When you have physical shares you have to send to the RTA via the DP for dematerialization. This is accompanied by the demat request form (DRF), which is the document requesting for converting the shares into electronic form. This DRF could get rejected for various reasons. For example, the DP will do some basic level filtering at the initial level itself. If flaws are found at that point then there is no problem. But if the flaws are found at the level of the registrar that there is some cost for you. DRF could get rejected at the registrar level for various reasons. Here are a few of them.
Firstly, the DRF could get rejected if the names of the owner of the specific distinct numbers in the record of the RTA do not match with the names on the share certificate. Secondly, if there have been some corporate actions have not been effected on the physical certificates then these will have to e first given effect, the new ISIN numbers obtained and then only the shares can be dematerialized.
Here again, the DRF will get rejected. DRF can also get rejected if the RTA has reasons to believe that the share certificates are either fake certificates or duplicate certificates where ownership is disputed. The DRF can also get rejected for technical reasons like torn certificates, bad delivery cases, mutilated certificates etc. In such cases, the DRF will get rejected. Remember, there is a basic charge on DRFs accepted by your DP. However, any additional costs at actuals will be billed to you. This is perfectly legitimate. You can speak to your DP for greater clarity.