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No. 1 e - Service Plateform in India

5 Simple Steps to Share Transfer to Another Person

1
Preparation of share transfer deed
2
Signing the Deed
3
Stamping the Deed
4
Attach the share certificate or allotment letter with the transfer
5
The company must process the documents and issue the share certificate

Rule 11 of Companies (Share Capital & Debentures) Rules 2014

  • Form No SH-4 is required to file in every instrument of transfer with the date of its execution specified thereon shall be delivered to the company within sixty (60) days from the date of such execution.

  • In the case of a company not having a share capital, provisions of sub-rule (1) shall apply as if the references therein to securities were references instead to the interest of the member in the company.

  • A company shall not register a transfer of partly paid shares unless the company has given a notice in Form No. SH.5 to the transferee and the transferee has given no objection to the transfer within two weeks from the date of receipt of a notice.

Basic information

Persons involved in the transfer

  • Subscribers to the memorandum.
  • Legal Representative, in case of a deceased.
  • Transferor.
  • Transferee.
  • Company (whether listed/unlisted).

Meaning of Share transfer

Transfer of shares means the voluntary handing over of the rights and possibly, the duties of a member (as represented in a share of the company) from a shareholder who wishes to not be a member in the company anymore to a person who wishes of becoming a member.

Thus, shares in a company are transferable like any other movable property in the absence of any expressed restrictions under the articles of the company.

9999

Basic

All Inclusive Fees

  • Transfer between one person to another person
14999

Silver

All Inclusive Fees

  • Transfer between Entities
24999

Gold

All Inclusive Fees

  • Transfer between Foreign Person

Procedure to Transfer Shares

Form No. SH.4

Section 56 provides that a company shall not register a transfer of shares of, the company, unless a proper transfer deed in Form SH.4 

Time Period

Form SH.4 with the date of its execution specified thereon shall be delivered to the company within sixty (60) days from the date of such execution by or on behalf of the transferor and by or on behalf of the transferee.

Stamps to be affixed

Stamp duty for transfer of shares is 25 paise for every Rs. 100 or part thereof of the value of shares as per Notification No. SO 130(E), dated 28-01-2004 issued by the Ministry of Finance, Department of Revenue, New Delhi.

Time limit for issue of certificate

Every company, unless prohibited by any provision of law or of any order of any Court, Tribunal or other authority, shall, within One month deliver, the certificates of all shares transferred after the application for the registration of the transfer of any such shares, debentures or debenture stock received.

Restriction right to transfer its shares

Entire shareholding of a private company may be owned by a family or other private group. Section 2(58)(i) of the Companies Act, 2013 provides that the Articles of a private company shall restrict the right to transfer the company’s shares.

 

Time Limit for appeal

As per section 58(3), a transferee of shares may appeal to the Tribunal against the refusal within a period of thirty (30) days from the date of receipt of the notice from the Company or in case no notice has been sent by the company, within a period of sixty (60) days from the date on which the instrument of transfer or the intimation of transmission, as the case may be, was delivered to the company.

Penalty for Non-compliance

Where any default is made in complying with the provisions related to transfer of shares, the company shall be punishable with fine which shall not be less than Rs. 25,000/- but which may extend to Rs. 5,00,000/- and every officer of the company who is in default shall be punishable with fine which shall not be less than Rs. 10,000/- but which may extend to Rs. 1,00,000/-.

Start 9999 /- all inclusive fees
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