Reetu | Nov 13, 2021 |
Ministry of Corporate Affairs simplifies IEPFA claim settlement process for Ease of Doing Business
The Ministry of Corporate Affairs (MCA) has further simplified claim settlement process through rationalisation of various requirements under Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016. This is a significant step towards the Government of India’s mission and vision of Ease of Living and Ease of Doing Business.
For claimants, the requirement of Advance Receipt has been waived, the requirement of Succession Certificate/ Probate of Will/ Will has been relaxed up to Rs 5,00,000 (five lakh) for both physical and DEMAT shares, notarization of documents has been replaced with self-attestation, and the requirements of Affidavits and Surety have been eased relatively.
The requirement for companies to attach documents related to Unclaimed Suspense Account has been eased, and companies have been given flexibility to accept transmission documents such as Succession Certificate, Will, etc. as per their internal approved procedures, and the requirement for Newspaper Advertisement for loss of physical Share Certificate has been waived up to a maximum of Rs.5,000,000.
The goal of the adjustment was to make the procedure easier and faster for claimants. The new regime envisions a trust-based paradigm for more efficient citizen-centric services and turnaround times. With these modifications, it is predicted that many more claimants will come forward to claim their shares and sums from the Investor Education and Protection Fund Authority (IEPFA). IEPFA has authorised over 20,000 claims totaling over 1.29 crore shares to date. Shares with a market value of more than Rs 1,011 crore, as well as dividends and other payments in excess of Rs 20 crore, have been reimbursed.
As per Section 125 (3) of the Companies Act 2013, the Investor Education and Protection Fund Authority (IEPFA) was established by Section 125 of the Companies Act 2013 to administer the IEPF fund. The authority’s principal goal is to promote Investor Education, Awareness, and Protection, as well as to repay unclaimed shares, dividends, and other funds transferred to it under sections 124 and 125 of the Companies Act 2013 to the genuine claimants. MCA has administrative control of IEPFA.
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