Several people just buy in shares and then miss to claim them, or many of them expire before they can be claimed. In such circumstances, the money might go unclaimed for years. As a result, the Ministry of Corporate Affairs (MCA) established the Investor Education and Protection Fund (IEPF) to ensure that IEPF unclaimed shares are transmitted to and redeemed by the correct individual.
The provided under Section 124 of the Companies Act, 2013 and the Investor Education and Protection Fund Authority (Financial reporting, Inspection, Transfer, and Refund) Rules, 2016 allow investors of a business to get a refund of unclaimed shares transferred to the IEPF unclaimed share by the firm.
Transfer of IEPF unclaimed share
A corporation must transmit to the IEPF unclaimed share any shares in which the dividend has not been declared or paid for more than seven years, together with any accumulated interest. The corporation must notify the IEPF Authority of such a transfer. A shareholder can reclaim unclaimed shares given to the IEPF by the firm by applying to the IEPF Authority, which keeps track of all accounts.
Any investor whose unclaimed shares have been transferred to the IEPF may petition to the IEPF Authority for a return of such shares. A claimants (IEPF unclaimed dividend), though, can only bring one consolidated claim against a corporation in a fiscal year. The data from the multiple Portfolio from the same firm should be included in the consolidated claim.
When the claimant is the registered shareholder's legal heir, nominee, or successor, he or she must first confirm that the corporation completes the share transmission procedure and provides an authorization letter prior filing the IEPF unclaimed dividend/ IEPF Unclaimed shares with the regulators.