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Capital and charges

Transfer shares

A shareholder wants to sell. Is that an allotment?

The short answer

A physical transfer is SH-4, stamped, and then registered by the company. The Registrar does not receive SH-4. A demat transfer never uses SH-4. It moves through the depository.

Shares already issued. An allotment of new shares is PAS-3, not this.

VerifiedAct-sourced — Sections 56 and 58.

Step by step

  1. 1

    Read the articles

    A private company restricts transfer. The board accepts or refuses as the articles and section 58 allow.

  2. 2

    SH-4, stamped

    Transferor and transferee sign. Stamp is the stamp law, not an MCA fee. An unstamped deed is not registered.

  3. 3

    The register

    The company enters the transferee in the register of members. That entry is what makes the person a member. The Registrar does not receive SH-4.

  4. 4

    Demat

    If the shares are in a depository, the delivery instruction replaces SH-4. Do not look for this form on the portal.

Forms

  • SH-4 — Lodged with the company. Not an ROC e-form.

Papers

  • SH-4, if the shares are physical
  • Share certificate, or the depository instruction
  • Board resolution where the articles require acceptance

Where this filing fails

  • PAS-3 is the wrong form. A transfer does not increase capital.
  • Stamp is not an MCA fee. The rate sits in the stamp law.