Transfer shares with a legally valid process.
Transferring shares in a private limited company requires a properly stamped SH-4 transfer deed, board approval, AoA compliance check, and Register of Members update — all within prescribed timelines.
Pricing
Pricing tailored to your specific requirements
Share Transfer Completed in 7 Days*
*Timeline is indicative and may vary based on document verification and government processing.
What is Share Transfer?
Share transfer is the process by which a shareholder (transferor) conveys their ownership of shares to another person (transferee). Under the Companies Act, 2013 and the Companies (Share Capital and Debentures) Rules, 2014, the transfer of physical shares requires execution of a share transfer deed in Form SH-4, payment of stamp duty at 0.25% of the higher of consideration or face value, and board approval. For private limited companies, the Articles of Association (AoA) typically contain restrictions on free transferability — including right of first refusal (ROFR) clauses requiring the transferor to first offer the shares to existing shareholders before selling to a third party. Failure to comply with AoA restrictions can render the transfer void. For demat shares, the transfer process is electronic through NSDL/CDSL.
Key Requirements
- SH-4 transfer deed executed by both transferor and transferee within 60 days
- Stamp duty paid at 0.25% of consideration or face value (whichever is higher)
- AoA reviewed for transfer restrictions and ROFR compliance completed
- Board resolution approving the transfer passed at a Board Meeting
- Original share certificate(s) surrendered by transferor
- Register of Members updated with transferee's details
- New share certificate issued to transferee
Tax Implications of Share Transfer
| Type | Tax Rate | Details |
|---|---|---|
| Short-term capital gain (held < 24 months) | Taxed at slab rate | For unlisted shares held under 24 months — gains added to income and taxed at the transferor's applicable income tax slab rate. |
| Long-term capital gain (held ≥ 24 months) | 20% with indexation | For unlisted shares held 24 months or more — taxed at 20% after indexation benefit (cost inflation index adjustment). |
| Stamp duty on transfer deed | 0.25% | 0.25% of the higher of consideration paid or the face value of shares. Paid to the State Government at the time of SH-4 execution. |
| Securities Transaction Tax (STT) | Not applicable | STT does not apply to transfer of unlisted private company shares. It applies only to trades on recognised stock exchanges. |
Common Errors That Invalidate a Transfer
Executing SH-4 without checking AoA restrictions — transfer may be voidable
Skipping ROFR notice to existing shareholders — exposes transfer to legal challenge
Underpaying stamp duty (based on face value when consideration is higher) — instrument is improperly stamped and unenforceable
SH-4 submitted to company after 60 days — a fresh deed must be executed
No board resolution passed — transfer not formally registered in company records
Register of Members not updated — new shareholder has no legal standing
Old share certificates not cancelled — risk of duplicate certificate claims
Documents & Records Checklist
- Form SH-4 — duly executed by transferor and transferee, properly stamped
- Original share certificate(s) of the transferor (to be cancelled)
- Board resolution approving the share transfer
- ROFR offer notice and waiver letters from existing shareholders (if AoA requires)
- Stamp duty payment challan / e-stamp paper
- PAN cards of both transferor and transferee
- Updated Register of Members (MGT-1) entries
- New share certificate in Form SH-1 issued to transferee
Our Process
Review AoA for share transfer restrictions and Right of First Refusal (ROFR) clauses
Send ROFR offer notice to all existing shareholders if required by AoA
If no ROFR exercise (or ROFR period expired), proceed to SH-4 execution
Compute stamp duty and advise on payment (e-stamp or physical stamp paper)
Execute Form SH-4 — signed by both transferor and transferee, stamped
Convene Board Meeting — pass resolution approving the transfer
Receive surrendered original share certificate from transferor
Update Register of Members (MGT-1) with transferee's details
Issue new share certificate to transferee in Form SH-1
How It Works
Share Your Details
Fill a short form or call us. We collect your requirements and all documents online — no physical visit needed.
Expert Assignment
A dedicated specialist with expertise in your service category is assigned to your case within 24 hours of payment.
Work in Progress
Your expert prepares documents, files applications with the relevant authority, and follows up on your behalf.
Delivery
Your registration certificate, legal document, or filed return is delivered digitally to your Golden Verdict dashboard.
Get Your Shares Transferred Without Any Hassle
AoA restriction check, right of first refusal compliance, SH-4 transfer deed, stamp duty computation, board resolution, and register update.
Pricing
Custom Quote
Pricing tailored to your specific requirements
Get Your Shares Transferred Without Any Hassle
AoA restriction check, right of first refusal compliance, SH-4 transfer deed, stamp duty computation, board resolution, and register update.
Pricing
Custom Quote
Pricing tailored to your specific requirements
Why Golden Verdict For
Share Transfer?
Share transfers in private limited companies are often done informally — a verbal agreement and a signed SH-4 without checking AoA restrictions, proper stamp duty, or board approval. These informal transfers create title disputes during funding rounds, acquisitions, or ESOP exercises. Golden Verdict reviews your AoA for transfer restrictions, conducts ROFR notifications to existing shareholders if required, prepares the SH-4 transfer deed, computes and advises on stamp duty, obtains board resolution approving the transfer, updates the Register of Members, and issues a new share certificate to the transferee.
An improperly executed share transfer creates title disputes that can derail funding rounds years later. Golden Verdict gets it right the first time.
Frequently Asked Questions
What is Form SH-4?+
How is stamp duty calculated on share transfer?+
What is the Right of First Refusal (ROFR) clause?+
Can a private limited company refuse to register a share transfer?+
Is board approval mandatory for share transfers?+
Ready to get your Share Transfer?
Transferring shares in a private limited company requires a properly stamped SH-4 transfer deed, board approval, AoA compliance check, and Register of Members update — all within prescribed timelines.
“An improperly executed share transfer creates title disputes that can derail funding rounds years later. Golden Verdict gets it right the first time.”
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