Ministry of Corporate Affairs (MCA) vide Notification dated 14 August, 2019 has amended Investor Education Protection Fund (“IEPF”) (Accounting, Audit, Transfer and Refund) Rules, 2016. Pursuant to this amendment, MCA has stiffened the IEPF norms and requires the historic data of funds transferred to IEPF. It also further clarifies that all shares in respect of which dividend has been transferred to IEPF on or before the 7th September 2016, shall also be transferred by the company in the name of IEPF.
The key highlights of the amendment are as follows:
1. Nodal Officer – The IEPF rules mandates the company which are required to credit amounts or shares or has already deposited or credited the shares to the IEPF Fund to nominate and appoint nodal officer. The key role of nodal officer is verification of claims and coordination with IEPF Authority.
- The Nodal officer so nominated shall be either Director or CFO or Company Secretary of the Company
- Company may appoint one or more officers as Deputy nodal officer to assist the nodal officer for the purpose of verification of claim and for coordination with IEPF authority
- Details of such nodal officer or deputy nodal officers required to be filed with IEPF authority in Form IEPF-2 within 15 days from the date of publication of these rules
- In case, Company fails to appoint nodal officer, every director shall be deemed to be nodal officer and liable for any failure to comply with this rules
- Change in nodal officer or his details shall be communicated within 7 days from such change in Form IEPF-2
[Effective from 20 August, 2019]
2. Transfer of Shares to IEPF – The shares in respect of which dividend has been transferred to IEPF on or before the 7 September 2016, are also required to be transferred to IEPF.
[Effective from 20 August, 2019]
3. Online Remittance into IEPF Account alongwith e- Form IEPF -1 : The amount which is to be credited to the IEPF account as provided in clause (a) to (n) of Section 125(2) of Companies Act, 2013 shall now be remitted through online mode only while filing e-form IEPF-1. Thereby, discarded the requirement of depositing the amount through offline mode.
[Effective from 20 August, 2019]
4. Requirement of filing of e-Form IEPF-1A - Companies which have transferred amount to IEPF u/s 205C of Companies Act, 1956 or Central Government but failed to file statement or have filed statement in format other than excel template are required to submit details in e-Form IEPF-1A alongwith excel template within 60 days of notification of this rule.
[Effective from 20 August, 2019]
5. Filing of IEPF- 2: The time period for furnishing the details of the unclaimed amount as referred in Section 125(2) which are required to be filed in e-Form IEPF-2 is reduced to 60 days after the date of AGM (earlier 90 days).
[Effective from 20 August, 2019]
6. Filing of e- Form IEPF-4 for corporate actions: The details of shares which are transferred to DEMAT account of IEPF pursuant to corporate actions are required to be submitted within 30 days in e-form IEPF -4 from the date of corporate action containing details of such transfer.
[Effective from 20 August, 2019]
7. Form IEPF-5– Claims from IEPF authority, shall be transmitted online to Company’s nodal officer in Form no. 5 for verification of claim. Thereafter the company will send an online verification report to IEPF Authority within 30 days.
[Effective from 20 September, 2019]
8. Fraudulent claim: Fraudulent claim by claimant shall be deemed to be fraud u/s 447 of the Companies Act, 2013
[Effective from 20 August, 2019]
9. E-Form IEPF-6 – The statement furnishing amounts due to be transferred to the Fund in next financial year in e-form IEPF 6 has been removed.
[Effective from 20 August, 2019]
10. Power to inspect the records: The Company shall maintain record of details filed in IEPF -1 and IEPF -5 along with all supporting documents and the authority shall have the powers to inspect such records.
[Effective from 20 August, 2019]
11. Schedule inserted – Schedules has been inserted for listing down documents to be submitted to IEPF Authority to register transmission of securities held in physical as well as DEMAT mode, and outlining the procedure to be followed while disposing the claims from the IEPF.
[Effective from 20 August, 2019]
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