Basic Details of Share Transfer

Every registered company will usually have a shareholder contract, director, and board of directors. However, a shareholder at any point in his life can transfer shares to any other person. This transfer of shares can be conducted due to multiple reasons. A person can sell or transfer the share to raise net working capital for the company or completely re-organize the firm. One can also pitch in new partners who can provide benefits for the company by transferring some of their shares.
Practically speaking a share, by the Companies Act, 2013, is an indivisible unit of capital that represents a company’s connection with its shareholders. A gift or sale is the usual method of transferring shares. You can transfer shares in a company even after it has been established as long as there are enough shares.
 You can also change the share structure of your business by adding a new shareholder contract or altering the existing percentage of shares among shareholders. When selling or giving away shares, a share transfer is a procedure of shifting them from one individual to another. This article will explain how to distribute existing shares in your firm.
 

Share Transfer Provision under Company Act, 2013

The Companies Act, 2013, and Companies (Share Capital and Debentures) Rules, 2014 stipulate how shareholders can transfer their shares. The value of a share is its face value and the face value of all shares issued represents the company’s total capital, which may not accurately reflect the market value of those shares.
 

Documents Required for Share Transfer

The following documents of both the acquirer and transferor are mandatory

• Income-tax PAN 
• Passport size photos
• Aadhaar card 
• Mobile Number and email id
• The transferor’s original stock certificate