Investors Free To Hold Physical Shares, but Transfer Can Be Done only through Demat: SEBI
Moneylife Digital Team 28 March 2019
Market regulator Securities and Exchange Board of India (SEBI) has clarified that investors can continue to hold shares in physical format after 1 April 2019. However, transfer can take place only for shares that are dematerilised, it added.
 
In a statement, SEBI says, "...investor has the option of holding shares in physical form even after 1 April 2019. Any investor who is desirous of transferring shares, which are held in physical form, after 1 April 2019 can do so only after the shares are dematerialised."
 
"The transfer deeds once lodged prior to the 31st March deadline and returned due to deficiency in the document may be re-lodged for transfer even after the deadline of 1 April 2019," it added.
 
This decision, according to SEBI, is not applicable to cases related with demat of shares, transmission or transfer of title of shares by way of inheritance or succession and transposition or re-arrangement or interchanging of the order of name of shareholders.
 
Last year in March, the market regulator had announced that securities and shares held in physical form will become illiquid after 5 December 2018 and anyone intending to trade physical shares will be able to do it only via a dematerialised or demat mode with a depository. This deadline was extended till 31 March 2019 after several representations and requests were made to SEBI by scores of investors still holding scrips in physical form.
 
The SEBI mandate to dematerialise physical shares does not apply in case of transmission or transposition of securities. However, if an investor needs to transfer or sell or trade shares, it has to be held in a dematerialised form with a depository.
Comments
Harish
3 years ago
SEBI needs to extend the March 31 deadline.
Arun Adalja
Replied to Harish comment 3 years ago
i agree as RTA cannot cope up the load as they are very rigid for small things .sebi asked them to do easily but they do not listen.
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