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Transfer of physical shares in private limited company

PRADEEP MULANI (Partner in MULANI BHANSARI & SHAH ) (142 Points)

08 December 2011

What shall be the procedure for transfering the physical shares in the Private Limited Company?

Whether is it required to be intimated to the ROC?

Whether any Stamp Duty is to be payable on such transfer of shares? If yes then by affixing the Non-Adhesive stamp on the Share Certificate or something else?

Whether Form-7b is also required to be filled in?

Awaiting your comments...

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11 Replies

Preet Kanwar Singh (Company Secretary) (161 Points)
Replied 08 December 2011

Required documents- 1) Share Transfer form(FORM No. 7B) signed by Transferor(S) and Transferee and attested by proper authority. It should contain amt of consideration (Mkt value* no. of shares) 2)PAN Card copy of transferee. 3)Original Share Certificate 4)Share Transfer Stamp of appropriate value to be affixed to the form. Value= Mkt value *no. of shares * 0.0025 The name,address,date,folio no.,dist no.s etc to be filled in columns provided for the same. In case of suspicion/doubts the co may ask documents.

2 Like

Rashi Tiwari (Company Secretary) (131 Points)
Replied 09 December 2011

Preet is correct.

I addition i would like to add that as per section 3(1)(iii) of the companies act transferbility of shares is restricted. You ned to check AOA of the Company.

Generally for transfer of shares in private limited company the existing shareholders should e offered first and on their refusal board will allow to transfer shares to outsider.

PRADEEP MULANI (Partner in MULANI BHANSARI & SHAH ) (142 Points)
Replied 13 December 2011

Whether is it required to be intimated to the ROC?

AND the STAMP Value should be in form of Non-Adhesive Stamp to be embossed on the Form -7B?

Awaiting your comments...

PRADEEP MULANI (Partner in MULANI BHANSARI & SHAH ) (142 Points)
Replied 14 December 2011

Hi,

Preet Kanwar Singh

1) Share Transfer form(FORM No. 7B) signed by Transferor(S) and Transferee and attested by proper authority. It should contain amt of consideration (Mkt value* no. of shares)

Kindly let me know WHO shall be the "proper authority" for Attestation?

Awaiting your Comments..............

Mohit Goyal (ABC) (233 Points)
Replied 01 February 2012

CASE:-

COMPANY ABC PRIVATE LIMITED - 10000 SHARES OF 10 EACH

DIRECTORS MR.A - 5000 SHARES

MR.B - 5000 SHARES

COMPANY XYZ PRIVATE LIMITED - 20 SHARES OF 1000 EACH

DIRECTORS MR.X - 10 SHARES

MR.Y - 10 SHARES

MR.A - NO SHARES HELD (COMMAN DIRECTOR)

NOW COMPANY XYZ P. LTD. WANTS TO BECOME HOLDING COMOANY OF ABC PVT. LTD.

AND MR. A WILL TRANSFER HIS WHOLE HOLDING AND MR. B WILL TRANSFER 4900 SHARES OF HIS HOLDING TO XYZ P. LTD.

PLEASE KINDLY TELL ME THE WHOLE PROCEDURE FOR TRANSFER OF SHARES AND COMPLIANCES TO BE DONE IN RELATION TO ROC

Bhagyashri (CS FINAL ) (48 Points)
Replied 26 April 2012

IN ONE PRIVATE LIMITED COMPANY, SHARES ARE TRANSFERED AND CONSIDERATION IS NOT YET RECEIVED BY TRANSFEROR EVEN AFTER ONE YEAR NOW.

PLEASE CAN ANYONE TELL ME THAT WHAT IS THE TIME LIMIT WITHIN WHICH CONSIDERATION SHOULD BE PAID TO THE TRANSFEROR BY TRANSFREE?

ALSO NOW WHAT ARE THE REMEDIES AVAILABLE TO THE TRANSFEROR?

prakash (Company Secretary) (1352 Points)
Replied 26 April 2012

Mr. Pradeed,

1.Proper Authority for attestation is ROC.

2. Not required to Intimate to ROC.

3. Share transfer stamps to be affixed on form 7B.

PRADEEP MULANI (Partner in MULANI BHANSARI & SHAH ) (142 Points)
Replied 27 April 2012

Mr. Prakash,

I found later on.....

ROC shall not entertain these things as he will not be able to give time for such ordinary things.

Attestation, where required (thumb impressions, marks, signature difference, etc.) should be done by a Magistrate, Notary Public or Special Executive Magistrate or a similar authority holding a Public

Office and authorised to use the Seal of his office or a member of a recognised Stock Exchange through whom the shares are introduced or a manager of the transferor's bank.

PRADEEP MULANI (Partner in MULANI BHANSARI & SHAH ) (142 Points)
Replied 27 April 2012

@ Bhagyashri, Please note that there is no time limit for payment of consideration to transferor. Its decided on mutual basis.

Bhagyashri (CS FINAL ) (48 Points)
Replied 27 April 2012

OK SIR.

BUT IN OUR CASE NOW TRANSFEREE IS DENYING TO PAY THE REMAINING CONSIDERATION AMOUNT WHICH WAS MUTUALLY AGREED TO BE PAID.

SO NOW WHAT REMEDIES ARE AVAILABLE TO THE TRANSFEROR? CAN THAT TRANSFER BE PROOVED AS INVALID?

AND CAN CLB PETITION BE FILED FOR THIS CASE NOW BY TRANSFEROR?

jayanta patra (students) (95 Points)
Replied 29 June 2013

dear sir,

for transfering share to the relative, does it required to pass board resolution and is it required to appear both transferor and transferee to appear before proper authority for attestion.