Understanding Section 45 of the Companies Act 2013: Key Provisions and Impact

Section 45 of the Companies Act 2013 outlines important guidelines regarding the holding of share capital in the company’s name. It mandates that every share must be held in the name of the person who legally owns it. This section plays a critical role in maintaining transparency in shareholding and ensuring legal clarity in the ownership structure of companies. Under Section 45 of the Companies Act 2013, any shares registered under a person’s name are legally recognized as that individual’s property unless proven otherwise. This regulation protects the rightful owners of shares and prevents any ambiguity related to ownership. In cases of disputes, the section ensures that companies follow the proper legal process to rectify any issues in share registration. The section’s emphasis on clear and rightful ownership contributes to the overall corporate governance framework by enhancing accountability and reducing fraudulent claims over shares. Companies must adhere to this provision to avoid legal repercussions and ensure their shareholding records are transparent and accurate. By complying with Section 45, businesses maintain legal integrity in their ownership structure, safeguarding against potential ownership disputes.