Conversion of public company to pvt company
This query is : Resolved
16 June 2011
Dears,
What is the procedure to be followed for conversion of public company to private company.
Means ress be passed and forms be filled etc..
Pls Help
What is the procedure to be followed for conversion of public company to private company.
Means ress be passed and forms be filled etc..
Pls Help
17 June 2011
Conversion of a Public Company into a Private Company
Under the Companies Act (Section31), all public companies, whether originally incorporated as a public limited company or at any time converted into a public limited company (under section 44 of the Act), may be converted into a private limited company, if the members so desire. The essential conditions for such a conversion are:-
The company must not be listed on any recognised stock exchange. In case of a listed company,it will have to wait for atleast one year after its delisting.
Shareholders' approval by special resolution for alteration of Articles of Association for incorporation of the definition of a private company. The Articles shall be suitably amended to include the basic restrictions applicable on a private company and other provisions necessary thereto.
No resolution amending the Articles, which has the effect of converting a public company into a private company, shall be effective unless it has been approved by the Central Government.
After the alteration has been approved, a printed copy of the Article shall be filed with the Registrar of Companies within one month of the date of receipt of the order of approval.
The name of the company shall be amended to include the word 'private' on all its documents.
The Companies Act contains the following procedure for the conversion:-
Convene a Board meeting for consideration of the proposal of conversion of the company into a private company.
Prepare the proposal for alteration of Articles of Association or prepare a new set of Articles of Association meeting the requirements of a private limited company.
Hold the Board meeting and get approval of the Board for the proposal, fix up the day, date and time of holding the general meeting of the company, approve notice and explanatory statement and authority to sign notice.
Hold the general meeting on the fixed day and pass the special resolution.
Fill e-Form 23 with the copy of special resolution, explanatory statement and Memorandum and Articles (before and after alteration).
Pay the requisite application fee.
Publish a newspaper notice in two widely circulated dailies of the State where the Regd. Office of the company is situated.
Get a no objection letter from major unsecured creditors and all secured creditors.
Apply to the Central Government in e-Form 1B.
Documents to be attached with the application are:-
Notice of extra-ordinary general meeting.
Minutes of extra-ordinary general meeting.
Copy of special resolution.
Copy of newspaper advertisement.
Affidavit that the company is not listed on any stock exchange.
Reference number, date of passing and date of filing the e-Form 23.
Payment of requisite application fee.
One copy each of the annual reports for the last three financial years.
Copy of the last annual return.
Altered Memorandum and Articles of Association.
No objection letters from major unsecured and all secured creditors supported by an Affidavit.
Reasons for conversion.
Terms of appointment of all managerial personnel.
Power of attorney in favour of the authorised representative.
On receipt of application, the Registrar of Companies(ROC) shall examine:-
Whether the interest of the public and particularly that of the creditors will be adversely affected.
Whether the company is listed.
Capital contribution by members.
Whether e-Form 23 has been passed and taken on record.
Whether the reasons for conversion are just and sufficient.
How many members voted for the resolution.
Whether any complaint against the company is pending.
Whether any show cause letter has been issued to the company or its Directors.
If there is any objection from members and creditors.
If the ROC approves the application, he refers it to Technical Section and Prosecution Section for their report. The Technical Section reports on whether the relevant e-Form23 and the last years annual report and annual return has been filed and passed/taken on record. The Prosecution Section reports on whether any complaint is pending from anybody against the company. If during the scrutiny any adverse point arises, that has to be looked into and the authorised representative should take the initiative to make good the default or defect. If the reports are satisfactory, the ROC will issue a letter granting its approval for conversion of a public company into a private company. The concerned ROC then issues fresh certificates of incorporation consequent upon change of name after conversion of the company from 'Public Company' to 'Private Company'.
for more information :-
https://www.caclubindia.com/forum/conversion-of-a-public-limited-company-into-a-private-limit-5875.asp
Under the Companies Act (Section31), all public companies, whether originally incorporated as a public limited company or at any time converted into a public limited company (under section 44 of the Act), may be converted into a private limited company, if the members so desire. The essential conditions for such a conversion are:-
The company must not be listed on any recognised stock exchange. In case of a listed company,it will have to wait for atleast one year after its delisting.
Shareholders' approval by special resolution for alteration of Articles of Association for incorporation of the definition of a private company. The Articles shall be suitably amended to include the basic restrictions applicable on a private company and other provisions necessary thereto.
No resolution amending the Articles, which has the effect of converting a public company into a private company, shall be effective unless it has been approved by the Central Government.
After the alteration has been approved, a printed copy of the Article shall be filed with the Registrar of Companies within one month of the date of receipt of the order of approval.
The name of the company shall be amended to include the word 'private' on all its documents.
The Companies Act contains the following procedure for the conversion:-
Convene a Board meeting for consideration of the proposal of conversion of the company into a private company.
Prepare the proposal for alteration of Articles of Association or prepare a new set of Articles of Association meeting the requirements of a private limited company.
Hold the Board meeting and get approval of the Board for the proposal, fix up the day, date and time of holding the general meeting of the company, approve notice and explanatory statement and authority to sign notice.
Hold the general meeting on the fixed day and pass the special resolution.
Fill e-Form 23 with the copy of special resolution, explanatory statement and Memorandum and Articles (before and after alteration).
Pay the requisite application fee.
Publish a newspaper notice in two widely circulated dailies of the State where the Regd. Office of the company is situated.
Get a no objection letter from major unsecured creditors and all secured creditors.
Apply to the Central Government in e-Form 1B.
Documents to be attached with the application are:-
Notice of extra-ordinary general meeting.
Minutes of extra-ordinary general meeting.
Copy of special resolution.
Copy of newspaper advertisement.
Affidavit that the company is not listed on any stock exchange.
Reference number, date of passing and date of filing the e-Form 23.
Payment of requisite application fee.
One copy each of the annual reports for the last three financial years.
Copy of the last annual return.
Altered Memorandum and Articles of Association.
No objection letters from major unsecured and all secured creditors supported by an Affidavit.
Reasons for conversion.
Terms of appointment of all managerial personnel.
Power of attorney in favour of the authorised representative.
On receipt of application, the Registrar of Companies(ROC) shall examine:-
Whether the interest of the public and particularly that of the creditors will be adversely affected.
Whether the company is listed.
Capital contribution by members.
Whether e-Form 23 has been passed and taken on record.
Whether the reasons for conversion are just and sufficient.
How many members voted for the resolution.
Whether any complaint against the company is pending.
Whether any show cause letter has been issued to the company or its Directors.
If there is any objection from members and creditors.
If the ROC approves the application, he refers it to Technical Section and Prosecution Section for their report. The Technical Section reports on whether the relevant e-Form23 and the last years annual report and annual return has been filed and passed/taken on record. The Prosecution Section reports on whether any complaint is pending from anybody against the company. If during the scrutiny any adverse point arises, that has to be looked into and the authorised representative should take the initiative to make good the default or defect. If the reports are satisfactory, the ROC will issue a letter granting its approval for conversion of a public company into a private company. The concerned ROC then issues fresh certificates of incorporation consequent upon change of name after conversion of the company from 'Public Company' to 'Private Company'.
for more information :-
https://www.caclubindia.com/forum/conversion-of-a-public-limited-company-into-a-private-limit-5875.asp
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17 June 2011
Conversion of a Public Limited Company into a Private Limited:-
Under section 31 of the Companies Act, 1956, any alteration made in the Articles, which has the effect of converting a public company into a private company shall not have effect unless such alteration has been approved by the Central Government (powers delegated to the Registrar of Companies). The following actions are required to be taken in respect of conversion of a public company into private company:—
(i) The Board of directors of the public company shall consider the proposal of conversion at a meeting and would resolve by means of a resolution that subject to necessary approvals under section 31, the company shall be converted into a private limited company and will include the word "Private" before the word "Limited" in its name.
(ii) Confirm that the numbers of members are not exceeding fifty;
(iii) Give notice in newspapers once in English and local language, where the registered office of the company is situated for conversion of company into private limited for providing opportunity to raise objections, if any, before the Registrar with a copy to the company within a period of 21 days from the date of notice and a copy of the notice be produced before the Registrar alongwith the application.
(iv) Give notice to all the creditors having secured or unsecured liabilities in excess of1.00 Lacs by Registered post and proof of delivery of such notice is required to be produced before the Registrar alongwith the application;
(v) The Board of directors will authorise calling a general meeting of members by giving notice of at least 25 days before the meeting and will also approve draft notice to be sent to the members enclosing with the explanatory statement under section 172 of Companies Act, 1956;
(vi) The Board of directors will authorise a director and/or the secretary to move an application to the Registrar of Companies after the proposal of conversion in approved at the general meeting of the shareholders by means of a special resolution.
(vii) Certified copy of the special resolution along with Explanatory Statements and amended copy of the Memorandum and Articles shall be filed with the Registrar of Companies within 30 days of passing of the resolution in terms of section 192 in e-Form 23.
(viii) Make an application in e-Form 1B to the Registrar of Companies attaching all enclosures required and pay fee prescribed under Companies (Fees on Application) Rules, 1999 as amended. The Managing Directors/director/manager or secretary submitting the form is required to disclose the following in Form 1B:
(a) Reason for conversion of company into private limited company.
(b) Date of passing special resolution, SRN of Form 23 and date of filing of Form 23. (It means the first step will be filing of Form 23 before preparation and filing of Form 1B)
(c) Copy of the orders for condonation of delay in filing of Form 1B, in case it could not be filed within a period of 30 days from the date of resolution passed by the member.
(d) Declaration/Verification that the Company has obtained all the mandatory approvals from the concerning authorities, departments and substantial creditors in respect of conversion of company from a public limited to private limited company.
(ix) Obtain from the Registrar of Companies a fresh certificate of incorporation consequent upon conversion of a public company into private company;
(x) Change the name in all documents of the company by inserting "Private" before the word "Limited".
Under section 31 of the Companies Act, 1956, any alteration made in the Articles, which has the effect of converting a public company into a private company shall not have effect unless such alteration has been approved by the Central Government (powers delegated to the Registrar of Companies). The following actions are required to be taken in respect of conversion of a public company into private company:—
(i) The Board of directors of the public company shall consider the proposal of conversion at a meeting and would resolve by means of a resolution that subject to necessary approvals under section 31, the company shall be converted into a private limited company and will include the word "Private" before the word "Limited" in its name.
(ii) Confirm that the numbers of members are not exceeding fifty;
(iii) Give notice in newspapers once in English and local language, where the registered office of the company is situated for conversion of company into private limited for providing opportunity to raise objections, if any, before the Registrar with a copy to the company within a period of 21 days from the date of notice and a copy of the notice be produced before the Registrar alongwith the application.
(iv) Give notice to all the creditors having secured or unsecured liabilities in excess of1.00 Lacs by Registered post and proof of delivery of such notice is required to be produced before the Registrar alongwith the application;
(v) The Board of directors will authorise calling a general meeting of members by giving notice of at least 25 days before the meeting and will also approve draft notice to be sent to the members enclosing with the explanatory statement under section 172 of Companies Act, 1956;
(vi) The Board of directors will authorise a director and/or the secretary to move an application to the Registrar of Companies after the proposal of conversion in approved at the general meeting of the shareholders by means of a special resolution.
(vii) Certified copy of the special resolution along with Explanatory Statements and amended copy of the Memorandum and Articles shall be filed with the Registrar of Companies within 30 days of passing of the resolution in terms of section 192 in e-Form 23.
(viii) Make an application in e-Form 1B to the Registrar of Companies attaching all enclosures required and pay fee prescribed under Companies (Fees on Application) Rules, 1999 as amended. The Managing Directors/director/manager or secretary submitting the form is required to disclose the following in Form 1B:
(a) Reason for conversion of company into private limited company.
(b) Date of passing special resolution, SRN of Form 23 and date of filing of Form 23. (It means the first step will be filing of Form 23 before preparation and filing of Form 1B)
(c) Copy of the orders for condonation of delay in filing of Form 1B, in case it could not be filed within a period of 30 days from the date of resolution passed by the member.
(d) Declaration/Verification that the Company has obtained all the mandatory approvals from the concerning authorities, departments and substantial creditors in respect of conversion of company from a public limited to private limited company.
(ix) Obtain from the Registrar of Companies a fresh certificate of incorporation consequent upon conversion of a public company into private company;
(x) Change the name in all documents of the company by inserting "Private" before the word "Limited".
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17 June 2011
Specimen of Board Resolution for conversion of the Limited Company into a Private Limited Company.
RESOLVED THAT pursuant to the provisions of section 31 of the Companies Act, 1956 and subject to the approval of the ROC and the members at the General Meeting the name of the Company be changed from KW Limited to KW Private Limited.
FURTHER RESOLVED THAT Shri SK, Managing Director of the Company be instructed to issue a notice of Extra Ordinary General Meeting to the members of the Company and others who are entitled to receive the same in order to obtain their approval for the above matter of conversion.
FURTHER RESOLVED THAT Shri SK, Managing Director of the Company be and is hereby authorised to make an application to make an application to the Registrar of companies in e-Form 1B and to do all such acts, deeds and things as may be required to be done in this regard.
RESOLVED THAT pursuant to the provisions of section 31 of the Companies Act, 1956 and subject to the approval of the ROC and the members at the General Meeting the name of the Company be changed from KW Limited to KW Private Limited.
FURTHER RESOLVED THAT Shri SK, Managing Director of the Company be instructed to issue a notice of Extra Ordinary General Meeting to the members of the Company and others who are entitled to receive the same in order to obtain their approval for the above matter of conversion.
FURTHER RESOLVED THAT Shri SK, Managing Director of the Company be and is hereby authorised to make an application to make an application to the Registrar of companies in e-Form 1B and to do all such acts, deeds and things as may be required to be done in this regard.
17 June 2011
Specimen of Special Resolutions
I. Special resolution for conversion of private limited company into public company
RESOLVED THAT pursuant to the provisions of sections 31, 44 and other applicable provisions of the Companies Act, 1956 the status of the Company be and is hereby converted from PRIVATE LIMITED into PUBLIC LIMITED Company.
FURTHER RESOLVED THAT pursuant to the provisions of the Companies Act, 1956 the name of the Company be and is hereby changed from KW PRIVATE LIMITED to KW LIMITED by deletion of the word 'Private' before the word Limited in the name of the Company and necessary corrections in the name Clause of the Memorandum And Articles of Association and all such other papers, documents and matters be made to give effect of the changed name accordingly.
II. Special resolution for adoption of new set of articles
RESOLVED THAT the a new set of Articles of Association incorporating the provisions applicable to the Public Limited Companies as placed before the Meeting be and is hereby substituted and adopted in the place of the existing Articles of Association of the Company.
Explanatory statement:
Item No. …. To …
The Company was incorporated on 7th September, 1987 as a Private Limited Company which put some restrictions of the Company and limiting its scope for its working. The Board of directors of the Company considered that looking into the expanded business activities the Company should be converted into a Public Limited Company to get confidence of the public as a whole.
As per the provisions of sections 31 and 44, and other applicable provisions of the Companies Act, 1956 consent of the Members is required by way of Special Resolution to convert the Company from Private Limited to Public Limited. Therefore your Directors recommend the resolution for approval as a Special Resolution as set out under item no. … to … of the Notice of the Meeting.
Item No. ….
The existing Articles of Association of the Company are limiting the working of the Company as the Articles includes the clause which are restricting the operations of the Company including therein the restrictive provisions of section 3(1)(iii) and other provisions of the Companies Act, 1956. In view of the change in the status of the Company into the Public Limited and to incorporate the provisions of the Companies Act, 1956, your directors proposes to substitute the set of the existing Articles of Association with the new set of the Articles of Association.
As per the provisions of section 31 and other applicable provisions of the Companies Act, 1956 consent of the Members is required by way of Special Resolution to alter/adopt a new set of Articles of Association of the Company. Therefore, your Directors recommend the resolution for approval as a Special Resolution as set out under item….
A copy of the draft amended Memorandum of Association and new set of Articles of Association along with the existing Articles of Association of the Company is available for inspection, which can be inspected at the Registered Office of the Company during working hours on any working day.
I. Special resolution for conversion of private limited company into public company
RESOLVED THAT pursuant to the provisions of sections 31, 44 and other applicable provisions of the Companies Act, 1956 the status of the Company be and is hereby converted from PRIVATE LIMITED into PUBLIC LIMITED Company.
FURTHER RESOLVED THAT pursuant to the provisions of the Companies Act, 1956 the name of the Company be and is hereby changed from KW PRIVATE LIMITED to KW LIMITED by deletion of the word 'Private' before the word Limited in the name of the Company and necessary corrections in the name Clause of the Memorandum And Articles of Association and all such other papers, documents and matters be made to give effect of the changed name accordingly.
II. Special resolution for adoption of new set of articles
RESOLVED THAT the a new set of Articles of Association incorporating the provisions applicable to the Public Limited Companies as placed before the Meeting be and is hereby substituted and adopted in the place of the existing Articles of Association of the Company.
Explanatory statement:
Item No. …. To …
The Company was incorporated on 7th September, 1987 as a Private Limited Company which put some restrictions of the Company and limiting its scope for its working. The Board of directors of the Company considered that looking into the expanded business activities the Company should be converted into a Public Limited Company to get confidence of the public as a whole.
As per the provisions of sections 31 and 44, and other applicable provisions of the Companies Act, 1956 consent of the Members is required by way of Special Resolution to convert the Company from Private Limited to Public Limited. Therefore your Directors recommend the resolution for approval as a Special Resolution as set out under item no. … to … of the Notice of the Meeting.
Item No. ….
The existing Articles of Association of the Company are limiting the working of the Company as the Articles includes the clause which are restricting the operations of the Company including therein the restrictive provisions of section 3(1)(iii) and other provisions of the Companies Act, 1956. In view of the change in the status of the Company into the Public Limited and to incorporate the provisions of the Companies Act, 1956, your directors proposes to substitute the set of the existing Articles of Association with the new set of the Articles of Association.
As per the provisions of section 31 and other applicable provisions of the Companies Act, 1956 consent of the Members is required by way of Special Resolution to alter/adopt a new set of Articles of Association of the Company. Therefore, your Directors recommend the resolution for approval as a Special Resolution as set out under item….
A copy of the draft amended Memorandum of Association and new set of Articles of Association along with the existing Articles of Association of the Company is available for inspection, which can be inspected at the Registered Office of the Company during working hours on any working day.
17 June 2011
Specimen of notice to be published in newspaper
Notice is hereby given that members of the Company at their Extra Ordinary General Meeting held on xx.xx.xxxx, have passed a special resolution for the conversion of the Company KW Limited to KW Private Limited under the provisions of section 31 of the Companies Act, 1956. Anybody having objection for such conversion may raise their objection with an affidavit and supporting evidences, if any, with the Registrar of Companies, Madhya Pradesh and Chattisgarh with a copy of the same to Company at the Registered Office. The Registrar of Companies will proceed for issuance of certificate for change of name after expiry of 21 days from the date of this notice.
Place: For, KW Limited
Date: DIRECTOR
Notice is hereby given that members of the Company at their Extra Ordinary General Meeting held on xx.xx.xxxx, have passed a special resolution for the conversion of the Company KW Limited to KW Private Limited under the provisions of section 31 of the Companies Act, 1956. Anybody having objection for such conversion may raise their objection with an affidavit and supporting evidences, if any, with the Registrar of Companies, Madhya Pradesh and Chattisgarh with a copy of the same to Company at the Registered Office. The Registrar of Companies will proceed for issuance of certificate for change of name after expiry of 21 days from the date of this notice.
Place: For, KW Limited
Date: DIRECTOR
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18 June 2011
THANK YOU VERY MUCH MR SANJAY GUPTA FOR YOUR SUCH WONDERFUL HELP.
THANKS A LOT
THANKS A LOT
20 June 2011
THANKS AUTHOR FOR PARTICIPATE IN CA CLUB INDIA.
21 June 2011
Dear Rakesh Kumar Verma
I Have a query regarding first board meeting of a public company which is filling SLP with ROC
Pls Help
I Have a query regarding first board meeting of a public company which is filling SLP with ROC
Pls Help
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