Procedure for Issue of Duplicate Share Certificate in India

Share certificates issued by the Company are sometimes lost or misplaced by the shareholders due to unforeseen circumstances. The loss of share certificates can lead to huge financial losses for both the shareholders and the company. To avoid unnecessary losses to shareholders and society, the remedy is provided by the central government. The Companies Act 2013 contains a provision for the procedure For Issue of Duplicate Share Certificate under section 46 read with rule 6 of the Companies (Share Capital and Debentures) Rules 2014 in the event of loss or misappropriation of the original share certificate Shareholder.

In this article, let us have a look at the Procedure for the Issue of Duplicate Share Certificates.

What is a share certificate?

The Company issues a Share Certificate to certify that, from the date, the certificate is issued to a person, that person is the registered owner of Company Shares. A share certificate issued by the Company is prima facie evidence of a member’s ownership of Company Shares. Share certificates proved a person’s ownership in the Company. The loss and misplacement of the Share Certificate will have a financial impact on the Shareholder as there will be no proof of its ownership. The company will issue a duplicate share certificate in case of loss or misappropriation of the original.

Mandatory Requirement

• Exhorting a stockholder for such defiling, mutilating, or ravaging the company.
• Ration sheets or fractional coupons of the required value are to be handed over to the company.

Responsibility of Shareholder

If a share certificate is lost or misplaced, shareholders should take the following steps:

• The Shareholder should immediately inform the Company of the loss or loss of the Share Certificate.
• Communication of information can be done by letter to the Company’s address or e-mail can be sent to the Company.
• Details of lost or misplaced share certificates such as name, address, folio number, and share certificate number.

Steps to be taken by the company

The company should take the following steps after losing or misplacing a share certificate:

• Once the company receives the information about lost or misplaced share certificates, it should freeze the transfer for at least 30 days to avoid any fraudulent transfer or illegal transfer procedure.
• After completing the company registration procedure, the entity should guide the shareholder to issue a duplicate share certificate once the identity of the shareholder is established.

What documents are required to issue a duplicate share certificate?

The documents required for issuing a duplicate share certificate are as follows:

• Prepare the Agreement to provide a guarantee for out-of-court stamp paper.
• The affidavit is made on a non-judicial stamp paper of amount Rs.100.
• An F.I.R should be filed with the police with complete information about the lost share certificate. The details required for the share certificate are as follows:
  • • Name on the share certificate
    • The folio number on the shared certificate
    • Share certificate number
    • A significant number of shares
• An advertisement should be published in the newspaper about the loss of the share certificate.

Procedure to issue a duplicate share certificate

The procedure for issuing a duplicate share certificate is as follows: An application for the issue of a duplicate share certificate is submitted by a shareholder of the company with the required documents.

• Upon receipt of the request by the Company, the process of issuing a duplicate share certificate can be initiated.
• The issuance of a duplicate certificate will be done with the approval of the company’s board of directors.
• In approving the issue of a duplicate share certificate, the board should consider the following:
  • • The charges should be taken as the Board thinks fit but the charges should not exceed 50 rupees per share certificate.
    • Out-of-pocket expenses incurred in investigating the evidence submitted by the Shareholder should also be taken into account by the Board of Directors when issuing a duplicate share certificate by the Company.
• After receiving the approval of the board of directors, the process of issuing a duplicate share certificate can be started.
• The company will check all the documents and issue the Share Certificate.
• The issuance of the duplicate share certificate should be completed within 4 to 6 weeks.
• A duplicate share certificate will be issued to the listed company within 45 days from the date of submission of the documents to the company.
• An unlisted company will be issued a duplicate share certificate within 3 months from the date of submission of company documents.
• Once the issue of the duplicate share certificate is made, entries should be made in the register of renewed and duplicate shares on Form SH-2.
• The SH-2 format is prescribed in the Companies (Share Capital and Debentures) Rules, 2014.
• The duplicate share certificate should contain the following lines “Duplicate issued in lieu of share certificate No….” and the word “Duplicate” should be printed or stamped in block letters on the share certificate.
• The register should be kept at the registered office of the Company or where the Company maintains a register of members or may be kept by the Secretary of the Company or anyone authorized by the Board of Directors.

Final words

The share certificate is proof of shareholder ownership of the Share. In case of loss or misplacement of the Share Certificate, to avoid any financial loss to the Company and the Shareholders, a duplicate Share Certificate should be issued. The process of issuing a share certificate is lengthy and long-term. Legal Window has experts who can help you with the process and ensure that the work is completed within the stipulated time.