Detailed Procedure for Name Deletion/Updation in Shares
Investing in equity shares of several companies jointly is a lucrative option; however, it can be problematic in cases where the joint shareholders abscond for a much longer time or is deceased, thereby necessitating the deletion of the missing or deceased shareholder’s name from the records as it is the only solution for keeping the investments intact to prevent it from getting worthless. The present article discusses the concept of name deletion/updation in shares, its need, the requisite documents and the procedure for the same.
Name Deletion / Updation in Shares: Meaning
Name deletion/ Updation refer to the change in the details of the existing shareholders in their joint shareholding records due to the abscondment or death of any of the shareholders.
Need of Name Deletion / Updation in Shares
The deletion /updation of the name is needed due to the following reasons.
- When the shares are in physical form, and there has been an abscondment or death of one of the joint shareholders.
- If the shares are required to be dematerialized and only one holder has a Demat account in a Depository Participant (DP). i.e., if shares are needed to be converted from joint holding to single holding or vice versa, then the name deletion process is brought into use.
List of Documents Required Name Deletion / Updation in Shares
The following documents are required for initiating the process of name deletion/ updation of shares –
- Request Form duly signed by the shareholder(s) and the Original Share Certificates and other documents mentioned therein, including a self-attested copy of the Pan Card.
- Attested copy of the Gazette Notification (in case of name correction/name change).
- Attested Copy of deceased joint shareholder’s Death Certificate (in case of Name Deletion).
- Marriage Certificate’s attested copy issued by the competent authority (in case of name change due to Marriage).
- Attestation of photocopies/xerox copies must be done by a Magistrate/Notary Public/ Special Executive Magistrate or a similar authority having a public office and the authorisation to use the seal of this office.
- Notarised documents must comprise of the Notary Serial no. / Register no. etc. according to the provisions of the Notaries Rules, 1956.
The Procedure of Name Deletion/ Updation of Shares
The Shareholder must approach a Depository Participant (DP) to open a demat account.
- Submission of the request letter after the successful opening of the demat account, along with the documents mentioned above.
- Scrutiny of the submissions made by the applicant and approval of the same as per SEBI Circular dated 25.01.2021 by the RTA followed by sending the Letter of Confirmation (LOC) to the shareholder along with retaining the Physical share certificate and defacing the certificate with a stamp “Letter of Confirmation Issued” on the face/reverse of the certificate.
- The validity of the LOC shall be 120 days from the date of its issue, within which the shareholder must make a request to the DP for the dematerialization of the said shares.
- Generation of the demat request on the basis of LOC by the DP followed by forwarding the same to the Issuer Company / RTA for processing the demat request.
- Processing of the request by the RTA upon the receipt of the request by the DP, together with crediting the shares in the applicant’s Demat Account
- Issuance of a reminder by RTA / Issuer Companies after the end of 30, 60 and 90 days from the date of issue of LOC, informing the applicant for submitting the demat request as above if no such request is received by the RTA / Issuer Company.
- In the event of the failure on the part of the Shareholder towards the submission of the demat request within the aforesaid period of 120 days from the date of issue of LOC, the RTA / Issuer Company shall credit the securities to the Suspense Demat Account of the Company.
- The Shares can subsequently be claimed back by the shareholder by applying in the format in Form by ticking the appropriate service request.
The death or the abscondment of any of the shareholders can be a traumatizing experience which can deviate the focus of the existing shareholder from the necessary formalities involved in the name deletion/updation of shares. The team of experts at Enterlice can provide much-needed guidance and end-to-end assistance throughout the process with the motive of completing the same seamlessly at the earliest.
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