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Transfer of Shares
The provisions for share transfer are governed by section 56 of The Companies Act, 2013 and The Companies (Share Capital and Debentures) Rules, 2014.
Shareholders are real owners of the Company. They have limited liability towards the company. They have powers to appoint directors who manage the company affairs in routine. Transfer of shares has the effect of a change in ownership. Transfer of shares of a private company is indeed restricted as mentioned in their Articles of Association because of protection of rights of the small group of investors, while shares of the public company can freely participate in transfer of shares. Shares have to first be offered to existing shareholders for sale. Transfer of Shares can be done to other person or entity.
ComplianceIndia helps you with the simplest way to Transfer your Shares.
Provisions related to Stamp Duty
As per Companies Act, 2013 capability of transfer of shares should be duly stamped, and stamp duty is paid by the seller of the shares. Finally, every company, unless prohibited, shall issue within one-month certificates for transfer of shares after the application for the registration of transfer of shares is received.
How we Work?
Documents Required for Transfer of Shares
Our charges for the process of Share Transfer starts from Rs. 1,999/-.
Frequently Asked Questions
1. How notice for Intention to transfer shares will be submitted?
Written notice is submitted to the company by the seller defining his intention to transfer the shares, the existing members of the company are informed and invited to buy the shares.
2. What are the Documents required for Transfer of Shares.?
When the deal to transfer is finalised, and consideration of such transfer is fixed. Form No- SH.4 is filled up by the prospective buyers and the same is signed by transferor and transferee in presence of a witness. The transferor then hands over the share certificate and SH-4 to the transferee. Appropriate stamp duty on share transfer is to be paid by affixing share transfer tickets on the share transfer form.
3. Is there any specify format for SH-4?
The Section 56 of The Companies Act, 2013 has prescribed format for Form No. SH-4 Securities Transfer Form.
4. Is fresh Share Certificate will be issued by the Company?
After the due approval of the board of directors of the company, the share transfer is recorded in the register of transfer of shares and replacement share certificate is issued in the name of the new member of the company.