The Companies Act, 2013 outlines the legal framework for various corporate processes, including the issuance of duplicate share certificate. When a shareholder loses, misplaces, or damages their original share certificate, they can request a duplicate certificate from the company. Below is a step-by-step guide on the procedure for issuing a duplicate share certificate under the Companies Act, 2013.

1. Legal Framework

Section 46 and Rule 6 of the Companies (Share Capital and Debentures) Rules, 2014 govern the issuance of duplicate share certificates. The articles of association (AoA) of the company must also be referred to for any specific provisions related to this process.

2. Grounds for Issuance of Duplicate Share Certificates

A company may issue a duplicate share certificate in the following cases:

1. Loss of the original certificate.

2. Theft of the certificate.

3. Mutilation or defacement of the certificate rendering it illegible.

4. Misplacement of the original certificate.

3. Preliminary Steps by Shareholder

The shareholder must initiate the process by taking the following actions:

A. Application to the Company

1. Submit a written application to the company, stating the reason for the request and details of the lost, damaged, or misplaced certificate.

2. Provide supporting documents, such as an affidavit, indemnity bond, and proof of identity.

B. Publication of Public Notice (If Required)

In some cases, the company may require the shareholder to publish a public notice in a widely circulated newspaper, announcing the loss of the share certificate. The notice should include:

1. Name of the shareholder.

2. Share certificate number.

3. Distinctive numbers of the shares.

4. Request for objections, if any, from the public.

4. Board Approval

The company must convene a board meeting to consider the application for a duplicate share certificate. The board of directors will:

1. Verify the application and supporting documents.

2. Assess compliance with the company’s AoA and legal requirements.

3. Pass a resolution approving or rejecting the request.

5. Documentation

The shareholder must furnish the following documents:

1. A duly executed indemnity bond to indemnify the company against any future claims.

2. An affidavit affirming the loss or destruction of the original certificate.

3. Proof of identity and address of the shareholder.

4. Copy of the FIR (First Information Report) in case of theft or loss.

5. Public notice details, if applicable.

6. Issuance of Duplicate Certificate

Upon board approval, the company will issue the duplicate share certificate. Key aspects include:

A. Format of the Certificate

1. The duplicate certificate must be issued in the format prescribed under Rule 6 of the Companies (Share Capital and Debentures) Rules, 2014.

2. It must clearly bear the words “Duplicate” on its face.

B. Register of Renewed and Duplicate Share Certificates

The company must maintain a register of renewed and duplicate share certificates as per Rule 6(3). The register should include:

1. Name of the shareholder.

2. Date of issuance.

3. Particulars of the duplicate certificate.

7. Intimation to Shareholder

The company must notify the shareholder about the issuance of the duplicate share certificate. The certificate should be sent to the registered address of the shareholder through registered post or courier.

8. Compliance with Legal Timelines

The duplicate certificate must be issued within a reasonable period, not exceeding three months from the date of receipt of the application and supporting documents.

9. Fees and Charges

The company may charge fees for issuing a duplicate share certificate. The fee structure, if any, should be specified in the company’s AoA or as approved by the board of directors.

10. Reporting and Record Maintenance

1. The issuance of a duplicate certificate must be recorded in the company’s statutory register.

2. Details of the issuance must also be reflected in the shareholder’s folio and the company’s share records.

Conclusion

The process for issuing duplicate share certificate is structured to ensure transparency and protect the interests of both the shareholder and the company. Compliance with the Companies Act, 2013, and associated rules is essential for mitigating legal risks. Companies should have a robust internal framework for handling such requests, ensuring a smooth and efficient process.