| Points | Transfer of shares | Transmission of shares |
| 1. Meaning | Transfer of shares means the transfer of ownership of shares from one person to another by entering into a contract. | It means the transfer of ownership of a member’s shares to his legal representative due to the operation of law. It takes place on the death of insolvency or insanity of the members. |
| 2. When Done | It is done when the member wants to sell his shares or give his shares as a gift. | It is done when the member dies or becomes insolvent or suffering from insanity. |
| 3. Nature of Action | It is a voluntary action taken by the member. | It is an involuntary action. It is performed by operation of law. |
| 4. Parties Involved | In the transfer of shares, there are two parties involved – the member who is called as transferor and the buyer who is called as transferee. | There is only one party e.g., the nominee of the members in case of death of the member or the legal representative. |
| 5. Instrument of transfer | Transfer requires an Instrument of transfer. | No instrument of transfer is needed. |
| 6. Initiated by | The transferor initiates the transfer process. | Legal representative or official receiver initiates the process of transmission. |
| 7. Consideration | Transfer of shares is done often by the member to receiving some consideration e.g., money. | In the transmission of shares, no consideration is involved. |
| 8. Liability | The liability of the transferor ends after the shares are transferred. | Original liability of the member continues in case of transmission of shares. |
| 9. Stamp duty | Stamp duty as per the market value of shares has to be paid. | No stamp duty is to be paid. |
