Question

Distinguish between the following:
Transfer of shares and Transmission of shares.

Answer 1

	Transfer of Shares	Transmission of Shares
1. Meaning	The passing of ownership of the shares by one shareholder to another as a result of voluntary sale or gift of shares is called Transfer of shares.	The passing of ownership of a shares from one shareholder to another by the operation of law is called Transmission of the shares.
2. Kind of action	Transfer of shares take place when there is a sale / purchase / gift of shares. So it is a voluntary action.	Transmission of shares take place in the event of death or insolvency or lunancy of the shareholders. So it is compulsory action.
3. Reasons	When both the parties i.e., transferor and transferee are willing to transfer by submission of instrument of transfer by transferor. Transfer of shares take place	Transmission of shares take place only when shareholders die or become lunatic the legal representative is required to submit an evidence that proves his legal status.
4. Initiative	Transfer of shares is initiated by the shareholders i.e., transfer or by an authorized person.	Transmission of shares is initiated by the legal representative of the deceased shareholder.
5. Consideration	There must be adequate consideration in terms of money for transfer of shares unless they are transferred by way of gift.	The question of consideration in money does not aries because shares are always transmitted to legal representative without any consideration.