Share transfer involves transferring ownership of company shares from one shareholder to another. Proper filing and documentation ensure legal recognition and smooth transition of ownership.
What is Share Transfer?
A share transfer is the process by which shares are moved from the seller to the buyer, maintaining records in the company’s register of members and complying with the Companies Act.
Who Can Apply?
Shareholders wishing to sell, transfer, or gift shares to another individual or entity, subject to company rules and legal regulations, can apply for share transfer.
Share Transfer Process
- Step 1: Execute a share transfer deed and obtain signatures of transferor and transferee.
- Step 2: Pay stamp duty applicable as per state regulations.
- Step 3: Submit share transfer deed and supporting documents to the company’s board.
- Step 4: Update company’s register of members and issue share certificates to transferee.
- Step 5: File necessary forms (e.g., SH-4, MGT-7) with MCA if required.
Benefits
- Legal Compliance: Ensures share transfer is recognized under law.
- Ownership Clarity: Accurate records in company’s register of members.
- Operational Continuity: Avoids disputes related to shareholding.
- Professional Support: Expert assistance ensures correct documentation and filing.
