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Key takeaways
- Transmission passes share ownership by operation of law on a member's death, insolvency, or incapacitation. No transfer deed or stamp duty applies.
- A nominee under Section 72 holds shares as custodian, not as absolute owner. A will or succession law takes precedence for final ownership.
- Where a nominee is registered, only a transmission request form, death certificate, and PAN card are required, at any value.
- Where no nominee is registered, the required documents depend on whether succession documents are available and whether the value of the securities falls within SEBI's prescribed thresholds. Below ₹5 lakh per listed entity (physical) and ₹15 lakh per beneficial owner account (demat), succession documents may be substituted with a no-objection certificate and an indemnity bond.
- For listed companies, the RTA issues a Letter of Confirmation after verifying documents, within 30 days. The claimant has 120 days from the Letter of Confirmation to submit a demat request to their DP.
- For private companies, the company must issue a new share certificate within one month of receiving the complete transmission intimation. Default attracts a ₹50,000 penalty under Section 56(6).
- SEBI's March 2026 proposals to raise the thresholds to ₹10 lakh (physical) and ₹30 lakh (demat) are not yet enacted.
- For private companies, the AoA and board judgement govern what documents are required.
What is transmission of shares?
Transmission of shares is the process by which ownership of shares passes to another person by operation of law, rather than by any voluntary act of the shareholder. It occurs when a registered member dies, becomes insolvent, or is declared of unsound mind by a competent court. Because no deliberate sale or gift initiates the event, transmission bypasses several requirements that apply to voluntary share transfers, including the instrument of transfer in Form SH-4 and stamp duty.
The governing provision is Section 56(2) of the Companies Act, 2013, which empowers a company to register a transmission on receipt of intimation from the person to whom the right has passed. The Articles of Association (AoA) may prescribe additional documentary requirements. For shares held in dematerialised form, SEBI's framework under the LODR Regulations and its Master Circular for Registrars to an Issue and Share Transfer Agents applies in parallel.
Transfer of shares vs. transmission of shares
Can a company refuse to register a transmission?
Under Section 58(1) of the Companies Act, 2013, a private company may refuse to register a transmission, whether or not its AoA contains a specific power to do so. If the board refuses, it must send written notice to the claimant stating reasons within 30 days of receiving the transmission intimation. The claimant can appeal to the NCLT within 30 days of receiving that notice, or within 60 days of delivering the intimation to the company if no notice was sent at all.
Section 58(4) permits a public company to refuse registration of a transmission if it has sufficient cause. If a public company refuses, the claimant has 60 days from the date of refusal to appeal to the NCLT, or 90 days from the date of delivering the transmission intimation if no notice was received.
In both cases, the NCLT may direct the company to register the transmission within 10 days of its order, or direct rectification of the register and award damages. A person who contravenes a Tribunal order under this section is liable to imprisonment of one to three years and a fine of ₹1 lakh to ₹5 lakh.
The nominee vs. legal heir distinction
Section 72 of the Companies Act, 2013 grants every securities holder the right to nominate a person to whom those securities shall vest on the holder's death. This provision is widely used but frequently misunderstood in terms of what it actually confers.
A nomination does not transfer absolute ownership. In Shakti Yezdani & Anr. v. Jayanand Jayant Salgaonkar & Ors. (December 14, 2023), the Supreme Court of India held that a nominee acquires shares in a limited capacity. The company may vest shares in the nominee to discharge its liability against competing claims from legal heirs, but the nominee holds them as custodian until succession is settled under applicable law. A will or personal succession law takes precedence over a nomination for the purpose of final ownership.
Tax treatment of transmission
Transmission is not a taxable event for the recipient. Section 47(iii) of the Income Tax Act, 1961 provides that any transfer of a capital asset under a gift, will, or irrevocable trust (including transmission by operation of law) is not treated as a transfer for capital gains purposes. No capital gains tax is triggered in the hands of the nominee or legal heir at the point of transmission. When the recipient subsequently sells the shares, the cost of acquisition is the original cost to the deceased holder, and the holding period includes the period for which the deceased held the shares.
Documents required for transmission of shares
The document requirements for listed companies come from SEBI's Master Circular for RTAs dated June 23, 2025, which is the operative reference for any transmission processed by a listed company or its Registrars to an Issue and Share Transfer Agents (RTA) today. The requirements vary based on three factors: whether a nominee is registered, the value of the securities, and whether the company is listed or private.
Scenario 1: Shares are held in a single name with a nomination
Where a nominee is registered, the same three-document set applies regardless of the value of the holding. The nominee submits:
- Transmission request form (Form TRF)
- Death certificate (original, or copy attested by a notary public or gazetted officer)
- Self-attested copy of the nominee's PAN card
Scenario 2: Shares are held in a single name with no nominee registered
Where no nominee is registered, the required documents depend on whether succession documents are available and whether the value of the holdings is within the prescribed thresholds.
Standard documentation (where succession documents are available)
Under Para 20.4.3 and 20.4.6 of the Master Circular, all claimants submit:
- Transmission request form (Form TRF)
- Death certificate (original, or copy attested by the claimant subject to verification with original, or attested by a notary public or gazetted officer)
- Self-attested copy of PAN card of each claimant
- Copy of birth certificate (in case the claimant is a minor)
- KYC* of the claimant guardian (in case of nominee /claimant being a minor/of unsound mind) (* if not KYC compliant)
- Original security certificate(s)
- Notarised affidavit from all legal heirs on non-judicial stamp paper, identifying themselves and claiming legal ownership of the securities (in the format at Annexure 17 of the Master Circular)
- Copy of any of the following documents:
- Succession certificate; or
- Probate of Will; or
- Will, along with a notarized indemnity bond from the legal heir whom the securities are transmitted, as per the format specified provided in Annexure-18; or
- Letter of Administration; or
- Court Decree; or
- Legal Heirship Certificate or its equivalent, along with (i) a notarized indemnity bond from the legal heir o(s)/claimant(s) to whom the securities are transmitted, as per the format provided in Annexure- 18; and (ii) No Objection from all the non- claimants, as per the format provided in Annexure- 19.
Simplified documentation (where succession documents are unavailable and the value is within the thresholds)
For securities valued at or below ₹5 lakh per listed entity (physical) or ₹15 lakh per beneficial owner account (demat) and succession documents are unavailable, items 9 and 10 may be substituted for the succession documents above
- No-objection certificate from all legal heirs relinquishing their claim (Annexure 19), or a family settlement deed executed by all legal heirs and attested by a notary public or gazetted officer
- Notarised indemnity bond on non-judicial stamp paper indemnifying the RTA or listed entity (Annexure 18)
Note: SEBI's March 2026 consultation paper proposes raising the simplified documentation thresholds to ₹10 lakh for physical securities and ₹30 lakh for demat. These proposals are not yet enacted. The thresholds above reflect the current operative position under the Master Circular.
Scenario 3: Joint holding, one holder dies
As per Para 20.5 of the SEBI Master Circular for RTAs, on the death of one or more joint holders, the RTA transmits the securities to the surviving joint holder(s) in compliance with Clause 23 of Table F, Schedule 1 of the Companies Act, 2013 (which applies as the default where the company's AoA does not specify otherwise), read with Sections 56(2) and 56(4)(c).
Transmission by incapacitation
Transmission can also be triggered where a registered member is declared of unsound mind by a competent court. In such cases, the court-appointed guardian or legal representative initiates the transmission intimation on behalf of the member. The procedure broadly mirrors the death scenario, with the court order substituting for the death certificate as the triggering document. The AoA may specify additional requirements; where it does not, the company determines what documentation is sufficient to satisfy itself of the representative's authority.
Post-verification process: Letter of Confirmation to demat credit
The claimant submits all required documents to the RTA or listed company. Once the RTA verifies the documents, it issues a Letter of Confirmation to the claimant by post and email, within 30 days of receipt of complete documentation. The physical certificate is retained by the RTA and stamped accordingly.
The claimant then has 120 days from the date of the Letter of Confirmation to submit a demat request to their DP, along with the Letter of Confirmation. The DP forwards this to the RTA, which processes the demat credit. If the claimant does not submit the demat request within 120 days, the securities are credited to the issuer company's Suspense Escrow Demat Account.
Documents required for share transmission in a private company
The Companies Act, 2013 does not prescribe a document set for private company transmissions. Section 56(2) empowers a company to register a transmission on receipt of an intimation from the person entitled to the shares.
What a private company requires is therefore governed by its AoA, if it contains relevant provisions. Where the AoA is silent, the company determines what documentation is sufficient to satisfy itself of the claimant's title. A new share certificate must be issued within one month of receiving the complete transmission intimation; failure to do so attracts a ₹50,000 penalty on the company and each officer in default under Section 56(6).
How EquityList supports transmission events
The documentation gap at the point of a transmission event (when nominee details are missing, KYC is unverified, and no record of a will exists) can delay proceedings for companies managing private shares. When a transmission event occurs, the company secretary can produce a verified document set to the RTA without convening a separate fact-finding exercise or requesting documents from bereaved family members under time pressure.
EquityList's Beneficiaries module allows stakeholders to designate nominees from their dashboard with KYC verification, formal acceptance by the nominee, and encrypted storage for wills and supporting documents. When a transmission event occurs, the company has a verified record ready rather than scrambling to gather documents during a bereavement.
FAQs on transmission of shares
What do you mean by transmission of shares?
Transmission of shares is the process by which ownership of a company's shares passes to another person by operation of law, without any voluntary act by the shareholder. It is triggered by the registered member's death, insolvency, or court-declared incapacity, and is governed by Section 56(2) of the Companies Act, 2013. Unlike a voluntary share transfer, transmission does not require a transfer deed or stamp duty.
What is the time limit for transmission of shares?
Under Section 56(4) of the Companies Act, 2013, a private company must deliver a new share certificate to the claimant within one month from the date of receiving the complete transmission intimation. For listed companies, the RTA must issue a Letter of Confirmation within 30 days of receiving complete documentation. There is no prescribed deadline for the claimant to file the intimation, but the one-month and 30-day clocks run from the date the company or RTA receives a complete set of documents.
What is the difference between transmission and transfer of shares?
A transfer of shares is a voluntary act initiated by a living shareholder who sells or gifts their shares to another person. Transmission is involuntary and occurs by operation of law on the shareholder's death, insolvency, or incapacitation. Transfer requires a duly stamped Form SH-4; transmission does not. Stamp duty applies to transfers; it does not apply to transmission.
What documents are required for transmission of shares in India?
The required documents depend on whether a nominee has been registered, the value of the securities, and whether the company is listed or private. Where a nominee is registered, the process requires only a transmission request form, a death certificate, and the nominee's PAN card. Where no nominee is registered, the claimant must submit a broader set including a notarised affidavit and succession documents, unless the value falls below SEBI's simplified documentation thresholds.
