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

Ramesh, Sunita and Anil hold a joint demat account in that order. Ramesh, the first holder, dies. How are the securities generally dealt with by the DP?

The DP transmits the holding to the surviving joint holders, Sunita and Anil, after receiving the death certificate and request, and deletes Ramesh's name. The nominee becomes relevant only when all joint holders have died, so no probate or freezing is required.

  1. AThe account is frozen until legal heirs of Ramesh obtain probate
  2. BThe securities are transmitted to the surviving holders, and the account continues in the names of Sunita and AnilCorrect
  3. CThe securities are transferred to Ramesh's nominee only, ignoring the surviving holders
  4. DThe account is closed and securities are auctioned

Explanation

In a joint account, on the death of a holder, the securities are transmitted to the surviving holders on submission of the death certificate and transmission request. The account is then in the names of the survivors, and the deceased holder's name is deleted. Nominee rights arise only when all holders have died.

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