Shareholder being a unregistered trust

This query is : Open

Jigar Dhabalia (Querist)
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21 February 2014 Dear all,

can a unregistered trust be a shareholder in a private limited company ??

further , if yes , whether the Trust can gift the shares to the Trustee of that trust through Gift Deed ??

SHAKTI JINDAL

SHAKTI JINDAL (Expert)
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21 February 2014 An unregistered trust can of course hold shares in a private limited company. However, the trust can hold the shares in the name of the trustees which may be individuals, corporations, companies or societies registered under the Societies Registration Act.

Further, the corpus of the trust is to be disposed/utilized/distributed in accordance with the terms of the trust deed and for the benefit of beneficiaries defined therein. Trustees have a fiduciary duty towards the trust property.

Jigar Dhabalia

Jigar Dhabalia (Querist)
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21 February 2014 Dear Shakti ,

Whether the trust can hold the shares in its own name...?? and not on behalf ??

and can it transfer the shares in name of its trustee, who is already a shareholder in that private limited company ??