SH-4 — Securities transfer form

Form SH-4 is the instrument of transfer prescribed under Section 56 — duly stamped, dated, and executed by both transferor and transferee — required before a company can register any transfer of shares or debentures in its register of members. Without a valid SH-4, a transfer is not registrable even if both parties agree to it privately and money has already changed hands.

The company has 30 days from receipt of a valid SH-4 to register the transfer (or communicate refusal, if the articles permit refusal), and it is common in diligence to find secondary transfers among founders or early employees that were agreed informally years earlier but never reflected with an SH-4 and a register update — leaving the register of members out of step with who actually holds what. Saral treats every transfer as a ledger event requiring the SH-4 reference before it is recorded, so the gap cannot occur going forward.

Stamp duty on the transfer is payable under the Indian Stamp Act (or the relevant state stamp legislation) at the rate applicable to the consideration, and an unstamped or under-stamped SH-4 is itself a defect a diligence team will flag.

The cap table, where SH-4 — Securities transfer form appears as a computed field traced to the ledger event that created it.