share transfer by shareholder

The procedure is subject to one condition which is as follows:

First transfer from A to B must be approved by the company in favour of B then only B can validly transfer his shares to C.

B should wait to receive properly endorsed share certificate in his favour from the company.

Revert if there is any doubt.

As I understood the query as : A sold shares to B by a transfer deed wherein only A'si.e. transferors details are filled in , later on B sold the shrars to C by handing over the certs with ths same transfer deed.C filled in the details of transferee and lodged the certs for transfer with the co.

Then it is case of blank transfer deed. A TD is valid for a year and in between it can be passed thru many buyers of the same qty of shares. the last person who would like to registerd his name in the register of members can lodged the doc. with the co. for transfer.

As per Sec 108 of Companies Act,1956, A company shall not register a transfer of shares in unless a proper instrument of transfer duly stamped and executed by or on behalf of the transferor and by or on behalf of the transferee and specifying the name, address and occupation, if any, of the transferee, has been delivered to the company along with the certificate relating to the shares or debentures, or if no such certificate is in existence, along with the letter of allotment of the shares or debentures

In ur case, A transfer  share to B directly by endorsing   transfer deed to B without registering it with the Company and later B transfer transfer share to C and filed the transfer deed for registering the share in name of C

This is not possible because originally the name registered in transfer deed is of A and if you want  to get it registered in the name of C consent of A  required  

AS PER  MY COLLEGUE CS ARS  :-A TRANSFER DEED IS  VALID FOR A YEAR AND IN BETWEEN SHAREHOLDER CAN TRANSFER HIS SHARE NO. OF TIME ON BLANK TRANSFER DEED. ONLY ALTIMATELY TRANSFEREE IS REQUIRED TO SUBMIT PROPER DOCUMENT FOR REGISTER HIS NAME IN SHARE HOLDER REGISTER.

Your case is a case of blank transfer but you have not mentioned in your original query. Never mind bro…Follow the advice given by ARS.

Also give a reading to the topic of Blank Transfer in any good law book.

Best Regards

Dear Friends,

I just want to correct the understanding relating to validity of Share Transfar Deed which is valid for Two months  in case of Private limited / unlisted public companies.In case of Private limited companies ,shares are not freely transferable.Articles of Association of Private Limited Companies do provide for restrictions on transfer of shares and pre-emptive rights of members.

Regards,

CS Sunil K. jain,Practising Company Secretary, 9810104162,skj13 @ rediffmail.com

IF i follow advice of cs ars that blank trnsfer can be done by a shareholder.  Then what should be mentioned at the time of submission of annual return in which  co. have to give transferor and transferee detailed.

Can co. mentioned as transferor is A and Transferee is C. who is ultimetely holding the share.

Dear Pawan

I wanna say one thing that A transfer must be registered by Company in favor than only B can transfer/sell his share because Private Company have rights to refuse the registration of shares in case of transfer.

So firstly it must be in name of B than only B can sell/transfer.

Regards

as company is a  pvt ltd company...then transferor shall take permission of company ( director) before transferring share...as they share cant be issued to general public theses shares are exclusive for some member ( relatives & family member )...so this procedre shall be done...form no . 7b shall be given by transferor after getting approval from company......................

i hope iam right ..other comments are also welcome

If there is transfer of share by way of blank transfer deed. In that case at the time of submission of annual report u mention the name of original transfer i.e in your case is A because the share is registered in the name of tranferor A unless the blank transfer deed is registered with company in the name of any transfree