Transferring equity ownership in a private company is a structured legal transaction governed by Section 56 of the Companies Act, 2013, and the company's Articles of Association (AOA). The process requires executing a Share Transfer Deed in Form SH-4, paying the unified national stamp duty of 0.015% of the consideration value, and submitting the deed along with the original share certificates to the company within 60 days. Private companies often have restrictions in their articles, such as pre-emptive rights or a Right of First Refusal (ROFR), which must be followed to prevent transaction disputes. Acclevate manages the entire process, reviewing your articles, calculating precise stamp duties, and coordinating board approvals to ensure your share registers are updated correctly.
We analyze your Articles of Association (AOA) to ensure your transfer complies with any pre-emptive rights, ROFR, or board restrictions.
Our team drafts and compiles the Share Transfer Deed in Form SH-4, coordinating signatures and verification from witnesses.
We calculate and process the required stamp duty payments based on the consideration value to ensure your transaction is legally valid.
We coordinate board approvals to register the transfer, updating your Register of Members and issuing new share certificates to the buyer.
Following recent amendments, the unified national stamp duty rate on physical and dematerialized share transfers is 0.015% of the total transaction consideration value, payable via statutory stamps or e-stamping portals.
The Share Transfer Deed (Form SH-4) must be submitted to the company within 60 days of its execution. Once submitted, the Board of Directors must review, approve, and register the transfer within 30 days.
In a private company, the Board of Directors has discretionary power to decline a transfer request, provided they act in good faith and their reasons align with the restrictions outlined in the company's Articles of Association (AOA).
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