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Transfer of interests of Members in Companies not having Share Capital

Recently, on 8th May, 2026, MCA has issued an advisory touching upon the  Procedure to be followed in case of transfer of interest of a member  in a company not having Share Capital.  Following is the text of the advisory.  Section 56 of the Companies Act, 2013 provides that a proper instrument of transfer is required to be executed in case of transfer of the interest of a member in case of a company having no share capital. Such instrument is required to be executed by or on behalf of the transferor and the transferee and must be delivered to the company in terms of the said provision.  Rule 11 of the Companies (Share Capital and Debentures) Rules, 2014 provides that form SH-4 shall be the format for transfer of securities held in the physical form. Rule 11(2) of the said rules clarifies that the same form is also required to be used in case of transfer of interest of a member in a company not having Share capital. The said provision clarifies that the referen...
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Transfer of shares to family trusts without complying with SAST requirements

Opportunity and Transparency through SAST SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (SAST Regulations) was brought with an intention to ensure fair, equitable and transparent operation of takeovers.  The word Takeover in a general sense refers to acquisition of a company by any person including a corporate. So as per SAST Regulations, the basic requirements under the regulations include the following: Open offer – a level playing field exercise This concept requires the acquirer to give an open offer to all the shareholders of the target company in case he intends to acquire either directly or indirectly, a large pie of shareholding or control in the same (first time acquisition of 25% and on further acquisition of additional 5% in a financial year). The same is provided with an intent to provide a fair exit to the remaining shareholders in case they are intending to do so; and Intimation to stock exchange Event based and annual intimations to be g...
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IPO Guide - Part 1

What is the meaning of promoter in SEBI ICDR Under the  SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 , the definition of a "promoter" is central to determining who controls the issuer and who is subject to lock-in requirements. The term is defined under  Regulation 2(1)(oo) . A person or entity is classified as a promoter if they fall into any of the following three categories: 1. Named in the Offer Documents Any person who has been named as a promoter in the  Draft Red Herring Prospectus (DRHP) ,  Red Herring Prospectus (RHP) , or  Prospectus . This also includes individuals named as promoters in the annual return of the company (as per Section 92 of the Companies Act, 2013). 2. Control over the Issuer Anyone who has "control" over the affairs of the issuer, whether directly or indirectly. This control can be exercised in various capacities: As a shareholder. As a director. Through an agreement or any other manner. 3. Direction and Inst...
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