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NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Transmission and Nomination

A demat account is held jointly by Ramesh, Suresh and Mahesh in that order. Ramesh, the first holder, dies. Who becomes the first holder after transmission is processed?

Suresh becomes the first holder, with Mahesh continuing as the other holder. When a joint holder dies, the surviving holders retain the securities, and the next named survivor moves up. The nominee or legal heir of the deceased claims only when no joint holder survives.

  1. ASuresh, the second holder, with Mahesh as the second holderCorrect
  2. BThe nominee, even though two joint holders survive
  3. CThe legal heir of Ramesh by default
  4. DThe account is closed and securities are moved to an unclaimed account

Explanation

In a joint account, on the death of a holder the securities continue with the surviving holders, and the survivor next in order becomes the first holder. The nominee does not take over while joint holders survive. The account is not closed merely because one holder died.

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