30 March 2009
The procedure for converting Private limited company into a public limited company is as follows:
1) a resolution to this effect should be passed at a Board Meeting. If the paid up capital of the private company is less than Rs. 5 lacs, a resolution should also be passed to increase the paid up capital to atleast Rs. 5 lacs or any higher sum.
2) A general meeting of the share holder should be convened to consider and pass a special resolution for conversion of a company into a public limited company.The special resolution should be to the following effect:
a) that those articles required to be included in the articles of a private limited company should be deleted, i.e. those articles which complies with section 3(1) (iii) and articles relating to restrictions or to the shares.
b) To delete the word private from the name of the company.
c) Any other articles which are in consistent with those required to be maintained by a public company should be deleted or amended.
For eg: articles describing a period of less than 21 days notice for general meetings and articles providing that for a share maybe issue without offering the same to the existing members.
3) File with the ROC either a prospectus or statement in lieu of prospectus within 30 days of passing of the special resolution.
4) File the special resolution and the explanatory statement with the ROC in Form 23 within 30 days of the passing of the special resolution.
5) Apply to the ROC for issue of a fresh certificate of incorporation in the new name of the company i.e. with the word Private deleted from the name or if an entirely new name is to be chosen with that name.
6) A. If the number of Directors is less than 3, the number of directors should be increased to atleast 3.
B. if the number of members is less than 7, the number of members should be increased to atleast 7
C. the change from private limited company to public limited company becomes effected when the ROC issues a fresh certificate of incorporation.
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