The Hindu Business Line : 20 lakh demat accounts frozen

Depositories National Securities Depository Ltd and Central Depository Services Ltd have frozen about 20 lakh demat accounts following the failure of the account holders to submit PAN card details before December 31 deadline.

Demat accounts of investors who failed to furnish their PAN card details were frozen at midnight on Dec 31, said officials from depositories.

The Securities and Exchange Board of India had made it mandatory for all investors to provide PAN card details for transactions in the cash market from January 1, 2007.

Both the leading depositories closed around a quarter of demat accounts registered with them.

"Out of the 21.6 lakh demat accounts, we have frozen approximately 6.1 lakh accounts," said a senior official at CDSL. NSDL has frozen 18 lakh accounts, which had some balance or holding, said an official with NSDL. He added that this number did not consist of accounts, which had zero holding and the number will be provided shortly.

Broking houses providing depository services confirmed the closure of such accounts and said that around half of the demat account holders had failed to give these details.

However, the freezing of accounts is not an irredeemable event, said a CDSL official. "The accounts can be re-started once the details are provided and verified," he added.

Depository officials stressed on the need to provide the information at least a day before they commence transactions to help the execution of the process.

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