Company · Money in
A founder is transferring shares — what does it take legally?
The short answer
A founder share transfer in a private company is a paper process, not an MCA e-filing. The transferee submits a stamped SH-4 with the share certificates; the board approves registration and the company must register or reject within 30 days. New or endorsed certificates go out within one month of registration. Check your Articles first — pre-emption clauses bind before anything else moves.
The paperwork nobody tells you about
Statutory formats that never touch the MCA portal — but an ROC inspection or due diligence will ask for every one of them.
Board approves registration of the transfer and issues new certificates
Section 56, Companies Act 2013
New/endorsed certificates delivered within 1 month of registration of transfer
Section 56(4)(c), Companies Act 2013
The sequence
- 1Check the Articles of Association for pre-emption and transfer restrictions
- 2Execute a stamped SH-4 share transfer instrument and submit it with share certificates
- 3Pass a board resolution approving registration of the transfer
- 4Register the transfer within 30 days of receiving the SH-4 and certificates, or reject and return
- 5Issue new or endorsed share certificates within one month of registration
Do it with us — or check it yourself first
Questions founders actually ask
Is there an MCA e-filing for a founder share transfer?
No. A plain private-company share transfer has no dedicated MCA e-filing. SH-4 is a stamped instrument processed internally, and the transfer surfaces in the next MGT-7 annual return.
How long does the company have to register the transfer?
Under Section 56 and Rule 11 of the Companies (Share Capital and Debentures) Rules 2014, the company must register the transfer within 30 days of receiving the SH-4 and share certificates, or reject and return them.
When does the transferee get new certificates?
New or endorsed share certificates must be delivered within one month of registration of the transfer under Section 56(4)(c).
Last verified 2026-08-24 against MCA V3 records and ICSI reference material. Form-level deadlines and penalties live on the linked form pages and update there.