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Shares of 29 lakh investors worth Rs 19,000 cr unclaimed

Lying unclaimed due to various reasons including loss of share certificates and heirs not aware of inheritance

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Nearly 29.5 lakh investors have not claimed their shares worth Rs 19,000 crore from the companies, shows the data available with the Ministry of Corporate Affairs (MCA). The money has been transferred by the firms in the last few months to the Investor Education & Protection Fund (IEPF) Authority mandated with making refunds of unclaimed shares, dividends and debentures to investors.

These figures have come out as the government last year decided to ask the companies to transfer the shares lying unclaimed for seven consecutive years to the IEPF Authority, functioning under the MCA.

The money has remained unclaimed with the companies due to various reasons including loss of share certificates and heirs not aware of inheritance.

After the government made it mandatory for companies to transfer the unclaimed shares to the IEPF Authority from 1 November, 2017, its corpus has swelled to around Rs 21,000 crore in the past one year. Of the total fund, around Rs 2,000 crore is the dividend, fixed deposit and debenture money while the remaining Rs 19,000 crore is the value of the shares. About 48.6 crore shares have been transferred by 1,355 firms so far.

Experts say that the unclaimed shares with the companies would be much more.

The IEPF Authority has sanctioned refunds of only Rs 2 crore to the investors, mainly the dividends, deposits and debentures, in the last one year.

"The fact that the Authority has been able to refund only Rs 2 crore in the last two years shows the outreach of the Authority in spreading the awareness about the unclaimed investor money. The Authority has not made any serious efforts to transfer the investor money which has been lying with the IEPF," said Virendra Jain of Midas Touch, an investors' forum.

The government officials, on the other hand, point out that seeking refund is a long-drawn process. The claimant has to fill up IEPF Form-5. Then a signed copy along with the required documents has to be sent to the registered office of the company. The company has to dispatch the verification report to the Authority in 15 days. After verification of the claim, the Authority sanctions refund through e-payment within 60 days.

IEPF was set up in the year 2000 under the Companies Act. The refund provision was introduced in September 2016 after notification of IEPF Authority (Accounting, Audit, Transfer & Refund) Rules 2016.

In November, 2017, the government made it mandatory for firms to transfer all the shares in respect of which dividend has not been paid or claimed for seven consecutive years or more to the IEPF Authority under the provisions of Section 124(6) of Companies Act, 2013.

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