Unclaimed Dividends — Explained

This document covers

1. Reasons for non-receipt of dividends by shareholders
2. Consequences of Non-payment of Dividends to shareholders for above reasons
3. How to claim unpaid dividend by shareholder or investor from Unpaid Dividend account (within 7 years)?
4. How to claim unpaid dividend by shareholder or investor from Unpaid Dividend account (post 7 years)?
5. How to check if you have any unclaimed dividends or shares

1. Reasons for non-receipt of dividends by shareholders

Many investors lose the dividend due to various factors as below

• Incomplete or Incorrect bank details
• Address change not updated
• Non-registration of bank mandate
• Forgotten Ownership of shares
• Dividend cheques not deposited in time (in certain cases)

2. Consequences of Non-payment of Dividends to shareholders for above reasons

• If the company is unable to pay the dividend to the shareholders within 30 days from the date of declaration, the company should transfer the unpaid dividend to a special account with scheduled bank called "Unpaid Dividend Account (UDA)".
• The amount should be transferred within 7 days from the expiry of the said 30 days.
• The company also needs to prepare a statement within 90 days of transferring the amount to unpaid dividend account and place it on website.
• The statement should contain the following details
  
  • Name of shareholder or investor
  • Last known address of shareholder or investor
  • Unpaid dividend amount
• If the dividend remains unpaid or unclaimed for 7 years or more, the company should transfer the dividend along with interest to the Investor Education and Protection Fund (IEPF) account

3. How to claim unpaid dividend by shareholder or investor from Unpaid Dividend account (within 7 years)?

If the shareholder has not received the dividend and if the company has not transferred the same to IEPF account (within 7 years), he can follow the below process

• Send a request letter to Registrar and share transfer agent (RTA) requesting them to release the unpaid dividend. The request letter should contain folio number/client Id and DP-ID and the period for which the dividend is not received.
• Self-Attested copy of PAN, Address proof and cancelled cheque or updated client master list should be attached with above request letter.

4. How to claim unpaid dividend by shareholder or investor from Unpaid Dividend account (post 7 years)?

Once the amount is transferred to IEPF account, the shareholder needs to follow the process below to claim dividend

• Login to mca.gov.in and access the IEPF-5 webform and fill in the details as requested in the form.
• An acknowledgement with SRN will be generated.
• The shareholder needs to submit the Self attested copy of printout of the IEPF- 5 form, acknowledgement, indemnity bond in original along with the other documents as mentioned in Form IEPF-5 to Nodal Officer of the company at its registered office in an envelope.
• The company concerned will verify the claim forms in all aspects and on the basis of company's verification report, IEPF will release the refund

5. How to check if you have any unclaimed dividends or shares

The shareholders can check if they have any unclaimed dividends or shares on their name as follows:

• Create account in https://iepfa.gov.in/login and click on login
• Once logged in, you can click on below criteria
  
  • Search by PAN
  • Search by Basic Informa
  • Search by Company name and Demat ID/Folio number
• Once the above criteria is selected, click on search and it will show the results of unclaimed dividend and shares