Transfer of shares is a process in which the existing shares as issued by the Company are transferred from one person whether natural or artificial to another either by way of sale or gift.
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Transfer of shares is a process in which the existing shares as issued by the Company are transferred from one person whether natural or artificial to another either by way of sale or gift. Shares are considered as a movable property, post reviewing the Articles of Association of the Company. As in case of Private limited companies the shares cannot be freely transferable while in case of Public Companies they can be transferred in the market easily.
In case of Public Companies or Listed Companies the shares are transferred electronically with the help of clearing house i.e. NSE and BSE. Further, the private limited companies who have not dematerialized shares, the shares are transferred in physical form only. Here we will discuss transfer of shares in a physical form.
Legal Window can help you with the transfer of shares just by following certain steps by providing the best assistance, timely delivery and guaranteeing the highest customer satisfaction You may get in touch with our team on 072407-51000 or email [email protected]
You are requested to first fill the simple questionnaire provided by our expert team which will enable us to know the case of transfer of shares of the Company.
At the second step you will be required to produce the documents in accordance with the questionnaire filled based upon which case will be dealt so that we can arrange them as per the requirement and for further processing.
After arranging the documents we will begin with the drafting of Board Resolution (if not passed) for Transfer of shares of the Company and to execute the share transfer deed in SH-4 (a prescribed format given under Companies Act, 2013) by the transferor and transferee and the stamp duty to be paid in accordance with Indian Stamp Act of the respective state. Conducting the Board Meeting and passing of Board Resolution for register of transfer of shares Again a Board Meeting will be conducted to register the transfer of shares if the documentation with regard to the transfer of shares is in order.
After approval in the Board Meeting, entry for share transfer will be recorded on the Share Certificates and Register of Members.
For initiating the process for transfer of shares of a [Private Limited Company](private-limited-company-registration) one must review the Articles of Association of the Company as a Private Limited Company is restricted to freely transfer its shares. This restriction could be:-
Rights of pre-emption: Right of pre-emption means whenever the shareholder wishes to transfer all or some part of his/her shares then they must be first offered to the existing members of the company in accordance with the price determined by the Directors or the Auditor of the Company. The value of such shares can be decided based upon the formula / method mentioned in the Articles of Association. If the existing shareholders are not interested in buying then such shares can be freely offered to outsiders.
Powers of Directors to refuse: In case any stringent provisions have been prescribed in the Articles of Association of the Company then the Directors may have the powers to refuse registration of transfer of shares.
The execution of share transfer is done through a share transfer deed SH-4 which has to be executed by the transferor and transferee by filling all the details of the company, no of shares transferred, value of shares, details of transferor and transferee and should be stamped as per the stamp duty levied in the respective state. The stamp duty has to be paid by the seller in this case. The executed deed has to be submitted within 2 months of the date of execution.
For transferring the shares from resident to non-resident or vice versa a Form FC-TRS shall also be filed by the Indian Resident with the Reserve Bank of India within 60 days from the date of remittance or transfer whichever is earlier.
Talk to our team before you begin.