Investment has become an important and interesting field of interest in today’s time. IEPF, fully known as Investor Education and Protection Fund is a protection scheme or project that helps to safeguard investors’ interest. It promotes awareness about different types of Investments along with the necessary information. IEPF is not about investment advice or evolution but, it is well-being or protection launched to promote awareness and help people in investment-related situations.
One of the major problems that investors face is to deal with unclaimed shares or, to be specific, funds of all shares they have failed to claim. Often if people fail in claiming their share, it is transferred to the IEPF. Now, it means our shares are no longer under the company but have gone to the investor education and protection fund. In this case, there are certain rules to track and recover lost shares from IEPF quickly. Before that, first, let’s understand why the problem of unclaimed shares arises.
The Investor education protection fund i.e IEPF is run and administered by the Ministry of Corporate affairs through IEPF authority. The IEPF has 7 members on its board to run the show. The members are anointed by the Govt of India. The IEPF maintains separate accounts for each defunct or unclaimed investment (funds) and regularly dispose of them in conjunction with CAG(Comptroller and auditor general). The funds in the IEPF are maintained as prescribed by the provisions of the Companies Act.
The IEPF will make use of the funds for the purposes as per the provisos of the companies act. The Comptroller and Auditor general will do a due diligence auditing of IEPF to point out the lacunas that the IEPF usually overcomes by rectifying mistakes. The fully certified audit reports are frequently sent to the Govt of India.
The IEPF Authority will also put together its annual report for every financial year, giving a complete summary related to its activities during the year and forward the copy to the Central Government. The Central Government will lay down the annual report by the IEPF Authority and the audit report given by the Comptroller and Auditor-General of India before each House of the Parliament.
Arise of dividends or unclaimed share
Claim share can arise according to the government plans and schemes. In the government planning, it is mentioned that, corporate shares that are lying unclaimed with the IEPF for the past seven years can be taken over by the government. There are different reasons for the rise of unclaimed shares. Such as;
- Investors may have lost the track record of the amount that has been invested in the company. Thus the company won’t be able to contact the investor and with time the shares will get unclaimed.
- Any financial company or organization has failed in proper management and thus has failed to contact or locate the investor for father payment of the unclaimed shares. Along with this, changing contact details for all failures in the record update can also play a vital role.
- Changing the legal heirs, owners, and nominees can also result in the rising of unclaimed shares. It is also supported with lost, torn, or forgotten shares, in the end, get unclaimed and are automatically transferred to the government.
Steps to follow to successful claim your unclaimed share
- Transmission Process
Before leaving the shares, successfully completing of transmission process from the company is very important. The first state towards the process of claiming the shares.
- Claim to the authority
Then comes the application form feeling. The investor needs to download the claim from the IEPF website, fill it, and upload it. One must be particular and extremely careful while filling in the details of the unclaimed investment. It plays a vital role in the process. Moreover, your application can get rejected if any wrong info is found.
- Claim to the company
After filling the application form, the investor needs to send its copies with the required documents to the concerned company’s office.
- Company to Authority
After this, the company will send a proper verification report to the authorities with the request to recover lost shares from IEPF.
- Authority to investors
After receiving the request, authorities verify the form and details of the particular unclaimed share with the given documents. If all the processes are done without any errors, a refund is sanctioned and transferred to the claimant or investor’s account.
In the entire process, rejection of the claim is very easy. It is because the shares are old and lie under IEPF. Thus, detailed verification of the documents is done. Therefore, to smoothly recover lost shares from IEPF one must go through all the minute details of the form with proper and accurate information. This will help the investor to successfully claim the shares without any interruption.
