Share Transfer of Company

What is Transfer of Shares ?

Transfer of shares involves the change in ownership of a company's shares. Since shares are considered movable property, they can be transferred like any other asset. This process occurs when a current shareholder transfers issued shares to another person, who then becomes the registered holder of those shares. While public companies allow free transfer of shares, private companies have certain restrictions in place to safeguard the interests of shareholders and investors.

According to Section 56 of the Companies Act, 2013, a company can register the transfer of its securities only if it is supported by a valid transfer instrument, specifically in the format prescribed under Form No. SH-4. Furthermore, if a company does not have share capital, it cannot register any transfer of securities or any member’s interest in the company.

Documents Required

Original Share Certificate of share to be transferred

Certificate of Stamp duty payment (Franking) on issue of share certificate

Valuation and the share transfer agreement

Share transfer form duly signed by the parties

ID and address proof of the transferor and transferee

Proof of payment of consideration of transfer if any