# Refusal of Registration & Appeal [Section 58]
When a company refuses to register a transfer or transmission of shares, Section 58 lays down a structured framework distinguishing private companies from public companies, along with appeal rights before NCLT.
## 1. Refusal by a Private Company
- Trigger: Private company refuses to register transfer/transmission.
- Duty: Must send a notice of refusal with reasons to:
- Transferor, and
- Transferee (or person giving intimation of transmission)
- Time Limit: Within 30 days of delivery of instrument of transfer / intimation of transmission.
## 2. Refusal by a Public Company
- Shares of a public company are freely transferable.
- A public company can refuse registration only with sufficient cause, within 30 days of delivery of instrument/intimation.
## 3. Appeal to NCLT
| Type of Company | Time Limit for Appeal |
|---|---|
| Private Co. | • 30 days from receipt of notice of refusal, OR<br>• 60 days from delivery of instrument/intimation (if no notice sent) |
| Public Co. | • 60 days from refusal, OR<br>• 90 days from delivery of instrument/intimation (if no intimation sent) |
## 4. Orders That NCLT May Pass
After hearing parties, NCLT may dismiss the appeal or order:
- Registration of transfer/transmission — company shall comply within 10 days of receipt of order; OR
- Rectification of register + direct company to pay damages sustained by aggrieved party.
## 5. Punishment for Contravention of NCLT Order
- Imprisonment: Not less than 1 year, may extend to 3 years, AND
- Fine: Not less than ₹1 lakh, may extend to ₹5 lakhs.
## Key Distinction
> Public company shares = freely transferable.
> Private company = restrictions on transfer are permitted in articles.