Preface: Transmission of shares refers to the legal transfer of shares to the heirs or nominees of a deceased or insolvent shareholder. It is governed by the Companies Act, 2013, and the company’s Articles of Association. The process for transmitting shares in a private company involves several steps: the claimant must submit a request letter along with necessary documents, including the original share certificate, death certificate, legal heir certificate, and a no-objection certificate (NOC) from other heirs. Once the company reviews the documents, it either approves or refuses the request within one month. If approved, the original share certificates are canceled, and a new share certificate is issued to the claimant. The company must also update the Register of Members within seven days of approval. The Articles of Association may require board approval for the transmission process. Drafts for the request letter and NOC are provided for the claimant’s convenience in submitting their claim.
Transmission of shares is the legal process of transfer of shares to the legal heir(s) or nominee(s) of a deceased or insolvent shareholder. It is a legal requirement, unlike the transfer of shares, which is voluntary in nature.
Transmission of shares is governed by the Companies Act, 2013 and a Company’s Articles of Association.
Process for Transmission of Shares in case of Private Company is as follows:
1. The Claimant/Legal Heir shall submit the Request Letter to the Board of Directors of the Company along with NOC from other Legal Heir(s), if any, Original Share Certificate, Death Certificate, Legal Heir Certificate and Nomination Certificate, if any.
2. The company shall thoroughly review all the documents submitted with transmission request.
3. If the documents submitted with transmission request are not in order, the company shall within one month from the date of receipt of intimation of transmission, communicate refusal to the concerned person.
4. If the documents submitted with transmission request are in order, the Company shall cancel the Original Share Certificates and issue the new Share Certificate to the Claimant within one month of receipt of intimation of transmission.
5. The Company shall also update the Register of Members within 7 days of approval of transmission.
Note: The Company needs to check its AOA if Board approval is required for transmission of shares.
“DRAFT REQUEST LETTER FOR TRANSMISSION OF SHARES”
Date:
To,
The Board of Directors
(Name of Company)
(Registered Office Address)
Sub.: Transmission of _______ Equity/Preference Shares held by Late _________
Dear Sir/Madam,
I, __________, wife of/son of/daughter of Late ________, r/o _______________, have to inform that my husband, father, Late ______ expired on _____. He/She was holding _______ Equity/Preference Shares of Rs. _____ each fully paid up in the ____________ (the Company).
Please find below relevant details of the Equity/Preference Shares:
| Folio No. of Deceased | Type of Security | No. of Shares | Share Certificate No. | Distinctive No. |
I, __________, requests the Company for transmission of the aforesaid shares in my name.
I confirm that other legal heirs have no objection, whatsoever, if the above shares are transmitted in my name and in token of such no objection, they have provided No Objection Certificate in token of relinquishment of their rights, title and interest in the above shares.
I herewith enclose the Share Certificates, Copy of Death Certificate, Legal Heirs Certificate along with NOC of other legal heirs for your necessary action in this regard.
Thanking You.
Yours Faithfully
Name of Claimant
“DRAFT OF NO OBJECTION DECLARATION”
I/We, ________________, legal heir(s) of late _____________ (deceased holder) declare as follows:
i) That the above-named deceased holder was holding the following securities in his/her name as single holder:
| Name of the Company | Folio No. | No. of Shares | Share Certificate No. | Distinctive No. |
ii) That the deceased had died intestate on __________.and without registering any nominee.
iii) That the following Claimant(s) has/have applied for the transmission of the aforesaid securities:
| Name of the Claimant(s) | Address | Age | Relationship with the deceased |
iv) That I/We are the legal heir(s) of the deceased holder, apart from the Claimant(s) who has applied for transmission of the aforesaid securities and our details are as follows:
| Name of the Legal Heir(s) | Address | Age | Relationship with the deceased |
v) I/We hereby declare that I/we do not desire to make any claim in respect of the title to the aforesaid securities held by the deceased and I/we hereby wilfully relinquish & renounce all our rights in respect of the aforesaid securities and shall have no legal claim upon said securities in future.
vi) Accordingly, I/we declare that I/we have NO OBJECTION WHATSOEVER in _______(name of Company) transmitting the aforesaid securities in favour of the Claimant, _________.
I/ We hereby state that whatever is stated herein above are true to the best of our knowledge and nothing has been concealed therein.
Name(s) and Signature(s) of Legal Heir(s) who are Non-Claimant(s):
Signature(s)
Date:
Place:
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