Skip to content

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

Mr. Sandeep Rao dematerialised shares from certificates held in the joint names of himself and his wife, in the order 'Sandeep Rao, Anita Rao'. He opened his demat account with the names in the order 'Anita Rao, Sandeep Rao'. What is the likely outcome of his demat request?

The request will be rejected because the names on the certificates and the demat account must be identical and in the same order. Since the account lists the holders in a different sequence, the RTA treats it as a mismatch. A correctly ordered account or transposition is needed.

  1. AThe request is accepted, as the order of names is immaterial
  2. BThe request is rejected because the names and their order must match the account holders' names in the same sequence as on the certificatesCorrect
  3. CThe request is accepted but only half the shares are credited
  4. DThe shares are credited to Anita Rao's separate account automatically

Explanation

Securities can be dematerialised only into an account whose holder names match the certificate names in the same order. A different order is a mismatch, so the request is rejected; the certificates would have to be dematerialised into a correctly ordered account or be transposed through the prescribed procedure.

Did you get it right without looking?

One question tells you little. A timed set on Functions of Depository Participant - Dematerialisation shows your real accuracy, how long you take and where you lose marks.

Practise Functions of Depository Participant - DematerialisationFree diagnostic mock

More Functions of Depository Participant - Dematerialisation questions