TaxTMI 
TaxTMI 
Procedural framework for dealing with unclaimed amounts lying with Real Estate Investment Trusts (REITs) and manner of claiming such amounts by unitholders
X X X X Extracts X X X X
X X X X Extracts X X X X
...., in certain cases it has been observed that the distribution amounts remained unclaimed or unpaid because of various reasons, including failure to update account details by the unitholders. 3. In order to deal with any amount remaining unclaimed or unpaid out of distributions [Hereinafter such amounts shall be referred to as, 'unclaimed amounts';], Regulation 18(6)(f) of the REIT Regulations, was inserted, as under: "any amount remaining unclaimed or unpaid out of the distributions declared by a REIT in terms of sub-clause (c), shall be transferred to the 'Investor Protection and Education Fund' constituted by the Board in terms of section 11 of the Act, in such manner as may be specified by the Board." 4. Further, Regulation 18(6)(g) of the REIT Regulations, provides that, 'the unclaimed or unpaid amount of a person that has been transferred to the Investor Protection and Education Fund in terms of sub-clause (f), may be claimed in such manner as may be specified by the Board'. 5. In order to define the manner of handling the unclaimed amounts lying with the REITs, transfer of such amounts to the IPEF and claim thereof by the unitholders, necessary amendments we....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... A. Obligations of the REIT: 1. Transfer of unclaimed amount to Unpaid Distribution Account: Where a distribution has been made by the Manager, but the payment to any unitholders has remained unpaid or unclaimed, up to fifteen days from the date of declaration, the Manager shall, within seven working days from the date of expiry of such period of fifteen days, transfer such unclaimed amounts to an Escrow Account to be opened by it on behalf of the REIT in any scheduled bank. Such account shall be termed as the 'Unpaid Distribution Account'. 2. Interest in case of default: In case a default is made in transferring the amount referred above in paragraph (A)(1) of Part I or portion thereof to the Unpaid Distribution Account of the REIT, it shall pay, interest on the amount that has not been transferred to the said account, for the period of default i.e. from the date of default till the date of transfer to the Unpaid Distribution Account, at the rate of twelve percent per annum. The said interest amount shall accrue to the unitholder in proportion to the amount remaining unclaimed. The Manager shall not recover such interest in the form of fees or any other form, payable to the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ate when unclaimed amount was transferred to Unpaid Distribution Account (dd/mm/yyyy); Further, the interest, if any, in the Unpaid Distribution Account, that accrues to the unitholder in proportion to his/ her unclaimed amount, may also be disclosed by the Manager. 7. Policy for filing of claim: The Manager of the REIT shall formulate a policy specifying the process to be followed by unitholders for claiming their unclaimed amounts. Such a policy shall include the following: 7.1. the format in which claim has to be submitted by a unitholder; 7.2. the procedure and documentation for making claim, depending on whether the claim is being submitted by the unitholder - self or by the legal heir/ nominee/ etc. of the unitholder; 7.3. the documents required to be submitted in support of the claim e.g. proof of identity, proof of address, proof of holding, etc.; 7.4. manner of submission of claim by the unitholder; 7.5. timeline within which the unitholder can submit documents, provide clarifications etc. 7.6. conditions for rejection of claim and option of re-filing of a claim by the unitholder; 7.7. timeline within which the claim shall be processed by the Man....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d to the Unpaid Distribution Account of an REIT which remains unpaid or unclaimed for a period of seven years from the due date of such transfer, shall be transferred by the Manager, along with interest accrued, if any, thereon, to the IPEF. The Manager shall make such transfer within a period of thirty days from the date of expiry of seven years. Such fund transfer shall be made in the manner prescribed vide SEBI Circular ref. no. SEBI/HO/GSD/TAD/P/CIR/2023/149 dated September 4, 2023 [https://www.sebi.gov.in/legal/circulars/sep-2023/change-in-mode-of-payment-w-r-t-sebi-investor-protection-and-education-fund-bank-a-c_76474.html], as amended from time to time. 2. Interest in case of default: In case a default is made in transferring the amount referred above in paragraph (A)(1) of Part II or portion thereof to the IPEF, the Manager shall be liable to a penalty of one lakh rupees and in case of continuing failure, a further penalty of five hundred rupees for each day that the failure continues, subject to a maximum of ten lakh rupees. The Manager shall not recover such penalty in the form of fees or any other form, payable to the Manager by the REIT. Any penalty amount so tran....
X X X X Extracts X X X X
X X X X Extracts X X X X
....amount, make an application to IPEF for refund of such amount. The application has to be submitted by the Manager for reimbursement of the amount transferred by it to the unitholder, as per prescribed format (enclosed as Form - B to this Annex), in hard copy, addressed to 'Chief General Manager, Office of Investor Assistance and Education, SEBI', as well as in soft copy, via email to [email protected]. 7. Indemnity: The amount refunded from IPEF to the REIT for the unclaimed amount paid by the REIT to the unitholder, shall discharge the Board against any future claim of such unitholder. The REIT shall indemnify the Board, against any future dispute that may arise with respect to the unclaimed amount of the unitholder, including, on account of a fraudulent claim or misrepresentation by the unitholder. However, this does not preclude the Board from taking any action for the fraud or misrepresentation in this regard. 8. Others: The provisions with regard to Designating Nodal Officer, Search facility for a unitholder on the website of the REIT, Policy for filing of claim by a unitholder and Processing of claim of a unitholder by the Manager, Maintenance of records and Update of in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r - f. Email ID - II. Details of Nodal Officer of REIT: a. Name - b. Designation - c. Registered office address - d. Phone number - e. Email ID - III. Details of unclaimed amounts: S. No. Name of the Unitholder Last known address, contact details (email ID and phone no.) of unitholder PAN of the Unitholder DPID/ Client ID of the Unitholder (if applicable) Amount transferred from Unpaid Distribution Account to IPEF (in INR) Category of Amount (interest/ dividend/ Repayment of Capital/ Any other) Date of Payment to IPEF UTR No. IV. Any other relevant information: Signature: Name: Designation of Officer (with stamp): Place: Date: Form - B (To be submitted by the Manager of REIT along with refund application to IPEF) I. Details of the REIT: a. Name - b. PAN - c. Registered off....