1. Can a Company refuse to Register Transfer of Shares?

Private Limited Company has a power of refusal to register transfer of shares which is to be exercised by the Company within 30 days from the date on which the instrument of transfer or the intimation of transfer, as the case may be is delivered to the Company by sending a notice of the refusal along with reasons for such refusal to the transferor and the transferee.

2. What is the procedure after the Company refuses to Transfer?

If a company refuses or fails to register or transfer the shares then the transferee can appeal to the National Company Law Tribunal (NCLT) against the refusal within a period of 30 days from the date of receipt of the notice from the Company or in case no notice has been sent by the Company, within a period of 60 days from the date on which the instrument of transfer was delivered to the Company.

3. What is the penalty for non compliance?

The Company shall be punishable by a fine which shall not be less than Rs. 25,000/- but which may extend to Rs. 5,00,000/- and every officer of the company who is in default shall be punishable by a fine which shall not be less than Rs. 10,000/- but which may extend to Rs. 1,00,000/-.