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Your hidden wealth may be lying with companies

Claim the dividends for FY10 before they are transferred to the Investors Education and Protection Fund. You can check the details on company websites and notify the current contact details to the companies. If you don’t recollect the individual company names that you had invested in you can find the details through www.iepf.gov.in. You can seek help from companies such as Hidden Wealth which help investors unlock their lost investment details and claim the money

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In his Independence Day speech, Prime Minister Narendra Modi mentioned how the vicious cycle of non-transfer of Employees' Provident Fund was put to an end using a Universal Account Number. While the UAN freed up crores of trapped EPF funds, there is another pile of funds lying unclaimed. Unfortunately, government measures won’t help free these funds, as investors would have to take act to claim the money stuck for years together without earning any interest.

These are the unclaimed dividends that individual investors have forgotten to claim thinking it is small change. But data culled out by dna indicates it is anything but small change. As per a list put out by BSE, a shareholder named G R Pandya, has unclaimed dividends worth Rs 3.79 lakh, while another investor with Castrol India has Rs 1.72 lakh worth of unclaimed dividend.

The unclaimed dividends of Reliance Industries have shot up to Rs 223 crore in financial year 2015-16 from Rs 199 crore pending a year ago, apart from the amount transferred to Investor Protection and Education Fund.

As per the latest annual report of Infosys, 4,332 investors had failed to claim their dividends worth Rs 28 lakh for the financial year 2015-16.

Grasim Industries has about Rs 156.67 lakh lying as unpaid dividend. High value stocks such as Hero MotoCorp have a higher share of unpaid dividends at Rs 8.54 crore with some investors having Rs 1.35 lakh worth of dividends lying unclaimed.

There are more than 5,000 such companies listed on BSE and NSE. If the amount is totalled, it would run into lakhs of crores. As per the last official estimate in 2013, Rs 1,101 crore was lying unclaimed with 1,406 companies.

The dividends remain unclaimed as investors change address, mention incorrect account details, don't update email address or haven't received the physical dividend warrants issued by the company.

But what do companies do with the unclaimed amount? The dividends are mandated to be distributed within 30 days of being declared. The ones that remain unpaid or unclaimed need to be transferred to unclaimed dividend account and remain there for seven years. It is imperative to claim the dividends before the expiry of 7 years from the year of declaring as they are then transferred to Investor Protection and Education Fund. HDFC Ltd transferred unclaimed dividends worth Rs 84 lakh for FY 2007-08 to the IEPF on September 8, 2015.

“Once such amounts are transferred to IEPF, no claim of the shareholder shall lie against the company or the IEPF. Dividends for and up to the financial year ended March 31, 2008 have already been transferred to the IEPF and the dividends for the financial year ended March 31, 2009 will be transferred to IEPF after July 13, 2016,” state the annual reports of corporates.

While unclaimed dividends under mutual funds are now permitted to be invested in liquid funds, the same isn’t allowed for corporate dividends. Hence. the money is lying idle.

As per the rules, companies have to identify and upload details of unclaimed dividend on their website and investors can check the details there and notify the current contact details to the company they had invested in earlier or still hold shares.

Most companies now provide a search mechanism on their website, wherein you can fetch the details of your unclaimed dividend amount by keying in the details of the shareholder such as full name, address and the folio number or client ID and Depository Participant (DP) ID. Some companies offer a facility of tracing the details using any of the details such as just name and address or merely the Folio number. If you don’t recollect the individual company names that you had invested in you can find the details through the Investor Protection and Education Fund website www.iepf.gov.in as all companies need to mandatorily notify details of unclaimed funds within a period of 90 days after the holding of Annual General Meeting each year.

However, if you are unable to trace the unclaimed dividend through IEPF website then you could possibly be a shareholder of companies – 381 of which – have failed to send the details to IEPF.

Once you find the amount and other details you can fill in the form available with the company website or its registrar and transfer agent to claim the money back. You need to carefully mention the details such as bank account details, name, IFS Code, MICR Code and the folio number apart from the year pertaining to the unclaimed dividend amount.

To avoid dividends being lost in transit, ensure that you update your correct Bank Account Number, 9-Digit MICR Code and 11-digit IFSC Code, email ID and mobile number with the demat account provider also called as depository participant as dividends now need to be electronically credited by companies to investors accounts through NEFT, ECS, NACH, etc.

If you can’t trace the unclaimed funds you can seek help from companies such as Hidden Wealth and Share Samadhaan which help investors unlock their lost investment details and claim the money. Act now as time is running out for those dividends due for financial year 2009-10. Else, one would have to wait for the Section 124 of Companies Act, 2013 to come into force under which refund of amount transferred to the IEPF account can be claimed by following the prescribed procedure.

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