Listen to this article
One of our readers wrote to us with this query:
My client has invested in an equity fund in 2003. The client has put his mother’s name as the second holder of the investment. There was no requirement of PAN at that time. Client’s mother does not have PAN but she has Aadhaar. Also, she is now 75 and could not obtain PAN as she is no longer in a situation to step out and apply for PAN. Now, the client wants to redeem his money. How can I help this client to get his money back?
Ritesh Sheth, Mumbai
Dear Ritesh,
Ever since AMFI made it compulsory for investors to update their PAN and PAN Exempt KYC Reference Number (PEKRN) in MF folios by March 31, 2023, many MFDs have been facing a lot of issues with folios having multiple investors due to host of practical problems.
In this case, if the value of the investment amount is less than Rs.50,000, your client will have to obtain Pan Exempted KYC Registration Number (PEKRN) before processing redemption request.
If the value of investment is over Rs.50,000, ideally, your client will have to get fresh PAN and complete the KYC to redeem money since the person is alive.
If this option is not feasible for your clients, you may request him to approach AMC to seek exemption. AMCs may review this situation and in exceptional cases, they may honour redemption if PAN of primary holder is available. However, the decision to honor redemption request rests with the fund house.
A senior official said that while the industry would freeze the non-complaint folios, the industry will review the situation where non-compliance is due to practical issues.
