Question

Distinguish between the following.

Transfer of Shares and Transmission of Shares

Answer 1

Transfer of Shares	Transmission of Shares
1. Meaning
Transfer of shares means voluntarily or deliberately giving away one's shares to another person by entering into a contract with the buyer.	It means the transfer of ownership of a member's shares to his legal representative due to the operation of law. It takes place on death, insolvency or insanity of the members.
2. When done
It is done when the member wants to sell his shares or give his shares as a gift.	It is done when the member dies or becomes insolvent or insane.
3. Nature of Action
It is a voluntary action taken by the member.	It is an involuntary action. It is due to the operation of law.
4. Parties involved
In the transfer of shares, there are two parties involved: the member who is called the transferor and the buyer who is called as transferee.	There is only one party, e.g., the nominee of the member in case of death of the member of the legal representative.
5. Instrument of transfer
Transfer requires an instrument of transfer. It is a contract between the transferor and the transferee.	No instrument of transfer is needed.
6. Initiated by
The transferor initiates the transfer process.	The legal representative or official receiver initiates the process of transmission.
7. Consideration
Transfer of shares is done often by the member to receive some consideration (money), i.e., the buyer has to pay for the shares. (Except given as a gift.)	No consideration is involved here. The legal heir or official receiver need not pay for the shares.
8. Liability
The liability of the transferor ends after the shares are transferred.	The original liability of the member continues in case of transmission of shares.
9. Stamp Duty
Stamp duty as per the market value of shares has to be paid.	No stamp duty is to be paid.