All about Nominee shareholder

Nominee shareholder:

1. Means a person whose name is entered in the registered of member, who hold share in behalf of actual owner of share.

2. Nominee shareholder has to make declaration,

3. Nominee can be Natural Person or a Legal Person.

Main Purpose:

1. To fulfill the minimum shareholders requirement as per the provisions of the Companies Act, 2013.

2. To give the opportunity to HUF, Partnership Firm etc, who directly cannot purchase the shares.

3. Where a Company purchased 100 Shares of a Company i.e a Wholly owned Subsidiary

Example:

Difference between the Registered owner and Beneficial Owner

Registered owner:

It means a person whose name is entered in the registered of members of the Company as a holder of the shares but who does not have any beneficial Interest in the shares.

Beneficial Owner:

It means the actual owner of the shares of the company, who enjoys all the benefits attached with the shares of the company, but whose name is not entered in the register of Member.

When this situation happened what compliance required to be done under the Companies Act, 2013

Relevant Sections under the Companies Act, 2013

Provisions Section 89 and Section 187 of the Companies Act, 2013, should be complied.

Section 89

Some mandatory declaration to be made by the registered owner of the shares and the Beneficial owner of the shares.

As per section 89 read with rule 9 of the Companies (Management and Administration) Rules, 2014.

1. The registered owner who have not beneficial interest in the shares of the company shall made a declaration in form MGT-4 within 30 days from the date of the name entered in the registered of  member or change therein.

2. The Beneficial owner of the shares whose name is not mentioned in the registered of members shall made a declaration in Form MGT-5 within 30 days from the of acquiring beneficial interest in the shares of the Company or Change therein.

3. Upon receipt of the Form MGT-4 & MGT-5 by the Company the same shall be approve by the Board of the Company and Company shall also made an intimation in the e-Form MGT-6 within 30 days from the receipt of declaration in Form MGT-4 & in Form MGT-5.

*Format of MGT-4 & MGT-5 given below as annexure-1

Example:

Form No. MGT-4

Declaration by the registered owner of shares who does not hold the beneficial interest in such shares

[Pursuant to section 89(1) of the Companies Act, 2013 and rule 9(1) of the Companies (Management and Administration) Rules, 2014]

To,

………………………………. Private Limited
…………………………………………………….

1. Particulars of the Registered owner of shares:

(i) Name: …………………………

(ii) Father’s Name:  …………………………..

(iii) Occupation:  ……………………………

(iv) Whether citizen of India:   ………………………………

(v) Nationality: …………………………………….

(vi) Date of Birth:  …………………………………

(vii) Gender:  ………………………………….

(viii) PAN No.  ………………………………….

(ix) Proof of Identity: ………………………………………

• For Indian Nationals:

(Any of the following):

Income-tax permanent account number
Voter’s identity card number
Passport number
Driving License
Unique Identification Number (UIN)

• For Foreign nationals and Non-Resident Indians:

Passport
Others

(x) Permanent Residential Address……………………………

ISO Country Code: IN       ………………………………

Phone:………………….          Mobile:………………………….

Fax: ………………….             Email ID: d………………………..

(xi) Whether present residential address is same as the permanent residential address: Yes

If No, present residential address

ISO Country Code     Country

Phone                          Mobile

Fax                               Email ID

2. Particulars of the shares in respect of which declaration is being made by the registered owner:

i)   Class of shares:   ……………….

ii)   Number of shares:  ……………………

iii)  Distinctive numbers:       ………………………

iv)  Certificate No.:  ………………………..

v)   Folio No.:  ………………………..

vi)  Nominal value of shares:  Rs……………………….

vii) Paid up value of shares:    Rs. ………………….

3. Declaration:

In pursuance of sub-section (1) of section 89 of the Companies Act, 2013, I Rakshit Jain, hereby declare that the person (s) name below hold(s) the beneficial interest in the above-mentioned shares registered in my name in the register of members of the company:

Sl. No	Name of the bene ficial owner(s)	Add ress and E-mail id	DOB/ Age	Father’s/ Spouse’s name	Occu pation	Natio nality	PAN/ UIN/ CIN (in case of company)	Passport No. (in case of foreign national)	Dis tinctive No., if app licable

4. Details of the beneficial interest:

i) Nature of the beneficial interest: ……………………..

ii)  Date of creation of the beneficial interest:  ……………………………

iii)  Reasons for not registering shares in the name of the beneficial owner(s):

As the Company is a Private Limited, it is required to have minimum 2 shareholders.

iv) Particulars of the instrument/ document,  ………………………………… if any, showing the creation of such beneficial interest :

5. Particulars of change in beneficial interest: N.A.

i)    Date of change:

ii)   Nature of the change in the beneficial interest:

iii)  Brief particulars of such change:

iv)  Reason for such change:

v)  Particulars of the instrument/ document, if any, showing the change in such beneficial interest:

Date:  ……………..

Place……………………

Name and Address:

……………………………….

Enclosures:

(a) Proof of identity of the registered owner and beneficial owner

(b) Instrument/ document under which the beneficial interest is created/ transferred/ changed.

Form No. MGT-5

 Declaration by the beneficial owner who holds or acquires beneficial interest in shares but whose name is not entered in the register of members

[Pursuant to sub-section (2) and (3) of section 89 of the Companies Act, 2013 and rule 9(2) of the Companies (Management and Administration) Rules, 2014]

To,

………………. Private Limited
………………………………..

1. Particulars of the shares in which beneficial interest is held by the person making declaration:

i) Class of shares: ……………..

ii) Number of shares:………………..

iii) Distinctive numbers: ………………….

iv) Certificate No.: …………………

v) Folio No.: ………………………

vi) Nominal value of shares: ………………

vii) Paid up value of shares:  …………………

2. Particulars of the beneficial owner

Sl. No.	Name of the beneficial owner(s)	Address and E-mail id	DOB/ Age	Father’s/ Mother’s/ Spouse’s name	Occu pation	Natio nality	PAN/ UIN/ CIN (in case of company)	Passport No. (in case of foreign national)

3. Declaration

In pursuance of sub-section (2) of section 89 of the Companies Act 2013, We, M/s MGF Developments Limited hereby declare that we hold/ have acquired the beneficial interest in the above-mentioned shares of the company which are registered in the name of the person whose particulars are furnished below:

4. Particulars of the registered owner 

Sl. No	Name of the registered owner	Address and E-mail id	DOB/ Age	Father’s/ Spouse’s name	Occupat-ion	Natio nality	PAN/ UIN/ CIN (in case of company)	Passport No. (in case of foreign national)

5. Details of the beneficial interest:

i)   Date of creation / acquisition of beneficial interest;   …………..

ii)  Mode of acquisition of beneficial interest:  ……………..
Allotment / Transfer / others specify

iii) Nature of the beneficial interest:………………………

iv) Reasons for not registering shares in my name:  …………………………….

v)  Particulars of the instrument/ document, if any, showing the creation of such beneficial interest: …………………………

6. Particulars of the person from whom the beneficial interest is acquired, if applicable:

N.A.

 i)  Name of the transferor of beneficial interest:

ii) Whether shares were registered in his name:

(If not, whether any declaration under sub-section (2) of section 89 was filed by him to the company. If so, date of such declaration)

iii) Particulars of the instrument/ document, if any, showing the transfer of such beneficial interest:

7. Particulars of change in beneficial interest: N.A.

i)   Date of change:

ii)  Nature of the change in the beneficial interest:

iii) Brief particulars of such change:

iv) Reason for such change:

v)  Particulars of the instrument/ document, if any, showing the change in such beneficial interest:

Date:  ………………………
Place: …………………………

For ………………………….
……………………………..
Director
DIN: ………………………….
…………………………………

CERTIFICATE

I hereby certify that the beneficial interest in the shares mentioned above has been transferred by me on ………………………..

Signature of the person who has transferred the beneficial interest in the shares

For ………………………Private Limited

……………………………..
Director
DIN: …………………………
…………………………………..
………………………………..

Date: ………………………….
Place: ……………………………..

Enclosures:

1. Proof of identity of the registered owner and beneficial owner;

2. Instrument/ document under which the beneficial interest is created/ transferred/ changed