Share Transfers in Pvt. Ltd. Company

Hi

Status: C pvt. ltd. has the follwoing sgareholding pattern:

A ltd.: 50%
B Ltd.: 49%
D: 1 %.

Now B ltd. wants to transfer its entire shareholding in C pvt. Ltd. to A Ltd. at its face value. 

Query: 1. Whether filling of Share Transfer Form and handing over the same to C pvt. Ltd. alongwith shares certificates and passing of Board resolution in C pvt. Ltd. is suffice?

I think its suffice but following procedure is given in Bharat Publications for transfer of shares in pvt. ltd. company:

"(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."

2. Should i need to follow this procedure?


Regards
Hinna Garg

Replies (2)

Hi Hinna,

 

A Pvt Ltd Co can impose restriction on the transfer of shares under the provisions of the Article of Association.  There are 2 kinds of provisions which can be incorporated in the Articles of the Company for this purpose. They are:

 

1. Power of Directors to refuse transfer of shares. 
 The power of the Board of Directors to refuse registration of transfer of shares must be in the interest of the company and the general body of share holders.

 

2.Pre-emptive rights. 
 
A right of pre-emption is incorporated in the articles of a Private Company to restrict the members’ right to transfer shares to non members.

 

So before transfer please refer the articles of the Company to find out whether any kind of restriction is imposed and follow the procedure given thereunder

Dear Ms. Hinna

 

You can follow the procedure as u have  discussed, after taking into account the provisions of company's articles.

 

Regards

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
ARTICLESHIP 28 September 2026
Junior Accountant

J S P M & Associates LLP

Pune

B.Com

View Details
Company
12 October 2026
AUDIT , ACCOUNTS AND TAXATION

KDSS

New Delhi

B.Com

View Details
Company
08 October 2026
Account Executive

Elite Taxation

New Delhi

CA Foundation

View Details
Company
Featured 21 September 2026
Consultant - Reporting

Finrep Advisors LLP

Mumbai

CA

View Details
Company
30 September 2026
Senior Accounts Executive

Codeboard Technology

Chennai

MBA

View Details
Company
30 September 2026
Senior Accountant

Codeboard Technology

Chennai

B.Com

View Details
Company
ARTICLESHIP 01 October 2026
Articled Assistant

KPSN & Associates LLP

Chennai

CA Inter

View Details
Company
13 October 2026
Accountant

Zerdi & Co. Chartered Accountants

Pune

B.Com

View Details