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Various Timelines Under The Companies Act, 2013 for IEPF Compliances

January 11, 2017     by Nupur Singhal

The provisions applicable on declaration and payment of dividend including its transfer to Unpaid Dividend A/c and Investor Education and Protection Fund are as follows:

Particulars Applicable Section Applicable Rule
For payment of dividend Section 123 The Companies (Declaration and Payment of Dividend) Rules 2014
For transfer of dividend to Unpaid Dividend A/c Section 124
For transfer to IEPF Section 125 and 126 The Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016

 

A brief summary containing various timelines related to dividend starting from the declaration of dividend till its transfer to Investor Education and Protection Fund is given as under:

S. No. Particulars Time limit Remark
1 Declaration of dividend At GM/BM
2 Amount of dividend shall be deposited with separate  bank account with the schedule bank Within 5 days from the date of declaration.
3 Dividend shall be paid or claimed Within 30 days from the date of declaration.
4  Amount still Unpaid or Unclaimed shall be deposited in UNPAID DIVIDEND A/C. Within 7 days from the expiry of above 30 days. If co. fails, then liable to pay interest @ 12%  p.a.
5* Statement containing names, addresses and unpaid dividend to be paid to each person Prepared and placed on the website of the Company, if any, within 90 days of making transfer to UNPAID DIVIDEND A/C. It shall also be placed on any other website
6 File Form IEPF-2 Form IEPF-2 shall be filed every year within 90 days of the AGM which shall contain investor wise details of unclaimed and unpaid amounts in respect of dividends, debentures, etc. It shall contain details as on the date of AGM.
7 File Form IEPF-6 Form IEPF-6 shall be filed within 30 days of the end of F.Y. stating the amounts due to be transferred to the Fund in next F.Y.
8* Deposit with IEPF U/S 125 Within 30 days after the expiry of 7 years from the date it was transferred to UNPAID DIVIDEND A/C.

*CONSEQUENCES OF NON-COMPLIANCE: If a company fails to comply with any of the requirements of Section 124, the company shall be punishable with fine of minimum INR 0.5 million and maximum INR 2.5 million and every officer of the company who is in default shall be punishable with minimum fine of INR 0.1 million and maximum INR 0.5 million.

IMPORTANT HIGHLIGHTS:

  • Amount shall be transferred to IEPF within 30 days after the expiry of 7 years from the date of deposit in Unpaid Dividend Account.
  • Form IEPF-1 shall be furnished to the Authority constituted under Section 125 containing details of such transfer within 30 days of submission of challan with the Authority.
  • The company shall also keep records consisting of names, etc. of persons in respect of whom amount has been transferred to the IEPF.
  • All shares in respect of which unclaimed dividend has been transferred to the Fund shall also be transferred in the name of IEPF. Form IEPF-4 shall be filed with the Fund containing details of transfer.
  • Form IEPF-3 shall be filed within 30 days from the end of financial year if there is a specific order of any statutory authority restraining any transfer of such shares and payment of dividend.

RELEVANT LINKS:

For Procedural aspects on transfer of dividend to the Fund, refer to the Transfer of Shares to IEPF – Procedural Aspects.

For information on transfer of shares to IEPF, refer to the Transfer of Shares to IEPF – Legality and Practicality.

For various IEPF related forms refer to the IEPF Forms – MCA website.

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