NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Transmission and Nomination
A demat account is held jointly by Meera, Kabir and Lata. Kabir, the second holder, dies. What is the usual course for transmission of the securities?
On the death of one joint holder, the securities are transmitted to the surviving holders when the death certificate and a request are submitted to the DP. The deceased's name is removed and the account continues, so no heirs are added and no sale or closure is needed.
- AThe securities are frozen until a succession certificate is produced
- BThe securities are transmitted to the surviving holders, on submission of the death certificate of the deceased holder, with the account continuing in their namesCorrect
- CThe securities are transferred to Kabir's legal heirs in the same account
- DThe account is closed and securities are sold in the market
Explanation
For a joint account, the death of a holder leads to the deletion of the deceased's name, and the surviving holders continue with the account on submission of the death certificate and a request. Succession certificates apply to different situations, such as the death of a sole holder with no nominee. Heirs of a deceased joint holder do not take his place in the account.
Did you get it right without looking?
One question tells you little. A timed set on Functions of Depository Participant - Transmission and Nomination shows your real accuracy, how long you take and where you lose marks.
More Functions of Depository Participant - Transmission and Nomination questions
- Ms. Rao names her brother as nominee for her demat account. Which of the following is true when she dies and the nominee claims the securiti…
- Mr. Raghav Iyer, the sole holder of a demat account, has registered a nominee. After his death, the nominee approaches the DP for transmissi…
- A demat account holder has opted out of nomination by submitting a declaration. Later, the holder dies, and three legal heirs claim the hold…
- A minor's demat account is operated by her guardian. On what event does the minor's account normally require conversion into an ordinary acc…
- Ms. Rao, an individual demat account holder, wants to appoint her husband as nominee. Which of the following is correct regarding nomination…
- Ms. Kavita opened a demat account and did not make a nomination. She later wishes to nominate her brother. Which statement about nomination …