Faizam was a shareholder in Sky Scrapers Limited. Faizam died after executing a will under which Rahim, a son of Faizam, was to inherit all his properties including the shares held by him. The Articles of Association of
CS Professional · Drafting, Pleadings and Appearances · PYQS · December 2024
Faizam was a shareholder in Sky Scrapers Limited. Faizam died after executing a will under which Rahim, a son of Faizam, was to inherit all his properties including the shares held by him. The Articles of Association of Sky Scrapers Limited vested, with the Board of Directors, absolute discretion in regard to registration of transfer of shares. The Board of Directors refused to register the transmission of the shares to Rahim on the ground that Rahim is an undesirable person. What are the documents Rahim has to submit for transmission of shares in his name?
Answer & Explanation:
Considering that the deceased shareholder has created a will wherein his shares of the company has been bequeathed in favour of his son Rahim, the process of transmission will be governed by the provisions of Section 56 of the Companies Act, 2013 read with the Indian Succession Act, 1925 and accordingly, Rahim needs to submit with the Company, a formal written request for transmission of shares (typically available with the company's RTA in case of dematerialised shares or as a simple letter) along with the following documents to allow the company to verify his legal rights for the transmission of shares: A certified copy of the Death Certificate of the deceased shareholder, issued by a competent authority (like the local municipal corporation). Copy of the Probate of Will, as issued by the relevant court (i.e., a legal document confirming the authenticity of the Will) along with the certified copy of the Will clearly mentioning the shareholder's intention of transferring the shares to the named beneficiary (transferee). Identity and Address Proofs of the deceased shareholder. Identity and address proof of the transferee (as per the Will). Affidavit of the Transferee confirming that the Will is the last valid testament of the deceased based on which he is staking claim for the being the rightful beneficiary of the deceased shareholder's estate. NOC from Other Legal Heirs, if the Will names a specific transferee but there are other legal heirs (e.g., spouse, children), may be required, affirming that they do not object to the transmission of the shares as per the Will. Original Share Certificate(s): The original share certificate (s) of the deceased shareholder, if available. If the shares are held in physical form, the original certificates need to be submitted. If the share certificates are lost or destroyed, an Indemnity Bond (on a non-judicial stamp paper) may be required, declaring the loss of the certificate and indemnifying the company against any future claims. If the shares are in dematerialized (demat) form, the details of the demat account of the transferee will need to be provided along with a demat request form for the transfer of shares. Bank Account Details of the transferee, for updation of details related to dividend payments or for future corporate actions. Any other documents that may be requested by the company as per the company's internal procedures.
Topics: Company Law / Securities Law
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