Have you ever thought what happens to all those unclaimed dividends, shares or any money which was lost in scams or frauds?
It might also happen that your grandparents or parents have made some investments and you are not aware about it? How to find it out and claim it back?
The answer is IEPF, which is Investor Education Protection Fund Authority (IEPF) by the Ministry of Corporate Affairs, Government of India. This is a body setup by govt, where all these unclaimed money gets transferred and investors can claim them back by following a procedure.
Recently IEPF authority recovered back Rs 1,514 Crores from Peerless finance which had done a fraud in past where lots of investors lost their hard earned money.
What exactly gets transferred to IEPF?
Something which is unclaimed for a period of 7 yrs., goes into IEPF, example are ..
- Unclaimed shares lying in demat accounts from years
- The application moneys received by companies for allotment of any securities and due for refund
- Matured debentures with companies
- Matured bank deposits
- Unpaid dividends by companies
- Interest accrued on above things
- Any investors money which is recovered from fraudulent companies
In case the dividend for any year is claimed or received by the shareholder during the last seven consecutive years, the shares will not be transferred to Investor Education and Protection Fund.
The below chart shows the unclaimed or unpaid money (in lakhs) transferred to IEPF (from 2001 to 2018) –
How to search for unclaimed and unpaid amounts?
In order to get a refund, the first step it to find out that there is any unclaimed amount for yourself/parents/grandparents etc. There is a facility provided by IEPF where an investor can find out the amounts which they are liable to get back.
The investor can search for their unclaimed and unpaid amount by filling in certain details such as investor name, father or husband name, folio number etc. by Clicking on this link.
The below-attached image shows how the investor can search for the unclaimed and unpaid amount.
Note that it’s a bit complicated and cumbersome to do the search. Please be patient and try all kind of combinations.
Tip : I suggest you putting all possible combinations of your name, your father/mother or grandparents’ name. A lot of times, our parents/grandparents invest in shares or have some deposits which we are not even aware about. This is how we can dig deeper and find out!
Process of getting Refund from IEPF?
Here I am writing keeping in mind refund for shares, but the process is pretty much same for other things as well.
- Go to IEPF Website and fill in IEPF Form 5 and use the option form upload. You will be redirected to Ministry of Corporate Affair (MCA) for form Upload.
- Login using your ID and Password (if existing or else register yourself by clicking on register and entering the required details).
- After login, click on normal upload.
- Click on Browse and attach the form. Click on Submit.
- SRN will be generated and you will ask for a payment option (Pay Now or Pay later).
- Though Fee will be zero but click on Pay now option only to generate the acknowledgement.
- After clicking on Pay Now, you have to click on Finish when the zero-fee page will be shown. The acknowledgement will be generated.
What is the procedure after applying for Refund?
The investor has to send the attachments prescribed below to Nodal Officer (IEPF) of the company at its registered office in an envelope marked “claim for a refund from IEPF Authority” for initiating the verification for a claim.
a) Print out of duly filled and uploaded claim form IEPF-5; with claimant signature and if joint holders are involved than the Form should be signed by all the joint holders.
b) Copy of acknowledgement generated after uploading the claim Form IEPF-5
c) Indemnity Bond (original) with claimant signature (As per format given in Annexure-II) to be executed :
- On a non-judicial Stamp Paper of the value as prescribed under the Stamp Act (According to state) if the amount of the claim is Rs 10, 000 or more. Please ensure to enter date, place and Signature of claimant and witness.
- 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.
d) Advance Stamped receipt (original) with the signature of the claimant and two witnesses. (Format is given at Annexure I)
e) In case of a refund of matured deposit or debenture, or bonds, or where shares (in physical form) are claimed original certificate thereto
f) Copy of Aadhaar Card of the claimant and if joint holders are there, Copy of Aadhar card of all the joint holders
g) Proof of entitlement (certificate of share/Interest warrant/dividend warrant, Application No. etc.)
h) Original Cancelled Cheque leaf (it must bear the name of the claimant and the cheque leaf must be of the same account of which details are given in the Form IEPF-5).
i) Self-attested copy of Passport, OCI and PIO card in case of foreigners and NRI
j) Self-attested copy of PAN Card (mandatory in case of a claim for shares)
k) Self-attested Client Master List of De-mat A/c of the claimant
l) In case any Joint holder is deceased, Copy of Death certificate to be attached.
m) Other optional documents, (if any)
The company shall, within fifteen days from the date of receipt of the claim, send a verification report to the Authority in the format specified by the Authority along with all the documents submitted by the claimant. The Nodal officer may approve or reject the Form and enclosures submitted, subject to verification.
How will I get my money or shares from the IEPF Authority?
For a monetary refund, IEPF initiates e-payment as per the rules. If shares are reclaimed, the shares will be credited to the claimant’s Demat account by the Investor Education and Protection Fund.
I hope you understood how you can benefit from IEPF and claim back your money if there is any. Do let me know your queries!