Procedure for of Issue of Duplicate Share Certificate

Procedure for of Issue of Duplicate Share Certificate.

[1] As per Section 84(2) -- a duplicate certificate may be issued if such the original certificate is proved to –

·         have been lost, or

·         destroyed, or

·          having been defaced or mutilated or torn, is surrendered to the company.

[ 2] No duplicate shares certificate shall be issued in lieu of the original without the prior consent of the Board or Committee of directors and without payment of such fees, if any, not exceeding Rs. 2 and on such reasonable terms, if any, as to evidence and indemnity and the payment of out of pocket expenses incurred by the company in investigating evidence as the Board or the Committee thinks fit.

Comment: Kindly note ----- “on such reasonable terms, if any as to evidence and indemnity and the payment of out of pocket expenses ……….” is as per discretion of the Board. However, as a general practice the Board/Committee demands for copy of FIR / Indemnity Bond, etc.  

[3] In case of large companies or, large holdings generally, a public notice of loss of original certificate and intention to issue duplicate certificate is published in newspapers. The expenses of the notice are ordinarily to be borne by the shareholder.

Comment: Public notice is not compulsory. However, again as a general practice the same is published in newspapers and expenses of the same are ordinarily borne by the shareholder.

[4] The Shareholer also has to execute an indemnity bond in favour of the company. It should be noted that the requirements as to public notice, indemnity bond, etc. are left to the discretion of the Board or the committee of directors. Therefore, in appropriate cases, such as, small holding, private companies, etc. these requirements may be relaxed or dispensed with.

[5] The discretion is absolute with which the Court would not interfere, where there is no question of mala fides.

Comment: Just the overcome the question of mala fides, as a general practice Board resort to go for public notice, indemnity bond, etc.

[6] In each case of issue of duplicate share certificate a prior resolution of the Board or a Committee of directors is essential.

Comment: Before issue of duplicate share certificate – ensure prior Board/Committee Resolution.  

[7] On every duplicate certificate issued and against the stub or counterfoil it shall be stated that it is a "duplicate issued in lieu of share certificate No.....". Further, the word "duplicate" shall be stamped or punched in bold letters across the face of the share certificate.

[8] A register to be called 'Register of Renewed and Duplicate Certificates' shall be maintained to enter therein the following particulars --

(i)	name(s) of the person(s) to whom the certificate is issued;
(ii)	the number and date of the original certificate;
(iii)	the necessary changes indicated in the Register of Members by suitable cross reference in the 'Remarks' column.

[9] All entries in the register shall be authenticated by the Secretary or some other person duly authorized by the Board or the Committee of directors for the purpose of sealing and signing the share certificate.

Secretarial Practice (Ensure the following)

1.       A written application from the concerned shareholder stating full disclosure of the shares for which duplicate share certificate is desired.

2.      An affidavit on stamp paper of requisite value

3.      An indemnity on the stamp paper of requisite value. (if the Board/Committee thinks fit)

4.      Public Notice – (if Board/Committee thinks fit).

5.      Resolution of the Board / Committee authorizing issue of duplicate share certificate – covering aspects of point [2] and [9]

6.      Chagres as per point [2] above – first part.

7.      Compliance of point [7] above – first part.

8.     Entry in the register – as per point [8] above – first part.