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TRANSFER OF SHARES
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TRANSMISSION OF SHARES
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Meaning
Transfer is a usual action of passing the ownership of shares to another person by the member voluntarily.(not compulsorily)
Nature
Transfer is done voluntary by the member.
Who is the transferee?
Shares can be transferred to any person.
Consideration. (thought)
In this case the shareholder transfers the shares to other person for consideration or money.
Stamp Duty
As money is involved in case of transfer, stamp duty is to be paid on the transaction based on the market value of shares.
Procedure
An application is made to the company to transfer which is signed by the transferor and transferee. The director decide whether to approve the transfer of not.
Liability
In case of transfer the liability is also transferred from the transferor to transferee immediately after transfer.
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Transmission is done in case of death, lunacy (madness) or insolvency (bankruptcy) of a member by passing the ownership of shares to the legal representative.
It is compulsory action taken in case of death, insolvency or lunacy of a member.
Shares are transmitted to legal representative (spoke person) only.
In case of transmission shares are transmitted to legal representative without consideration.
Consideration or money is not involved in the transaction therefore stamp duty not required to be put.
In case of transmission the person in whose name the shares are transmitted has to give a proof that he is a legal representative of the concerned member
After transmission of shares liability of original members is continued with the person to whom the shares are transmitted.
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TRANSFER OF SHARES TRANSMISSION OF SHARES
