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CONVERSION OF PUBLIC COMPANY INTO PRIVATE COMPANY

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CHECKLIST FOR CONVERSION OF PUBLIC COMPANY INTO PRIVATE COMPANY:

Relevant Sections & Rules of the Companies Act 2013:

  1. Section 14 Alteration of Article of Association.
  2. Section 13 Alteration of Memorandum of Association.
  3. Section 18
  4. Rule 33 of Companies (incorporation) Rules, 2014

Relevant Provisions of NCLT RULE 2016:

  1. Rule 68
  2. Rule 35

CONVERSION PROCEDURE:

  1. Convene and Hold a Board Meeting for the following purposes:
  • To consider and approve the proposal of converting the public company into private company,
  • To decide day, date, time and venue of the general meeting where special resolution is proposed to be passed,
  • To approve the notice of general meeting to be issued,
  • To authorize the company secretary /Director to issue the notice of General meeting.
  1. Issue the notice of General Meeting to all the members, auditors and directors.
  2. Hold the general meeting and pass the following special resolution.
  • For alteration of AOA,
  • For alteration of MOA.
  1. File within 30 days of Passing Special Resolution with the ROC in form MGT-14
  • ATTACHMENTS WITH FORM MGT-14:
  • Special Resolution along with the Explanatory Statement,
  • Alterted copy of AOA,
  • Altered copy of MOA.
  1. Not Less than Three Months from the Date of passing of Special Resolution, a Petition for the conversion of public company into private company shall be filed to the NCLT in form NCLT-1,
  • ATTACHMENT TO THE APPLICATION:
  • Copy of MOA & AOA
  • Copy of documents showing that the company cease to a public company
  • Affidavit verifying the petition
  • Bank draft evidencing payment of application fees(Rs. 5000/-)
  • Memorandum of appearance with copy of Board Resolution or the executed vakalatnama (Form NCLT-12)
  • OTHER DOCUMENTS:
  • A list of creditors and debenture holder (not older than 2 months from the date filing petition)
  • Petitioner Company shall file an affidavit, signed by the Company Secretary of the Company and 2 directors of the company verifying that the creditor list is correct.
  1. The company shall at least 14 days before the date of hearing:
  • Advertise the petition in form NCLT-3A:
  • Once in Vernacular Newspaper
  • Once in English Newspaper, circulating in that district.
  • Advertisement shall be placed on the Website of the company, if any.
  • Particulars of advertisement:
  • The date on which the application or petition was presented,
  • The name and address of the applicant, petitioner and his authorized representative, if any.
  • The nature of petition or application,
  • The date fixed for hearing
  • A statement to the effect that any person whose interest is likely to be affected by the proposed petition or who intends either to oppose or support the petition at the hearing shall send a notice of his intention to the concerned Bench and the petitioner, indicating the nature of interest and grounds of opposition so a to reach him not later than 2 days previous to the day fixed for hearing.
  • Send by registered post with acknowledgement due, individual notice in form NCLT 3B to every creditor.
  • Send by registered post with acknowledgement due, notice together with copy of petition to the CG, ROC and other applicable regulatory authority.( In case of a Listed Company)
  1. An affidavit shall be filed to the Tribunal, not less than 3 days before the date fixed for hearing, stating whether the petition has been advertised and have been served to the persons duly required to be served along with proof of advertisement.
  2. File E-Form INC-27 to the ROC within 30 days from the date of receiving of order of NCLT:
  • Attachment to the E-form INC-27:
  • Minutes of the member’s meeting where approval was given for conversion and alteration of the articles of association.
  • Copy of SPECIAL RESOLUTION
  • Copy of altered MOA & AOA
  • Order of NCLT.
  1. Issuance of Fresh Certificate of Incorporation by Registrar in INC-25.

NOTE:

  1. CONVERSION OF A PUBLIC COMPANY INTO A PRIVATE COMPANY SHALL NOT TAKE EFFECT EXCEPT WITH THE APPROVAL OF THE TRIBUNAL WHICH SHALL MAKE SUCH ORDER AS IT MAY DEEM FIT.
  2. MINIMUM TIME : 5-6 MONTHS

 

 

 

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