Company Share Transfer (SH-4) Online Process
Share transfer in a company is like giving away your ownership rights to someone else who wants to be part of the company, as long as the company’s rules don’t say you can’t.
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Four Steps to Obtain Your Certificates/Licenses
Fill the Form
Provide business details
Add to cart
Pay the required fee online
Submit Documents
Upload required papers
Certificate delivery
Official Document Delivery
Find the best plan for your needs
Basic Plan
+GST
- Drafting of Share Transfer Form (Form SH-4)
- Issuance of New Share Certificate
- Electronic Certificate Delivery
Standard Plan
+GST
Basic Plan
+
- Hard Copy Certificate Delivery
- Assistance with Lost or Damaged Certificates for 3 years
Premium Plan
+GST
Standard Plan
+
- Legal Consultation on Transfer Process
- Priority Processing
- Dedicated Account Manager
- Digital Storage of Documents
- Post-transfer Support
Overview of Company Share Transfer
A Share Transfer Certificate is a document issued by a company to acknowledge the transfer of shares from one party to another, as per the Companies Act, 2013, and associated rules. This certificate serves as proof of ownership transfer and must be issued after the company receives a valid instrument of transfer (Form SH-4), along with the original share certificate and requisite transfer stamps.
Under the Companies Act, 2013, the Board of Directors must approve the share transfer within 15 days of receiving the transfer request. Once approved, the company is required to endorse the share certificate and issue a new one in the transferee’s name within 30 days. This process ensures legal compliance and proper documentation of ownership changes, maintaining transparency and accuracy in the company’s shareholding records.
A Share Transfer Certificate is a document issued by a company to acknowledge the transfer of shares from one party to another, as per the Companies Act, 2013, and associated rules. This certificate serves as proof of ownership transfer and must be issued after the company receives a valid instrument of transfer (Form SH-4), along with the original share certificate and requisite transfer stamps.
Under the Companies Act, 2013, the Board of Directors must approve the share transfer within 15 days of receiving the transfer request. Once approved, the company is required to endorse the share certificate and issue a new one in the transferee’s name within 30 days. This process ensures legal compliance and proper documentation of ownership changes, maintaining transparency and accuracy in the company’s shareholding records.
Importance of Share Transfer Certificates
Share Transfer Certificates are vital for validating and recording the change in ownership of a company's shares.
Proof of Ownership
Transparency
Compliance
Dispute Resolution
Record Accuracy
Investor Confidence
Proof of Ownership
They act as definitive legal proof of share ownership.
Transparency
Ensure transparency in the company's shareholding structure.
Compliance
Aid in compliance with legal and regulatory requirements.
Dispute Resolution
Serve as key documents in resolving any ownership disputes.
Record Accuracy
Help maintain accurate and up-to-date shareholder records.
Investor Confidence
Enhance investor confidence in the company's share management practices.
Persons Involved in Share Transfer
The current shareholder who is selling or transferring the shares.
The person or entity receiving the shares and becoming the new owner.
Authorizes the share transfer and issues the Share Transfer Certificate.
Often oversees the share transfer process, ensuring legal compliance and proper documentation.
Legal Representative transfers deceased’s shares as per the will or law to the chosen beneficiary.
Documents required for share transfer certificate
| Document Type | Description | Applicability |
|---|---|---|
Original Share Certificate | Certificates representing the shares being transferred, providing proof of the transferor's share ownership. | Required for all share transfers |
Self-Attested Copy of PAN Card | Mandatory for all transactions involving share transfers to validate the identities of the transferor and transferee. | Required for all share transfers |
Identification Proofs | Self-attested copies of valid identity proof like Aadhaar, Passport, or Driving License of both parties. | Required for all share transfers |
Address Proofs | Self-attested copies of address proofs to confirm the current addresses of both parties involved in the transfer. | Required for all share transfers |
Death Certificate | Needed to confirm the demise of the shareholder and initiate the transfer process. | Required when the transfer involves the estate of a deceased shareholder |
Succession Certificate, Probate, or Letter of Administration | Establishes the legal heirs or executors to the deceased's estate, including shares. | Required when the transfer involves the estate of a deceased shareholder and to legally establish the rightful heirs |
Procedure for Transfer of shares under the companies act,2013.
Obtaining a Share Transfer Certificate in a company in India is a systematic process governed by the Companies Act, 2013, and involves several key steps to ensure legal compliance and transparency. Here’s a detailed overview of the process:
Initiation: The share transfer process begins with the execution of a Share Transfer Deed by both the transferor (current shareholder) and the transferee (new shareholder). In India, this deed is prescribed as Form SH-4.
Details to Include: The form must include comprehensive details such as the names and addresses of the transferor and transferee, the class and number of shares being transferred, and the share certificate number.
Legal Requirement: Payment of stamp duty is mandatory on the share transfer deed, and the rate varies from state to state within India.
Proof of Payment: The transfer deed must be stamped with the requisite duty to be considered valid for processing.
Document Submission: The duly filled and stamped Share Transfer Deed, along with the share certificate(s), is submitted to the company for processing.
Supporting Documents: Additional documents, such as identity proofs of the transferor and transferee, may also be required.
Board Review: The company’s board of directors reviews the submitted documents to ensure compliance with the Articles of Association and the Companies Act, 2013.
Verification Process: The company verifies the authenticity of the documents and the eligibility of the transferee to hold shares.
Resolution for Transfer: Upon satisfactory verification, the board passes a resolution approving the share transfer.
Legal Compliance: The approval process ensures that all legal and procedural requirements are met.
Certificate Preparation: The company prepares the Share Transfer Certificate in the name of the transferee once the board approves the transfer.
Record Update: The company updates its Register of Members to reflect the transfer, recording the transferee as the new shareholder.
Dispatch to Transferee: The Share Transfer Certificate is dispatched to the transferee, officially completing the transfer process.
Acknowledgment: The transferee acknowledges the receipt of the Share Transfer Certificate, confirming the completion of the process.
Time Frame
Legal Mandate: As per the Companies Act, 2013, the entire process, from submission to the issuance of the Share Transfer Certificate, should ideally be completed within one month.
