Transfer of shares means a transfer of ownership in whole or part from existing holder to a new one with an objective to change the structure of the company either by adding a new shareholder or by changing the existing proportion of shares between shareholders. The entire process is internal which only gets recorded in minutes, and no further filing of the form with ROC is required. Further, the transfer of the shares attracts stamp duty at the rate as prescribed in the Stamp Act for respective states and the payment can be born either by the transferor or the transferee.
The shares transfer procedure is regulated by the articles of association of the company. The procedure for the same varies from a private limited company to a public limited company. In case of a company which is required to hold shares in physical form and the entire shares as mentioned on certificate are being transferred to another person, then the name of the transferee is written at the back of the share certificate and signed by the transferor but if the part of shares are being transferred the old share certificate need to be cancelled, and fresh share certificates with split in shares will be required to be executed.
Once the company receives a duly stamped, dated & executed an instrument of transfer along with other relevant documents, it shall register the concerned transfer of shares within a period of one month of receipt of above specified documents.
The process of transfer of shares is a simple with no filing of the form with ROC or similar share transfer procedure involved in the process.
The existing shares can be transferred from one person to another easily. The share transfer form or share transfer deed can be prepared easily. We at Startupseven, ensure a seamless and hassle-free experience.
By shares transfer procedure, the ownership and title of the shares is transferred from one person to another. Thereby, the ownership and control lie in the hands of the shareholder, and the voting rights in the company are also transferred accordingly.
The liability of the shareholder is limited to the extent of the shares held by him or her. This secures the personal assets of the shareholders in case of loss incurred by the company.
Arrange to provide the details of the new member to whom the shares are required to be transferred as per the list of details and documents shared.
The Board shall issue share certificate in the name of the transferee after endorsing at the back of the share certificate & enter the details of the transferee in the register of members.
On the receipt of the proper share transfer documents, the company shall hold the Board meeting and take on record the transfer of shares.
Share transfer deed duly executed by the transferor & the transferee along with the original share certificate to be handed over to the company
Transfer of shares means a transfer of ownership in whole or part from existing holder to a new one with an objective to change the structure of the company either by adding a new shareholder or by changing the existing proportion of shares between shareholders.
No, transfer of shares is an internal process which only gets recorded in minutes, and no further filing of the form with ROC is required.
No, it is not mandatory to transfer the shares only to the existing members instead transfer can be made to the third party also. However, in case of the Private Company, the shares are required to be first offered to the existing shareholders & once they refuse to accept, the shares can be transferred to any third person.
Yes, the transfer of shares attracts stamp duty at the rate as prescribed in stamp act for respective state and the payment can be born either by the transferor or the transferee.
In case of a company which is required to hold shares in physical form and the entire shares as mentioned on the certificate are being transferred to another person then the name of the transferee is written at the back of the share certificate.
In case of part of shares being transferred, the certificate needs to be cancelled, and fresh share certificates with split in shares will be required to be executed.
The Company shall register & issue the share certificate in the name of the transferee within one month of the receipt of the duly executed & stamped share transfer instrument along with the original certificate of the shares being transferred.
The seller and the buyer can negotiate the price if the shares are sold freely. The shareholder’s agreement or the company’s article of association may have specific details about the valuation of the shares.
The directors of the company have the obligation to act in the best interest of the shareholders. So, selling shares at lower price would not be acting in the best faith. However, under certain circumstances and as per Companies Act, shares can be transferred for amount less than their worth. Please get in touch with us for additional details.
Bhanu is a person to count upon, with his expertise in his domain and knowledge he brings on you can reach him with a problem any time. His appetite to listen and understand the issue makes him the man for the job. He is proactive, energetic and a resourceful guy. My best wishes to Bhanu and Startup seven for future endeavour.
Founder at Addensure Media LLP
Startup Seven is perfect to partner with in your startup or corporate journey. Seamless service and support provided by team is really helpful specially when you are trying to setup your venture. I would like recommend Startup Seven to every startup.
Founder Onmytap - NETWORK FOR PROFESSIONAL GROWTH
Bhanu is one of the most sincere and trustworthy person I have come across. He is extremely ethical and is completely customer focused. His hard work and dedication is commendable and with him handling the legal as well as taxation things are always in order and compliant. Keep up the good work Bhanu. Wishing you more and more success as you grow.
Co-founder, Executive - Brightsandz Clean Tech Pvt Ltd