Transfer of Shares:- Shares are movable property and transferable like any other property. Transfer of shares is one of the beneficial features of a public company. Transfer is a voluntary act of parties which results in transfer of ownership.
A shareholder cannot withdraw his money from the company as the amount received on shares is the permanent capital of the company. This is the reason why transferability of shares has been given importance from the very beginning of the company. A shareholder can only convert their shares into cash by transferring them to any other person either in share market or by private sales.
For an effective transfer, the ‘Transfer Deed’ which contains the particulars of transferor and transferee and is duly signed by both of them is sent to the company along with the Share Certificates. The company will examine the particulars and on getting satisfied with the particulars, company will enter the name of transferor in the ‘Register of Members’ and remove the name of transferee will be removed from the Register.