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Definitive Guide to Share Transfer Stamp Duty, Form 117 Execution, and RJSC Register Rectification in Bangladesh

As Barrister Liton Sarkar, Advocate of the Supreme Court of Bangladesh, I present this definitive commercial guide on the statutory mechanics of share transfers within private and public limited companies. The transfer of shares in Bangladesh is strictly governed by the Companies Act 1994 and the Stamp Act 1899…

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As Barrister Liton Sarkar, Advocate of the Supreme Court of Bangladesh, I present this definitive commercial guide on the statutory mechanics of share transfers within private and public limited companies. The transfer of shares in Bangladesh is strictly governed by the Companies Act 1994 and the Stamp Act 1899…

Practice area corporate rjsc
Reading time About 3 min
Latest date Review pending
.statutory-table { width: 100%; border-collapse: collapse; margin: 24px 0; } .statutory-table th, .statutory-table td { border: 1px solid #E2E8F0; padding: 12px; text-align: left; } .statutory-table th { background: #0D2826; color: #FFF; } .svg-infographic-wrap { margin: 28px 0; background: #0A1118; padding: 16px; border-radius: 8px; text-align: center; } .cta-box { background: #0D2826; color: #FFF; padding: 24px; border-radius: 8px; text-align: center; margin: 30px 0; } .cta-box a { background: #C9A84C; color: #000; font-weight: 700; padding: 10px 20px; text-decoration: none; border-radius: 4px; display: inline-block; margin-top: 10px; } </style><div><h2>Introduction</h2><p>As Barrister Liton Sarkar, Advocate of the Supreme Court of Bangladesh, I present this definitive commercial guide on the statutory mechanics of share transfers within private and public limited companies. The transfer of shares in Bangladesh is strictly governed by the <strong>Companies Act 1994</strong> and the <strong>Stamp Act 1899</strong>. Non-compliance renders the transfer void ab initio and exposes the corporate entity to severe statutory penalties.</p><h2>1. Execution of Form 117 (Instrument of Transfer)</h2><p>Under Section 38 of the Companies Act 1994, a company shall not register a transfer of shares unless a proper instrument of transfer—statutorily recognized as <strong>Form 117</strong>—has been delivered to the company. The instrument must be duly executed by both the transferor and the transferee. The execution must be witnessed, and the original share certificate must accompany the submission to the Board of Directors.</p><h2>2. Share Transfer Stamp Duty</h2><p>Pursuant to Article 62(a) of Schedule I of the Stamp Act 1899, share transfers attract a mandatory ad valorem stamp duty. The duty is calculated at 1.5% of the consideration value of the shares being transferred. Failure to affix and cancel the requisite non-judicial stamps on Form 117 renders the instrument inadmissible in evidence and legally defective for RJSC (Registrar of Joint Stock Companies and Firms) filing.</p><h2>3. Rectification of Share Register (Section 43)</h2><p>If a company, without sufficient cause, refuses to register a valid share transfer, or if there is an unnecessary delay in entering the transferee's name in the Register of Members, the aggrieved party must seek judicial intervention. Under <strong>Section 43 of the Companies Act 1994</strong>, an application for rectification of the share register must be filed before the Company Bench of the High Court Division of the Supreme Court of Bangladesh. The Court possesses the plenary jurisdiction to order the rectification of the RJSC records and award damages.</p><h2>Statutory Compliance Matrix</h2><table border='1' cellpadding='10' cellspacing='0' style='width:100%; border-collapse: collapse;'><thead><tr><th>Statute</th><th>Relevant Section/Article</th><th>Mandatory Provision</th></tr></thead><tbody><tr><td>Companies Act 1994</td><td>Section 38</td><td>Mandatory execution of Form 117 by both parties.</td></tr><tr><td>Stamp Act 1899</td><td>Article 62(a), Schedule I</td><td>Payment of 1.5% ad valorem stamp duty on the transfer consideration.</td></tr><tr><td>Companies Act 1994</td><td>Section 43</td><td>High Court jurisdiction for rectification of the Register of Members.</td></tr></tbody></table><h2>Share Transfer Process Roadmap</h2><svg viewBox='0 0 800 240' class='process-roadmap' xmlns='http://www.w3.org/2000/svg' style='width:100%; height:auto; background:#f9f9f9; border:1px solid #ddd; margin-top:20px;'><rect x='50' y='80' width='150' height='80' rx='10' fill='#2c3e50'/><text x='125' y='120' fill='#ffffff' font-family='Arial' font-size='14' text-anchor='middle' font-weight='bold'>1. Execute Form 117</text><line x1='200' y1='120' x2='270' y2='120' stroke='#34495e' stroke-width='4' marker-end='url(#arrow)'/><rect x='270' y='80' width='150' height='80' rx='10' fill='#2980b9'/><text x='345' y='120' fill='#ffffff' font-family='Arial' font-size='14' text-anchor='middle' font-weight='bold'>2. Pay Stamp Duty</text><line x1='420' y1='120' x2='490' y2='120' stroke='#34495e' stroke-width='4' marker-end='url(#arrow)'/><rect x='490' y='80' width='150' height='80' rx='10' fill='#27ae60'/><text x='565' y='120' fill='#ffffff' font-family='Arial' font-size='14' text-anchor='middle' font-weight='bold'>3. Board Approval</text><line x1='640' y1='120' x2='710' y2='120' stroke='#34495e' stroke-width='4' marker-end='url(#arrow)'/><rect x='710' y='60' width='150' height='120' rx='10' fill='#c0392b'/><text x='785' y='110' fill='#ffffff' font-family='Arial' font-size='14' text-anchor='middle' font-weight='bold'>4. RJSC Filing /</text><text x='785' y='130' fill='#ffffff' font-family='Arial' font-size='14' text-anchor='middle' font-weight='bold'>Sec 43 Rectification</text><defs><marker id='arrow' markerWidth='10' markerHeight='10' refX='9' refY='3' orient='auto' markerUnits='strokeWidth'><path d='M0,0 L0,6 L9,3 z' fill='#34495e'/></marker></defs></svg></div><section class="faq-section"><h2>Frequently Asked Questions</h2><div class="faq-item"><h3>What is the current stamp duty rate for share transfers in Bangladesh?</h3><p>Under Article 62(a) of Schedule I of the Stamp Act 1899, the stamp duty for transferring shares of a limited company is 1.5% of the consideration value.</p></div><div class="faq-item"><h3>Can a company register a share transfer without Form 117?</h3><p>No. Section 38 of the Companies Act 1994 strictly prohibits the registration of a share transfer unless a proper instrument of transfer (Form 117), duly stamped and executed, is delivered to the company.</p></div><div class="faq-item"><h3>What legal recourse is available if the RJSC or the company refuses to register the transfer?</h3><p>If a company refuses to register a transfer without sufficient cause, the aggrieved party must file an application under Section 43 of the Companies Act 1994 before the High Court Division of the Supreme Court for rectification of the share register.</p></div></section>

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Official Regulatory Authorities, Gazettes & Forms

Governing Primary Statutes: Companies Act 1994, Partnership Act 1932, Local Government (City Corporation) Act 2009 

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  <a href="https://www.roc.gov.bd/" target="_blank" rel="noopener noreferrer" style="color:#C5A059; font-weight:600; font-size:14px; text-decoration:underline;">Registrar of Joint Stock Companies & Firms (RJSC) &nearr;</a>
  <p style="color:#94A3B8; font-size:12px; margin:4px 0 0 0; line-height:1.4;">Online Name Clearance, MoA/AoA Registration & Returns Filing</p>
</div>

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  <a href="https://bida.gov.bd/" target="_blank" rel="noopener noreferrer" style="color:#C5A059; font-weight:600; font-size:14px; text-decoration:underline;">Bangladesh Investment Development Authority (BIDA) &nearr;</a>
  <p style="color:#94A3B8; font-size:12px; margin:4px 0 0 0; line-height:1.4;">One-Stop Service (OSS), 100% Foreign Equity Approvals & Branch/Liaison Office Permission</p>
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  <a href="https://bdlaws.minlaw.gov.bd/" target="_blank" rel="noopener noreferrer" style="color:#C5A059; font-weight:600; font-size:14px; text-decoration:underline;">Ministry of Law, Justice & Parliamentary Affairs &nearr;</a>
  <p style="color:#94A3B8; font-size:12px; margin:4px 0 0 0; line-height:1.4;">Codified Statutory Laws of Bangladesh</p>
</div>
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