Conversion

CONVERSION OF UNLIM ITED LIABILITY COMPANY INTO LIMITED LIABILITY AND VICE –VERSA

PROCEDURE TO CONVERT LIMITED LIABILITY COMPANY INTO UNLIMITED LIABILITY COMPANY:

  • To consider the proposal of conversion.
  • To approve amendment in Articles of association by Special resolution in General Meeting.
  • To authorize director or any other eligible person to carry out the effect and all necessary acts required.
  • To fix the date, time, venue of General meeting and authorize director or any other eligible person to carry out the effect and all necessary acts required.
  • To consider the list of creditors/ debenture holders and amount thereof.
  • Its net worth is negative
  • An application is pending under the provisions of the Companies Act, 1956 or the Companies Act, 2013 for striking off its name
  • The company is in default of any of its Annual Returns or financial statement under the provisions of the Companies Act, 1956 or the Companies Act, 2013
  • A petition for winding up is pending against the company
  • The company has not received amount due on call in arrears , from its directors, for a period of not less than six months from the due date
  • An inquiry, inspection or investigation is pending against the company

The Registrar of Companies shall take a decision on the application filed under these rules within 30 days from the date of receipt of application and thereafter issue the certificate.

CONVERSION OF LIMITED LIABILITY PARTNERSHIP INTO COMPANY

Procedure for conversion

Several businesses started in India as Limited Liability Partnership (LLP), may now wish to convert into a private limited company for more growth in business or for infusing equity capital. An LLP can be converted into a Pvt. Ltd. company as per the provisions contained in Section 366 of the Companies Act, 2013 and Company (Authorized to Register) Rules, 2014. However, there are various requirements which need to be satisfied for converting an LLP into a Private Limited Company, for instance, an LLP must have at least 7 partners, approval from all the partners is required, advertisement in newspaper is to be done in a local and a national newspaper, a No Objection Certificate (NOC) is required from the ROC where such LLP is registered which requires the following::

1. CONSENT OF PARTNERS

The assent of all the partners in the form of resolution must be taken by conducting a meeting and authorization must be given to required partners for executing the steps papers, deeds, and documents required for registration.

2. NAME APPROVAL

LLP have to apply for name availability through Part A of Spice+ Form ,company may run without the name change except the addition of private limited or limited word in conjunction to LLP(subject to availability of name as per guidelines of Companies Act.) The name is valid for a period of 20 days.

3. NEWSPAPER ADVERTISEMENT

The LLP shall publish an advertisement in a newspaper in English and in any Vernacular language in a format of form URC-2.
The objection can be made by any party within 21 days of the publication of the advertisement. The LLP needs to address all the objections, if any received.
The advertisement copy shall be served to the registrar where the LLP is registered.

4. FORMS FILLING

The next step is to file form URG-1 along with SPICE+, INC -33, INC- 34 and AGILE form.

E-form URC-1: Application by company for registration under section 366 documents to be attached:

5. E-FORM SPICE+/INC-33/INC-34 AND AGILE :

In addition to URC-1 as linked form with all the attachments as required in normal course procedure of incorporation have to be filed.

6. – AFTER FILLING OF SPICE+ FORM, THE APPLICANT HAS TO FILL THE E-FORM INC-33(MOA)

And INC-34 (AOA), stating the main objects and ancillary objects in MOA along with the details of the subscribers and their shareholding details.

7. – E-FORM AGILE(SINGLE WINDOW FORM)

Through this form one can obtain

CONVERSION OF ONE PERSON COMPANY (OPC) INTO PUBLIC COMPANY OR PRIVATE COMPANY AND VICE VERSA.

Methods of conversion:

VOLUNTARY CONVERSION

PROCEDURE TO CONVERT OPC INTO PUBLIC OR PRIVATE COMPANY:

  • Altered Memorandum of Association and Article of Association
  • Copy of Resolution
  • List of proposed members and its directors along with their consent
  • List of creditors
  • Latest audited Balance Sheet and Profit and Loss account

On being satisfied that the requirements stated have been complied, Registrar of Companies shall approve the form and Issue the Certificate.

PROCEDURE TO CONVERT PRIVATE COMPANY INTO OPC:

  • List of members and list of creditors
  • Latest audited Balance Sheet and Profit and Loss accounts
  • Copy of NOC from secured creditors

On being satisfied that the requirements stated have been complied, Registrar of Companies shall approve the form and Issue the Certificate

CONVERSION OF SECTION 8 COMPANY INTO A COMPANY OF ANY OTHER KIND

Introduction:

Section 8 Company is formed to encourage and nourish certain acts of art, education, science, sports, religion, charity, social welfare, research, protection of environment or any other related objective. The sec 8 company does not pay any bonus or dividend to its members. The profits of this company are used towards achieving and promoting the objective of the company.

PROCEDURE FOR CONVERSION:

  • Reasons for opting for such conversion
  • Date of incorporation
  • Principal Objects
  • Reasons as to why Objects cannot be carried on
  • Altered Objects, if any along with reason
  • Details of privileges enjoyed by the company
  • Details of Conversion and its impact on the members
  • Regional Director in Form INC-19
  • Chief commission of Income Tax
  • Income Tax Officer
  • Chief Secretary of State
  • Department/Authority of Central Government/State Government
  • Other regulatory authorities
  • Such authorities may make representations, if any, within 60 Days. A copy of proof of serving such notice shall be included in application
  • Company shall give up all special exemptions, privileges under section 8
  • If company acquired any immovable property free of cost or at concessional cost, may be required to pay off the difference amount
  • Any accumulated profit be first utilized to settle all outstanding dues and liabilities, if any amount remains will be transferred to IEPF( Investor Education and Protection Fund account)
  • Amended Memorandum of Association /Article of association
  • Declaration by Directors that all imposed conditions has been complied with

CONVERSION OF PRIVATE COMPANY TO PUBLIC COMPANY

(Section 14, Section 15 of Companies Act, 2013 and Company (Incorporation) Rules, 2014)

Subject to the provisions of this act and the rules made there under and the conditions contained in its memorandum, if any, a company may, by special resolution ,alter its articles including alterations having the effect of conversion of-

A PRIVATE COMPANY INTO A PUBLIC COMPANY:

KEY CONSIDERATION

A PUBLIC COMPANY INTO A PRIVATE COMPANY:

KEY CONSIDERATION

PROCEDURE FOR CONVERSION:

  • Certified true copy of special resolution.
  • Certified true copy of explanatory statement.
  • Certified true copy of altered Memorandum of Association and Articles of Association.
  • Date of Board Meeting at which proposed alteration took place.
  • Date of General meeting
  • Reason for conversion
  • Effects of such conversion on shareholder/creditors/debenture holder/deposit holder and other persons concerned