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    Demat of shares- by public company

    Posted By : Damini / Published on : 07-Aug-2020 06:10 PM / View : 480 / Comment : 1

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    Dear Members,

    A public company wants to allot shares which has not opted demat facility....till now...is there any way out to allot the shares.
    Read more on : company public shares demat

    • Dear Folk,

      Since 02/10/2018 MCA makes it mandatory for all unlisted Public Companies (Excluding Nidhi Co) to issue /Transfer the shares only in dematerialized form.
       
       
      1. Dematerialisation of Shares of Unlisted public Companies:
       
      Provisions-
       

      Every unlisted public company making any offer for issue of any securities or buyback of securities or issue of bonus shares or rights offer shall ensure that before making such offer, entire holding of securities of its promoters, directors, key managerial personnel has been dematerialised in accordance with provisions of the Depositories Act, 1996 and regulations made there under.

      Every holder of securities of an unlisted public company, –

      (a) who intends to transfer such securities on or after 2nd October, 2018, shall get such securities dematerialised before the transfer; or

      (b) who subscribes to any securities of an unlisted public company (whether by way of private placement or bonus shares or rights offer) on or after 2nd October, 2018 shall ensure that all his existing securities are held in dematerialized form before such subscription.

       

      PROCEDURE:
       
      The process of Dematerialization may be described as follows.

      1. Shortlisting of a Depository Participant
      A Depository Participant (DP) is an intermediary between a depository and the investors.
      The list of DPs is made available on the websites of Central Depository Services (India) Limited (CDSL) and National Securities Depository Limited (NSDL).
      The first step in dematerializing shares is to open an account with a DP offering DEMAT SERVICES.
      Upon opening of such an account, investors need not open separate accounts for trading in debt, bonds, or any other financial instrument.

      2. Filling the Dematerialization Request Form
      A Dematerialization Request Form (DRF), available with the DP, has to be filled and submitted by the investor as shown in the image below. Along with the duly filled DRF form, investors have to surrender their physical share certificates.
      It is important to make sure that on every share certificate, ‘Surrendered for Dematerialization is mentioned.

      3. Processing of the request
      Upon submission of the DRF and physical certificates, the application is processed by the DP.
      The physical share certificates are submitted to the registrar of the issuer company.
      The registrar confirms the dematerialization request.

      4. Receiving an approval of the request
      Once the request has been approved, the registrar informs the DP of the completion of the process.
      All the share certificates held in the physical form are then destroyed.
      The investor’s account will then show a credit of the shares.
      After submission of the dematerialization request, it generally takes around 15 to 30 days for the shares to get transferred electronically.
       
      II. More new Compliance introduced PAS-6 Filing for all unlisted Public Companies -
       
      It is a Reconciliation of Share Capital Audit Report on half - yearly basis* 
       
      This form can only be filed after ISIN of the Company.
       
      19-08-2021 / 06:55:31 AM
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