividends.

P.S.: This information regarding the bonus shares is based on the history of the company in the stock market and is based on the data from 2001 onwards.

The company declared heavy dividends of up to 500% per share in 2020. The first interim dividend released by the company in March 2020 is Rs. 10000 per share. The equity dividends declared by the company in past 12 months are Rs 36 per share.

Calculation related Shares bought for L&T in 1995

• Suppose you bought shares of Larson and Toubro Ltd. in January 1995 for ₹ 21, 500.
• The share price per share in 1995 for L&T was Rs. 43. The No. of shares you could have bought in Rs. 21, 500 = Rs. 21, 500/ Rs. 43 = 500.
• Thus, you would have purchased 500 shares.
• In 2006, the company issued bonus shares in the ratio of 1:1.

[Bonus Shares are the shares issued by a company for its shareholders as fully paid up shares without receiving any money (as a bonus) for their shareholders. In other words, the corporate houses, give a gift to their shareholders for their long-term association by issuing bonus shares].

Issue of bonus shares at a 1:1 ratio means, that for every share owned by an investor, the share company issues another share in the investors’ name. This means that if you had 500 shares, in 1995, then it would have become 1000 shares, i.e., double the initial number of shares.

• The company again issued bonus shares in the ratio 1:1 in 2008. This means the total no. of shares became 2000 in the year 2008.
• The company continued being generous to its investors in 2013 and issued bonus shares in the ratio 1:2. This meant the new shares will increase and become 3000.
• The latest gift for L&T investors came in the year 2017 when it issued shares in the ratio of 1:2. This took the total no. of shares to 4500.
• Now, the price of 1 share of Larson and Toubro Ltd. as of February 2020, is Rs. 1521. The value of your shares as of date will become,

₹ 4, 500 x 1521 shares = ₹ 68,44, 500 (Sixty eight lakhs forty four thousand five hundred rupees).

• The above amount is only calculated for the price of the shares. We have not calculated the dividends corresponding to the shares that you would have received so far.
• As we have stated, the dividend is huge for investors if they invest in L&T. therefore the corresponding total amount for a mere Rs. 21500 invested in the company would have easily been more than One Crore.
• You can calculate the dividend corresponding to the investment from the table given below.

Source: Dion Global Solutions Limited

So, if you had just invested ₹ 21500 years ago, in the shares of Larson and Toubro Ltd., then you would have become a Crorepati today. Now, suppose you have forgotten about your investment in these shares and therefore, have not claimed dividends related to them for the past 26 years. If that is the case, then do not think that you cannot get possession of these shares anymore, even though you are the rightful owner of the same.

The said shares have now been transferred to the IEPF regulated by the Government. As per the Government’s guidelines, such shares will now be treated as dormant shares because no one has claimed dividends for them for more than seven years. Since the shares have unclaimed dividends, they are now in the possession of the Government of India under their Investor Education and Protection Fund (IEPF) Authority. The Government introduced this in 2016 to resolve the problem of such ‘long lost and forgotten shares’ which were unclaimed for decades.

What is Investor Education and Protection Fund?

As stated above, the govt introduced the IEPF to deal with the ever-increasing problem of individuals forgetting their shareholdings during a company. The IEPF was launched to market the protection of interest, and awareness of the investors. The unclaimed dividend and lost shares transferred to the present account are taken care of by the govt on behalf of the rightful shareholders. The dividends on the shares remain unclaimed for years because people tend to forget that they own the shares within the first place. There are multiple reasons why people ditch their ownership during a company:

• If an investor is a senior citizen, they tend to forget to appoint a nominee for their shares before their death. Therefore, the heirs remain clueless about their ownership of such shares, and therefore the shares remain dormant.
• A small amount makes investors forgetful of their investment.
• Shares get stuck in the court’s proceedings due to any family dispute and thus remain unclaimed till the court’s proceedings are over.

There could be other reasons for an investor to forget about his/ her shareholding in the company. This is often the rationale why many companies have abundant shares with them with no sign of ownership.

Before the introduction of the IEPF, the businesses were required to transfer the unclaimed dividends and unclaimed shares to the govt funds which were employed by the govt under various public welfare schemes and for various developmental works. When the govt saw that it had been a really big loss for the investors, then the govt decided to line up the IEPF.

It’s a platform provided to the investors where they will approach the govt to say their dividends and ask them to refund their long-forgotten shares. Investors can claim their dividends/shares from the IEPF authority’s fund manager by applying for it to the managing authority. Due to the established authority of IEPF, people can claim their dividends and shares of various companies through one platform rather than getting to each company individually.

Authority for Governing IEPF

Companies Act, 2013 and Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 are applicable to the functioning of the IEPF. These laws state that the shareholders get 30 days to say the dividend after it gets declared by the corporate. If the dividends remain unclaimed by the shareholders, then the corporate must transfer such dividends to a special account, opened within the name of the corporate, called ‘Unpaid Dividend Account’.

The company has got to publish an inventory of all the shareholders along side their unclaimed dividend on its website within 90 days of transferring the quantity to the ‘Unpaid Dividend Account’. Once the quantity reaches the ‘Unpaid Dividend Account’, the shareholders need to file an application to the agency of the corporate to say the payment of the unclaimed dividends. If the shareholder fails to say the quantity for 7 years or more thanks to the above-mentioned reasons or the other reason, then the corporate is required to transfer the unclaimed dividend to the IEPF. Since the dividend remains unclaimed for quite 7 years, the shares also are considered as forgotten. Thus, they’re also transferred within the name of the IEPF along side their dividends.

Note: The shares which are transferred within the name of the IEPF are those on which the dividend has been declared by the corporate, and therefore the shareholders have did not claim an equivalent for a consecutive period of seven years.

Dividends of Larson and Toubro Ltd. in IEPF

The Annual Reports of a corporate state the present status of the dividends and shares of the corporate which is transferred to the IEPF account. In consistency with the Annual Report, 2019-2020 of Larson and Toubro Ltd., a sum of RS. 24,34,13,796 was transferred to the fund. As mentioned above, before the IEPF was introduced, the unclaimed funds used to get transferred to the Central Government and it was used in public welfare schemes. The unclaimed shares/dividends were transferred to the IEPF in the perusal of Companies Act 2013 Section 124 read with Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 for the shareholders who did not claim their dividends for quite 7 years.

Unclaimed dividends declared by the corporate for the fiscal year were Rs. 3,93,12,966 and were transferred to the IEPF in 2020. The deadline to say the dividends for the fiscal year 2014-2015 is going to be given during this year’s annual financial report release.

An investor can check the status of their unclaimed dividend, declared by Larson and Toubro Limited, from https://investors.larsentoubro.com/Unclaimed_Dividend.aspx

For more information, they can visit https://investors.larsentoubro.com/Resources.aspx

Shares of L&T Transferred to the IEPF

In accordance with the norms of Rule 6(3)(a) of the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘IEPF Rules’) and Section 124(6) of the Companies Act, 2013 the Company has transferred 3,634 equity shares of Rs. 2 each (0.0003% of total no. of shares) held by 257 shareholders (0.024% of total shareholders) to IEPF.

As we can see, the number of unclaimed shares of L&T transferred to the IEPF authority account worth crores. The company has a big chunk of unclaimed dividends in the IEPF. The shareholders are advised to recheck their complete investment history, or they can look for ownership of shares passed on from any deceased family member and claim dividends on their behalf from IEPF.

Unclaimed Shares Transferred to IEPF by L&T

What happens to the unclaimed shares and therefore the associated dividend transferred to the IEPF? Do investors lose all of their rights over your dividend income alongside the shares?

As stated in the IEPF rules, a shareholder won’t lose the rights over the dividend amount and therefore the shares once they were transferred to the govt funds. However, with the introduction of IEPF, a shareholder retains his/ her right over the dividend amount also because of the shares were transferred to the IEPF Account. All one must get to do is apply to the fund manager of the IEPF. Nonetheless, Larson and Toubro Ltd. still sends letters individually through posts and other modes of communication, to make their shareholders conscious of their holdings within the company and ask them to lay timely claims for their dividends. Once the dividends, holding the shares, get transferred to the IEPF, then it becomes a touch difficult for the shareholders to recover their shares.

This is often because the procedure followed by the fund manager, to refund the dividend amounts and therefore the shares, is time-consuming. To ensure that the refund of shares goes to its rightful owner, they complete thorough scrutinization of all the applications before initiating the transfer of the quantity of raised claim and therefore the shares. This is often the rationale behind Larson and Toubro Ltd. advising its shareholders to get the dividend from the corporate itself because it takes less time, and it’s a simple process. The shareholders can apply to the Company’s Registrar or the agency to say the dividends. However, if your shares are already transferred to the IEPF, then you’ll approach the Nodal Officer of the corporate, appointed during this regard. To contact the Nodal Officer of Larson and Toubro Ltd., write an email to Prasad.Shanbhag@Larsontoubro.com 

The Necessity of Legal Help?

The application procedure to lay the claim for refund of unclaimed dividends/lost shares from the IEPF Authority may be a tedious process. It requires a particular degree of legal and financial knowledge. If you hire a legal expert, then you’ll easily circumvent this headache as your legal consultant will take you out of this. He also will make sure that the appliance contains no mistakes to avoid rejection from the IEPF Authority. The expert will do all the tedious tasks for you; from collecting the data from the corporate about the dividends and shares to collecting the specified documents to filing the said application.

If your shares are involved in any family dispute, then the consultant will come in handy to resolve such issues. As stated above, it’s common for a shareholder to die before appointing any nominee. In such a case, the various relatives of the deceased could come to raise claims on all associated property of the deceased which incorporates the shares he bought in his lifetime. Nobody wants to let go of the shares of Larson and Toubro Ltd. And when there are numerous claiming members from a huge family, then there’s always going to be a dispute. A legal professional or a legal firm will assist you to manage all such disputes associated with the ownership of the shares. A lawyer knows all the laws and nitty-gritty of the loopholes around the distribution of the family assets; therefore, he can provide you with the simplest deal possible.

To Summarize…

As we’ve seen, Larson and Toubro Ltd. have given dividends of up to 500% per share to their shareholders over the years. Thanks to this ever-increasing, non-stop growth of the share price, ₹ 21500 invested within the shares of Larson and Toubro Ltd. in 1995 are worth well ahead of ₹ 1 Crore today. The current times are perhaps the best time to lay claim and sell these shares because it can assist an investor in dealing with the financial difficulties arising due to the dim scenario of the pandemic.

Thus, if you only came to understand the existence of such shares in your name, which was left to you by your deceased loved one, then it’s the perfect time to redeem the lost shares. you’ll also receive the dividend associated with them accumulated over the period. An unexpected gift of crores of rupees is just like hitting a jackpot. It is advised that an investor must inspect the links given above which will take you to the specified section of the company’s website. The perspective claimant should gather information regarding your dividends accumulated thus far, alongside the shareholding within the company, and file an application to lay a claim on their dividend from Larson and Toubro Ltd.

You’ll need to apply to the Nodal Officer of the corporate, by contacting them. You can find the details of the officer on the following link.

http://investors.larsentoubro.com/upload/ListingCompliance/Letter%20for%20Intimation%20of%20Nodal%20Officer%20under%20IEPF.pdf

However, if your dividend amount and shares are already transferred to the IEPF, then you’ll need to file your application through the fund manager of the IEPF. For this, we will recommend you to seek out an expert legal consultant/legal firm as soon as possible and apply to the IEPF Authority for the refund of the unclaimed dividend and therefore the recovery of the transferred shares. A legal expert also will assist you to fight for the shares stuck during a family dispute.

The post Unclaimed L&T Shares Are an Undiscovered Treasure! Recover them from IEPF Now! appeared first on MUDS.

Do you think five hundred shares of a company can make you a Crorepati? No, it is not a scam sales ad that you may find on the internet these days. If you or your elders have bought five hundred shares of Piramal Enterprises Limited in 1990, then the value of those shares in today’s date is worth above crores.

History of the Company

Piramal Enterprises Limited (PEL) boasts diversified businesses, like financial services and working in pharmaceuticals. PEL’s financial services offer a variety of monetary solutions and products related to retail and wholesale financing. The wholesale lending business provides financing to land developers, also as corporate clients in non-real estate sectors. Within its retail-based lending structure, PEL lends housing loans to its customers and is working on creating a multiproduct retail lending platform. The PIL corporate house also offers India Resurgence Fund (IndiaRF) as part of its financial business. it is a distressed asset investment platform, which invests in equity and/or debt across non-real estate sectors. The Piramal Pharma Limited (PPL), which is a subsidiary of PEL, offers a portfolio of services and products with its end-to-end manufacturing capacity. Piramal Pharma is part of a complex hospital generics business, has an integrated contract development and manufacturing facility, an Indian consumer products business, and selling over-the-counter products in India.

Even during the setback of the COVID-19 pandemic, it continued to get profits and supply dividends to its investors. For the primary three quarters of the year 2020-21, the shares of Piramal Enterprises Limited have provided impressive dividends to its shareholders. for instance, if there are 50 shares in your name, bought in 2008, then even by keeping the bonus dividends aside the corresponding values would are really high.

• Value of fifty shares in Jan 2008 at Rs. 313 per share is 15650.
• Value of equivalent shares in Feb 2021 at 1515 per share is 75750.

The corresponding increase in value is 400% approximately (that too considering no bonus shares or dividends).

Now considering the share splits offered by the corporate, it’s alright to be confused at this stage on how just 500 shares of the company gives a dividend of more than 1 Crore Rs. It should have led to an income of just equivalent price value. This happens in the case when the corporates are generous enough to issue huge amounts of bonus shares to their shareholders. You heard it right! Piramal Enterprises Limited has issued an enormous amount of bonus shares to its shareholders. the subsequent calculation will illustrate how the 500 shares yielded the value of ₹ 1, 07, 10, 000, and the way they’re worth above one Crore today.

Calculation

• Suppose you purchased 500 shares of Piramal in 1990.
• In 1991, the corporate-issued bonus shares within the ratio of 1:1.

[Bonus Shares are issued by the corporate to its shareholders as fully paid up shares with no cost. In other words, the corporate by issuing bonus shares gives a present to its shareholders].

Issuing bonus shares at a 1:1 ratio means for each 1 share owned by a shareholder, the corporate will issue another share in his name. this suggests that if you had 500 shares within the beginning, it’s now become 1000 shares, i.e., 500 shares + 500 Bonus Shares.

• In 1993, the Piramal company again issued the bonus shares within the ratio of 1:2. Now, for every 2 shares a shareholder-owned, the corporate issued another share. Therefore, the 100 shares in your name have now become 1500 shares.
• Now, since 1993 the values of these have kept increasing and thus with the added bonus shares issued by the corporate the corresponding increase in price is large .
• 10 years down the road , the corporate , in 2004, thanks to an extreme rise in its share price, break up its stock within the ratio of 1:5 and in 2005 in 1:920. In 2018 it again splitted its shares by 1/600 and followed it up by 1/420 split in 2019.

[A company splits its stock when the share price of the share increases to an excellent extent and it becomes difficult for the retail investors or small investors to take a position within the shares of such companies. By splitting the stocks, the corporate increases the number of shares within the market while decreasing its price by an equivalent proportion. during this way, there’s no change within the net value of the market capital.]

The same thing happened with Piramal Enterprises Limited. Its stock price skyrocketed and was trading at the worth range of ₹ 750 per share. it had been becoming difficult for retail investors to shop for the company’s stocks. Therefore, Piramal Enterprises did the split at the ratio of 1:5. this suggests that for each share, the shareholder got 5 shares, worth 1/5th of the first 1 share. this suggests that, earlier, if you had 10 shares of ₹ 5, 000 each, then now you’ve got 50 shares of ₹ 1000 each. Thus, no change within the net value of the shares worth ₹ 50, 000.

Due to the split of 2004, now your shares increased from 1500 to 7500.

P.S.: Don’t confuse it with Bonus Shares. Because unlike Stock Spilt, the worth per share doesn’t decrease while issuing Bonus Shares.

• Now, the worth of 1 share of Piramal Enterprise, as of December 2020, is ₹ 1428. Thus, the worth of your shares as of date (without considering other share splits is)

₹ 1428 x 7500 shares = ₹ 1, 07, 10, 000 (One Crore Seven Lakhs Ten Thousand).

• The above amount is merely the worth of the shares. we’ve not calculated the dividends that you simply have received thus far .
• Piramal Enterprises Limited is understood for paying its investors generously. To date, the corporate has paid tons of dividends too.

Source: https://in.investing.com/equities/piramal-healthcare-company-profile

Now you’ll calculate your dividends accordingly.

So, if you had invested money in buying just 500 shares of Piramal in Piramal Enterprises Limited in 1990, then you would have became a Millionaire by today’s share prices. Now the difficulty is that you simply aren’t within the possession of the shares of Piramal Enterprises, though you recognize that you are simply the rightful owner of the said shares. As per the Government’s rule, these shares are now treated as forgotten shares because nobody has claimed dividends for seven years or more. Since the dividend remained unclaimed, the shares are now within the possession of the govt of India under the Investor Education and Protection Fund (IEPF). it had been introduced in 2016 by the govt to resolve the difficulty of such ‘long lost and forgotten shares’.

Overview of Investor Education and Protection Fund

As mentioned, IEPF was introduced by the Indian Government to ensure a caretaker for the unclaimed dividend and unclaimed shares on behalf of the rightful owners of shares. People usually forget that they own shares of a company which is the reason why the dividends on such shares remain unclaimed for years or decades. The rationale to ditch the existence of such shares can be any of the following:

• Investors tend to forget to appoint a nominee for his or her shares. After their death, their heirs remain clueless about their ownership of such shares, and therefore the shares remain deserted.
• The amount of investment is so small that the investor forgets about it.
• Shares might become a reason for the family dispute of ownership and remain without ownerless till the decision of the court.

There might be another reasons also that would cause investors forgetting about their shares. thanks to this, many companies have shares that roll in the hay them with none sign of ownership.

Before the introduction of the IEPF, such unclaimed dividends and unclaimed shares were transferred to the govt funds which were employed by the govt for various public welfare schemes and developmental works. When the people started claiming their dividends and asked to refund their shares, the govt decided to line up IEPF. it’s a medium that gives the general public to approach it and claim their dividends and ask to refund their long-forgotten shares. they will claim their dividends and shares by applying to the managing authority of the fund manager. thanks to the establishment of IEPF, people don’t got to approach separate companies to acquire their dividends and shares.

Acts Governing IEPF for Regulation

The Companies Act, 2013 and Investor Education Protection Fund (IEPF) Authority (Audit, Accounting, Transfer and Refund) Rules, 2016 regulate the functioning of IEPF. These laws state that after a corporation declares its dividend, the shareholders get 30 days to say the dividend. If the shareholders fail to say, then the corporate is forced to transfer such unclaimed dividend to a special account, opened within the name of the corporate, called ‘Unpaid Dividend Account’.

The company, within 90 days of transferring the quantity to the ‘Unpaid Dividend Account’, has got to publish an inventory of all the shareholders alongside their unclaimed dividend on their website. then, a shareholder has got to file an application of claim to the corporate for the payment of the unclaimed dividend. If the dividends remain unclaimed for a consecutive period of seven years, then the corporate is obliged to transfer the unclaimed dividend to the IEPF. Once the 7-year period of time gets over, the shares also get transferred to the IEPF, along side the dividend amount.

Note: The shares transferred within the name of the IEPF are the shares on which the dividend has been declared by the corporate, but the shareholder has did not claim an equivalent for a consecutive period of seven years.

Unclaimed Dividend/Shares of Piramal

We can see the transfer status of the unclaimed dividend and unclaimed shares to the IEPF from the Annual Reports of a corporation.

Funds & Shares transferred to the IEPF

According to the Annual Report 2019-2020 of the company, Piramal Enterprises has transferred the following unpaid dividend and unclaimed shares to the IEPF during the Financial Year of 2019-20:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2018-19.pdf

Following are the reports for seven financial years before that:

Financial Year of 2018-19:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2018-19.pdf

Financial Year of 2017- 18:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2017-18.pdf

Financial Year of 2016 – 17:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2016-17.pdf

Financial Year of 2015-16:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2015-16.pdf

Financial Year of 2014 – 15:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2014-15.pdf

Financial Year of 2013 – 14

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2013-14.pdf

Financial Year of 2012 – 13:

https://www.piramal.com/wp-content/uploads/2020/10/Equity-Unclaimed-Dividend-FY-2012-13.pdf

The company in the previous financial years has transferred huge amount of money along with dividends related to shares to the IEPF.  The company has transferred this amount continuously in previous years and also released advertisements in the newspapers asking their investors to recover their dormant money. The number of unclaimed lost shares transferred to the IEPF are worth crores of rupees. PEL corporate house has a huge chunk of unclaimed shares which is transferred to IEPF every year. The shareholders are advised to look into their investment history, or the ownership of shares passed on from a deceased family member and claim their dividends and shares from IEPF. The shareholders must regularly check the newspaper advertisement and corporate information section of Piramal Enterprises to know the status of pending shares.

Funds to be transferred to the IEPF

The Annual Report 2019-2020 gives investors the details of their shares with the amount which has been transferred to the IEPF. It also provides the amount of outstanding unclaimed dividends that have been transferred with the names of shareowners. The shares mentioned in the report have crossed date to make a final claim directly to the company. Hence, Piramal Enterprises Limited is forced to transfer the outstanding amounts of dividends, along with the shares, to the IEPF.

Annual Report Link:

https://www.piramal.com/wp-content/uploads/2020/09/PELl_AR_20-07_final.pdf

The report above gives complete details of the shareholders of Piramal Ltd. whose dividends have been transferred to IEPF. An investor can apply to the IEPF’s website and subsequently contact the nodal officer of Piramal through contact details mentioned at end of this blog to process their application.

An investor can check the status of their unclaimed dividend, declared by Piramal Ltd., from https://www.piramal.com/investor/shareholder-information/unclaimed-dividend/

Dormant Shares/Lost Dividends under IEPF

What happens to the shares and therefore the dividend transferred to the IEPF? Will you lose all of your dividend income along side your shares?

A shareholder, before the introduction of IEPF, wont to lose his rights over the dividend amount and therefore the shares once they were transferred to the govt funds. But now, with the introduction of IEPF, a shareholder doesn’t lose his/ her right over the dividend and therefore the shares. However, companies still urge their shareholders to say their dividends before the shares enter IEPF. the rationale behind this is often that the procedure of claiming the refund of dividend and therefore the shares from IEPF is extremely time-consuming. IEPF takes an extended time to refund the quantity and shares to the rightful owner because it wants to be 100% sure that the dividend and shares are given to the rightful owners only. thanks to this, they carefully scrutinize the applications before giving their approval of the transfer. this is often why Piramal Enterprises Limited advises their investors to say their dividend from the corporate by applying to the Company’s Registrar or the agency, instead of claiming the refund of shares and therefore the dividend amount from the IEPF. For this purpose, the Nodal Officer, appointed by the corporate under the principles of IEPF, is Mr. Bipin Singh, Company Secretary. One can also contact the Piramal Nodal officer on complianceofficer.pel@piramal.com.

Why Does an Investor Need Legal Help?

The procedure to file an application for the refund of unclaimed dividends and lost shares to the IEPF Authority may be a tricky and tedious task. Hiring a jurist will ease out your process of filing the appliance. Application filing to IEPF requires a particular degree of technical knowledge. The advocate/legal expert will make sure that the appliance contains no mistakes and thus, helps to avoid the probability of it getting rejected. He will do all the tasks; from collecting the knowledge from the corporate about the dividend and shares to filing the said application.

The legal/financial expert can also assist you to urge your shares that are involved during a family dispute. As stated above, when a shareholder dies without appointing a nominee for its shares or doesn’t draft a will on what is going to happen to its shares after his death, then all the relatives of the deceased shareholder come to say their share within the deceased’s property, a.k.a., shares during this case. I mean who will leave the shares of Piramal Enterprises Limited worth more than One Crores. No one, right! No loved one of a dead person will want to abandon the shares of Piramal Enterprises Limited (PEL) that were bought by his elder before 1990. Thanks to these reasons, a claimant requires the assistance of a legal professional or a legal firm to manage all such disputes associated with ownership of the shares. A jurist knows all the laws and nitty-gritty round the loopholes regarding the partition of the family assets, therefore, he can provide you with the simplest deal possible.

To conclude…

As we’ve seen, Piramal Enterprises is extremely generous in issuing bonus shares to its shareholders from time to time. Thanks to this generosity, the 500 shares bought before 1990 could give returns well above one crore rupees. And as we all know, the worth of the shares has increased manifold. Thus, if you only came to understand the existence of such shares in your name, then it is perhaps the best time to redeem them, along side the dividend accumulated over time. Getting more than One Crore rupees, out of the blue is nothing but winning a lottery. It is advised that you simply check the data/links provided above and find the expiry date by which you’ll claim the dividend from Piramal Enterprises Limited (if it is not transferred into the IEPF already), then apply for the dividend claim as soon as possible. You might need to apply to the Nodal/ Deputy Nodal Officer of the corporate in case the amount is already transferred to the IEPF. If your dividend amount and shares are already transferred to the IEPF, then find a financial consultant as soon as possible, and apply to the IEPF Authority for the refund of the unclaimed dividend and therefore the recovery of the transferred shares. Hiring a legal consultant also will assist you to fight for the shares stuck in any a legal dispute with other relatives.

The post Can Recovery of Piramal Enterprises’ Shares from IEPF Make You a Crorepati? appeared first on MUDS.

Now, what does it indicate? It shows that if somehow you can find any proof of investment in Eicher Motors from the early 90s, then you can raise a claim on the unclaimed dividend of Eicher Motors share and get the amount which will be huge compared to the invested amount. Finding lost shares like these is like finding hidden treasures. The obvious question is how to claim these funds and is it easy to raise a claim on such funds. Before we answer such questions, let us understand how Eicher Motors has managed to provide such growth to its investors and why is it logical to find unclaimed dividends of this company. 

Financial History of the Company

Eicher Motors Ltd. was incorporated in 1982. It is a Large Cap company with a market cap of Rs 69254.03 Crore and operates in the auto manufacturing sector on India. It is the manufacturer of iconic Royal Enfield Motorcycles. It also manufactures other vehicles and auto spare parts. The company went public in 1982 and got listed on the Stock Exchange. The company performed tremendously so much so that its per-share price reached more than ₹ 2536.70 in November 2020. Due to this high value, it had become difficult for retail shareholders to invest in the company. Therefore, on August 11 2020, the company announced the splitting of its stock into 10 shares. Thus, each equity share worth ₹ 10 was worth 10 shares of Rs. 1 each. Even during the Covid-19 Pandemic, the company has managed to stay in the game and kept its growth momentum. The shares of the company have grown manifolds over the years with an average annual growth rate of 32%. Let us see how it has grown over the years with the following calculation.

Calculation

• Suppose your father has bought 5000 shares of Eicher Motors in 1996.
• In 1996, the company shares had a valuation of Rs. 2.32.
• So the net amount invested by your father is Rs. 11600.
• 24 years down the line, the worth of those 5000 shares as per today’s closing rate of Rs. 2515 will be nearly Rs. 1,25,75,000.
• Source: https://in.finance.yahoo.com/quote/EICHERMOT.NS/history?period1=849139200&period2=1606521600&interval=1d&filter=history&frequency=1d&includeAdjustedClose=true
• The company due to an extreme rise in its share price split up its stock in the ratio of 1:10.

[By splitting the stocks, the company increases the number of shares in the market while decreasing its price by the same proportion. In this way, there is no change in the net value of the market capitalization, and it becomes easy for retail investors to invest in the company.]

Now, imagine if you find that your grandfather had in fact invested those Rs. 11660 in 1996 and then forgot to take notice of this investment. Over the years this investment and the dividend remained unclaimed and later in the years, your grandfather passed away without naming an heir to these shares. If you find these shares today and lay claim on the unclaimed dividend, then you can become a Millionaire in no time! 

Now the issue is that you are not in the possession of these shares of Eicher Motors Ltd., though you know that as a grandson, you are the rightful owner of the same. As per the Government’s rule, these shares are now treated as unclaimed shares as no one has claimed dividends for seven years or more. Since the dividend remained unclaimed, the shares are now in the possession of the Government of India under the Investor Education and Protection Fund (“IEPF”). It was introduced in 2016 by the Government to resolve the issue of such ‘lost or forgotten shares.’ Earlier such unclaimed shares were transferred to the public fund of government for utilisation in public welfare schemes. but later when there were too many people coming out after years to lay claim on the shares, then the Government decided to make a fund to keep such lost or unclaimed shares secure. It also introduced an online procedure for anyone who wants to lay claim to their lost shares. Let’s understand more about the IEPF and recovery of lost shares in the following sections. 

As per the data given below, the company’s paid dividend has grown by 1250% since 2001. If you calculate, it is an extraordinary level of growth on any standard. 

Source: https://www.eicher.in/dividend-history

What is Investor Education and Protection Fund?

As stated above, IEPF was introduced by the Government to take care of the unclaimed dividend and unclaimed shares on behalf of the rightful shareholders. People usually forget that they own shares in a company which is the reason why the dividends on such shares remain unclaimed for years. The reason to forget about the existence of the shares can be any of the following:

• Investors tend to forget to appoint a nominee for their shares. After their death, their heirs remain clueless about their ownership of such shares, and the shares remain deserted.
• The amount of investment is too small to remember.
• Shares become a part of the property dispute and remain without ownerless till the verdict of the court.

There could be some other reasons also that could lead to investors forgetting about the shares. Due to this, many companies have shares that lie with them without any sign of ownership. IEPF is a medium that allows the public to claim their dividends and ask to refund their long-forgotten shares. They can claim their dividends and shares by applying to the managing authority of the fund manager. Due to the establishment of IEPF, people do not need to approach separate companies to procure their dividends and shares.

Regulating Laws of IEPF

Companies Act, 2013 and Investor Education, and Protection Fund Authority (Accounting, Audit, Transfer, and Refund) Rules, 2016 govern the functioning of the IEPF. These laws state that after a company declares its dividend, the shareholders get 30 days to claim the dividend. If the shareholders fail to claim, then the company is forced to transfer such unclaimed dividend of Eicher Motors to a special account, opened in the name of the company, called ‘Unpaid Dividend Account’.

The company, within 90 days of transferring the amount to the ‘Unpaid Dividend Account’, must publish a list of all the shareholders along with their unclaimed dividend on their website. After that, a shareholder must file an application to the company for the payment of the unclaimed dividend. If the dividends remain unclaimed for a consecutive period of 7 years, then the company is obliged to transfer the unclaimed dividend to the IEPF. Once the 7-year time period gets over, the shares also get transferred to the IEPF, along with the dividend amount.

What happens to the shares and the dividend transferred to the IEPF? Will you lose all your dividend income along with your shares?

A shareholder, before the introduction of IEPF, used to lose his rights over the dividend amount and the shares once they were transferred to the Government funds. But now, with the introduction of IEPF, a shareholder does not lose his/ her right over the dividend and the shares. However, companies still urge their shareholders to claim their dividends before the shares go into IEPF. The reason behind this is that the procedure of claiming the refund of dividend and the shares from IEPF is very time-consuming. IEPF takes a longer time to refund the amount and shares to the rightful owner because it wants to be 100% sure that the dividend and shares are given to the rightful owners only. Due to this, they carefully scrutinize the applications before giving their approval of the transfer. 

Procedure of IEPF to Claim Unclaimed Dividend of Eicher Motors in Simple Steps

Step 1: Claimant to Authority

A claimant has to apply to MCA through IEPF Form-5 with details of their particulars, company, and shares to be claimed. 

Step 2. Claimant to Company

After filling the online refund form, the claimant should send it to the Nodal Officer of the concerned company with attachments like indemnity bond, original receipts and certificates related to matures deposit or debentures, etc. these will help in verification of claim with the company. 

Step 3. From Company to Authority

A company has to create a claim verification report within 15 days of receiving the claim form along with documents and send it to the authority in the prescribed format of the authority. 

Step 4. Grant of Claim by Authority

The authority will grant the claim to the claimant after verification of all documents and the form sent by the company. 

If the claimant has claimed shares, then the sanctioning authority will order a refund to be paid to the Demat account of the claimant. If there is any amount, then it will be transferred to the bank account of the claimant. Normally, the authority disposes of claims within 60 days of receiving the verification report from the company.

Why do You Need Legal Help?

The procedure to file an application for the refund of an unclaimed dividend of Eicher Motors and lost shares to the IEPF Authority is a tricky and tedious task. Hiring a legal expert will ease out your process of filing the application. The application filing requires a certain degree of technical knowledge. The legal expert will ensure that the application contains no mistakes and thus, avoids the chances of it getting rejected. He will do all the tasks; from collecting the information from the company about the dividend and shares to filing the said application.

The legal expert can also help you to get your shares that are involved in a family dispute. As stated above, when a shareholder dies without appointing a nominee for its shares or does not draft a will as to what will happen to its shares after his death, then all the relatives of the deceased shareholder come to claim their share in the deceased’s property, a.k.a., shares in this case. I mean who will leave the shares of Eicher Motors Ltd. No family member of a deceased person will want to let go of the shares that were bought by him in the 90s. Due to these reasons, a claimant requires the help of a legal professional or a legal firm to manage all such disputes related to ownership of the shares. A legal expert knows all the laws and nitty-gritty around the loopholes regarding the partition of the family assets, therefore, he can provide you with the best deal possible.

Conclusion…

As we have seen, Eicher Motors’s value of the shares has increased manifold. Thus, if you just came to know about the existence of such shares in your name, then it is the best time to redeem them, along with the dividend accumulated over time. Getting a sum in excess of a crore is nothing less than winning a lottery. It is advised that you check the data on the company’s website to find the expiry date by which you can claim the unclaimed dividend of Eicher Motors Ltd Shares. If your shares are not transferred to the IEPF, then apply for the dividend claim to the Nodal/ Deputy Nodal Officer of the Company. However, if your dividend amount and shares are already transferred to the IEPF, then find a legal expert as soon as possible, and apply to the IEPF Authority for the refund of the unclaimed dividend of Eicher Motors and the recovery of the transferred shares. Hiring a legal expert will also help you to fight for the shares stuck in a legal dispute. These firms can also guide you through the complete process and make your job of share recovery easy.

The post Recover Unclaimed Dividend of Eicher Motors from IEPF Can Make You a Crorepati Overnight! appeared first on MUDS.

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Yes! You read that right about recovery of shares. This information was revealed by none other than Mr Mukesh Ambani (Chairmen, managing director of the Reliance India Limited) in the Annual General Meeting of the company in 2017. Mr Ambani said, 

“In just 4 decades, Reliance Industries has grown from a small startup to one of the largest, most admired companies in the world,”

“One thousand rupees invested in Reliance shares in 1977 is today worth Rs 16,54,503 – over 1,600 times more valuable,”.

Now, what do these figures mean to an average investor? The main thing we can interpret from this data is that if by chance anyone has an invested stock from 1977 then they could get rich by manifolds. This is where recovery of shares gains importance. In a recently released data by RIL, it has the largest no. of unclaimed shares or unclaimed dividend among companies in India. The details of the data unclaimed IEPF shares are given in the table after the following section. The obvious question here is 

How does this unclaimed dividend come into being?

People generally tend to invest their money into various companies to reduce the risk of losing money. This seems profitable to the people but sometimes during the process, people tend to forget about their small investments and do not avail the dividends. The bought shares remain dormant for years with no one to claim. Sometimes senior citizens buy shares and forget to nominate an heir to shares before their death. This could lead to money unclaimed dividends or shares for companies. 

Status of Unclaimed Shares of Reliance India Limited

Reliance Industries Limited 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 2016, RIL had almost 113 crores recorded as unclaimed dividends from investors. The reliance Industry limited has 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 RIL 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.rinfra.com/unpaid-unclaimed-dividend-holders

According to the latest released data by RIL, we can also see the transfer status of IEPF unclaimed dividends for various financial years in the following charts. If you want to study the information deeply you can access the documents from the source mentioned below the table. 

Chart 1: Status of unpaid and unclaimed dividend for Reliance Industries in different years:

Source: https://www.ril.com/DownloadFiles/IRForms/Shareholders-Referencer.pdf

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

• The market capitalization of Reliance has multiplied 5000- times from the year 1977 to 2017. 
• Total assets increased from Rs. 33 crores to Rs. 700000 Crores.

One can simply conclude that owning a RIL share from the 80s would be the most profitable investment ever. Therefore, recovery of shares of Reliance is a profitable venture. Spending a small sum to get the lost shares is not a big deal considering the number of profits it will bring in terms of unclaimed dividend. Obviously, one would require legal help to claim all the lost shares. Especially in the scenario when an elderly have died without claiming the amount and their kin are laying claim on the amount. All the grandchildren might start asking for a share in the amount. This is where legal help can play a major role as they can help to get the will of the elderly to resolve the claim issue among the family members. A legal professional can also help in filing for the claim in IEPF. 

Claiming Money through IEPF

Earlier, according to the policy of government these unclaimed dividends were transferred to the government which will use it further for public use.  But the government later decided to set up an unclaimed dividend fund where the lost or unclaimed share of companies could be transferred. Any heir to the funds or people remembering their long-forgotten investment could file a report to the managing authority of the fund to claim their lost money and shares. With this concept in mind, the Government of India came up with the IEPF or Investor Education and Protection Fund. 

Provisions of Investor Education and Protection Fund:

The Ministry of Corporate Affairs announced Investor Education and Protection Fund (IEPF) rules in 2017. The rules stated that any money which has been part of the unpaid dividend account of the company for seven years and has no claimant for the said duration must be transferred to the IEPF. The amount must be transferred to the fund with the interest for the same period. The said amount once transferred can only be claimed by a claimant after applying to IEPF. Therefore, the IEPF became a one stop destination for investors to lay claim on lost shares. it eased out the process of claiming refund of lost shares and provided investors an opportunity to avail their long lost investment. 

Now, let’s understand the process of claiming lost shares or unclaimed dividends from shares of reliance transferred to the IEPF. The process mentioned in the upcoming section is a set of simple guidelines to claim refund of shares form IEPF for a common investor. 

The Process to Get Refund of Lost Shares from 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, etc. has been transferred to the Fund, may claim the shares under the provision to sub-section (6) of section 124 or apply for a refund under clause (a) of sub-section (3) of section 125 or proviso to sub-section (3) of section 125, as the case may be, to the Authority.

Step 1: Claimant to Authority

A claimant has to apply to MCA through IEPF Form-5 with details of their particulars, company, and shares to be claimed. 

• Particular of Applicant
• Details of Shares to be claimed
• Particular of Company
• Details of the amount claimed
• Aadhaar Number or PIO Card No. (in case of NRI/foreigners)/Passport/OCI
• Year-wise details of deposits/ securities.
• Aadhar linked bank account’s details (in which refund of claim to be made).

Step 2. Claimant to Company

After filling the online refund form, the claimant should send it to the Nodal Officer of the concerned company with attachments like indemnity bond, original receipts and certificates related to matures deposit or debentures, etc. these will help in verification of claim with the company. 

Docs Required are as listed:

• Original Physical Share Certificate/ bond/ Debenture Certificate
• Indemnity Bond (original) with claimant signature

On a non-judicial Stamp Paper of the value as prescribed under the Stamp Act if the amount of the claim is Rs.10, 000 or more.

On a plain paper if the amount claimed does not exceed Rs.10,000.

In case of a refund of shares, on a non-judicial Stamp Paper of the value as prescribed under the Stamp Act.

• Advance Stamped receipt (original) with the signature of the claimant and two witnesses
• Copy of Aadhaar Card of claimant
• Print out of duly filled claim form (IEPF-5) with claimant signature
• Acknowledgement copy
• Cancelled Cheque 
• Copy of Passport, OCI and PIO card (for foreigners and NRI)

Step 3. From Company to Authority

A company has to create a claim verification report within 15 days of receiving the claim form along with documents and send it to the authority in the prescribed format of the authority. The company has to appoint a nodal officer to carry out the verification process of the claim. 

The Nodal Officer shall be solely liable for all actions of any officer appointed as Deputy Nodal Officer: In case a company fails to appoint Nodal Officer, every director of the company shall be deemed to be a nodal officer and be liable for any failure to comply with the requirement of these rules.]

Step 4. Grant of Claim by Authority

The authority will grant the claim to the claimant after verification of all documents and the form sent by the company. 

II. Verification report to the Authority:

The company shall within 30 days of receipt of claim form, send a verification report to the Authority in the format specified by the Authority along with all documents submitted by the claimant.

The Company shall attach the scanned copy of all the original documents submitted by the claimant in physical form duly certified by its Nodal Officer along with the e-verification report along with a scanned copy of both sides of the original physical share certificate or original bond or deposit or debenture certificate/s duly cancelled and certified:

If the claimant has claimed shares, then the sanctioning authority will order a refund to be paid to the Demat account of the claimant. If there is any amount, then it will be transferred to the bank account of the claimant. Normally, the authority disposes of claims within 60 days of receiving the verification report from the company. 

Time: An application received for refund of any claim under this rule duly verified by the concerned company shall be disposed of by the Authority within 60 days from the date of receipt of the verification report from the company.

If  Submitted Application is Incomplete:

If the verifying authority finds the application incomplete or requires any other document to complete the verification, then they will write an email to the claimant mentioning the defects in the submitted form or details or any other required documents. The claimant is then required to submit the refurbished documents or other set of documents within 15 days of receiving the communication email form the authority. If the documents are not submitted on time, the authority can reject the claim application due to incomplete nature of documents. All the documents required again by the verifying authority must be addressed to the verifying nodal officer of the company. ensure that the documents reach the officer within fifteen days.

So, we understood the complete process of getting unclaimed dividends from a company. Shares of Reliance Industries Limited have risen manifolds in their value in the last few decades. Therefore, if you lay claim to shares lost or unclaimed for a long time then their value in the current times will be considerably higher. This is like finding unexpected gold buried in your ancestors’ land. However, claiming this lost moneyand recovery of shares requires filing documents and meeting all the requirements mentioned above. The easy workaround for this tedious process is to get the help of a legal firm that can do all the documentation and filing work for you.  These firms can also guide through the complete process and make your job of recovery of shares easy. So, without waiting anymore, if you have any queries or recovery of shares/transfer related questions, find a suitable legal firm with experts and get guidance on recovery of your unclaimed investment.  

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