Demat account 1

In partial fulfillment of the
Requirements for the award of
Degree of B.com
Submitted to:-DEPARTMENT of
management. Lala Laj Pat Rai
Insitute of Engineering and
Techonology
DEMAT ACCOUNT
2016

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DEMATERIALISATION ACCOUNT
SUBMITTED BY : Simranjeet singh
CLASS : B.COM (pro) 4th
sem
ROLL NO : 1415776
AREA OF RESEARCH : FINANCE
Under the guidance of: Mr. GOPAL PANDEY (FINANCE Executive)
Mr. Kaushal (Chartered Accountant)
Ms. Navneet Kaur

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SUBMITTED TO:-Departmentof b.com
LALA LAJPAT RAI INTIUTE OF ENGINEERING AND
TECHNOLOGY MOGA

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DECLARATION
I SIMRANJEET SINGH declare that I myself worked on the topic
DEMATERIALISATION ACCOUNT under ThinkNEXT
Technologies Pvt. Ltd. Mohali. The data and the information is
collected by myself and no third party has helped me in doing so. I
myself have conducted all the surveys and research analysis.
Signature of the Student:SIMRANJEET SINGH
Place: Mohali
Date:

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CERTIFICATE TO WHOM IT MAY CONCERN
This is to certify that the project titled ‘DEMATERIALISATION
ACCOUNT’is the original work carried out by the me submitted to Guru
Nanak Dev University Regional Campus Sathiala under the supervision of Mr
GOPAL PANDEY submitted in partial fulfilment for the award of Master’s
degree in Commerce ( B.COM ).PROF
This project was completed within the stipulated time period as per the statues
of the university.
It is further certified that this work has not been submitted earlier in this
university or any other university for any degree/diploma.
H.O.D Guide
_______________ __________________

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Place: Mohali
Date:
ACKNOWLEDGEMENT
First of all I would like to express my gratitude to almighty God, who bestowed
his blessing on me and gave me courage and right type of environment for
completion of my project.
It gives me a great pleasure to submit this project to Guru Nanak Dev
University Regional Campus Sathiala. I take this opportunity with great
pleasure to present before this project on “DEMATERIALISATION
ACCOUNT” which is result of co-operation, hard work & good wishes of many
people. The most pleasant part of any project is to express the gratitude towards
all those who have contributed to the success of my project.
I am deeply indebted to my supervisor/project guide Mr.GOPAL
PANDEY(FINANCEExecutive ofThinkNEXT TechnologiesPvt. Ltd.
Mohali)having permitted me to carry out this project work. I wish to express
my deep sense of gratitude to herfor her guidance and useful suggestions, which
helped me all the time in completing the project work in time.
I would like to thanks Mr. Kaushal (Chartered Accountant)who has been my
mentor for this project. It was only through her excellence assistance & good
suggestions that I have been able to complete this project.

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I would also like to thank my college project guide MR. GOPAL PANDEY
for his valuable guidance and support words are inadequate in offering my
thanks to all the members of ThinkNEXT Technologies Pvt. Ltd., Mohali for
their encouragement and cooperation in carrying out the project work.
SIMRNJEET SINGH
LIST OF CONTENTS
CHAPTERS TOPICS PAGE NO.
CHAPTER 01 INTRODUCTION
1.1 Introduction about it industry
1.2 Company profile
1.2.1 Services
1.2.2 Vision
1.2.3 Mission:
1.2.4 Quality Policy
1.3 Management of ThinkNEXT
1.4 Some of our clients:
1.5 Placements
1.6 Programs offered
1.7 ThinkNEXT Edge
1.8 ThinkNEXT Cloud Campus Advantages
CHAPTER 02 INTRODUCTION TO PROJECT
2.1 INTRODUCTION TO DEMAT ACCOUNT

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2.2 DEFINITION OF DEMAT ACCOUNT
2.3 EXAMPLE OF DEMAT ACCOUNT
CHAPTER 03 GOALS OF DEMAT ACCOUMT
CHAPTER 04 HOW TO OPEN DEMAT ACCOUNT
4.1 LIST OF PROOFS
4.2 IDENTITY BPROOF
4.3 ADDRESS PROOF
CHAPTER 05 BENEFITS OF DEMAT ACCOUNT
5.1 TO COMPANY
5.2 TO INVESTOR
5.3 TO BROKER
CHAPTER 06 CONCEPT INVOLVED IN DEMAT ACCOUNT
6.1 DEPOSITARY PARTICIPANT
6.2 DEMAT CONVERSION
6.3 DEMAT OPTIONS
CHAPTER 07 FEES CRITERIA
7.1OPENING FEES
7.2 ACCOUNT FEES
CHAPTER 08 ADVANTAGES OF DEMAT ACCOUNT
CHAPTER 09 DISADVANTAGES OF DEMAT ACCOUNT
CHAPTER 10 BIBLIOGRAPHY

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CHAPTER-1
Introduction

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1.1 INTRODUCTION ABOUT IT INDUSTRY
Information Technology covers a broad spectrum of hardware and software solutions that
enable organizations to gather, organize, and analyze data that helps them achieve their
goals. It also details technology-based workflow processes that expand the capacity of an
organization to deliver services that generate revenue. The four main focuses of IT
personnel are business computer network and database management, information security,
business software development, and computer tech support.
As the IT industry evolves to meet the technology demands of today’s workplace, different
challenges are arising and IT professionals are striving to meet them. Network security is
by far the greatest concern for many companies and they rely on their IT staff to prevent or
stop these system breaches. Data overload is becoming an increasingly important issue
since many businesses are processing large amounts of data on a daily basis, with many of
them not have the processing power to do so. Last, but not least, two of the most essential
skills needed from IT professionals are teamwork and communication skills. Systems are
complex and people are needed to help translate that task. Therefore, IT professionals are
the ones responsible for helping others get their work done efficiently without the complex
jargon of the technology world.
Let’s talk about careers for a moment. Employment for information technology and
related services are projected to grow rapidly over the next decade, outpacing similar
professional, scientific, and technical industries, as well as the economy as a whole.
According to the Bureau of Labor Statistics (BLS), “output in computer systems design
and related services is expected to grow at an average annual rate of 6.1 percent [between
2010 and 2020], compared with 3.6 percent for the broad industry category—professional,
scientific, and technical services—and 2.9 percent for all industries.” Compared to 2.6
percent for professional, scientific, and technical services and 1.3 percent for all other
industries, that’s a huge demand coming up! Why is this happenings
Because the necessity for information technology is king. With the emerging popularity of
the Cloud technology, many organizations are taking this up as an alternative to actual
hardware using up space. Cloud computing service providers manage IT infrastructure and
platforms, and provide businesses with access to remote data storage and software
packages.
Another reason for the rise of IT careers is the need to defend our information systems
from countless attacks. Just in the past few years alone, the BLS reports “there is a 17-fold
increase in the number of cyber-attacks on U.S. infrastructure between 2009 and
2011.”Security companies also have produced reports that show large increases in security
breaches on private businesses in those years as well.
With the increasing need for IT professionals, this seems to be one of the more stable
careers for the next decade. One of the first steps to becoming an IT professional is to
obtain a degree or certification in computer or management information systems. Then you
must decide which field to go into, as there are many in the IT universe.
Here are some of the most popular positions for people interested in Information
Technology:

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1. Computer Systems Analyst.
In this position, analysts design and develop computer systems and are an expert at every
facet of hardware, software, and networks. Analysts also evaluate the systems and research
the industry for better products to enhance their existing system.
2. Cloud Specialist.
Cloud specialists organize and give configuration to the information infrastructure in the
sky. Because this is still an emerging technology, these architects are highly sought after
and one of the top-paying professions in the industry.
3. Computer Forensic Investigator.
These investigators are computer crime detectives that search for, identify, and evaluate
information from computer systems.
4. Health IT Specialist.
Health IT is booming, especially with Affordable Care Act coming on and transition from
paper to electronic health records. Health IT specialists will mix computer knowledge will
record-keeping skills, medical coding, and billing.
5. Database Administrator.
Database administrators create, upgrade, and test for databases.
6. Web Developer.
Web developers are in high demand because they have a great understanding of what
makes a good operating system. They create web pages, web applications and web content
with their knowledge of what the average surfer finds visually stimulating and how to
optimize sites for mobile tech, among numerous other skills.
7. IT Manager.
These managers are the contact pros when your email won’t send or Microsoft Word
doesn’t open. As the head of the IT department, they ensure that a company’s network is
operating smoothly and that dangerous threats like malware are minimized.
8. Information Technology Vendor Manager.
Slightly more hands-off compared to some tech positions, vendor managers oversee supply
when it comes to software and hardware. This can mean anything from Microsoft’s latest
word processor to health IT programs for hospitals.
9. Computer Systems Administrator.
The expertise of network and computer systems administrators is essential to every office.
Aside from maintaining a healthy computer network, they also lend their tech knowledge
to managing telecommunication networks. This profession is expected to add 96,600 new
positions by 2020!
10. Mobile Application Developer.
Because of our highly-mobile lifestyle, mobile application developers are and will be in
high demand for years to come, especially as mobile devices and technology becomes
increasingly sophisticated.

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1.2 COMPANY PROFILE
ThinkNEXT Technologies Private Limited (Formerly Brilliant Software Solutions) is an ISO
9001:2008 certified software development company founded in August 2009 and it is
approved from Ministry of Corporate Affairs which deals in University/College/School ERP
Solutions, Android /iPhone Applications development, Web designing, Web development,
Discount Deals (www.thinknextcard.com, www.tricitydeal.com), Bulk SMS, Voice SMS,
Bulk Email, Biometric Time Attendance, Access Control, SEO/SMO, Database Solutions,
Payment Gateway Integration, E-Mail Integration, Industrial Training, Corporate Training
and Placements etc. ThinkNEXT Technologies provides software solutions using latest
technologies e.g. Smart Card, NFC, Biometrics, GPS, Barcode, RFID, SMS, Auto SMS
(Short code), Android, iPhone, Web, Windows and Mobile based technologies
ThinkNEXT has wide expertise in .NET, Crystal Reports, Java, PHP, Android, iPhone,
Databases (Oracle and SQL Server), Web Designing, Networking, Web Server
configurations, various RAID Levels etc.
ThinkNEXT Technologies has also setup its offices in USA, Delhi, Shimla and Bathinda for
its software support. ThinkNEXT has its own multiple Smart Card printing, encoding and
barcode label printing machines to provide better and effective customer support solutions.
ThinkNEXT has also setup its own placement consultancy and is having numerous placement
partner companies to provide best possible placements in IT industry.
ThinkNEXT Technologies has developed for the first time in northern region cloud
computing based Cloud Campus 4.0 to facilitate knowledge and placement centric services. It
is a unique concept for effective and collaborative learning.
1. ThinkNEXT deals exclusively in campus automation through Smart Campus ERP
Solutions. Therefore we have better experience in handling large group of institutions
through proper time-tested policies and procedures.
2. First Company of India who has Launched NFC Technology (The Future) for Smart
Campuses through NFC Smart Cards.
3. First Company of India who has launched Android Version of Smart Campus ERP
Solutions for Mobiles and Tablet PCs.
4. First company of India who has developed SMS Opt-In Technology so that
Institutes/Colleges can send Transactional SMS with SMS Sender ID and without
SMS Template approval.
5. First company of Punjab, Haryana, Himachal, J&K (Northern region) who launched
Smart Cards (Contact Type), Smart Cards (Contactless) in Punjab for campus
automation.

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6. First company of India which has launched its ThinkNEXT Smart Card as Discount
Card in more than 120 enterprises.
7. Established own multiple Smart Card Designing, Smart Card Printing, Smart Card
Lamination and Oyster Barcode Printing Units.
8. Multiple SMS Gateway Support.
1.3 SERVICES:
We provide Software Solutions using latest technologies or features:
 NFC
 Biometrics (Fingerprint with Automated Online)
 Smart Card
 Barcode
 RFID
 SMS
 Short code 56767 (Auto SMS)
 Android
 ions (phone)
 GPS
 WAP (For WAP Enabled Mobile Phones)
 Multiple SMS Gateway Support
 Web based Technologies (365x24x7 services)
 Windows based Technologies
 Mobile based Technologies
 Webcam support for various operations
 Parallel Internet, Intranet and Wi-Fi Support
1.4 Vision:
ThinkNEXT Technologies Pvt. Ltd. are already very flexible and scalable. Still, we
always take care of specific requirements of our clients. Our highly committed R&D
team makes our software feature rich, dynamic and future tuned everyday so that our
clients always maintain the lead over their competitors. The development of the
software is being done and the purpose full customization of the package is carried
out in the ThinkNEXT lab.
1.5 Mission:
ThinkNEXT is pioneer in Smart Campus ERP Solutions for
Universities/Colleges/Schools using latest technologies and features. We provide
software solutions using .NET, PHP, Android, iphone, Java technologies with three
tier-architecture support. We provide back-end solutions using MS SQL Server,
Oracle, and MySQL.

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1.6 Quality Policy:
We have wide experience working with eminent Educationists, Managements,
Directors, Principals, Head of Departments, other Staff Members, Parents and
students. Therefore we do not sell only software Modules but an innovative system
which has more importance than just ERP software modules. Today Smart Campus
solutions are a need of hour for every University/Group of Colleges or an Institution
to make edge over others and maintain a lead over their competitors. Our Research
and Development team is committed to make your institute(s) to maintain lead over
their competitors.
More Services:
 ThinkNEXT offers various industry-ready programs so that student needs not
to struggle for jobs. ThinkNEXT offers 6 weeks/2 Months/6 Months training
programs to make students industry.
 ThinkNEXT is pioneer in providing best placements in Industry. We offer
minimum five job interviews for each student and provide 100% Placement
Assistance.
 ThinkNEXT Offers Life-Time Validity Learning and Placement Card.
Students undergoing six months training will have advantage to learn free of
cost anything against that training program for life-time.
 ThinkNEXT offers Part-Time/Full Time Job Offer for each student during
training so that students can earn while they learn. Student can bear their food,
accommodation and other expenses on.

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1.7 MANAGEMENT OF THINKNEXT TECHNOLOGIES PVT.LTD.
BOARD OF DIRECTOR
 Sunil Jindal
 Munish Mittal
 GhanshamDas
MANAGING DIRECTOR
 Sunil Jindal
MARKETING OFFICER
 Deepak kumar
IT HEAD
 Mukesh Kumar

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1.8 SOME OF OUR CLIENTS:

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1.9 PLACEMENTS
Company List





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1.10 PROGRAMS OFFERED BY THINKNEXT TECHNOLOGIES
PVT.LTD.
COMPUTER /IT
 .NET
 JAVA
 Android
 iPhone
 PHP / MySQL
 Web Designing
 Software Quality Testing
 Hardware & Networking
 CCNA
 MCITP
 SEO, SMO & Bidding
 C/C++
 Online Bidding (Freelancing)
 Oracle / SQL Server
 Animation & Multimedia
 SAP
 Cloud Computing
2. Electronics/ communication
 Embedded System + Industrial Automation + Industry Training
 Embedded System & Robotics + Industry Training
 Android + Industry Training
 Networking + Telecom + Industry Training
 CCNA + Industry Training
 MCITP + Industry Training
 Advance Industrial Automation + Industry Training
 Advance Embedded System + Industry Training
3. MANAGEMENT
 Industry Training in Finance
 Industry Training in Marketing
 Industry Training in HR
4. CIVILENGENEERING
 Instrumentation Design Training + Industry Training
 Industrial Automation Training + Industry Training
5. CHEMICAL ENGENEERING
 Chemical Process Design + Industry Training

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 Piping Design + Industry Train
6 CIVIL ENGENEERING
 Civil Structural Design Training + Industry Training
 STAADPro + Industry Training
 AutoCad 2D/Isometric/3D + Industry Training
 Autodesk Revit + Industry Training
 Primavera + Industry Training 3Ds MAX + Industry Training
1.11ThinkNEXT Edge
 Industrial Training and Certificates from Software/Electronics Company not just from an
institute
 Free Interview Preparation, Spoken English and Personality Development Programmers.
 Opportunity to get placed in ThinkNEXT and numerous other companies.
 Life-Time Validity Learning and Placement Card.
 Part-Time/Full-Time Job Offer for each student during Training.
 ThinkNEXT Cloud Campus advantage not only during training, even after completion of
training for life time.
 One-to-one PC and Corporate Environment.
 Learn from Developers/Industry experts rather than Trainers/Teachers.
 Direct interaction with Developers/Industry Experts.
 Industrial training programmers are designed to make students industry-ready.
 Large Display LEDs in each Class-Room/Lab, Wi-Fi Labs.
 Guest Lectures/Seminars by Industry Experts.
 Every Student is provided with “Live Projects” mentored by Software/
Electronics/Industry Experts.
 100% Placement assistance.
1. 12 ThinkNEXT Cloud Campus Advantages
 Each Student will have Unique User ID and Password to Login to ThinkNEXT Cloud
Campus 4.0 anytime…anywhere…
 View Numerous Technical, Personality Development Videos anytime…anywhere…
 Students will be able to download e-Books, e-Journals, Class Notes, Important Links and
other study material.
 ThinkNEXT Smart Campus is a step towards not only 100% placements but also better
job offers even after placements.
 Student Profile, Instant Technical Updates, Class Notes, Project Report Submitted,
Attendance, Performance, Notice-Board, Class Timings etc. Everything online.
 Communication with industry experts, Technologists through cloud Campus
anytime…anywhere….
 Regular SMSes and E-mail for Related Job Offers.
 Access through PCs, Laptops, Tablet PCs, Mobiles via internet.

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CHAPTER-2
INTRODUCTION OF DEMAT ACCOUNT
In India, shares and securities are held electronically in a dematerialized ( Demat account)
instead of the investor taking physical possession of certificates. A Dematerialized account is
opened by the investor while registering with an investment broker (or sub-broker). The
Dematerialized account number is quoted for all transactions to enable electronic settlements
of trades to take place. Every shareholder will have a Dematerialized account for the purpose
of transacting shares.
Access to the Dematerialized account requires an internet password and a transaction
password. Transfers or purchases of securities can then be initiated. Purchases and sales of
securities on the Dematerialized account are automatically made once transactions are
confirmed and completed.

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DEFINITION OF DEMAT ACCOUNT
DEMAT Account Meaning:
In India's banking terminology, the term DEMAT Accountrefers to a deposit
made at an Indian financialinstitution that can be used for investing in shares
of stocks and other financial assets. Securities are held electronically in a
DEMAT Account, thereby eliminating the need for physicalpaper certificates.

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DEMATACCOUNTEXAMPLE:
For example, a DEMAT Account became available after India adopted the
DEMAT systemfor the electronic storing of stock shares and other securities in
1996. DEMATis shortfor "Dematerialized" and such accounts requirethat an
investor open an account with an investmentbroker linked to a savings or
other funded account. Access to a DEMAT Accountrequires both an Internet
and transaction password, and such accounts allow for the transfer of
securities without any physicalcertificates changing hands. This feature helps
prevent problems such as:loss, forgery or theftof the certificates and makes
the process of buying and selling securities much more efficient.

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CHAPTER 3
GOALS OF DEMAT ACCOUNT
India adopted the Demat System for electronic storing, wherein shares and securities are
represented and maintained electronically, thus eliminating the troubles associated with paper
shares. After the introduction of the depository system by the Depository Act of 1996, the
process for sales, purchases and transfers of shares became significantly easier and most of
the risks associated with paper certificates were mitigated.
In 1996, trading began on NSE for shares held in demat account form. It was the beginning of
a new paperless trading stock market trading environment. If an investor buys a share today,
it gets credited to the investor's account in two days. Today, shares get transferred to the
investor's demat account.[1]

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CHAPTER-4
HOW TO OPEN DEMAT ACCOUNT
 Thenfill upan account openingformandsubmitalongwithcopiesof the required
documentsanda passport-sizedphotograph.Youalsoneedtohave a PAN card. Alsocarry
the original documentsforverification.
 You will be providedwithacopyof the rulesand regulations,the termsof the agreement
and the chargesthat you will incur.
 Duringthe process,an In-PersonVerificationwouldbe carriedout.A memberof the DP’s
staff wouldcontactyou to checkthe detailsprovidedinthe accountopeningform.
 Once the applicationisprocessed,the DPwill provide youwithanaccountnumberor client
ID. You can use the detailstoaccessyour demataccount online.
 As a demataccount holder,youwouldneedtopaysome feeslikethe annual maintenance
fee levied formaintenanceof accountandthe transactionfee -- leviedfordebitingsecurities
to and fromthe account on a monthlybasis.These feesdifferfromeveryservice provider
(calledaDepositoryParticipantorDP).While some DPscharge a flatfee pertransaction,
otherspegthe fee to the transactionvalue,andare subjectto a minimumamount.The fee
alsodiffersbasedonthe kindof transaction(buyingorselling).Inadditiontothe otherfees,
the DP alsocharges a fee forconvertingthe sharesfromthe physical tothe electronicform
or vice-versa.
 Minimumshares:A demataccount can be openedwithnobalance of shares.Italsodoes
not require thata minimumbalance be maintained.

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WHAT ARE THE DOCUMENTS REQUIRED FOR A DEMAT ACCOUNT?
You need to submit proof of identity and address along with a passport size photograph and
the account opening form. Only photocopies of the documents are required for submission,
but originals are also required for verification.
Here is a broad listof documents thatcanbe used as proofs:
You need to submit proof of identity and address along with a passport size photograph and
the account opening form. Only photocopies of the documents are required for submission,
but originals are also required for verification.
Proof of identity: PAN card, voter's ID, passport, driver's license, bank attestation, IT
returns, electricity bill, telephone bill, ID cards with applicant's photo issued by the central or
state government and its departments, statutory or regulatory authorities, public sector
undertakings (PSUs), scheduled commercial banks, public financial institutions, colleges
affiliated to universities, or professional bodies such as ICAI, ICWAI, ICSI, bar council etc.
Proof of address: Ration card, passport, voter ID card, driving license, bank passbook or
bank statement, verified copies of electricity bills, residence telephone bills, leave and license
agreement or agreement for sale, self-declaration by High Court or Supreme Court judges,
identity card or a document with address issued by the central or state government and its
departments, statutory or regulatory authorities, public sector undertakings (PSUs), scheduled
commercial banks, public financial institutions, colleges affiliated to universities and
professional bodies such as ICAI, ICWAI, Bar Council etc.
This is easy. All you need to do is fill in the Demat Request Form (DRM), fill inappropriate
details of the share certificates you hold, and submit it with the physical share receipt. Every
share certificate needs a separate DRM form. Once the form is approved, your demat account
will automatically be updated to reflect your newly dematerialized shares.

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CHAPTER-5
BENEFITS OF DEMAT ACCOUNT
Demat benefits
Demat account for shares and securities with Business purpose
The benefits of demat are enumerated[by whom?] as follows:
 Easy and convenientwaytoholdsecurities
 Immediate transferof securities
 No stampdutyon transferof securities
 Saferthan paper-shares(earlierrisksassociatedwithphysical certificatessuchasbad
delivery,fake securities,delays,theftsetc.are mostlyeliminated)
 Reducedpaperworkfortransferof securities
 Reducedtransactioncost
 No "oddlot"problem:evenone share canbe sold
 Change inaddressrecordedwitha DepositoryparticipantDP getsregisteredwithall
companiesinwhichinvestorholdssecuritieseliminatingthe needtocorrespondwitheachof
themseparately.
 Transmissionof securitiesisdone by DP,eliminatingthe needfornotifyingcompanies.
 Automaticcreditintodemataccountfor sharesarisingoutof bonus/split,
consolidation/merger,etc.
 A single demataccountcan holdinvestmentsinboth equity anddebtinstruments.
 Traderscan workfromanywhere (e.g.evenfromhome).
 Traderscan workfromanywhere (e.g.evenfromhome).

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Benefittothe company
The depository system helps in reducing the cost of new issues due to lower printing and
distribution costs. It increases the efficiency of the registrars and transfer agents and the
secretarial department of a company. It provides better facilities for communication and
timely service to shareholders and investors.
Benefittothe investor
The depository system reduces risks involved in holding physical certificates, e.g., loss, theft,
mutilation, forgery, etc. It ensures transfer settlements and reduces delay in registration of
shares. It ensures faster communication to investors. It helps avoid bad delivery problems due
to signature differences, etc. It ensures faster payment on sale of shares. No stamp duty is
paid on transfer of shares. It provides more acceptability and liquidity of securities.
Benefitstobrokers
It reduces risks of delayed settlement. It ensures greater profit due to increase in volume of
trading. It eliminates chances of forgery or bad delivery. It increases overall trading and
profitability. It increases confidence in their investors.

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CHAPTER 6
CONCEPTS INVOLVED IN DEMAT ACCOUNT
DEPOSITARYPARTICIPANT
DEMAT CONVERSION
DEMAT OPTIONS

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Depository Participant (DP)
A depository (in simple terms) is an institution holding a pool of pre-verified shares held in
electronic mode that offers efficient settlement of transactions. A Depository Participant (DP)
is an intermediary between the investor and the depository. A DP is typically a financial
organization like a bank, broker, financial institution, or custodian acting as an agent of the
depository to make its services available to the investors. Each DP is assigned a unique
identification number known as DP-ID. As of March 2006, there were a total of 538 DPs
registered with SEBI.
Demat conversion
Converting physical records of investments into electronic records is called "dematerialising"
of securities. In order to dematerialise physical securities, investors must fill in a Demat
Request Form (DRF), which is available with the DP and submit the same along with
physical certificates. Every security has an ISIN (International Securities Identification
Number). A separate DRF must be filled for each ISIN.
The complete process of dematerialisation is outlined below:
 The investorsurrendersthe certificatesfordematerialisationtothe DP.
 DP updatesthe accountof the investor.
Demat options
There are many hundreds of Depository Participants (DPs) offering the Demat account
facility in India as of September 2011. A comparison of the fees charged by different DPs is
detailed below.
There are a few distinct advantages of having a bank as a DP. Having a Demat account with a
bank DP, usually provides quick processing, accessibility, convenience, and online
transaction capability to the investor. Generally, banks credit the Demat account with shares
in case of purchase, or credit a savings account with the proceeds of a sale, on the third day.
Banks are also advantageous because of the number of branches they have. Some banks give
the option of opening a demat account in any branch, while others restrict themselves to a
select set of branches. Some private banks also provide online access to the demat account.
Hence, the investors can conveniently check online details of their holdings, transactions and
status of requests through their bank's net-banking facility. A broker who acts as a DP may
not be able to provide these services.

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CHAPTER 7
FEES CRITERIA
There are four major charges usually levied on a demat account: account opening fee, annual
maintenance fee, custodian fee and transaction fee. Charges for all fees vary from DP to DP.
Account-opening fee
Depending on the DP, there may or may not be an opening account fee. Private banks, such
as HDFC Bank[2] and AXIS Bank,ICICI Bank, do not have one. However, players such as
Kotak Securities,[3] Sushil Finance, Globe Capital, Karvy Consultants and Bajaj Capital
Limited do impose an opening fee. But in Ventura Securities ltd, Angel Broking[4] and some
other companies do not have an any opening charge.State Bank of India does not charge any
account opening charge while other maintenance and transaction charges apply. Most players
levy this when re-opening a demat account. However, the Stock Holding Corporation offers a
lifetime account opening fee, which allows the investor to hold on to his/her demat account
for a long period. The fee is also refundable.
Annual maintenance fee
This is also known as folio maintenance charges, and is generally levied in advance. It is
charged on annual or monthly basis.
Transaction fee
The transaction fee is charged for crediting/debiting securities to and from the account on a
monthly basis. While some DPs, such as SBI, charge a flat fee per transaction, HDFC Bank
and ICICI Bank pay the fee to the transaction value, which is subject to a minimum amount.
The fee also differs based on the kind of transaction (buying or selling). Some DPs charge
only for debiting the securities, while others charge for both. Some DP's also charge the
investor even if the instruction to buy/sell fails or is rejected. In addition, service tax is also
charged by the DPs
In addition to the other fees, the DP also charges a fee for converting the shares from the
physical to the electronic form or vice versa. This fee varies for both demat (physical-to-
electronic) and remat (electronic-to-physical) requests. For demat transactions, some DPs
charge a flat fee per request in addition to the variable fee per certificate, while others charge
only the variable fee.
For instance, Stock Holding Corporation has charged Rs 25 as the request fee and Rs 3 per
certificate as the variable fee. However, SBI has charged only the variable fee, as Rs 3 per
certificate. Remat requests also have charges akin to that of demat. However, variable
charges for remat are generally higher than demat.
Some of the additional features (usually offered by banks) are as follows. Some DPs offer a
frequent-trader account, where they charge frequent traders at lower rates than the standard
charges. Demat account holders are generally required to pay the DP an advance fee for each

P a g e | 32
account that will be adjusted against the various service charges. The account holder needs to
raise the balance when it falls below a certain amount prescribed by the DP. However, if the
holders also hold a savings account with the DP, they can provide a debit authorisation to the
DP for paying this charge. Finally, once choosing a DP, it would be prudent to keep all
accounts with that DP, so that tracking of capital gains liability is easier. This is because
when calculating capital gains tax, the period of holding will be determined by the DP, and
different DPs follow different methods. For instance, ICICI Bank uses the first in first out
(FIFO) method to compute the period of holding. The proof of the cost of acquisition will be
the contract note. The computation of capital gains is done account-wise.
Indian Banking System First, an investor has to approach a DP and fill up an account
opening form. The account opening form must be supported by copies of any one of the
approved documents to serve as proof of identity (POI) and proof of address (POA) as
specified by SEBI. An investor must have his/her PAN card in original at the time of opening
of the account (mandate effective from April 1, 2006).
All applicants should carry original documents for verification by an authorized official of
the depository participant, under his signature. Further, the investor has to sign an agreement
with the DP in a depository prescribed standard format, which details rights and duties of
investor and DP. DP should provide the investor with a copy of the agreement and schedule
of charges for their future reference. The DP will open the account in the system and give an
account number, which is also called BOID (Beneficiary Owner Identification number). The
DP may revise the charges by giving 30 days notice in advance. SEBI has rationalised the
cost structure for dematerialisation by removing account-opening charges, transaction
charges for credit of securities, and custody charges vide circular dated January 28, 2005.
Documents Required For Demat Account[5]
To open a Demat account you have to provide documents which fulfill the requirements of
KYC (Know Your Customer) norms. You have to sign a contract with Stock broker.
Generally the documents are:
 PAN (Compulsory)
 Bank statement(last3months)
 AddressProof
 Income Tax Return
 Two colourphotos
 Bank crossedCheque (If required)
 KYC details

P a g e | 33
Transfer of Shares between (depository participant)
DPs
To transfer shares, an investor has to fill one of two kinds of Depository Instruction Slip
(DIS). The first check made is whether both Demat accounts are at the same depository.
There are two depositories: (CDSL (Central Depository Service (India) Limited) and NSDL
(National Securities Depository Limited)). If both demat accounts are not at the same
depository, then an Inter Depository Slip (Inter DIS) has to be filled and submitted. For
example:
 If there is one Demataccount withCDSL andthe otherDemataccount withNSDL,thenan
Inter-DISisneeded.(Incase the investorneedsanInter-DIS,the investorshouldcheckwith
the broker,since brokersusuallyissueanInter-DIS).
 Nowthat the correct DIS has beendetermined,informationpertainingtothe transfer
transactionhas to be entered:scripname,INEnumber,quantityinwordsandfigures.
 Finally,the investorshouldsubmitthatDISto the brokerwithsignatures.
 The transferbrokershall acceptthat DIS induplicate andacknowledge receiptof DISon
duplicate copy.
The investor should submit the DIS when the market is open. Accordingly, date of
submission of DIS and date of execution of DIS can be same or a difference of one day is
also acceptable. The investor also has to pay the broker some charges for the transfer.

P a g e | 34
CHAPTER 8
ADVANTAGES OF DEMAT ACCOUNT
The bonus/rightsharesallottedtothe investorwill be immediatelycreditedintohisaccount.There is
no riskdue to losson accountof fire,theftormutilation.Transactioncostsare usuallylowerthan
that inthe physical segment.A demataccountalso helpsavoidproblemstypicallyassociatedwith
physical share certificates.Forexample:deliveryfailurescausedbysignature mismatch,postal
delaysandlossof certificate duringtransit.Further,iteliminatesthe risksassociatedwithforgery
and due to damaged stockcertificates.Demataccountholdersalsoavoidstampduty(asagainst0.5
percent payable onphysical shares) andfillingupof transferdeeds.The biggestadvantage of having
demataccount isthat you don'thave to pay forstamp since these are electronicallystoredwhich
reducesthe transactioncost.

P a g e | 35
CHAPTER 9
DISADVANTAGES OF DEMAT ACCOUNT
 Tradingin securitiesmaybecome uncontrolledincase of dematerializedsecurities.
 It isincumbentuponthe capital marketregulatortokeepa close watchon the tradingin
dematerializedsecuritiesandsee toitthat trading doesnot act as a detrimenttoinvestors.
 For dematerializedsecurities,the role of keymarketplayerssuchasstock-brokersneedsto
be supervisedastheyhave the capabilityof manipulatingthe market.
 Multiple regulatoryframeworkshave tobe conformed to,includingthe DepositoriesAct,
Regulationsandthe variousBye-Lawsof variousdepositories.
 Agreementsare enteredatvariouslevelsinthe processof dematerialization.These may
cause worriestothe investordesirousof simplicity.
 There isno provisiontoclose ademataccount, whichishavingilliquidshares.The investor
cannot close the accountand he and hissuccessorshave to go on payingthe chargesto the
participant,like annual foliochargesetc..
 Afterliquidatingthe holdings,manyIndianinvestorsdon'tclose theirdpaccount.Theyare
unaware that DPscharge evenondormantaccounts.

P a g e | 36
CHAPTER-10
BIBLIOGRAPHY
1. The source of data regarding ThinkNEXT Technologies PVT.LTD. Mohali Profile
Details is collected from the annual reports of ThinkNEXTand some part of the
profile is also taken from the following websites:
 www.thinknet.co.in
 WWW.thinknexttraining.com
 www.smartsheet.com
 www.prenhal.com
 http;//www.wikipedia.com
2. The of data is also collected from the books :
 Gupta, Shashi K, Management Accounting; Kalyani Publishers, Ed. 2003
 Kothari, C.R.,Research Methodology; WishwaParkashan, Ed. 2004
 Moyer, R. C., Mcguigan, J. R., &Kretlow, W. J. (2003). Contemporary Financial
Management (Ninth Ed.). United States of America: Thomson.
 Annual General Report of the company
 Documents & files of ThinkNEXT Technologies PVT.LTD. Mohali
 Magazine of the company

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