# Share Transmission on Death of a Shareholder

> Transmission is the transfer of shares by operation of law — usually on a shareholder's death — to the nominee or legal heirs. The claimant applies to the company with the death certificate, proof of entitlement (nomination, will with probate, succession certificate or legal-heir documents as required) and KYC; the board approves and the register of members is updated. No stamp duty applies because there is no sale.

Practice: Company Secretary & Corporate Compliance — https://www.industax.com/services/company-secretary/

Where the deceased had filed a nomination (Form SH-13), transmission to the nominee is straightforward. Without a nomination, the company asks for documents that establish who is entitled — a probate or succession certificate for larger holdings, or legal-heir documents and indemnities as the company's policy allows.

For shares held in demat form, transmission is processed by the depository participant; for physical shares, by the company. In both cases the company's register and records must reflect the new holder.

Inherited shares are not taxed on receipt. When the heir later sells, the cost and holding period of the deceased are used to compute capital gains.

## Key facts

| Item | Detail |
| --- | --- |
| Nature | Transfer by operation of law (not a sale) — no stamp duty |
| With nomination | Shares go to the nominee (Form SH-13 nomination) |
| Without nomination | Probate / succession certificate / legal-heir documents as required |
| Tax on receipt | None; heir uses the previous owner's cost and holding period on sale |

## Who needs this

- Families of a deceased shareholder
- Companies processing claims from nominees or heirs
- Founders setting up nominations to make future transmission simple

## What's included

- Entitlement documents checklist
- Application, indemnity and affidavits
- Board approval and register update
- Demat transmission coordination
- Nomination set-up for remaining shareholders

## Documents

- Death certificate
- Share certificates or demat statement
- Nomination, will with probate, or succession certificate (as applicable)
- KYC and PAN of the claimant
- Indemnity / no-objection from other legal heirs (where required)

## Process

1. **Entitlement** — We identify which documents establish the claim.
2. **Application** — Claim prepared with affidavits and indemnities.
3. **Approval** — Board approves; register and certificates updated.

## FAQs

### What is the difference between transfer and transmission of shares?

A transfer is a voluntary act by the holder (sale or gift) and needs an instrument and stamp duty; transmission happens by operation of law, such as on death or insolvency, and needs proof of entitlement instead.

### Is a succession certificate always required?

Not always. A valid nomination is usually enough; otherwise the company may accept probate, a succession certificate or legal-heir documents with indemnity depending on the value and its policy.

### Is tax payable when shares are inherited?

No. Tax arises only when the heir later sells, using the original owner's cost and holding period.

## Official sources

- Ministry of Corporate Affairs — MCA21 portal: https://www.mca.gov.in/
- Companies Act, 2013 (India Code): https://www.indiacode.nic.in/handle/123456789/2114

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Canonical page: https://www.industax.com/services/company-secretary/share-transmission
Publisher: Indus Tax — CA-led tax and compliance firm (https://www.industax.com). Contact: info@industax.com, 9059139258.
This is general information, not advice for your specific facts.