Ans. This statement is False.
1. When a member sells or gives his shares to another person voluntarily, it is known as transfer of shares. Transfer of shares is a voluntary act on the part of the shareholder.
2. The shares cannot be transferred by mere delivery. The transfer has to be place in the manner as specified in this respect. The transfer is effected by registering an instrument called ‘Instrument of Transfer’ with the company.
3. The application for transfer of shares may be made in the prescribed printed form either by the transferor or by the transferee. Such transfer instrument or form must be signed by the transferor, transferee and a witness. Such duly filled in form, stamped and signed must be submitted to the company’s office along with original share certificate.
4. In respect of transfer of partly – paid shares, a notice must be given by the company to the transferee mentioning therein that the shares to be transferred are partly paid up.
5. If an application for transfer of partly – paid shares is made by the transferee, such a notice is not required to be given by the company to the transferee.