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

Ravi Menon, a resident individual, wants to open a demat account with a Depository Participant. Which document must the DP obtain in all cases as proof that he has a PAN, before activating the account?

The DP must obtain a copy of the PAN card and verify it against the original or the Income Tax database. PAN is compulsory for demat account holders, subject to limited exemptions, and other documents such as utility bills or cheques cannot replace it.

  1. AA copy of the PAN card, verified with the original or through the Income Tax databaseCorrect
  2. BA copy of his latest electricity bill
  3. CA passport-size photograph only
  4. DA cancelled cheque of his bank account only

Explanation

PAN is mandatory for all holders of a demat account (with limited exemptions such as Sikkim residents and certain government bodies). The DP verifies the PAN copy against the original or the Income Tax database. An address proof or cheque alone cannot substitute for PAN.

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