II) Nomination for DP accounts: - Individual(s) Beneficiary Accounts
a) The nomination / dissent to nominate, as the case may be is mandatory in case of individual beneficiary accounts holder(s). In the case of joint accounts, signatures of all the account holders are required.
b) As per the instructions received from the Depositories, we can take cognizance of nomination only if it is submitted in the prescribed format & the same has to be registered with the Depository Participant(DP) under a ' Nomination Registration Number' (NRN). In the absence of NRN, DP will not be able to transmit the securities in favour of the nominee. Transmission can be effected in favour of the nominee only if it is registered & after duly submitting the prescribed documents. B
c) If nomination has not been registered, account holders may submit the nomination form in the prescribed format to the nearest SHCIL centre. On registration of the nomination, the NRN will be communicated to the account holder(s).In case nomination is not registered , securities can be transmitted to legal heirs only on submission of legal documents as per Depository guidelines." In case you do not wish to nominate, kindly submit declaration in prescribed format available with the branches.
f) Depositories do not have facility to operate a beneficiary account on 'Either or Survivor' basis.
g) As per the latest NSDL guidelines, client may give local address or correspondence address, depending on his preference to receive the communications from the companies.
h) The demat accounts can be operated by both the client and the POA holder however the account can not be opened by the POA holder.
A sample clause for Power of attorney is given hereunder :
"To sell or otherwise deal with or dispose of and to purchase, subscribe or otherwise acquire in any manner from the market or under public or rights issues or otherwise and accept the transfers of any stocks, funds, shares, debentures, Government and other promissory notes, securities, bonds, debentures, annuities or other mercantile negotiable instruments which shall or may at any time belong to me or which hereafter be transferred to me, whether solely or jointly and whether in my own right or having any other interest of whatsoever nature and however arising and in any capacity whatsoever including those belonging to others with my name and for such purposes to sign, execute or endorse all instruments of transfer and other documents for any purpose what so ever by the virtue of these present."
Some important facts about nomination :-
a) The nomination can be made only by individuals holding beneficiary owner accounts on their own behalf singly or jointly. Non-individuals including society, trust, body corporate, partnership firm, karta of Hindu Undivided Family, holder of power of attorney cannot nominate.
b) A minor can be nominated. In that event, the name and address of the Guardian of the minor nominee shall be provided by the beneficial owner.
c) The Nominee shall not be a trust, society, body corporate, partnership firm, karta of Hindu Undivided Family or a power of Attorney holder. A non-resident Indian can be a Nominee, subject to the exchange controls in force, from time to time.
d) Nomination in respect of the beneficiary owner account stands rescinded upon closure of the beneficiary owner account. Similarly, the nomination in respect of the securities shall stand terminated upon transfer of the securities.
e) Transfer of securities in favour of a Nominee shall be valid discharge by the depository against the legal heir.
f) The cancellation of nomination can be made by individuals only holding beneficiary owner accounts on their own behalf singly or jointly by the same persons who made the original nomination Non-individuals including society, trust, body corporate, partnership firm, karta of Hindu Undivided Family, holder of power of attorney cannot cancel the nomination. If the beneficiary owner account is held jointly, all joint holders will sign the cancellation form.
g) On cancellation of the nomination, the nomination shall stand rescinded and the depository shall not be under any obligation to transfer the securities in favour of the Nominee.