Ans. This statement is
False.
1. Share certificates,
when converted from a physical form into an electronic form are called demat
shares.
2. The depository system
eliminates the handling of huge paperwork involved in the transfer of
securities. Under this system, the securities are transferred by means of
entries in the ledger of Depository System without physical movement of the
security certificates.
3. Under the depository
system, the process of transfer of securities is very simple and easy. The
transfer of securities from one investor to another under this system is
virtually automatic, speedy and all hurdles in the transfer of securities are
removed.