Beneficial interest in shares Scope of the section relating to declaration by persons not holding beneficial interest in share

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..... in share A question has been raised as to whether shares held in joint names, for the sake of convenience and easy transmission to survivors in the case of death of any of the holders, would attract the provisions of section 187C. On this, the view of the Department is that in the case of the registered joint holders of shares no trustee‑beneficiary relationship arises inter se in the eye .....

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..... and beneficial interests in respect of such shares as between the karta and the other members of the family. Hence, the rules under reference do not apply. However, where the person who is in the position of karta happens to have any special relation with any person who is a member of the Hindu family in respect of shares not comprised in the family estate, section 187C and the rules thereunder wi .....

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..... should have the right of membership in respect of the shares in question, it is obviously necessary for such partners who hold shares not only for themselves but for the benefit of all partners constituting the firm whose names are not entered in the register of members, to comply with the rules framed under section 187C. An apprehension has been expressed that the rules will hinder trading in s .....

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..... property in the shares, a species of goods transferable only, in the manner contemplated by the law, does not pass. In view of this legal position, the apprehension expressed is not tenable. In this view of the matter, in the case of any shares traded on the stock exchange without the transfer deed prescribed under section 108 duly executed both by the transferor and the transferee, there is no le .....

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..... e rules will have to be made. The rules are not applicable to shares held by official designations only, e.g., court receiver, official liquidator, administrator general, Income‑tax or Wealth‑tax Commissioner, custodian of evacuee or enemy properties, etc., since no title to the shares vests in the officials who deal with the property under special judicial or statutory authority.
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