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

In a joint demat account of Rahul, Meera and Sanjay, Meera dies. Which statement describes the usual transmission treatment?

On death of one joint holder, the DP deletes the deceased holder's name after receiving the death certificate, and the surviving holders continue to hold the account. Securities do not pass to the deceased's heirs while other joint holders are alive.

  1. AThe account must be closed and securities sold
  2. BThe names of the surviving holders continue, and the deceased holder's name is deleted on submission of the death certificateCorrect
  3. CSecurities go automatically to Meera's legal heirs, removing the other holders
  4. DThe account becomes frozen for all holders for three years

Explanation

In joint accounts, on death of one holder the DP deletes that name on receipt of the death certificate, and the surviving holders continue to operate the account as per the operating instructions. The securities do not pass to heirs while other holders survive.

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