Maharashtra State BoardHSC Commerce 12th Board Exam
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Transfer of Shares and Transmission of Shares - Secretarial Practice

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Transfer of Shares and Transmission of Shares

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Solution

Basis Transfer of Shares Transmission of Shares
1. Meaning  The passing of ownership of the shares by one shareholder to another as a result of voluntary sale or gift of shares is called Transfer of shares.  The passing of ownership of of shares from one shareholder to another by the operation of law is called Transmission of the shares.
2. Kind of action Transfer of shares take place when there is a sale / purchase / gift of shares. So it is a voluntary action Transmission of shares take place in the event of death or insolvency or lunancy of the shareholders. So it is a compulsory action.
3. Reasons When both the parties i.e., transferor and transferee are willing to transfer by submission of instrument of transfer by transferor. Transfer of shares take place Transmission of shares take place only when shareholders die or become lunatic the legal representative is required to submit an evidence that proves his legal status.
4. Initiative Transfer of shares is initiated by the shareholders i.e., transferor or by an authorised person. Transmission of shares is initiated by the legal representative of the deceased shareholder.
5. Consideration  There must be adequate consideration in terms of money for transfer of shares unless they are transferred by way of gift. The question of consideration in money does not aries because shares are always transmitted to legal representative without any consideration.
Concept: Transfer and Transmission of Shares
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