1. Introduction: Shares are alloted to those investors who have applied to buy shares and whose application is accepted by the company. Every shareholder who is having share of the particular company is considered as the member of the company. Evçry member having right in the share capital of the company has the right to get the share certificate for his interest from the company.
2. What is share certificate? : When any person purchases the shares of the company, the certificate bearing the seal of the company, which is given to him is called the share certificate.
As per the Company Act, “The share certificate means a document bearing common seal of the company given by the company to its members entitling him its ownership.”
Thus, the share certificate is a primary evidence of ownership for shareholder because with this company accepts that the name of the individual mentioned in the share certificate is the genuine owner of the given number of shares.
3. Details Included in the Share Certificate : According to New ‘Company Act’ details in share certificate shall be as per the Form No. SH 1. They are as follows:
(1) The name of the company.
(2) Authorised share capital of the company.
(3) Address of Registered office.
(4) Serial number of shares.
(5) Serial number of share certificate.
(6) The name and address of the shareholder.
(7) Types of shares held and its number.
(8) Nominal value of share and paid up amount there on.
(9) The date and day of share alloted.
(1O)Signature of authorised director.
(11) Signature of secretary.
(12)Company’s common seal impression.
4. Provisions of Companies Act for Share Certificate: Following are the provisiois (clauses) of Companies Act for the share certificate.
(1) Common Seal : The share certificate should have the company’s common seal.
(2) Signature : The share certificate should have the signature of two directors and the secretary or the authorised signatory responsible for the same.
(3) Joint Shareholder: If more than one person helds the shares jointly, all the shareholder do not get individual share certificate for the same shares. But on that consolidated share certificate along with the name of the first shareholder, the name of other shareholder is also mentioned.
5. Conclusion : As per the law, share certificate must be issued to every member, for the shares that are subscribed by him, if this certificate is lost, torn, destroyed, misplaced or damage then the shareholder has to get duplicate certificate from the company.