The Capital of a Company is usually divided into certain indivisible units of a fixed amount, these units are called Shares. 'Share means '  Share in the capital of a Company. It includes stock except where a Distinction between Stock and Shares is expressed or implied.


Transmission of Shares 

           Transmission of Shares takes place on the death or insolvency of an individual member or if the member is a limited company, on its going liquidation. When the member of a company dies or is declared insolvent, his shares vest in his legal representative or official assignee or receiver respectively.  The legal representative or official assignee receiver can validly transfer shares to another person even though he himself, not a member.  In the case of transmission of shares, no instrument of transfer is necessary. The person to whom the shares are transmitted should make an application to the Company for transmission of shares in his name.  The Articles usually contain a provision relating to the transmission of shares.


Distinction between Transmission of Shares and Transfer of Shares 



No

                Transfer of Shares

           
              Transmission of Shares

1

Transfer of shares is affected by the act of the parties.


Transmission of shares takes place by operation of Law.

2

In the case of transfer of shares as soon as the transfer is complete, the Liability of transferor ceases.
  

But in case of transmission of shares, the shares continue to be subject to the original liabilities


         If there is a lien on the shares, it will subsist even though the transmission of share has taken place.  



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