Investor Desk - Shareholders Services - Investor FAQs
Dematerialisation / Rematerialisation of Shares:
Demat facilitates paperless trading whereby securities transactions are executed electronically reducing / mitigating possibility of loss of related documents and / or fraudulent transactions. Trading in demat form is regulated by the Depositories Act, 1996 and is monitored by the Securities and Exchange Board of India (SEBI). The two depositories presently functioning in India are National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL).
1. Trading in Compulsory Demat:
SEBI has notified various companies whose shares shall be traded in demat form only. By virtue of such notification, the shares of the Company are also subject to compulsory trading in demat form on the Stock Exchanges.
Immediate transfer of shares.
No formal registration required.
No stamp duty applicable.
No additional holding/transaction cost to Shareholders pursuant to SEBI directions of January 28, 2005.
No requirement for approval of Board of Directors of the Company for transfers.
Shareholders need not worry about the space required for preserving certificates in case of large holdings.
Avoidance of loss through loss in transit, theft, mutilation, forging of share certificates.
Widely accepted for pledging against borrowings with lower interest rates.
SEBI Guidelines prescribe further issues in electronic mode only.
Facilitates the Company to determine entitlements easily and faster.
Details of investors are obtained from the Beneficiary Position (Benpos) and hence cannot be manipulated by companies.
Dematerialised shares can be rematerialised or changed into physical form whenever the shareholder so wish.
The procedure for dematerialising shares is as under:
- Open Beneficiary Account with a DP registered with SEBI.
- Submit Demat Request Form (DRF) as given by the DP, duly signed by all the holders with the names and signature in the same order as appearing in the concerned certificate(s) and the Company records, alongwith requisite documentary proof.
- Obtain acknowledgment from the DP on handing over the share certificate(s).
- Demat transfers are required to be completed in 21 days as against 30 days (excluding time for despatch) for physical transfer. Service standard prescribed by the Company for completing demat is three days from the date of the receipt of requisite documents for the purpose.
- Receive a confirmation statement of holdings from the DP. Statement of holdings is sent by the DPs from time to time. Presently, confirmation is given by DPs on an immediate basis through email or SMS facilities, thus enabling shareholders to further trade in the securities immediately. Shareholders should not send share certificate(s) / documents to the Company / Company's R&TA directly.
Dividend of shareholders holding shares in dematerialised form will be credited through ECS to the bank accounts as opted by them while opening the Beneficiary Accounts with the DP. In other cases, dividend warrants will be despatched to them with the bank account details, as furnished by the Depositories, printed thereon.
Holding shares in dematerialised form will not affect the rights of the Shareholders. They, as members of the Company, will be entitled to receive Annual Report, attend General Meetings and participate and vote thereat to the extent of their entitlement.
Dematerialised shares can be pledged for the purpose of availing of any funding / loan arrangement with a bank.
It is the processes through which shares held in demat form are converted into physical form in the form of share certificate(s).
- Shareholder should submit duly filled in Rematerialisation Request Form (RRF) to the concerned DP.
- DP intimates the relevant Depository of the request through the system.
- DP submits RRF to the Company's R&TA.
- Depository confirms rematerialisation request to the Company's R&TA.
- The Company's R&TA updates accounts and prints certificate(s) and informs the Depository.
- Depository updates the Beneficiary Account of the shareholder by deleting the shares so rematerialised.
- Share certificate(s) is despatched to the shareholder.
Section 109A of the Companies Act, 1956 provides the facility of nomination to share / debenture holders. This facility will be very useful for individuals holding shares / debentures in sole name. In the case of joint holding of shares / debentures by individuals, nomination will be effective only in the event of the death of all joint holders.
Investors especially those who are holding shares / debentures in single name, are advised to avail of the nomination facility by submitting the prescribed Form 2B to the Company's R&TA. Form 2B may also be downloaded from the Company's website, www.reliancebroadcast.com under the section "Investor Desk".
However, if shares / debentures are held in dematerialised form, nomination has to be registered with the concerned DP directly, as per the format prescribed by the DP.
Individual shareholders holding the shares / debentures in single name or joint names can appoint a nominee. While an individual can be appointed as a nominee, a trust, society, body corporate, partnership firm, karta of HUF or a power of attorney holder will not be nominee(s). Minors can, however, be appointed as a nominee.
There can be only one nomination for one folio. Folios having different order or combination of names of shareholders will require separate nominations.
It is possible to revoke / vary a nomination once made. If nomination is made by joint holders, and one of the joint holders dies, the remaining joint holder(s) can make a fresh nomination by revoking the existing nomination.
Joint holders are not nominees; they are joint holders of the relevant shares having joint rights on the same. In the event of death of any one of the joint holders, the surviving joint holder(s) of the shares is / are the only person(s) recognised under law as holder(s) of the shares.
The nominee is entitled to all the rights of the deceased shareholder to the exclusion of all other persons. In the event of death of the shareholder, all the rights of the shareholder shall vest in the nominee. The nominee is required to apply to the Company by reporting the death of the nominator along with the death certificate.
The nominee has an option to decide to register himself as a shareholder or he could send an application to have the shares transferred to any other person to whom the nominator could have otherwise transferred the shares. If the nominee opts to transfer the shares to a third party, he should submit to the Company's R&TA the transfer deed(s) duly stamped and executed accompanied by the relevant certificate(s) and other documentary proof(s).
If shares are held in dematerialised form, nomination has to be registered with the concerned DP directly, as per the format prescribed by the DP.