Question

State, with reasons, whether the following statement is True or False.

Share Certificate is a bearer document. 

पर्याय

• True

• False

Answer 1

False

Reasons:

(1) A share certificate is a written document prepared by the company under its common seal and sent to the members, containing the number of shares held by him/her and the amount paid thereon. The document work as an evidence for the ownership of shares of the shareholder. It is not exactly same as share warrant.

(2) It evidences holding of so many shares by the person mentioned therein. I.e the shareholder.

(3) The details of the share certificate are recorded y company in its Register of Members.

(4) This renders it Non - negotiable but transferable document.

(5) The company has to be notified to execute transfer or shares of shares and it is effective only after necessary changes are made in the Register of Members by the company.