*[5. Transfer of shares.-(1) Save as otherwise provided in sub-section (2), the shares of the Financial Corporation shall be freely transferable.
(2) Nothing contained in sub-section (1) shall entitle the parties referred to in clauses (a), (b) and (c) of sub-section (3) of section 4 to transfer any of the shares held by them in the Financial Corporation if such transfer will result in reducing the aggregate value of shares held by them to less than fifty-one per cent. of the issued equity capital of the Financial Corporation.
(3) The Board may refuse to register the transfer of any shares in the name of the transferee on any one or more of the following grounds, and on no other ground, namely:-
(a) the transfer of the shares is in contravention of the provisions of the Act or regulations made thereunder or any other law;
(b) the transfer of the shares, in the opinion of the Board, is prejudicial to the interests of the Financial Corporation or to the public interest;
(c) the transfer of shares is prohibited by an order of a court, tribunal or any other authority under any law for the time being in force.
(4) The Board shall, before the expiry of two months from the date on which the instrument of transfer of shares of the Financial Corporation is lodged with it for the purpose of registration of such registration ought not or ought to be refused on any of the grounds referred to in sub-section (3) but also,- transfer, not only form, in good faith, its opinion as to whether such (a) if it has formed the opinion that such registration ought not to be so refused, effect such registration; and (b) if it has formed the opinion that such registration ought to be refused on any of the grounds mentioned in sub-section (3), intimate the transferor and the transferee by notice in writing.
(5) An appeal against the order of refusal of the Board under sub-section (4) shall lie to the Central Government and the procedure for filing and hearing of such appeal shall be in accordance with the rules made by the Central Government in this behalf.
*[substituted vide State Financial Corporations Amendment Act, 2000, section 7]
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