Authored by Sethupathy Rathna Kumar
SEBI vide its circular dated 30 January 2026 (HO/38/13/11(2)2026-MIRSD-POD/I/3750/2026) (“Circular”) has now opened a special window for transfer and dematerialisation of physical securities sold or purchased prior to 1 April 2019, with a view to facilitating ease of doing investment and securing investor rights.
Special Window – Scope and Timelines
The special window will be open for a period of one year starting from 5 February 2026 to 4 February 2027 (“Special Window”). The Special Window can be availed for fresh transfer requests as well as transfer requests that were earlier rejected, returned or not attended to due to deficiencies in documentation.
Eligibility and Exclusions
The Special Window is limited to cases where the transfer deed was executed prior to 1 April 2019 and the original security certificate being available. Specifically, requests where the original certificate is unavailable are not eligible. Cases involving disputes between the transferor and transferee and situations where securities have already been transferred to the Investor Education and Protection Fund (IEPF) are expressly excluded from the scope of the Special Window.
Mandatory Dematerialisation and Lock-in
All securities transferred pursuant to the Special window will be mandatorily credited in dematerialised form and will be subject to a one-year lock-in from the date of registration of transfer. During the lock-in period, such securities cannot be transferred, pledged, or otherwise encumbered. In the event any fraud is detected during the lock-in period, the lock-in period maybe extended and release of such securities would be subject to orders of a competent court.
Documentation and Procedural Requirements
The transferee is required to submit the original security certificate, duly executed transfer deed, proof of purchase (as available), KYC documents, a recent Client Master List of the demat account and an undertaking-cum-indemnity in the format prescribed under the Circular.
Listed companies and RTAs are required to carry out mandatory identity and signature verification, issue newspaper advertisements (in specific cases involving non-cooperation or non-traceability of the transferor) and process transfer requests within 70 days.
Conclusion
The opening of this special window seeks to enable investors to regularise transfers of physical securities. By mandating dematerialisation and prescribing clear timelines and safeguards, SEBI has balanced investor convenience with market integrity. The measure is expected to provide long-pending relief to investors facing procedural hurdles.
