Big depositor recovery from Peerless General; government body gets this much for investor protection

By: |
April 23, 2019 4:24 PM

Signifying a major step towards investor protection the IEPF Authority has recovered depositor wealth totalling to Rs 1,514 crore from The Peerless General Finance and Investment Company.

Depositors’ money was pending with the company for the last 15 years.  

Signifying a major step towards investor protection, the IEPF Authority has recovered depositor wealth totalling to Rs 1,514 crore from The Peerless General Finance and Investment Company. Notably, this depositors’ money was pending with the company for the last 15 years.  

“The matter came to the notice of the Authority recently and within a short time due to the proactive action of the Authority the said sum has now been transferred to IEPF. This amount was taken by the company by issuing about 1.49 crore Deposit Certificates and include more than 1 crore individual investors,” the IEPF authority said in a release. Notably, the IEPF has been set up under the Ministry of Corporate Affairs, and takes various initiatives in the of investor awareness and protection. Accordingly, the provisions of the authority state rules relating to transferring the unpaid and unclaimed dividend to the Investor Education and Protection Fund.

Also read: Haldiram’s munches into Indian startup ecosystem; backs incubator Venture Catalyst

In this specific case, 50.77% of the total amount (Rs 1,514 crore) was taken in form of deposit certificates of value of Rs 2000 or less. Notably, such certificates form 85.32 percent of total number of certificates issued, implying that the majority of these investors are common citizens belonging to lower and middle income group including daily wage earners, said the release. Notably, the total investors involved belong to 30 states and Union territories of the Country. Majority of the investors belong to the state of West Bengal.

According to the current rules, the firms must transfer to the Investor Education and Protection Fund (IEPF)  in case the dividend remains unclaimed for a period of seven years from the date of transfer to the Unpaid Dividend Account. IEPF authority noted that many of the the companies are showing unclaimed and unpaid amounts in their Balance Sheets but have not transferred such amounts to IEPF even after seven years. IEPF said that these firms include NBFC companies which have neither refunded these amounts back to their entitled investors nor have transferred such amounts to IEPF even after expiry of the period of seven years.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1India’s crude steel output rises 0.9 per cent to 9 MT in October: World Steel Association
2Sebi orders attachment of bank, demat accounts of ATM Agro, Sunshine Agro to recover Rs 21 crore
3Sensex, Nifty tumble after reaching fresh highs, end deep in red; are bears returning to D-Street?