Question

transfer of share will be effective only if it is made by
​

Answer 1

Explanation:

Free transferability of share is one essential condition for Company form of business, subject to some restrictions under private companies. New Act, deals with substantially.

Statutory provisions related to transfer of share one should refer the following sources:

Section 56 of Companies Act, 2013

Rule 11 of Companies (Share Capital & Debentures) Rules 2014

Provisions given in model articles of association given in Table ‘F’ of Schedule-I

Generally a Private Company is guided by its Article of Association. As per Section 2(68) of Companies Act, 2013 Private Company restricts the transfer of shares and prohibit invitation to public to subscribe to any securities of the Company.

IMPORTANT:

Transfer in violation of Article Void: Share Transfer in violation of Article is void.

Transfer without consideration is Void: Share transfer without consideration is void.

Transfer in family arrangement: Transfer of shares on basis of family arrangement without complying with provision of Section 108 is valid.

PROCEDURE FOR TRANSFER OF SHARES BY PRIVATE LIMITED COMPANY:

A. INTIMATION:

Transferor should give a notice in writing for his intention to transfer his share to the company.

B. DUTY OF THE COMPANY:

The company in turn should notify to other members as regards the availability of shares and the price at which such share would be available to them.

Such price is generally determined by the directors or the auditors of the company as per book value of shares.

The company should also intimate to the members , the time limit within which they should communicate their option to purchase shares on transfer

If none of the members comes forward to purchase shares then the shares can be transferred to an outsider and the company will have no option, other than to accept the transfer.

C. EXECUTION FORM: Get the Share transfer deed in form SH-4 duly executed both by the transferor and the transferee. SH-4 should be

Answer 2

Answer:

If it is transferred by the company then it will be effective only.

Explanation:

• At the time of share transfer the company ill provide the certificate to the buyer.
• This certificate mostly provided by the company within the one month after the share transferring.
• In the certificate all the share related information like number of shares, price and date of purchased are mentioned on it.

#SPJ2