Securities in DEMAT

ISIN Compliance

ISIN Dematerialization Mandate

ISIN requirements

In October 2023, the Ministry of Corporate Affairs (MCA) amended the Companies (Prospectus and Allotment of Securities) Rules, 2014 by introducing Rule 9B. This rule requires that, within eighteen months of the end of each financial year, every private company (except small companies) must:

Issue securities exclusively in dematerialized form.

Enable the dematerialization of all its securities in compliance with the Depositories Act, 1996 and related regulations.

Accordingly, private companies are required to mandatorily facilitate the dematerialization of their equity shares by September 30, 2024.

ISIN Compliance Timeline

Gazette Notification 2023

Further, a new notification was issued in October 2023, through the Companies (Prospectus and Allotment of Securities) Second Amendment Rules, 2023, which reinforces the requirement for companies to comply with the dematerialization rules within specified timelines. Failure to comply within the stated period will result in penalties and mandatory conversion of securities.
🔗 Click to view Notification 2023

Gazette Notification 2019

In July 2019, the Ministry of Law & Justice released a notification mandating that all companies must ensure their securities are held and transferred only in dematerialized form in accordance with the Depository Act, 1996. This applied to both public and private companies, except small companies.
🔗 Click to view Notification 2019

ISIN Enforcement & Benefits

Penalties for ISIN Violation

If a company fails to obtain an ISIN and dematerialize its securities within the prescribed timelines, it is subject to penalties under Section 450 of the Companies Act, 2013:

Initial Penalty

A fine of ₹10,000 will be imposed on the company and each defaulting officer.

Repeat Violation

An additional penalty of ₹1,000 per day will accrue for each day the contravention continues, subject to a maximum of ₹2,00,000 for the company and ₹50,000 for officers.

ISIN Enforcement & Benefits

Why Choose Dematerialization?

Cost Reduction

Elimination of stamp duty on the transfer of securities significantly reduces costs.

Risk Mitigation

Physical risks like loss, theft, forgery, or damage to paper certificates are eliminated.

Fast and Efficient

Paperless transactions allow for quicker and more efficient transfers of securities.

Easy to Pledging

DEMAT securities are easy to pledge. Banks and financial institutions easily accept dematerialized shares for credit facilities.

Our Role

Who is BEETAL?

Beetal, a Category 1 Registrar and Share Transfer Agent registered with SEBI, can assist in dematerializing your securities. Established in 1993, Beetal offers reliable, cost-effective, and efficient services for companies looking to comply with dematerialization requirements.

Beetal has more than 1,500 clients, including Public Sector Units (PSUs), Government Entities, Banks, and Large Corporates. With connectivity to both NSDL (National Securities Depositories Ltd) and CDSL (Central Depository Services India Ltd), Beetal has extensive experience handling public, private, and bond issues.

For further details or assistance, please reach out to us along with below details, and we’ll be happy to guide you through the dematerialization process and answer any questions:

Company Name
Paid-up Capital
Registered and Correspondence Address
Type of Securities

How Can BEETAL Help You?

ISIN Acquisition

Assisting with the acquisition of an ISIN through a SEBI registered Registrar and Share Transfer Agent.

DEMAT of Securities

Ensuring all issued securities are properly dematerialized in line with MCA regulations.

Compliance Check

Providing regular compliance audits to maintain adherence to MCA guidelines and prevent any penalties.