As per recent amendment issued by Ministry of Corporate Affairs on September 10, 2018, following Rule (Rule 9A) has been inserted after Rule 9 of Companies (Prospectus and Allotment of Securities) Rules, 2014 –
‘Every Unlisted Public Company shall issue its securities in dematerialized form and facilitate dematerialization of all its existing securities as well.’
A paperless form of trading in shares whereby share transactions and transfers are processed electronically without involving any share certificate or transfer deed after the share certificate has been converted from physical to electronic form.
An investor who wants to dematerialize his share needs to open DEMAT account with depositary participant (a market intermediary through which investors can avail depository services). Investor surrenders his physical shares and get electronic shares in turn to his demat account.
is mandatorily required to dematerialize its existing securities as well as new issue of securities.
This is a quick, efficient, transparent and paperless form of holding of securities and hence we suggest all the Unlisted Public Companies to dematerialize their shares at the earliest to avoid any penalties or fees.
Author: Ruchi Mehta
Clarification regarding Applicability of GST on supply of cranes, rigs, tools & Spares and other machinery when moved from one state to another by a person on his account for their use for supply of service
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Economics,Marketing with 26 years of experience
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