Email Question: Unable to close Demat account because of locked in infrastructure bond

I’ve got a couple of emails about this subject, so I thought I’d share it here, and see if anyone has any fresh ideas.

These readers bought the 80CCF infrastructure bond in the Demat form, which has been now allotted to them, and credited to their Demat account.

Now, these readers want to close their Demat account, and open one some place else, but they are being told that since the bonds are currently locked – in (these bonds have a lock in period of 5 years) they can’t transfer the bonds to another Demat account.

One way to deal with this situation is to rematerialize the bonds, and get the company to issue a physical certificate to them.

This can be done after the bond has been allotted, and you don’t have to wait for the lock – in period to expire to do this. After the bond has been rematerialized you can close the Demat account, and open a new one.

Does anyone have any other ideas on this, or any experience with the process of rematerialization?

41 thoughts on “Email Question: Unable to close Demat account because of locked in infrastructure bond”

  1. Hello
    I want to close my demat account but the problem is – in my account there are stocks in which trading is suspended. So am unable to sell the stocks and without getting rid of all the stocks, account closing is not possible. Please advise

  2. Hello,

    I want to close my demat account but the problem is I have couple of penny stocks in which trading is suspended. Hence am unable to sell the stocks; and without selling or getting rid of stocks my account is not getting closed.

    Please advise.

  3. Hi

    Me too stuck with HDFC since I cannot transfer my gold bonds. Just want to get rid of HDFC as they are too costly and I have paid over 18000rs just as brokerage the previous year.

    Luckily I now have my account with which is the cheapest and best brokerages out there.


  5. Also guys , I have the opposite problem , I want to Demat my IFCI infra bonds . This is because once STT is paid , one can avail benefits of Long term Capital Gains with Indexation benefits ( Indexation is not available if it is held in Physical form)

    Are you guys aware whether the Physical Infra Bonds (IFCI) can be converted to Demat

  6. Guys , there is an option where if your holding in a demat account is less than 50,000 , the Annual Maintenance Charge will be Zero , Please use this option instead of going through the hassle of rematerializing if you have no interest in trading etc as many responses suggest. I did the same in my demat account and it is a Govt rule recently introduced

    We refer to the Basic Services Demat Account (BSDA) facility applied by you and would like to inform you that as per your application, your Demat Account has been converted to BSDA scheme.

    Incase, the holding in your Demat account is up to Rs. 50,000, you will not be charged any Annual Maintenance Charge (AMC). If your holding is from Rs. 50,001 to Rs. 2 lac, you will be charged Rs. 100 as AMC.

    However, please note that as and when the value of holding increases above Rs. 2 lac, you will be charged AMC as per a regular account.

  7. hey friends,

    You don’t need to rematerialize the Lock in Securities like Bonds to close your current demat account. Simply go to your DP and request them to close your demat and transfer to your another new DP account. All your existing securities will get transfer including your lock in securities like Infrastructure Bonds. Transfer Charges are Nil if your completely close DP account and transfer your all securities to new one. Only the thing is you have to fill up the form for the same mentioning your new DP details.
    For transferring Lock in securities DP has to process your request to RTA of that particular Lock in securities and relevant Authorities (CDSL, NSDL etc.) and it will automatically transfer it after required procedure.
    This required some more days than all other un-locked securities.
    See SEBI Master Circular April 7, 2014 on sebi website.

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