Supergrowth would like to explain the above subject with the help of an example.
Mr.Ram hasn't claimed the dividend for Financial Year 2010-2011, however, he claimed dividend for Financial Year 2011-2012. In this case, the dividend that remains unpaid for FY 2010-2011shall be transferred to IEPF on expiry of seven years, i.e. FY 2017-2018. However, the underlying shares can't be transferred in FY 2017-2018 since Mr. Ram has claimed the dividend on such shares for FY 2011-2012. The shares will only be transferred in case there is a failure of consecutive seven years in payment of dividend.
In this case, the underlying shares will only gett transferred to IEPF in the Financial Year 2019-2020 provided Mr. Ram hasn't encashed any dividend on such shares from FY 2012-2013 and onwards consecutively for 7 years.
Therefore, the word 'Consecutive'mentioned under section 124 (6) is only relevant for the transfer of shares.
Supergrowth compliance team came across till now lots of companies like Everest Kanto Limited, Panacea Biotech Limited, IG Petro Limited, DCM Limited Limited, Archies Limited, Wockhardt Limited, Garware Marine Industries Limited, TVS Electronics Limited, etc. have made such mistakes. These mistakes not only increase the workload for company secretaries themselves but will be a big hassle for the shareholders whose shares transferred to IEPF.
The IEPF which is overburdened by lots of request of reclaiming of shares and dividend now that will add to its workload because of not clarity of the law. The IEPF should trace those companies, which were not supposed to transfer the share but have done and return those shares to the companies and let the shareholder claim the shares from the company itself. What do you say? ..........................