What Should You Do if Your Demat Request Form Gets Rejected

Online demat accounts were introduced in India in 1996. Before this most trading was paper-based. Investors bought shares and held them in physical form. This meant a number of issues such as loss of or damage to the physical certificate, a discrepancy in name or signature, and other paper-work related issues. The arrival of demat accounts eradicated such niggling issues. However many investors still hold their equities in physical form. This is especially true for investors who may have bought their shares in the pre-demat account era and may have forgotten to have them dematerialized or those investors who are not active participants in the stock markets. In case such investors want to sell their holdings today, they must first convert their stocks into demat or dematerialized form. This is done using a demat request form or DRF that needs to be submitted to your depository participant or DP. However, sometimes a Demat Request Form may get rejected. Read on to find out what needs to be done in such a case.

What is a Demat Request Form and What is the Submission Procedure?

A demat request form or DRF is a form that the holder of a security fills when they wish to convert their holding to dematerialized form. Dematerialization Is necessary if you wish to sell your equity. Once you fill out the DRF, it is to be submitted to your DP along with the physical certificates of ownership of the holdings. The DP verifies all the details filled in by you and forwards the Demat Request Form to the concerned company or its Registrar and Transfer (R&T) agent. A Registrar and Transfer agent is an official specifically appointed by a company to keep a track of all the shareowners and the transfer of shareholdings of the company. Once the Demat Request Form is received by the R&T agent of the issuer company, they again verify the form and forward it to the concerned depository, whether CDSL or the NSDL. Therefore in this entire chain, it is important to note that your DRF is scrutinized at two levels – first by the DP and second by the Registrar. Therefore it is likely that it may get rejected at either of these two levels. Below we look at the reasons for rejection at each level and what remedial action can you undertake in each case.

When the Dematerialization Request Form is rejected by the DP

The DP is the first level of verification for your DP. It may reject your DEMAT REQUEST FORM for the following reasons:

Demat Request Form Number not Unique for Each Certificate

For every physical certificate you possess, you need to fill out a fresh certificate and generate a new Demat Request Form number. In case your DP rejects your form for this reason, you can simply fill out a fresh form for each of your holdings.

Name Mismatch on Certificate and Demat Account

The name on your holding certificate must be the same as the name in your demat account with the DP. In this case, you have two options. You can either submit a legal affidavit rectifying the name issues, or you can simply open a new demat account that matches the name on your holding certificate.

Mismatch in Number of Shares

The number of shares mentioned in your Demat Request Form must be the same as the number mentioned on your holding certificate. In case there is a mismatch, the DP will reject your form. To rectify this, you can simply fill out the Demat Request Form again with the correct details.

Once your DP has verified your form, it will issue you a demat request number or DRN. This DRN is needed for all further communication in the matter and must be saved carefully.

When the Registrar Rejects the Demat Request Form

Once our DP has verified your DRF at its end, it sends the form to the Registrar and Transfer agent of the company whose stock you hold. The registrar then verifies the details on their end. The registrar may likely reject your form on the following counts:

Mismatch in the Number of Shares

In case the number of shares mentioned in the Demat Request Form is more than the number specified in the registrar’s records, your DRF is likely to be rejected. In such a case you will need to fill the DRF again and send it to the registrar.

Duplicate or Fake Certificates

This is a common problem with physical certificates as they are easy to forge or manipulate. In case the registrar rejects your form on account of duplicate or fake shares, you will need to contact the seller of the shares and resolve the issue of authenticity of shares with them.

Signature Mismatch

This is another common problem with physical certificates. In case the signature on the Dematerialization Request Form does not match with those in the registrar’s records, your DRF is likely to be rejected Signatures may change for a variety of reasons. The most common is age-related. As people age, it is common for their signatures to change. In case the difference in signatures is significant enough to cause concern, you can verify your signature in the presence of a magistrate and send the same to the registrar to authenticate your Demat Request Form.

ISIN Mismatch

ISIN or the International Securities Identification Number is a 12-digit code that uniquely identifies each security. Sometimes companies issue multiple ISINs for different kinds of stock such as fully-paid or partly-paid shares. In such a case it is common for a stock owner to mistakenly fill the wrong ISIN in the Demat Request Form. If this is the case, simply fill the form again with the correct ISIN.

Stop Order Issued on the Company’s Stocks

Sometimes a stop order may be issued on the sale of a company’s stock by SEBI or a court of law. In such a case the company’s shares cannot be sold until such issues are resolved.


Getting your physical shares dematerialized is a prerequisite to selling them. The process is fairly simple and involves filling up a Demat Request Form and submitting it to your DP, which after due verification further submits it to the issuer. The most common issues that arise in this process relate to errors while filling up the form or name or signature mismatch. Once these have been rectified, you may submit your form again.