DEMATERIALISATION:

Dematerialization is a process by which the physical share certificates or certificates of other securities are taken back by the company and an equivalent number of shares or other securities are credited in an electronic form at the request of the investor. An investor will have to first open a Demat account with a depository participant and then request for the dematerialization of his share certificate through the depository participant so that his dematerialized holdings may be credited into his Demat account. This is similar to opening a bank account.

It is optional for an investor to dematerialize his shares and he can still hold shares in physical form. However, an investor has to Demat the shares if he or she wishes to sell the shares through the stock exchanges. Similarly, if an investor purchase shares through registered stock exchanges, he or she will get the delivery of the shares in Demat form.

FEATURES OF DEMATERIALISATION:

• The holding of those securities is admitted for dematerialization which can be dematerialized by NSDL or CDSL.
• Only those holdings that are registered in the name of the account holder can be dematerialized.
• The names of the holders of the securities should match with the names given for the Demat account.
• A client may, in the normal course, receive Demat confirmation in about 30 days from the date of submission of the Demat request to the depository participant.

PROCEDURE FOR DEMATERIALISATION:

• An investor intending to dematerialize the securities needs to open a Demat account with the depository participant. The client is given a unique client ID number. It is also called the Demat account number.
• The client will submit a request to the depository participant in the Dematerialisation Request Form for dematerialization, along with the certificate of securities to be dematerialized. Before submission, the client must deface the certificates by writing “SURRENDERED FOR DEMATERIALISATION”.
• The depository participant will verify the form. If the form and security count is in order, the depository participant will issue an acknowledgment slip duly signed and stamped, to the client.
• The depository participant will intimate the depository electronically.
• The depository participant will send the securities to the concerned Issuer or Registrar and Share Transfer Agent of the issuer.
• The depository informs the Issuer or Registrar and Transfer Agent of the Issuer electronically, using the depository system, about the request for dematerialization.
• If the Issuer or Registrar and Transfer Agent of the issuer finds the certificate in the order, it will register the depository as the holder of the securities (the client will be the beneficial owner).
• The depository participant will communicate to the depository the confirmation of the request electronically.
• On receiving the aforesaid confirmation, the depository will credit the securities in the Demat account of the client with the depository participant. The client will also be informed about the dematerialization of the shares.

REMATERIALISATION:

Rematerialisation is the process of conversion of securities held in an electronic form to an equivalent number of the securities in the physical form, i.e. in conventional certificates. It involves physical trading. The securities account is maintained by the company or the issuer.

For rematerialization, the beneficial owner of the securities is required to file the Remat Request Form and submit it to the depository participant with whom he or she has his Demat account. When securities are rematerialized, the conventional certificate is issued which has distinctive numbers. Thus, they gain their identity.

PROCESS FOR REMATERIALISATION:

• Client submits rematerialization request form(RRF) to depository participant.
• Depository participant intimates depository and submits RRF form to the registrar.
• Depository intimates the Registrar/Issuer.
• Registrar/Issuer dispatch certificates to the investor.
• Registrar/Issuer confirms remit to the depository.
• Investor’s account with depository participant debited.

This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being. Further, despite all efforts that have been made to ensure the accuracy and correctness of the information published, 5thVoice.News shall not be responsible for any errors caused due to human error or otherwise.