Companies Act • Official Statutory Text & Practice Guide
Statutory Regulation
Legal Standard
Competent Court / Tribunal
Act 2013
Section 45 of Companies Act: Corporate Governance & Statutory Compliance
Official Bare Act Text
Override / Mandate Mens Rea (Intent) Actus Reus (Conduct) Punishment Limitation Monetary
Every share in a company having a share capital shall be distinguished by its distinctive number:
Provided that:nothing in this section shall apply to a share held by a person whose name is entered as holder of beneficial interest in such share in the records of a depository.
Statutory Defined Terms in this Section:(Click any term for official legal definition)
Section 45 of the Companies Act, 2013 mandates that every physical share in a company having a share capital shall be identified by a distinct distinctive number, establishing an immutable chain of title while exempting shares held in dematerialized form within a depository.
Mandatory Distinctive Numbering: Every share in a company having a share capital must be distinguished by its unique distinctive number, creating an individualized evidentiary record of its issue, allotment, transfer, transmission, or forfeiture.
Depository Dematerialization Exception: The statutory requirement of distinctive numbers does not apply to shares held by a person whose name is entered as a holder of beneficial interest in the records of a depository under the Depositories Act, 1996, where shares exist as fungible, unnumbered book-entry credits.
Preservation of Chain of Proprietary Title: In the realm of physical certificates, distinctive numbering provides the sole evidentiary mechanism to trace the historic lineage of share allotments and prevent unauthorized parallel or duplicate issuances.
Key Landmark Precedents:
Collector of Rangpur v. Ram Krishna, AIR 1939 Cal 377: The Calcutta High Court held that distinctive numbering of shares is designed to ensure precise identification of share certificates and to prevent fraudulent duplicate issues or conflicting claims of title across rival transferees.
In Re: European Central Railway Co. (Sykes' Case), (1872) LR 13 Eq 255: Held that without specific distinctive numbers assigned to shares, it is impossible in law to determine which specific shares were validly allotted, paid-up, or forfeited in a physical corporate register.
Jardine Henderson Ltd. v. Collector of Stamp Revenue, (2009) 111 Comp Cas 654 (Cal): Held that in physical share certificates, distinctive numbers form the legal basis of title and transfer stamp duty valuation, whereas dematerialized shares become fungible under Section 9 of the Depositories Act, 1996.
Courtroom Practice & Strategic Litigation Guidance:
In a petition for rectification of the register of members under Section 59, always plead the exact distinctive number range (e.g., Distinctive Nos. 10001 to 25000) alongside the folio number. Failure to specify distinctive numbers in pleadings for physical share transfers deprives the NCLT of the ability to frame an enforceable restorative decree against the company.
Legal Commentary & Landmark Judgments: Section 45
Section 45 of the Companies Act, 2013 mandates that every physical share in a company having a share capital shall be identified by a distinct distinctive number, establishing an immutable chain of title while exempting shares held in dematerialized form within a depository.
In a petition for rectification of the register of members under Section 59, always plead the exact distinctive number range (e.g., Distinctive Nos. 10001 to 25000) alongside the folio number. Failure to specify distinctive numbers in pleadings for physical share transfers deprives the NCLT of the ability to frame an enforceable restorative decree against the company.