The Securities and Exchange Board of India (SEBI) has introduced a series of measures to help investors resolve such legacy cases. The latest steps include a special window for eligible physical shareholdings and a simplified framework for transmission of securities.
The issue dates back to the transition from physical share certificates to dematerialised holdings.
While SEBI’s move to phase out physical share transfers was aimed at modernising the securities market, many old holdings remained unresolved because of incomplete documentation, rejected transfer deeds, deceased shareholders and lack of awareness.
Why old share certificates can become difficult to claim
Physical share certificates were once a common way of holding investments. Many were bought decades ago and subsequently passed down within families.
The difficulty often begins when investors try to transfer these holdings after several years. Records may have to be matched with documents that are decades old. In some cases, the original shareholder may have died, leaving legal heirs to establish their claim.
K C Jacob, Partner at Economic Laws Practice, a full-service law firm in India, said the process can involve scrutiny of “decades-old records”, with issues including signature mismatches, missing transferors and incomplete registers. These cases can also carry higher fraud risks compared with routine transfers.
SEBI extends relief for eligible investors
SEBI’s January 2026 circular provides a special window from February 5, 2026, to February 4, 2027, for eligible legacy physical shareholding cases. The facility is restricted to bona fide and uncontested cases and does not cover disputed matters or shares already transferred to the Investor Education and Protection Fund.
The framework also includes safeguards such as compulsory dematerialisation, a one-year lock-in, indemnities and public notices. These measures are intended to help genuine investors regularise their holdings while limiting the possibility of misuse.
SEBI has separately approved a simplified and standardised framework for transmission of securities. It provides for faster processing of small-value claims, higher thresholds for simplified documentation and reduced procedural requirements, including relaxation of probate requirements in certain cases.
What investors with old shares should keep in mind
Investors or legal heirs holding old physical certificates should first establish the ownership trail and check whether the case falls within the eligible category under SEBI’s framework.
Documentation becomes particularly important when the registered shareholder has died. In such cases, succession-related requirements may need to be completed before the shares can be transmitted.
Jacob said SEBI’s approach has become more “facilitative” as regulators have recognised the practical difficulties involved in resolving genuine legacy holdings.
However, the window is not intended to remain open indefinitely. Keeping legacy cases unresolved for long periods can increase the risk of fraudulent claims, particularly when original holders are no longer alive and historical records become harder to verify.
For investors who have old physical share certificates, the current window therefore provides an opportunity to regularise eligible holdings. But given the documentation and verification involved, waiting until the deadline could make an already complicated process harder.
