Share Transfer
Execute and record the transfer of shares between shareholders with the required documentation.
What's covered
- Shares in a private limited company change hands under Sec 56 of the Companies Act 2013, read with Rule 11 of the Companies (Share Capital and Debentures) Rules 2014. The transfer is executed on Form SH-4 — the statutory instrument of transfer — signed by the transferor and transferee, witnessed and stamped.
- Stamp duty on a transfer of shares is levied under the Indian Stamp Act and is commonly cited at 0.015% of the consideration, but the incidence varies with how the shares are held and the state involved — we confirm the duty applicable to your transaction before execution.
- Before any transfer, the company's Articles of Association must be reviewed: private-company articles typically contain pre-emptive rights (a right of first refusal in favour of existing shareholders) and may give the board discretion to refuse registration of a transfer on grounds set out in the articles.
- Once the executed SH-4 reaches the company with the share certificate, the board passes a resolution registering the transfer and the certificate is endorsed in the transferee's name — only then is the transferee entered in the register of members.
How we work
- 01
Review the AOA and clear restrictions
Check the articles for pre-emptive rights, right-of-first-refusal procedures and any board discretion to refuse registration; obtain waivers or NOCs from existing shareholders where the articles require them.
- 02
Execute the SH-4 transfer deed
Prepare Form SH-4 with the consideration, distinctive share numbers and certificate details; both parties sign before a witness and the deed is stamped with the applicable duty. Transfers by a director or nominee on behalf of corporate or government bodies, transfers of pledged shares and debenture transfers follow distinct documentation outside SH-4.
- 03
Submit the deed to the company
Deliver the executed, stamped SH-4 together with the original share certificate to the company within the sixty-day window Sec 56 prescribes.
- 04
Board registers the transfer
The board passes a resolution taking the transfer on record, the register of members is updated and the share certificate is endorsed (or a fresh certificate issued) in the transferee's name.
Documents required
- Executed Form SH-4 transfer deed, signed by both parties and witnessed
- Original share certificate(s) covering the shares being transferred
- PAN of the transferor and the transferee
- Board resolution approving registration of the transfer
- NOC or waiver from existing shareholders where the AOA's pre-emption clause applies
- Indemnity bond, where the certificate is lost or the company requires one
Applicable laws & forms
- Companies Act 2013, Sec 56(1) and 56(3) — transfer and transmission of securities, and the time limits for lodging and registering the instrument
- Companies (Share Capital and Debentures) Rules 2014, Rule 11 — prescribes Form SH-4 and its execution requirements
- Indian Stamp Act — stamp duty on the transfer instrument; the rate is state- and mode-dependent, so the figure is confirmed per transaction