Share sale by promoter of public limited company

There is no restriction under the Companies Act, 2013 on selling shares of an unlisted public company at a price above book value, as long as:

• The shares are not subject to any lock-in or contractual restriction (e.g., shareholder agreement, investment agreement, etc.).

• The Articles of Association do not impose pre-emptive rights or transfer restrictions requiring Board approval or offer to other shareholders first.

• Proper transfer procedures under section 56 are followed (execution of share transfer form — SH-4, payment of stamp duty, updating of register of members, etc.).

✅ Conclusion:
Under company law, sale above book value is perfectly fine — share price is a matter of mutual agreement between buyer and seller.

Yes. For an unlisted company, promoter shareholders may generally sell shares at a price substantially above book value; book value is not, by itself, a legal ceiling. The price should be commercially supportable, and the transaction must comply with the company’s articles, any shareholders’ agreement or transfer restrictions, and applicable Companies Act and, where relevant, FEMA requirements.

The tax and regulatory position depends on the parties and transaction: a resident-to-resident transfer may attract tax consequences, while a non-resident transfer can involve FEMA pricing rules and reporting. Related-party or connected-party facts may also affect valuation and disclosure. Check the share-transfer documents, buyer/seller residency, and any applicable valuation or reporting requirements before completing the transfer.

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