if the company not issue share certificates within 2 months of incorporation..what is the penalty ??
and is share stamping is necessary before transfer of shares ??
As per Section 56 of the Companies Act, 2013 if the company does not issue share certificates within two months of its incorporation, the company shall be punishable with fine which shall not be less than twenty-five thousand rupees but which may extend to five lakh rupees and every officer of the company who is in default shall be punishable with fine which shall not be less than ten thousand rupees but which may extend to one lakh rupees.
Also, it is always advisable to go for the stamping of share certificates as without payment of stamp duty on the same, the share certificates have no value. However, it is not compulsory to go for stamping of share certificates before transfer of equity shares. You can apply for stamping of share certificate even after the transfer of equity shares.
CAclubindia
