Transmit Shares on Death explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
To transmit shares on a shareholder's death, the nominee (if registered in SH-13) or the legal heirs apply to the company with the death certificate, original share certificate and succession proof. The Board approves the transmission, updates the register of members and issues a fresh certificate — no SH-4 or stamp duty is required.
Overview
Transmission is the process by which shares of a deceased (or insolvent/insane) member pass to the nominee or legal heirs by operation of law. Unlike a transfer, it is not a voluntary transaction, so it needs no instrument of transfer and attracts no stamp duty.
When It Is Required & Legal Basis
Section 56(2) of the Companies Act, 2013 recognises transmission by operation of law. Section 72 read with Rule 19 allows a member to nominate a person in Form SH-13; that nominee's rights on death prevail over the legal heirs, subject to the succession law position.
Step-by-Step Process
- Intimation. The nominee/legal heir informs the company of the member's death.
- Collect documents. Obtain the certified death certificate, original share certificate, and succession proof or nomination (SH-13).
- Application. The claimant submits a transmission request with a specimen signature and, where needed, an indemnity/affidavit.
- Verification. The company verifies the documents and title; for higher-value holdings it may insist on a succession certificate or probate.
- Board approval. The Board approves the transmission and directs the update.
- Update & issue. Record the change in the register of members and issue a fresh certificate within one month.
Forms, Attachments & Fees
| Document/Form | Purpose | Timeline |
|---|---|---|
| SH-13 (if nomination exists) | Establish nominee's entitlement | Filed earlier by member |
| Death certificate + succession proof | Prove death and title | With the application |
| Register of members (MGT-1) | Record the transmission | On approval |
No SH-4 and no stamp duty. Where there is no nomination and no probated will, a succession certificate or legal heir certificate is generally required for larger holdings; smaller holdings may be settled on an indemnity.
Timeline & Due Dates
The company should register a valid transmission and deliver the new certificate within one month of receipt of the documents (Section 56). There is no external filing deadline as no ROC form is involved.
Penalty for Delay / Non-compliance
Unjustified refusal or delay in registering a valid transmission attracts penalty under Section 56(6) — ₹50,000 on the company and every officer in default — and the claimant may approach the Tribunal for rectification of the register under Section 59.
Practical Tips
- Encourage members to file SH-13 nominations to make transmission smooth and avoid succession disputes.
- Adopt a clear internal threshold above which a succession certificate/probate is insisted upon.
- Take an indemnity bond where documents are incomplete but the claim is otherwise genuine.