Understanding the transfer and transmission of shares is essential for every investor, company, and legal heir. Though both terms may sound similar, they are distinct processes governed by corporate and securities law.

Transfer of shares is a voluntary act by a shareholder who decides to sell, gift, or otherwise move ownership of shares to another person. It requires a valid transfer deed, stamping as per the Indian Stamp Act, and submission to the company or registrar for approval. Once approved, the transferee’s name is entered in the company’s register of members, completing the legal transfer.

On the other hand, transmission of shares takes place by operation of law, usually due to the death, insolvency, or lunacy of a shareholder. Here, no transfer deed is required. Instead, the legal heirs or representatives must submit documents like the death certificate, succession certificate, or probate of will to establish their claim. After verification, the company records the new shareholder’s name without charging any transfer fees.

The Companies Act, 2013 and SEBI regulations ensure that both processes are transparent and safeguard the rights of investors. While the transfer process is initiated by the shareholder’s intent, the transmission process protects rightful heirs and successors.

For investors, knowing the difference between transfer and transmission of shares helps avoid legal disputes and ensures a smoother compliance journey. Whether you're planning a voluntary transfer or handling inherited securities, following the proper legal process is the key to protecting your financial rights.