How to Transfer Shares of a Private Limited Company
- Step 1: Obtain share transfer deed in the prescribed format.
- Step 2: Execute the share transfer deed duly signed by the Transferor and Transferee.
- Step 3: Stamp the share transfer deed as per the Indian Stamp Act and Stamp Duty Notification in force in the State.
What Documents are required for share transfer ?
- Income Tax PAN of both the transferee and the transferor.
- Passport size colour Photo of both the transferee and the transferor.
- Aadhaar Card or Electricity Bill or Passport or Driving License or Voter ID Card of both the transferee and the transferor.
What documents are required to transfer the share?
- Original share certificate(s) of transferor.
- Self-attested copy of PAN card of Transferor(s) (i.e. sellers) and Transferee(s) (i.e. buyers)
- Pay appropriate stamp duty @0.25% on market value by way of franking or affix share transfer stamps.
The shares of a public company are freely transferable unless the company has a valid reason to disallow the same. The shares of a private limited company are not transferable subject to certain exceptions. A transfer deed is executed for the transfer of shares.
Register by post
You can send your changes by post. Download and fill in the share change forms depending on the changes you’re making. Send your completed forms, a copy of your resolution if needed and your statement of capital to the address on the forms.
This is to inform you that I,………………….. , the Shareholder of …………………..shares in your Company, request you to transfer my …………………… Equity Shares held in the Company for a total consideration of Rs …………………… (Rupees …………………..
Yes there is no restriction to transfer of shares less then the face value of shares.
Stocks can be given to a recipient as a gift whereby the recipient benefits from any gains in the stock’s price. Gifting stock from an existing brokerage account involves an electronic transfer of the shares to the recipients’ brokerage account.
Cancellation of Stamp by Company is illegal. If once a company transfers shares by mistake even if the instrument was not duly stamped, it can’t then apply for rectification of members.
Section 2(68) of the Companies Act 2013 provides that the Articles of a private company shall restrict the right to transfer the company’s shares. This restriction is binding upon the company and members thereof.
A public company is a company that is not a private company. As per the Companies Act 2013, a public company has a minimum of 7 members and has no restriction on the transfer of its shares.
The provision contained in the law for the free transferability of shares in a public Company is founded on the principle that members of the public must have the freedom to purchase and, every shareholder, the freedom to transfer.
In the case of public companies, shares are freely transferable subject to the provisions of the Articles of Association. Whereas, in the case of Private Company, there are restrictions on the free transfer of shares. Thus, it is rightly justified that, a member of a Public company can transfer shares.
What is the maximum limit of members in case of private company?
In case of private companies, the maximum limit has been increased by the new Companies Act, 2013 from 50 to 200. There is however no maximum limit on the no. of members in a public company.