Securities transfer forms, executed prior to the new Companies Law coming into force from April 1, would be valid and can be registered by the firms.
The clarification, provided by the Corporate Affairs Ministry, has been communicated by Sebi to stock exchanges for dissemination to the market participants.
The Companies Act 2013 provides for a new securities transfer form for stakeholders. It has replaced the earlier forms with effect from April 1, 2014.
However, various stakeholders had sought clarity from the ministry with regard to share transfer forms executed before April 1, 2014 but which were yet to be accepted by companies.
The matter was clarified by the ministry, which is implementing the Companies Act, following representations from various stakeholders.
"Any share transfer form executed before April 1, 2014 and submitted to the company concerned within the period prescribed under relevant section of the Companies Act 1956 needs to be accepted by companies for registration of transfers," the ministry said.
"In case any such share transfer form, executed prior to April 1, 2014, is not submitted within the prescribed period under the Companies Act, 1956, the concerned company may get itself satisfied suitably with regard to justification of delay in submission etc," it noted.
Additionally, a company would have to give reasons for deciding not to accept the share transfer form.
Meanwhile, it was also clarified that a committee of directors may issue duplicate share certificates, subject to regulations imposed by the board in this regard.
Following Sebi orders to disseminate the information with regard to share transfers to the market participants, BSE has asked its trading members to take note of the same.
