Can Physical Shares in Joint Names Be Sent for Demat in the First Holder’s Demat Account?
Yes, physical shares held in joint names can typically be sent for dematerialization (demat) in the demat account of the first holder. However, the exact procedure may vary based on the policies of the depository and the registrar of the shares. Here are the general steps to follow:
Check Eligibility
Ensure that the shares are eligible for dematerialization and that there are no restrictions.
Demat Account
The first holder of the joint shares should have an active demat account.
Dematerialization Request Form (DRF)
Obtain and fill out the DRF, which is usually available from the depository participant (DP).
Documents Required
The original share certificates A copy of the PAN card of all joint holders Proof of identity and address for all joint holders Any other documents as specified by the DPSubmission
Submit the DRF and the required documents to the DP.
Processing
The DP will process the request and send the physical shares to the registrar for verification.
Credit to Demat Account
Once verified, the shares will be credited to the demat account of the first holder.
'It is advisable to check with your DP for any specific requirements or additional steps that may be necessary in your case.
Transferring Shares
The shares can be transferred from one account to any other account. The joint holders can approach their DP and inform that they want to make an offline transfer. The DP will provide them with the necessary papers to be filled and signed by both parties to complete the process.
Same Names on Demat Account
No. The demat account has to be in exactly the same names in the same sequence. In case of discrepancies, either open a new account or first transfer the shares in the correct name.
Transposition of Shares
While you will need to open one separate demat account jointly, the new account will allow for the transposition of the joint demat holders. For example, if you have physical shareholdings with A as the first shareholder and B as the second shareholder, and another physical shareholding with B as the first shareholder and A as the second shareholder, both can be dematerialized in a single demat account with A and B as joint holders in any order. Two separate joint demat accounts with A as the first holder in one and B as the first holder in another need not be opened as transposition of names is allowed.
This reply is based on personal experience, and it aligns with the concept of transposition of shares, where shares held in the name of A and B and the customer has a demat account in the reverse order (i.e., name of B and A) can be dematerialized in the same account.
Further Clarification
Transposition means that if shares are held in the name of A and B, and the customer has a demat account in the reverse order (i.e., name of B and A), the shares can be dematerialized in the same account, and a new demat account in the name of B and A would not be required.
Please refer to the following reference: Transposition - Transmission - Saraswat Cooperative Bank Ltd.