Capital market regulator SEBI (Securities and Exchange Board of India) has simplified the procedure for transfer of securities from the account of a deceased person and raised the threshold limit for such transactions in demat format to Rs. 5 lakh.
Transmission means to the transfer of securities from the account of a deceased holder to that of surviving joint holder, nominee or legal heir.
In case of transmission of securities in dematerialized mode, where the securities are held in a single name without a nominee, the existing threshold limit of Rs. 1 lakh per beneficiary owner account has now been revised to Rs. 5 lakh, SEBI said in a notification on Monday.
In case of transmission of securities in physical mode, where the securities are held in single name with a nominee, SEBI asked share transfer agents or issuer companies to follow the standardised documentary requirement specified by it.
This process requires an application in a prescribed format, along with supporting documents, as evidence for the death of the holder.
For securities held in single name without a nominee, SEBI has said that additional documents such as identity card and claim of legal ownership to the securities might be sought.
In case the valuation of such securities are over Rs. 2 lakh, a succession certificate or probate of Will or Letter of Administration or court decree is required.
The timeline for processing the transmission requests for securities held in dematerialised and physical mode would be 7 days and 21 days respectively, after receipt of the prescribed documents.
To improve the awareness of nomination facility, all Registrars to an Issue and Share Transfer Agents shall publicize nomination as an additional right available to investors, while sending communications to the investors, SEBI added.