Financial Daily from THE HINDU group of publications
Sunday, Dec 26, 2004
Financial Daily from THE HINDU group of publications Sunday, Dec 26, 2004 |
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Investment World
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Financial Services Nomination and transmission
Nomination can be made only by individuals holding beneficiary accounts either singly or jointly. Non-individuals, including society, trust, body corporate, partnership firm, karta of Hindu undivided family (HUF) and power-of-attorney holder cannot nominate Can joint-holders nominate? Yes. Nomination is permitted for accounts with joint-holders. But in case of death of any of the joint holder(s), the securities will be transmitted to the surviving holder(s). Only in the event of death of all the joint-holders, the securities will be transmitted to the nominee. Can an NRI nominate? Yes, an NRI can nominate directly. But the power-of-attorney holder cannot nominate on behalf of the NRI. Can a minor nominate? No, a minor cannot nominate either directly or through his/her guardian. Who can be a nominee? Only an individual can be a nominee. A nominee shall not be a society, trust, body corporate, partnership firm, karta of HUF or power-of-attorney holder. Can there be more than one nominee? No, only one nomination can be made for one depository account. Can a minor be a nominee? Yes, a minor can be a nominee. In such a case, the guardian will sign on behalf of the nominee, and, in addition to the name and photograph of the nominee, the name, address and the photograph of the guardian must be submitted to the depository participant (DP). Can separate nomination be made for each security held in a depository account? No. Nomination can be made account-wise and not security-wise. Can an NRI be a nominee? Yes, an NRI can be a nominee subject to the exchange control regulations in force from time to time. What is the procedure for nomination? The nomination form duly filled-in should be submitted to the DP either at the time of account opening or later. The accountholder, nominee and two witnesses must sign this form and the name, address and photograph of the nominee must be submitted. If nomination was not made at the time of account opening, it can be made subsequently by submitting the nomination form. Can the nominee be changed? Yes, the nomination can be changed anytime by the accountholder(s) by simply filling up the nomination form once again and submitting it to the DP. What does transmission mean in relation to demat accounts? Transmission is the process by which securities of a deceased accountholder are transferred to the account of the surviving joint holder(s)/nominee/legal heir(s) of the deceased accountholder. The process of transmission in the case of dematerialised holdings is more convenient, as the transmission formalities for all securities held in a demat account can be completed by submitting documents to the DP. Whereas in the case of physical securities, the surviving joint holder(s)/nominee/legal heir(s) has to correspond independently with each company in which shares are held. What is the procedure for transmission of securities to the nominee in case of the sole accountholder's death? In such a case, the nominee has to submit a duly filled-in transmission form, notarised copy of death certificate and an affidavit in the prescribed format to the DP. After verifying these documents, and if found in order, the DP will transmit the securities to the account of the nominee. Source: National Securities Depository Ltd (www.nsdl.co.in)
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