Transfer of company rights and other assets

Vandit Bhardwaj (Querist) 22 June 2021 This query is : Resolved
My father was the sole proprietor of a Pest control services company in New Delhi. He is no more now, we want to transfer his company to my name(i am his eldest son). We have running tenders and want to continue the work and in order to take new tenders, e need the proprietorship changed to my name. Can SDM change it? or succession certificate is the only way out? We don't have a lot of time as we want to run the current work and take new ones also.

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This discussion addresses the process of transferring a sole proprietorship company, specifically a pest control business in New Delhi, from a deceased father to his eldest son. The primary concern is the urgent need to change proprietorship to continue existing tenders and secure new ones. It explores whether an SDM can facilitate this or if a succession certificate is necessary, highlighting the importance of inventorying assets and liabilities, executing title transfers, and considering legal procedures for company property.

P. Venu (Expert) 23 June 2021
Have you inquired with the authority with whom the company is registered?

Shashikant V. Patil (Expert) 23 June 2021
Since it is Company , and your father is proprietor , he might have registered it with ROC, you may ask your father and apply to ROC for change of proprietorship from your father to your name.

T. Kalaiselvan, Advocate (Expert) 25 June 2021
If a business is owned and operated as his own business by an individual without having created a separate legal entity for the business. then he is the sole proprietor.

If he wishes wish to sell or transfer the business to another person, there are some steps to be followed to ensure that the transfer is accomplished in a legal and binding manner.

They are;

Before selling or transferring the legal interest in the business, he must know exactly what those interests consist of first, inventory the business.

List out all assets and liabilities/debts, as well as any stock on hand, if applicable.

Execute title transfers or quitclaim deeds if applicable in favor of the new owner. If real property is part of the business, and the property owned is free of any liens or encumbrances, then execute a quitclaim deed to effectuate the transfer. Other property, such as vehicles or machinery, will also need to be transferred into the new owner's name by signing the title over.
Even though the father is the sole proprietor of the company since the immovable property is in the name of the company he has to follow the procedures in law about transferring the company properties on the name of any third party

In the absence of any guidance under the Act to ascertain the meaning and scope of the expression 'property of the company', reference may be made to the general law governing and regulating the transfer of property,
The three main ways in which a business can be transferred to a family member is as a gift, through a sale, or through a partial sale.

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