03 July 2012
How and where should one get transfer of shares of a private limited company registered? Can anyone provide me with performa of a share transfer deed.
Is it really a necessity to get transfer registered? Thanks in Advance.
1) Arrange for share transfer form (Form 7B) which should be endorsed by the prescribed authority.
2) Get the transfer form duly executed both by the transferor (seller) and the transferee (buyer) in pursuance to sections 108 and 109 of the Companies Act, 1956 and the Articles of Association of the Company.
3) The transfer deed should bear stamps according to the Indian Stamp Act and Stamp Duty Notification in force in the State concerned. The present rate of stamp duty for transfer of shares is 25 paise for every one hundred rupees of the value of shares or part thereof transferred.
4) The signatures of the transferor and the transferee in the share transfer form must be witnessed by a person giving his signature, name and address.
5) Attach the relevant share certificate or allotment letter with the transfer deed and deliver the same to the company within the two months from the date execution.
6) The company on Lodging the duly executed share transfer deeds shall approve the same in the next Board Meeting.
7) Subsequent to the approval of transfer in the Board meeting, the Share Transfer Register will be updated and accordingly the name of Transferee will appear in the Register of Members of the Company.
It is better to buy form 7B from a form shop. You can also get it from website just type form 7b format in google.
I will suggest you to purchase share transfer form (deed) from concerned authority like Stock exchange or other place where easily available. Yes, it is presented with prescribed authority for registration like ROC of concern state.
04 July 2012
Procedure for transfer of shares of private company Generally articles contain the detailed provisions as regards the procedure for transfer of shares. Usually following steps shall be followed by a private company to give effect to the transfer of shares:— (i) Transferor should give a notice in writing for his intention to transfer his share to the company. (ii) The company in turn should notify to other members as regards the availability of shares and the price at which such share would be available to them. (iii) Such price is generally determined by the directors or the auditors of the company. (iv) The company should also intimate to the members, the time limit within which they should communicate their option to purchase shares on transfer. If none of the members comes forward to purchase shares then the shares can be transferred to an outsider and the company will have no option, other than to accept the transfer. It is to be noted that any transfer of shares to an outsider without complying with the procedure as specified in the articles for effecting transfer of shares will not be operative against the company. Even in the case where the procedure prescribed by the articles was not followed and such failure was not due to any fault on the part of the selling shareholder, the transfer to an outsider was held not to be effective. Transfer of shares without consent of holder of shares and without prior sanction of board of directors as required under articles of association of a private company concerned could not be held to be valid. [John Tinson Co. (P) Ltd. v Mrs. Surjeet Malhan (1997) 88 Comp Cas 750 (SC)].
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