The Indian government with the motive of ease of doing business and ease of living has introduced a new update. The MCA and IEPFA have further simplified IEPFA claim settlement process. All the important information about MCA and IEPFA claim settlement is mentioned in this article.
What is IEPFA?
IEPFA stands for Investor Education & Protection Fund Authority. It was established in India under Section 125 of the Companies Act, 2013 (‘Act’). The major aim of IEPFA is to:
- Promote Investor Protection
- Promote Education and Awareness among all the stakeholders
Besides, IEPFA also works to provide refunds to all the shareholders that companies transfer to IEPF. Companies provide unclaimed and unpaid dues of seven years to the IEPFA. The refunds include unclaimed dividends, shares, and other amounts that company transfers for the rightful claimants to the IEPFA.
What is the IEPFA claim settlement process?
Shareholders of the firm who have unclaimed or underpaid funds transferred to the IEPF may request reimbursement from the IEPFA. This can be done through Form IEPF 5. A legal successor of a shareholder may also make a claim on their ancestor’s shares that have been transferred to the IEPF but have not yet been claimed or paid for.
The claimants must complete out the IEPF-5 form, upload it to the IEPF website, and provide the necessary documentation to the Nodal Officer (IEPF) of the relevant firm at its registered office. The concerned company will examine the form IEPF-5 and the delivered documentation. Based on the company’s verification report, the IEPFA will disburse the refund in favor of claimants’ Aadhaar-linked bank accounts via electronic transfer.
MCA and IEPFA Simplified Claim Settlement Process
The MCA announcement streamlining the IEPFA claim settlement procedure envisions a trust-based approach for quicker turnaround and citizen-centric services. For shareholders and their legal successors seeking their unclaimed or underpaid dividends, shares, or other dues, the procedure has been streamlined and simplified. Furthermore, the MCA and IEPFA have announced several ease of procedures as follows:
Ease in IEPFA Claim Settlement Process for Companies
- There is no longer a strict requirement that companies provide paperwork or other documentation of the unclaimed suspense account.
- When it comes to accepting papers relating to transmission, including wills and succession certificates, the corporations are authorized certain liberty as long as they follow their own internal-approved protocols.
- For up to Rs. 5,00,000 worth of shares, there is no need to place an advertisement in the newspaper in the event that the actual share certificate is lost.
Ease in IEPFA Claim Settlement Process for Claimants
- The prerequisite of advance receipt is waived.
- For claims of up to Rs. 5,00,000 worth of shares, including Demat and physical, the need for probate of the will, succession certificate, and will has been relaxed.
- Documents must now be self-attested rather than notarized.
- Affidavit and surety restrictions have been simplified.
The MCA (Ministry of Corporate Affairs) and IEPFA want to speed up and simplify the IEPFA claim settlement procedure for claimants. With the aforementioned changes, it is anticipated that many more claimants would approach the IEPFA to make a claim for their dividends, shares, and other dues.
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