Conversion of a Private Limited Company

A Private Limited Company can be converted into different form of business like Public Limited, One Person Company and Limited Liability Partnership for which different procedures need to be followed.

The type of business registration usually affects the flow of cash and management of finances in a company. Since, there are minimum requirements for all sorts of businesses choosing the right structure is important.

Though, Private Limited Company is the most popular form of business in India however; you can also convert it to another business form if you wish to grow it on a large scale.

Private Limited Company to OPC

A Private Company, which has a paid up share capital of Rs. 50 Lakh or an average annual turnover of Rs. 2 Crore or less, can convert itself into One Person Company (OPC). This excludes Companies registered under Section 8 of the Companies Act.

  • A Board Meeting is to be conducted seeking approval from all the Directors of the Company and finalising the date for a General Meeting to get an approval from the shareholders as well.
  • The notice for a General Meeting is issued to all the members, directors and auditors of the company.
  • A Special Resolution in the General Meeting needs to be passed for approval of such conversion.
  • The company shall obtain a No Objection Certificate (NOC) from all existing members and creditors before passing such resolution.
  • A form MGT-14 is to be filed on MCA within 30 days of passing a special resolution along with the copy of the notice of conducting General Meeting and the resolution passed.
  • To initiate the conversion process, file form INC-6 along with the prescribed fee and required documents.

The concerned department will verify all the details/documents of the Company and upon satisfaction, will issue a new Certificate of Incorporation after cancelling the earlier one.

Note: The Company needs to get new MOA and AOA after successful conversion into One Person Company.

Private Limited Company to LLP

To convert a private limited company to Limited Liability Partnership, the Company must -

  • Have up-to-date Income Tax Returns with no proceedings in any court or tribunal.
  • The partners of the company will only be its shareholders and no one else.
  • Every partner of the company must acquire a Digital Signature Certificate (DSC) and Director Identification Number (DIN).      
  • A No Objection Certificate (OBC) is required from all creditors of the Company, if any.

Step 1: Conducting a Board Meeting

Once all these conditions are fulfilled, a special resolution needs to be passed in the Board Meeting for converting into LLP and authorising any director to apply for the company name (LLP).

Step 2: Name Availability

The company now needs to apply for a name of the company as per the Limited Liability Partnership Act, 2008. RUN-LLP is filed with the Registrar of Companies attached with a copy of the Board Resolution agreeing to the conversion of the company.

After successful submission, the concerned authorities will examine, verify all the details and issue an approval certificate. Form FiLLiP can also be filed as an integrated form for the incorporation of LLP.  

Step 3: Filling Incorporation Documents

After getting name approval for LLP, Form FiLLiP is filed along with the proof of registered office address, subscription sheet duly signed by the partners, consent letter and appointment of designated partners and detail of LLP.  

Form FiLLiP can also be used as a single application for reservation of company name, incorporation of LLP and allotment of DIN/DPIN. However; maximum 2 partners can use this form to get a DIN during the incorporation process.

Step 4: LLP Agreement

A LLP Agreement (Form-3) is to be filed containing details like name of the LLP, name of the designated partners, profit sharing ratio, liability of each partner, form of contribution, rules governing the LLP and proposed business activity.  The form needs to be filed within 30 days of incorporation.

Step 5: Conversion into LLP

To convert private limited into LLP form of business, Form-18 is filled with -

  • A statement of shareholder’s consent.  
  • Assets and liabilities of the company verified by the auditor.
  • Latest Income Tax Return.
  • Consent of all the secured creditors with their consent.

The form should be signed digitally by the designated partners of the company and certified by a professional CA/CS.  

The Registrar and Ministry will verify all the details and issue a certificate of registration for the conversion. After receiving the certificate, the same needs to be communicated to the Registrar of the Companies through Form 14 along with a copy of Incorporation of LLP certificate

Note: This must be done within 15 days of receiving the incorporation certificate.

Private Limited to Public Company

There are different reasons of why a Private Company would like to convert itself into a Public Company. Few of them are –

  • Raise finances for the company.
  • Place a market value.
  • Enhance the status of the company.
  • Create a market for company’s shares.

Once converted, a private limited company can trade its shares on stock exchange and create presence in the market.

To initiate the conversion process –

Board Meeting

A board meeting is called for getting approval from all the directors of the company to convert into a public limited company by altering the Articles of Association.

If approved, the Director/ Company Secretary will issue notice to all the members, auditors and directors of the company to conduct an Extra-ordinary General Meeting (EGM) along with the date and time fixed for the meeting.

General Meeting

Get the approval of all the shareholders of the company and pass a special resolution to alter the Articles of Association (AOA) by filing form MGT-14.  

Form MGT-14

This form needs to be filed within 30 days of passing the special resolution. A copy of notice to conduct the General Meeting, special resolution passed by the company, altered Memorandum of Association and Article of Association will also be attached with the form.

Form INC-27

To convert a private limited company to public company form INC-27 is filed with the –

  • Minutes of Meeting containing the approval of conversion and altered Articles of Association.
  • Altered Articles of Association (AOA).

The Registrar of Companies will verify all the details after which the department will cancel the initial registration as a Private Limited Company and offer fresh registration as a Public Company.

The conversion of the company will not affect any debts, liabilities or contracts of the company. Post conversion, the company needs to get a new Memorandum of Association and Articles of Association, a new PAN Card on company’s name, increase the number of directors (minimum 3 in case of a public company) and intimate all the tax authorities about the conversion. 


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