Arrange the following in the correct order of the working of the Dema…

Arrange the following in the correct order of the working of the Demat System.

(A) An account opening form and documentation (PAN card details, photograph, power of attorney) may be completed.

(B) If shares are applied in a public offer, simple details of DP and demat account are to be given and the shares on allotment would automatically be credited to the demat account.

(D) A Depository Participant (DP), either a bank, broker, or financial services company, may be identified.

Choose the correct answer from the options given below:

Answer & explanation

Correct answer: option 4

The correct answer is Option (4) → (D), (A), (C), (B)

(D) A Depository Participant (DP), either a bank, broker, or financial services company, may be identified. — first. A demat account is opened only through a depository participant, so the investor must first choose one.
(A) An account opening form and documentation (PAN card details, photograph, power of attorney) may be completed. — second. With the DP chosen, the account is opened by filling in the form and giving the documents.
(C) The physical certificate is to be given to the DP along with a dematerialization request form. — third. Once the account exists, paper share certificates can be converted into electronic form and held in it.
(B) If shares are applied in a public offer, simple details of DP and demat account are to be given and the shares on allotment would automatically be credited to the demat account. — fourth. With the account working, new shares from a public issue go straight into it.

Note: Although the chapter ‘Financial Markets’ was dropped from the NCERT textbooks during rationalisation, it has stayed in the NTA syllabus every year since 2022, except for 2025, and it is part of the syllabus again from 2026. This question is therefore based on the pre-rationalised NCERT, an extract from which is given below.

NCERT (Pre-rationalised Edition): “Working of the Demat System 1. A depository participant (DP), either a bank, broker, or financial services company, may be identified.
2. An account opening form and documentation (PAN card details, photograph, power of attorney) may be completed.
3. The physical certificate is to be given to the DP along with a dematerialisation request form.
4. If shares are applied in a public offer, simple details of DP and demat account are to be given and the shares on allotment would automatically be credited to the demat account.”