Did you know that when you lose track of your shares or fail to claim the dividend for a period of seven consecutive years, the company would transfer your shares to an authority known as IEPF?
Following this, it is the investor’s job to reclaim shares directly from this authority.
Wait, wait, wait?
Is this too jargonish? Let us first understand what exactly is the IEPF Authority!
It stands for the Investor Education and Protection Fund Authority. Although its name suggests a different mandate i.e., of educating investors, however, it also has the responsibility of holding the money and shares that remained unclaimed by the shareholders.
So, for the superhero fans — it would be easy to understand that the role IEPF authority plays is similar to what was played by Spiderman in this 2002-flick.
Just as in the Tobey Maguire-starrer movie, the young photographer clicks pictures for a newspaper in his day job, while meeting his key agenda to be a saviour of humanity.
The same way, this authority (IEPF) fulfils its key agenda of giving the shares and dividend to their rightful owners, but also uses its excess reserves to educate investors — at the same time.
It is vital to note that it is a central government entity and a part of the ministry of corporate affairs, Government of India. Importantly, its purpose is to hold these shares in a safe until their rightful owner comes forward to claim them.
But the funds sent to IEPF don’t follow one-way streets. The way they are transferred, the same way they can be claimed back too.
However, the person (shareholder) claiming these shares from the IEPF is usually different from the one (company) who had transferred these in the first place.
Now, let us understand how you – as a shareholder – can reclaim the shares you rightfully own, but lost track of.
A step-by-step guide to reclaim shares from IEPF
1. First and foremost, you must fill in the IEPF-5 webform. Make sure to follow the instructions given in the instruction kit.
2. Once you fill the form as per the instructions, you should submit the same. The acknowledgement will be sent to you which will also have an SRN. You should keep the SRN with you for future reference.
3. You now should take a printout of filled out IEPF-5 webform and the acknowledgement.
4. After all this is done, you should arrange all the requisite documents which include indemnity bond, IEPF-5 and other documents and send them to the company.
5. Each company has a nodal officer (IEPF) and you must send these documents in an envelope by writing this in the subject: ‘claim for refund from IEPF authority’.
6. Once the company receives these documents, it will verify them and send the verification report to IEPF within 15 days of the receipt of the claim.
7. Now, the IEPF will examine the completeness of documents.
8. In case all the formalities are completed, IEPF will transfer the shares and refund amount electronically.