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NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Dematerialisation

A client's DRF for dematerialisation was rejected by the registrar because the signature on the certificate did not match the specimen on record. The client wants to try again. Which statement is correct?

The rejected certificates come back through the DP with the reason for rejection. The client rectifies the defect, such as signature mismatch, and submits a fresh DRF. Nothing is credited automatically and the demat account is unaffected by the rejection.

  1. AThe DP receives the rejected certificates with a rejection reason and the client may rectify and resubmit, a fresh DRF being needed in the case of a rejectionCorrect
  2. BThe securities are automatically credited after 30 days regardless
  3. CThe depository must cancel the client's demat account
  4. DThe certificates are destroyed by the registrar

Explanation

On rejection, the certificates are returned through the DP with the reason. Once the defect is rectified, the client submits a fresh DRF. Securities are not credited automatically, nor is the account cancelled, and the registrar does not destroy certificates.

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