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SEBI has issued a new circular in which it has issued a uniform set of norms for the issuers of REITs/InvITs to deal with unclaimed amounts.
Issuers of REITs/InvITs will have to distribute money within 15 days of declaring dividend (in the form of rent). Also, such a distribution has to happen at least once in every six months. However, at times, the issuers could not credit this money to unitholders’ account due to discrepancy in their bank account details.
SEBI has clarified that issuers of REITs/InvITs will have to make efforts to reach out to such investors and encourage them to update their details.
In the meantime, such an amount has to be transferred in an escrow account within 7 days of a failure report. Issuers will have to give annual interest rate of 12% on these unclaimed amounts.
Further, after seven years, these unclaimed will be transferred to the Investor Protection and Education Fund (IPEF).
SEBI clarified that unit holders can claim their money from issuers by submitting documents like proof of address, proof of identity, proof of holding and so on.
Issuers will have to prominently display details of unclaimed amount lying in escrow account and IPEF. They will have to display a guidance note on how unitholders can claim their unclaimed amount.
These provisions will come into effect from March 1, 2024.