- Provisions under the new Companies Act 2013:
- Under the new companies act 2013 there is no provision of Re-validation of Share Transfer Deed / Form. It is not possible to re-validate a securities transfer form after the expiry of 60 days from the date of execution of the share transfer form.
- A transfer deed used for transfer of shares is valid for a certain period of time, within which the duly executed transfer deed has to be delivered to the company or share transfer agent of that company for further processing of the transfer of shares by the company.
- If the time period is expired, the company have full right to not to entertain the transfer.
- Therefore, in order to facilitate the shareholder the successful transfer of the shares on the base of that same expired transfer deed, section 108(1D) gives an option to the shareholder to re-validate the expired transfer deed for another 30 days period.
- Process of revalidation: To revalidate the transfer deed, one has to make necessary payments through MCA portal entering the details of the transfer, take the challan copy of the payment and submit it to the respective ROC along with the share certificate for revalidation. Generally within a period of day or two the ROC returns the transfer deeds with revalidated stamps on it.
- Once the revalidation of the expired transfer deed is done, it should be sent to the Company or the RTA within one month.
- What other option you can adopt to avoid revalidation.: If you are thinking about some other way out through which the same transfer can happen without going for revalidation process, then another way would be to once again execute a fresh transfer deed with the transferor. But the only demerit of this option is once again the stamp duty has to be paid.
- The above suggestion would be advisable for transfers involving small consideration only.
Validity of Share Transfer Deed