FREQUENTLY ASKED QUESTIONS

ON

DEPOSITORY SYSTEM

Disclaimer: These FAQs are not the interpretation of law but provide only a
simplistic explanation of terms / concepts related to the depository system. All
information has been updated till December 21, 2012. For full particulars of
laws governing the depository system, please refer to the
Acts/Regulations/Guidelines/Circulars appearing under the Legal Framework
Section.

Understanding Depository System

1. What is a Depository?

A depository is an organisation which holds securities (like shares, debentures,

bonds, government securities, mutual fund units etc.) of investors in electronic
form at the request of the investors through a registered depository participant. It
also provides services related to transactions in securities.
2. What is the minimum net worth required for a depository?

The minimum net worth stipulated by SEBI for a depository is Rs.100 crore.

3. How is a depository similar to a bank?

It can be compared with a bank, which holds the funds for depositors. A bank -
depository analogy is given in the following table:

BANK-DEPOSITORY – AN ANALOGY
BANK DEPOSITORY

Holds funds in an account Holds securities in an account

Transfers funds between Transfers securities between

accounts on the instruction accounts on the instruction of the
of the account holder BO account holder

Facilitates transfer without Facilitates transfer of ownership

having to handle money without having to handle securities

Facilitates safekeeping of Facilitates safekeeping of securities

money

4. How many Depositories are registered with SEBI?

At present two Depositories viz. National Securities Depository Limited (NSDL)

and Central Depository Services (India) Limited (CDSL) are registered with SEBI.
Their addresses are:

National Securities Depository Limited (NSDL)

Trade World, A wing, 4th & 5th Floors,
Kamala Mills Compound,
Lower Parel, Mumbai-400013
 Tel: (022) 2499 4200 (60 lines)
Fax: (022) 24976351
Email: info@nsdl.co.in

Central Depository Services (India) Limited (CSDL)

Phiroze Jeejeebhoy Towers,
16th Floor, Dalal Street
Mumbai 400001
Phone:91-22-22723333
Fax91-22-22723199/22722072
Email : investors@cdslindia.com

5. Who is a Depository Participant (DP)?

A DP is an agent of the depository through which it interfaces with the investor

and provides depository services.

6. Who can be a DP ?

Public financial institutions, scheduled commercial banks, foreign banks operating

in India with the approval of the Reserve Bank of India, state financial
corporations, custodians, stock-brokers, clearing corporations / clearing houses,
NBFCs and registrar to an issue or share transfer agent complying with the
requirements prescribed by SEBI can be registered as DP. Banking services can
be availed through a bank branch whereas depository services can be availed
through a DP.

7. Who is an Issuer ?

“Issuer” means any entity such as a corporate / state or central government

organizations issuing securities which can be held by depository in electronic
form.

8. What is an ISIN?

ISIN (International Securities Identification Number) is a unique 12 digit alpha-

numeric identification number allotted for a security (e.g.- INE383C01018). Equity-
fully paid up, equity-partly paid up, equity with differential voting /dividend rights
issued by the same issuer will have different ISINs.

9. What is dematerialisation (demat)?

Dematerialisation is the process by which physical certificates of an investor are

converted to an equivalent number of securities in electronic form.

10. What is Rematerialization (remat)?

Rematerialization is the process of converting securities held in electronic form in

a demat account back in physical certificate form.

11. Who is an Registrar and Transfer Agent (RTA)?

An RTA is an agent of the issuer. RTA acts as an intermediary between the

issuer and depository for providing services such as dematerialization,
rematerialization, initial public offers (IPO) and corporate actions.
 12. Who is registered owner of Securities?

When securities of a company are held in physical form by an investor, his/ her
name is recorded in the books of the company as a ‘Registered Owner’ of the
securities. When physical shares are converted into electronic form, the
depository becomes ‘Registered owner” in the books of the company and
investor’s name is removed from books of the company.

13. Who is a Beneficial Owner (BO)?

All the benefits of the dematerialized shares are given to the actual investor
since the depository holds the securities in a fiduciary capacity on behalf of the
investors who have opened a demat account with the depository. Hence, the
actual investor is the “Beneficial Owner” (BO) of the securities.

14. How many DPs are registered with SEBI?

As on December 21, 2012, a total of 866 DPs (289 NSDL, 577 CDSL) are
registered with SEBI.

15. Is it compulsory for every investor to open a BO account to trade in the

capital market?

As per the available statistics at BSE and NSE, 99.9% transactions take place in
dematerialised mode only. Therefore, in view of the convenience of trading in
dematerialised mode, it is advisable to have a beneficial owner (BO) account for
trading at the exchanges.

However to facilitate trading by small investors (maximum 500 shares, irrespective

of their value) in physical mode the stock exchanges provide an additional trading
window, which gives one time facility for small investors to sell physical shares
which are in compulsory demat list. The buyer of these shares has to demat such
shares before further selling.

16. How I can avail the services of a Depository?

A depository interfaces with the investors through its agents called DPs. If an
investor wants to avail the services offered by the depository, the investor has to
open an BO account with a DP.

17. What are the services provided by a Depository?

Following services are provided by a depository to the beneficial owners but of

course, through a depository participant:

• Opening a demat account;

• Dematerialization, i.e. converting physical securities into electronic form;
• Rematerialization, i.e. converting electronic securities balances held in a BO
account into physical form;
• Maintaining record of securities held by the beneficial owners in the electronic
form;
• Settlement of trades by delivery or receipt of securities from / in BO accounts;
• Settlement of off-market transactions between BOs;
• Receiving electronic credit in respect of securities allotted by issuers under IPO
or otherwise on behalf of demat account holders;
 • Receiving non cash corporate benefits such as allotment of bonus and rights
shares or any other non cash corporate benefits given by the issuers in electronic
form on behalf of its demat account holders;
• Pledging of dematerialized securities & facilitating loans against shares;
• Freezing of the demat account for debits, credits, or both

18. What are the benefits of availing depository services?

The benefits are enumerated below:-

• A safe and convenient way to hold securities;

• Immediate transfer of securities;
• No stamp duty on transfer of securities;
• Elimination of risks associated with physical certificates such as bad delivery,
fake securities, delays, thefts etc.
• Reduction in paperwork involved in transfer of securities;
• Reduction in transaction cost;
• No odd lot problem, even one share can be traded;
• Nomination facility;
• Change in address recorded with DP gets registered with all companies in
which investor holds securities electronically eliminating the need to
correspond with each of them separately;
• Transmission of securities is done by DP eliminating correspondence with
companies;
• Automatic credit into demat account of shares, arising out of
bonus/split/consolidation/merger etc;
• Holding investments in equity and debt instruments in a single account.

Account Opening

19. How can one open an account?

First an investor has to approach a DP and fill up an account opening form. The
account opening form must be supported by copies of any one of the approved
documents which serve as proof of identity and proof of address as specified by
SEBI. Apart from these PAN card has to be shown in original at the time of
account opening from April 01, 2006.

All applicants should carry original documents for verification by an authorized

official of the DP, under his signature.

Investor has to sign an agreement with DP in a depository prescribed standard

format, which gives details of rights and duties of investor and DP. DP should
provide the investor with a copy of the agreement and schedule of charges for
their future reference. The DP will open the account in the system and give a
unique account number, which is also called BO ID (Beneficial Owner
Identification number) and used for all future transactions.

20. Can a demat account be opened directly with Depository?

No. A demat account cannot be opened directly with depository. It has to be

opened only though a DP of depository.
21. Can a demat account be opened in the name of Joint Holders?

Yes. A demat account can be a opened in a single name or in joint holders’

name. There can be maximum three account holders i.e. one main holder and
two joint holders.

22. Can a Demat account be opened for a minor?

Yes. Demat account can be opened in the name of a minor. The account will be
operated by a guardian till the minor becomes major. Guardian has to be the
father or in his absence mother. In absence of both, father or mother, the
guardian can be appointed by court.

23. Can minor be a joint holder in another demat account?

No. Minor cannot be a joint holder in a demat account.

24. Can a demat account be opened in the name of a trust?

Yes. A demat account can be opened in the name of a trust if the trust is
registered under the Public Trust Act 1860 / Societies Registration Act / Bombay
Public Trust Act / Public Trust Act in force in the state. If the trust is a private or
unregistered trust then a demat account shall be opened in the name of trustees
as an individual account. If the trust has more than three trustees, then they will
have to decide in whose name the demat account will be opened.

25. Can a demat account be opened in the name of HUF ?

No. In the case of HUF, shares can be held in the name of existing Karta on
behalf of HUF.

26. Does an Non Resident Indian (NRI) need any Reserve Bank of India (RBI)
permission to open a demat account?

No permission is required from RBI to open a demat account. However, credits

and debits from demat account may require general or specific permissions as
the case may be, from designated authorized dealers.

27. Is nomination compulsory for a demat account?

SEBI has mandated that nomination should be recorded for a demat account
held by individuals. If nomination is not to be given then the account holder(s)
should give a written and signed declaration to the effect.

28. Can multiple accounts be opened by an investor?

Yes. An investor can open more than one account in the same name with the
same DP and also with different DPs. For all the accounts, investor has to strictly
comply with know your client (KYC) norms including proof of identity, proof of
address requirements as stipulated by SEBI and also provide PAN number. The
investor has to show the original PAN card at the time of opening of demat
account.

29. Can an investor open a single account for securities owned in different
ownership patterns such as securities owned individually and securities
owned jointly with others?
 No. Demat account must be opened in the same ownership pattern in which the
securities are held in the physical form. e. g. if one share certificate is in the
individual name and another certificate is jointly with somebody, two different
accounts would have to be opened.

30. What is required to be done if one has physical certificates with the same
combination of names, but the sequence of names is different i.e. some
certificates with ‘A’ as first holder and ‘B’ as second holder and other set
of certificates with ‘B’ as first holder and ‘A’ as the second holder?

In this case the investor may open only one account with ‘A’ & ‘B’ as the account
holders and lodge the security certificates with different order of names for
dematerialisation in the same account. An additional form called "Transposition
cum Demat" form will have to be filled in. This would help you to effect change in
the order of names as well as dematerialise the securities.

BO account charges

31. What are all charges an investor has to pay for opening and maintenance
of a BO account?

SEBI has rationalised the cost structure for dematerialisation by removing

account opening charges, transaction charges (for credit or buy transactions of
securities), custody charges and account closing charges. Custody charges are
now paid by the issuer companies. Broadly, investors are required to pay the
charges towards:-

- Dematerialisation and Rematerialisation of their securities

- Annual account maintenance charges
- Transactions fees (only for sell transactions)

The DP may revise the charges by giving 30 days notice in advance.

Further, SEBI has also advised the DPs to submit to their Depository their
tariff/charge structure every year latest by 30th April and changes made therein,
along with the date of effect to enable the investors to have a comparative
analysis of the tariff/charge structure of various DP’s. The information received
by the depositories is put up on their websites.

32. Is Account Maintenance Charges (AMC) collected upfront by the DPs to be

refunded in the event of closure of BO account?

Yes. In the event of closing of demat account or shifting of demat account from
one DP to another, the AMC collected upfront on annual / half yearly basis by the
DP, shall be refunded by the DP to the BO for the balance of the quarter/s.
example 1: Annual AMC collected by BO, BO closes / shifts his account in the
1st quarter, he shall be refunded the amount of balance 3 qtrs i.e. 3/4th of the
AMC collected. example 2: Likewise if a BO closes / shifts his account in 3rd qtr.,
he shall be refunded the amount of balance 1 qtr i.e. 1/4th of the AMC collected.

33. Whether all DPs are required to refund the AMC collected upfront for the
balance quarters?

No. It will not be applicable to the DPs who collect quarterly / monthly AMC.
34. How will the beginning of year considered for the calculation of the AMC?

For the calculation of the AMC, year shall begin from the date of opening of the
account in quarterly rests.

35. What would be the charges for account closure and securities transfer due
to account closing?

SEBI has advised that from January 09, 2006, no charges shall be levied by a
depository on DP and consequently, by a DP on a BO, when a BO transfers all
the securities lying in his account to another branch of the same DP or to another
DP of the same depository or another depository, provided the BO Account/s at
transferee DP and at transferor DP are identical in all respects. In case the BO
Account at transferor DP is a joint account, the BO account at transferee DP
should also be a joint account in the same sequence of ownership.

All other transfer of securities consequent to closure of account, not fulfilling the
above-stated criteria, would be treated like any other transaction and charged as
per the schedule of charges agreed upon between the BO and the DP.

Operation of BO Account

36. What should be done if the address of the investor changes?

Investor should immediately inform his DP along with necessary documents, who
in turn will update the records. This will obviate the need of informing different
companies.

37. Does the investor have to keep any minimum balance of securities in his
account?

No.

38. Is it necessary to have account with the same DP as broker has?

No. Investor can choose any DP as per his / her convenience or choice and
carry on trading activity through broker of his / her choice, irrespective of the DP
of broker.

39. Can an investor operate a joint account on "either or survivor" basis just
like a bank account?

No. The demat account cannot be operated on "either or survivor" basis like the
bank account.

40. Can someone else operate the account on behalf of the BO on the basis of
a power of attorney (POA)?

Yes. If the BO authorises any person to operate the account by executing a POA
and submit it to the DP, that person can operate the account on behalf of the BO.

41. How can intimation of any transaction be given for POA operated
accounts?
 Subscription of SMS alerts for the depository accounts operated through POA is
mandatory except in cases of accounts held by non-individual, foreign individuals
& NRIs.

42. Is addition or deletion of names of BO account holders permitted after

opening the account?

No. The names of the account holders of a BO account cannot be changed. If

any change has to be effected by addition or deletion, a new account has to be
opened in the desired holding pattern (names) and then transfer the securities to
the newly opened account. The old account may be closed.

43. Is change in the names of BO accounts permitted after opening the

account?

Yes. An individual BO may change his/ her name in the event of marriage,
change in father's name or any other reasons by submitting the following
documents

Reasons for name change Documents to be submitted

Marriage Marriage certificate or copy of passport
showing husband’s name or publication of
name change in official gazette
Change in father's name Publication of name change in official gazette
Any other reasons Publication of name change in official gazette

44. Can an investor close his demat account with one DP and transfer all
securities to another account with another DP?

Yes. The investor can submit account closure request to his DP in the prescribed
form. The DP will transfer all the securities lying in the account, as per the
instruction, and close the demat account.

45. What if there are any discrepancies in the statement of holdings?

In case of any discrepancy in the statement of holdings, investor can contact his
DP and in case of discrepancies in corporate benefits, one can approach the
company / its RTA. If the discrepancy is not resolved, the investor may approach
concerned Depository (NSDL or CDSL).

46. Can an investor can freeze his account(s)?

Investor can freeze his account and/or ISIN and/or specific number of securities
under an ISIN for any given period of time as per applicable Regulations of SEBI
and Bye Laws of the respective depository.

47. Why should an investor give his bank account details at the time of BO
account opening?

Bank account details are necessary for the protection of interest of investors.
When any cash or non cash corporate benefits such as rights or bonus or
dividend is announced for a particular scrip, depositories provide to the
concerned issuer /it’s RTA, the details of the investors, their electronic holdings
as on record / book closure date for reckoning the entitlement of corporate
benefit.
 The disbursement of cash benefits such as dividend is credited directly by the
Issuer/it’s RTA to the beneficiary owner through the ECS (Electronic Clearing
Service wherever available) facility or by issuing warrants on which bank account
details are printed for places where ECS facility is not available. The bank
account number is mentioned on the dividend and warrant to avoid any
fraudulent misuse. The bank account details will be those which are mentioned
in account opening form or modified details that had been intimated
subsequently by the investor to the DP.

48. Can an investor change the details of his bank account?

Yes. However, the investor must inform the DP regarding change in the bank
account and corresponding change in MICR / IFSC code while updating their
bank account details with DP. In the depository system monetary benefits on the
security balances are paid as per the bank account details provided by the
investor at the time of account opening The investor must ensure that any
subsequent changes in bank account details are informed to the DP.

Dematerialisation
49. Is dematerialization of securities compulsory?

According to the Depositories Act, 1996, an investor has the option to hold
securities either in physical or electronic form. Part of holding can be in physical
form and part in demat form. However, SEBI has notified that settlement of
market trades in listed securities should take place only in the demat mode.

50. What type of instruments are available for demat at Depository?

All types of equity/ debt instruments viz. equity shares, preference Shares, partly
paid shares, bonds, debentures, commercial papers, certificates of deposit,
government securities (G-SEC) etc. irrespective of whether these instruments
are listed / unlisted / privately placed can be dematerialized with depository, if
they have been admitted with the depository.

51. Is there any charge for dematerialization of physical certificates?

Depository does not levy any charge for dematerialization of securities. However,
DPs may collect dematerialization charges towards postage / courier charges
etc. as per their tariff sheet.

52. How can one convert physical holding into electronic holding i.e. how can
one dematerialise securities?

In order to dematerialise physical securities one has to fill in a DRF (Demat

Request Form) which is available with the DP and submit the same along with
physical certificates that are to be dematerialised. Separate DRF has to be filled
for each ISIN. The complete process of dematerialisation is outlined below:

• Surrender certificates for dematerialisation to your DP.

• DP intimates to the Depository regarding the request through the system.
• DP submits the certificates to the registrar of the Issuer Company.
• Registrar confirms the dematerialisation request from depository.
• After dematerialising the certificates, Registrar updates accounts and informs
depository regarding completion of dematerialisation.
• Depository updates its accounts and informs the DP.
 • DP updates the demat account of the investor.

53. Can odd lot shares be dematerialised?

Yes, odd lot share certificates can also be dematerialised.

54. Whether different securities issued by the same issuer will have same
ISIN?

No, different securities issued by the same issuer will have different ISIN code.

55. Do dematerialised shares have distinctive numbers?

Dematerialised shares do not have any distinctive numbers. These shares are
fungible, which means that all the holdings of a particular security will be identical
and interchangeable.

56. Can electronic holdings be converted back into physical certificates?

Yes. The process is called rematerialisation. If one wishes to get back his
securities in the physical form he has to fill in the RRF (Remat Request Form)
and request his DP for rematerialisation of the balances in his securities account.
The process of rematerialisation is outlined below:

• Make a request for rematerialisation.

• Depository participant intimates depository regarding the request through the
system.
• Depository confirms rematerialisation request to the registrar.
• Registrar updates accounts and prints certificates.
• Depository updates accounts and downloads details to depository participant.
• Registrar dispatches certificates to investor.

Trading / Settlement

57. What is the procedure for selling dematerialised securities?

The procedure for buying and selling dematerialised securities is similar to the
procedure for buying and selling physical securities. The difference lies in the
process of delivery (in case of sale) and receipt (in case of purchase) of
securities.

In case of purchase:-

• The broker will receive the securities in his account on the payout day.
• The broker will give instruction to its DP to debit his account and credit BO's
account.
• BO will give ‘Receipt Instruction’ to DP for receiving credit by filling
appropriate form. However BO can give standing instruction for credit to his
account that will obviate the need of giving Receipt Instruction every time.

In case of sale:-

BO will give delivery instruction through Delivery Instruction Slip (DIS) to DP to

debit his account and credit the broker’s account. Such instruction should reach
the DP’s office at least 24 hours before the pay-in, failing which, DP will accept
the instruction only at the BO’s risk.
58. What 'Standing Instruction' is given in the account opening form?

In a bank account, credit to the account is given only when a 'pay in' slip is
submitted together with cash/cheque. Similarly, in a depository account 'Receipt
in' form has to be submitted to receive securities in the account. However, for the
convenience of BOs, facility of 'standing instruction' is given. If you say 'Yes' for
standing instruction, you need not submit 'Receipt In' slip every time you buy
securities. If you are particular that securities can be credited to your account
only with your consent, then do not say 'yes' [or tick ] to standing instruction in
the application form.

59. What is Delivery Instruction Slip (DIS)? What precautions do one need to
observe with respect to Delivery Instruction Slips?

To give the delivery one has to fill a form called Delivery Instruction Slip (DIS).
DIS may be compared to cheque book of a bank account. The following
precautions are to be taken in respect of DIS:-

• Ensure and insist with DP to issue DIS book. Submit DIS instruction request
slip (contained in previous booklet) duly complete in all respects to the DP.
• Ensure that DIS numbers are pre-printed and DP takes acknowledgment for
the DIS booklet issued to investor.
• Ensure that your account number [client id] is pre-stamped.
• If the account is a joint account, all the joint holders have to sign the
instruction slips. Instruction cannot be executed if all joint holders have not
signed.
• Avoid using loose slips.
• Do not leave signed blank DIS with anyone viz., broker/sub-broker, DPs or
any other person/entity.
• Keep the DIS book under lock and key when not in use.
• If only one entry is made in the DIS book, strike out remaining space to
prevent misuse by any one.
• BO should personally fill in target account-id and all details in the DIS.
• If the DIS booklet is lost / stolen / not traceable, the same must be intimated to
the DP immediately in writing. On receipt of such intimation, the DP will
cancel the unused DIS of the said booklet.

60. Is it possible to give delivery instructions to the DP over Internet and if yes,
how?

Yes. Both NSDL and CDSL have launched this facility for delivering instructions
to your DP over Internet, called SPEED-e and EASI respectively. The facility can
be used by all registered BOs after paying the applicable charges.

61. Is it possible to get securities allotted in public offering directly in the

electronic form?

Yes, it is possible to get securities allotted to in Public Offerings directly in the

electronic form. In the public issue application form, there is a provision to
indicate the manner in which an investor wants the securities to be allotted. He
has to mention the BO ID, name and DP ID on the application form. Any
allotment made will be credited into the BO account.

Pledging
62. Can one pledge the dematerialised securities?

Yes. Pledging dematerialised securities is easier and more advantageous as

compared to pledging physical securities.

63. What should one do to pledge electronic securities?

The procedure to pledge electronic securities is as follows:

• Both BOs, investor (pledgor) and the lender (pledgee) must have BO account
with the same depository;
• Pledgor will have to instruct DP to create pledge in prescribed standard form
(Pledge Request Form) with the details of the securities;
• The lender (pledgee) has to confirm the request through his/her DP;
• Once this is done, securities are pledged.
• All financial transactions between the pledgor and the pledgee are handled as
per usual practice outside the depository system.

64. What is the procedure for closure of pledge after repayment of loan?

After the repayment of loan, pledgor can request for a closure of pledge by
instructing the DP in a prescribed format. The pledgee on receiving the
repayment will instruct his DP accordingly for the closure of the pledge.

65. Can pledgor (investor) change the securities offered in a pledge?

Yes, if the pledgee (lender) agrees, pledgor (investor) may change the securities
offered in a pledge.

66. Who will receive the corporate benefits on the pledged securities?

The securities pledged are only blocked in the account of pledgor (investor) in
favour of the pledgee (lender). The pledgor would continue to receive all the
corporate benefits.
Transaction Statement

67. How does one know that the DP has updated the account after each
transaction?

The DP provides a Transaction Statement periodically, which gives details of

current balances and various transactions made through the depository account.
If desired, DP may provide the Transaction Statement at intervals shorter than
the stipulated ones, probably at a cost.

Depositories also provide SMS Alert facility for demat account holders whereby
investors can receive alerts for debits (transfers) to their demat accounts and for
credits in respect of corporate actions for IPO and offer for sale. Under this
facility, investors can receive alerts, a day after such debits (transfers)/credits
take place. These alerts are sent to those account holders who have provided
their mobile numbers to their DPs.

68. At what frequency will the investor receive his transaction and holding
statement from his DP?
 DPs have to provide transaction statements to their clients once in a month, if
there is any transaction. DPs have to provide the transaction statements /
holding statement to the BOs in other cases as per the table given below-

DPs also provide transaction statement in electronic form under digital signature
subject to their entering into a legally enforceable arrangement with the BOs to
this effect.

Type of BO account Frequency of Transaction statement /

Holding statement sent to BO
Accounts with zero balance - No Transaction statement.
and nil transactions during the
year - One physical statement of holding annually.
(DP shall resume sending the transaction
statement as and when there is a
transaction in the account)
Accounts which become zero - No transaction statement for the duration
balance during the year when the balance remains nil

- An annual statement of holding

Accounts with credit balance - No Transaction statement
but no transactions during the
year - One statement of holding for the year

69. What is to be done if there are any discrepancies in transaction statement?

In case of any discrepancy in the transaction statement, BO can contact his DP.
If the discrepancy cannot be resolved at the DP level, BO should approach the
Depository.

70. Whom should BO contact in case of any investor complaint / problem /

query?

In case of any investor complaint / problem / query one may first contact his
DP. If DP is unable to solve the complaint / problem / query one should approach
concerned depository. If one is not satisfied one may approach SEBI. One may
also approach SEBI directly through SEBI Complaints Redress System
(SCORES).

SCORES is a web based centralized grievance redress system of SEBI.

SCORES enables investors to lodge and follow up their complaints and track the
status of redressal of such complaints online from the above website from
anywhere.To register a complaint online on SCORES portal,
(http://scores.gov.in) click on “Complaint Registration” under “Investor Corner”
then fill up the mandatory details and submit your complaint.

Nomination

71. Who can nominate?

Nomination can be made only by individuals holding beneficial accounts either

singly or jointly. Non-individuals including society, trust, body corporate, Karta of
HUF, holder of POA cannot nominate.

72. Who can be a nominee?

 Only an individual can be a nominee. A nominee shall not be a society, trust,
body corporate, partnership firm, Karta of HUF or a POA holder.

73. Why is it important to nominate?

Nomination is helpful in smooth transmission of shares upon the death of the

BO/s. The nomination once made can be changed at a later date as desired by
the BO/s.

Transmission of dematerialised securities

74. What is transmission of dematerialised securities?

Transmission is the process by which securities of a deceased account holder

are transferred to the account of his legal heirs / nominee. Process of
transmission in case of dematerialised holdings is more convenient as the
transmission formalities for all securities held in a demat account can be
completed by submitting documents to the DP, whereas in case of physical
securities the legal heirs/nominee/surviving joint holder has to independently
correspond with each company in which securities are held.

75. In the event of death of the sole holder, how the successors should claim
the securities lying in the demat account?

The claimant should submit to the concerned DP an application i.e. Transmission

Request Form (TRF) along with the following supporting documents -

1. In case of death of sole holder; where the sole holder has appointed a
nominee
• Notarised copy of the death certificate

2. In case of death of the sole holder; where the sole holder has not
appointed a nominee
• Notarised copy of the death certificate

And any one of the below mentioned documents :

• Succession certificate
• Copy of probated will
• Letter of Administration

The DP, after ensuring that the application is genuine, will transfer securities to
the account of the claimant.

The major advantage in case of dematerialised holdings is that the transmission

formalities for all securities held with a DP can be completed by interaction with
the DP alone, unlike in the case of physical share certificates, where the claimant
will have to interact with each issuing company or its registrar separately.

Inter Depository Transfers

76. If a BO holds an account with NSDL/CDSL, can he receive securities from

an account in CDSL/NSDL?

Yes. Inter depository transfers are possible without any additional costs.
 Basic Services Demat Account (BSDA)

77. What is BSDA?

Basic Services Demat Account (BSDA) is provided by DPs with effect from
October 1, 2012 with limited services to achieve wider financial inclusion,
encourage holding of demat accounts and reduce the cost of maintaining
securities in demat accounts for retail individual investors.

78. Who is eligible to open of BSDA ?

a. All the individuals who have or propose to have only one demat account
where they are the sole or first holder.
b. Individuals having any other demat account/s where they are not the first
holder shall be eligible for BSDA in respect of the single demat account
where they are sole or first holder.
c. The individual shall have only one BSDA in his/her name across all
depositories.
d. Value of securities held in the demat account shall not exceed Rs. two
lakhs at any point of time.
The DPs shall reassess the eligibility of the BOs at the end of every billing
cycle and give option to the BOs who are eligible to opt for BSDA

79. Can a existing account holder open a BSDA?

Yes. All existing eligible individuals can convert their demat account into BSDA
on the date of the next billing cycle based on the value of holding of securities in
the account as on the last day of previous billing cycle.

The DPs shall reassess the eligibility of the BOs at the end of every billing cycle
and give option to the BOs who are eligible to opt for BSDA.

80. What are the charges applicable to the BSDA?

The charge structure may be on a slab basis as indicated below:

a. No Annual Maintenance Charges (AMC), if the value of holding is upto Rs.

50,000.

b. AMC not exceeding Rs 100 if the value of holding is Rs 50,001 to Rs

200,000,

Charges for statements:

i. Electronic statements shall be provided free of cost.

ii. In case of physical statements, the DP shall provide at least two statements
free of cost during the billing cycle. Additional physical statement may be
charged at a fee not exceeding Rs.25/- per statement.

81. How the value of holding in BSDA calculated?

The value of holding shall be determined by the DPs on the basis of the daily
closing price or NAV of the securities or units of mutual funds, as the case may
be. Where such price is not available the last traded price may be taken into
account and for unlisted securities other than units of mutual funds, face value
may be taken in to account.
82. In case the value of holding exceeds the prescribed criteria what will be
applicable charges for BSDA?

If the value of holding in such BSDA exceeds the prescribed criteria at any date,
the DPs may levy charges as applicable to regular accounts (non-BSDA) from
that date onwards.

83. At what frequency will the investor receive his Transaction & Holding
Statement from his DP for BSDA?

a. Transaction statements:

• Transaction statements shall be sent to the BO at the end of each quarter.

If there are no transactions in any quarter, no transaction statement may
be sent for that quarter.

• If there are no transactions and no security balance in an account, then no

further transaction statement shall be provided.

• Transaction statement shall be required to be provided for the quarter in

which the account became a zero balance account.

b. Holding Statement:

• One annual physical statement of holding shall be sent to the stated

address of the BO in respect of accounts with no transaction and nil
balance.

• One annual statement of holding shall be sent in respect of remaining

accounts in physical or electronic form as opted for by the BO.

84. How many Delivery Instruction Slips (DIS) shall be issued for BSDA?

At least two Delivery Instruction Slips (DIS) shall be issued at the time of account
opening.

85. How will intimation of debit transaction be given to the BOs opting for
BSDA?

All BOs opting for the facility of BSDA, shall register their mobile number for
availing the SMS alert facility for debit transactions.

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