Claiming Unpaid Dividend and Shares Transferred to IEPF

The management of a company is overseen by its Board of Directors; however, its ownership lies with the shareholders. To safeguard shareholder interests, the Government of India has established the Investor Education and Protection Fund (IEPF). This fund consists of grants, donations, unpaid dividends, matured deposits, matured debentures, and accrued interest. The IEPF is primarily utilized for refunding shareholders, promoting investor awareness, and other related activities.

This guide explains the process for claiming unpaid dividends and shares transferred to the IEPF. Shareholders can retrieve their unclaimed funds and shares by submitting an application to the concerned IEPF authority.

When is the Amount Transferred to IEPF?

If a company does not pay a declared dividend or if the shareholder does not claim it within 30 days, the company must transfer the unpaid dividend to a designated “Unpaid Dividend Account.” If the amount remains unclaimed for seven years, both the unclaimed dividend and associated shares are transferred to the IEPF.

 

Procedure for Claiming Unpaid Dividend and Shares

1. Filing an Online Application

Shareholders must submit an online application using Form IEPF-5, attaching the required documents. After submission, a physical copy of the application, along with original documents, must be sent to the Nodal Officer at the company’s registered office.

2. Verification by the Nodal Officer

Each company transferring unclaimed dividends and shares to the IEPF must appoint a Nodal Officer. This officer, along with any designated Deputy Nodal Officers, is responsible for verifying claims. Once the online application is submitted, it is forwarded to the company’s Nodal Officer for review.

3. Submission of Online Verification Report

The Nodal Officer must verify the claim and submit an online verification report within 30 days. This report includes scanned copies of the original documents submitted by the claimant. If the report is not received within 60 days from the date of Form IEPF-5 submission, the authority may reject the claim.

4. Processing the Refund

The IEPF authority processes the refund within 60 days of receiving the verification report. Once verified, the Drawing and Disbursement Officer presents the payment request, and the competent authority approves the refund. The refund amount is credited electronically, and shares are transferred to the claimant’s DEMAT account.

Required Documents for Refund

1. Form IEPF-5 application
2. Original Share Certificate/Proof of entitlement
3. Indemnity Bond
4. Advance Receipt
5. Identity and residence proof of claimant
6. Any other required documents

Note: All documents must be self-attested by the claimant.

By following these steps, shareholders can successfully reclaim their unclaimed dividends and shares from the IEPF.