Transmission of shares under the Companies Act, 2013 refers to the transfer of shares from the deceased shareholder to their legal heirs or nominees. The process of transmission is governed by the provisions of the Act and the company's articles of association.
Here are the key steps involved in the transmission of shares under the Companies Act, 2013:
- Intimation of Death: The legal heirs or nominees of the deceased shareholder must inform the company about the death of the shareholder by submitting a death certificate and other necessary documents.
- Verification of Documents: The company will verify the documents submitted by the legal heirs or nominees to establish their claim on the shares.
- Request for Transmission: The legal heirs or nominees must submit a request for transmission of shares to the company along with the necessary documents such as a copy of the will, succession certificate, or legal heir certificate.
- Issuance of New Share Certificate: Upon verification of the documents and establishing the claim of the legal heirs or nominees, the company will issue a new share certificate in the name of the legal heir or nominee.
- Updating of Share Register: The company will update its share register and transfer the ownership of the shares in the name of the legal heir or nominee.
- Payment of Stamp Duty: Stamp duty must be paid on the transmission of shares as per the applicable state laws.