Share transfer in a public limited company. The shares of a public limited company are freely transferable and do not require any permission from directors or other shareholders. Although, the board may refuse to pass resolution for transfer of share if it deems appropriate for the interest of the company.
How to put the transfer into effect?
- A proper transfer deed in form SH.4 need to be duly stamped and executed by the transferor and transferee. Name, address and occupation must be specified along with the certificate of shares or letter of allotment of shares.
- Transferor and transferee have to intimate to the company the reason of transfer of shares
- The Form SH.4 to be delivered to the company within 60 days of its execution
- Stamp duty of Rs. 0.25 for every share of value Rs. 100 to be paid
- Within one month, the company should get a certificate of all shares transferred after application for registration of transfer of shares
- Hold board meeting to pass resolution to approve the transfer of shares
- If the board accepts the transfer, it shall register the transfer and issue share certificate within one month. If the board rejects the transfer, it will send a notice to the transferor/transferee within 30 days of receiving Form SH.4 from transferor/transferee, stating reasons for refusal
- Share transfer details to be given to ROC in annual return in Form MGT-7
Time taken for the whole process is tentatively 2-3 weeks.
Cost of vendor ranges from INR 6000-10000.