Why is Non-PIS required?
Non PIS account takes care of certain transactions which are not covered under PIS: • Under IPO, it is the responsibility of the company to inform RBI of the shares it is allotting to NRIs; therefore these shares are not covered under PIS. • Shares bought as resident Indian, do not confer the ownership right to any NRI as a foreign body, therefore these shares are also not covered under PIS. • While declaring bonus, it is like a fresh issue of shares at zero cost, therefore the responsibility is of the company to inform RBI about the shares it is providing to NRIs. Also since bonus is provided to all, overall percentage holding remains the same. • While investing in MF, the voting right or the ownership of the shares remains with the AMC/trust and not the individual investing in the MF. Therefore, here also reporting is not required and these transactions are covered under Non-PIS. In simple words, for transactions to be covered under Non–PIS, the acquisition should not be done under P
