The delivery instruction slip book is similar to a cheque book and it needs to be handled with the same care as a cheque book
Most of us know what is dematerialisation of securities, advantages of holding shares in demat form and how to manage your investment in demat mode.
The below write-up will elaborate more on how to transfer shares from demat account to another demat account. The article also provides details on how to transfer securities from the demat account of a deceased holder to the account of a surviving joint holder(s), nominee or legal heir.
Demat mode: Shares and debentures in your demat account can be transferred to another demat account by issuing appropriate instructions to your depository participant (DP) through delivery instruction slip (DIS). If you sell your securities through the stock exchange, you will instruct your DP to transfer shares from your demat account to the brokers’ pool account. In case of off market transaction, you will instruct your DP to transfer to the concerned buyer’s demat account.
Similarly, securities can be transferred to your demat account by the instruction of the seller (transferor) to his DP. The seller will have to mention your demat account number in the DIS.
The DIS book is similar to a cheque book and it needs to be handled with the same care as a cheque book. Accordingly, you will always store the DIS book in a safe place in your custody and not hand over signed blank DIS to anybody.
Physical certificates: You can transfer shares or debentures to your name by forwarding the following documents to RSTA (registrar and share transfer agent) of the company.
Time line for transfer: Listed companies are required to transfer shares or send the objection memo within 15 days from the date of lodgment for transfer deeds, original certificates and all other required documents. In case of debentures / bonds, the company is required to effect the transfer within two months from the date of lodgment for transfer deeds, original certificates and all other required documents.
Compensation in case of delay: You are entitled to claim interest from the company in case of delay in transfer of shares beyond the 30-day period. For this, you can file for arbitration at the stock exchange where company’s shares are listed.
Transmission of securities
In the event of death of a share / debenture holder, his / her ownership rights can be passed on to the legal heir / nominee through a process known as transmission. The procedure for transmission of securities is as follows;
1. If you are a nominee: For shares in demat mode, you have to provide the following documents to the depository participant
For physical certificates, you may be required to provide one or more of the following documents to the RSTA
2. Where there is no nomination:
Where value is more than Rs. 1 lakh, the DP may additionally insist on one or more of the following documents
Shares held in Physical mode:
* In case of multiple successors, NOC from non-applicants shall be recorded on the share transmission form of the applicant instead of insisting separate share transmission form from each of the successors.
Time line for transmission: Shares in physical form are required to be transmitted within one month of receipt of complete set of requisite documents. Shares in demat form are required to be transmitted within seven days of receipt of complete set of requisite documents by the DP.
Source: Securities and Exchange Board of India
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