Overview

• Private Limited Company

  Any private limited company meant working for small companies. The liability of the facilities of a private restricted company is assigned to the number of shares held by him personally. The legacy of a private limited company cannot be shared or updated.

• Public Limited Company

  A company whose shares are bought on a stock exchange and can be acquired and sold by anyone. It is also called a publicly held company. A public limited company, such as Signature, shows that the business provides shares to the public. After the Companies Act 2013, a public limited company is a company with limited liability and contribution to the general public. Any privately held (IPO) can acquire its stock through 'initial public offering' or by trading on the stock market.

Some Topics

• A public company has seven or more members and may invite the public to contribute to its shares. A subsidiary corporation of a public company is meant to be a public company.
• A private company is an organization that limits its number of categories to 200 and cannot invite the public to contribute to its shares. The Companies Act, 2013 provides for the conversion of a public company into a private company by changing the MOA and AOA of the business.
• The main advantage of a public company is that it can mobilize large scale resources without addressing the banking system and reducing debt. In contrast, private companies that are privately controlled, all funds are raised by existing members, shareholders and promoters. If a private company goes public, the opportunity is also shared among shareholders. Public companies, once registered, receive indirect promotions and endorsements through stock clearinghouse websites, where their shares are recorded.
• Earlier, the National Company Law Tribunal (NCLT) effected the conversion of a public company to a private company. The Companies Act, 2013 underwent various amendments and the NCLT has a lot of responsibilities. Since the 2013 Act came into force, the NCLT has the discretion to terminate the petitions earlier granted by the High Courts.

Careless conversion

• Wherever the private company defaults in complying with the legal requirements laid down in the security. 3 (1) (iii) of the Companies Act (i.e., if its association is more than fifty, it permits free transfer of shares, or invites the public to subscribe to its shares or debentures), it is natural Form becomes a public company.
• 'The Company Law Board may relieve the corporation from being entertained as a public company on any terms and conditions as it seems just and justifiable, if it believes that the omission is inadvertent or accidental or any other substantial Was due to reason.
• It should be remarked that a private company which automatically displays a public company under the aforesaid provisions is not required to follow any legal function. Again, despite the conversion, such a company may hold the facilities of a private company, that is, it may have limitations on the transfer of shares, company, and public membership. It can only proceed to two 'members' and 'two directors'.
• Section 43-A sub-section (1) states that a private company shall be a public company with twenty-five per cent or more of its payable share capital.

Conversion by operation

• Section 43 a proposed by the Companies (Amendment) Act, 1960 attached a new class of organisations of "Considered to be Public Company".
• Private businesses are issued by the operation of several divisions of a Companies Act and enjoy exceptional opportunities, particularly on the basis that they are family businesses in which the public is not immediately entertained.
• However, it is well known that there are many private companies that hold significant capital and control various public companies. This became possible because funds from other public and private companies are advanced in such companies.
• The prediction of private companies has always been somewhat complicated. On the one hand, there are private companies that have zero, but a fantastic partnership. On the other hand, there are private companies whose services, financial and industrial, are far more extensive than many public organizations.
• The Companies (Amendment) Act, 1960 enacted a new section 43-A to deal with private companies, which operate free money without a small amount, but as applicable to public companies Disclosure and restrictions are avoided.
• The Companies (Amendment) Act of 1974 and 1988 has substantially increased Section 43-A by adding three new sub-sections (1A), (1B) and (1C).

Some requirements

• DSC for 1 Director
• Minimum 7 shareholders
• DIN for all directors
• Minimum Authorized Share Capital of 5lacs
• Minimum Paid-up Share Capital of Rs.5lacs
• Directors and shareholders can be the same person
• Minimum of 3 Directors

Conversion process

• Complete our simple form
• For further plans, the details submitted by you will be verified by our experts.
• After presenting your documents, we will draft / revise the MOA / AOA for your company.
• We will organize your documents and credentials and file them with the ROC.
• After your corporation joins, we send you all reports and DSCs.

required Documents

• PAN card of shareholders and directors
• Foreign citizens must provide a valid passport.
• Voter ID / Passport / Shareholder and Directors Driving License
• Address proof: telephone bill / electricity bill / latest bank account details of shareholders and directors
• Photograph: latest passport size photograph of shareholders and directors
• Business Proof of Residence: Electricity Bill / Telephone Bill of Certified Office Address
• NOC from landlord: NOC to be collected from the owner (s) of the certified office
• Leased: Rent contract of certified office, if any, should be provided.
• Memo: In case of NRI or foreign national, the documents of the Director should be notarized
• Incorporation certificates: Declaration of Incorporation, MoA & AoA to be presented
• Financial Statement: Duly verified copy of latest audited financial statements
• Income Tax Return: ITR to be filed for last financial year

Prospectus

• The statutory requirements relating to the conversion of a private company to a public company are set out in 'Sections 18 and 14' of the Companies Act, 2013, which is shown along with 'Rule 33' of the Companies (Association) Rules, 2014.
• Section 14 of the Companies Act, 2013 'Private Limited plays an essential role while converting the company into a public limited company.
• Converting a private limited company into a public limited company requires a change in the Articles of Association (AOA) of the private company 'U / S 14' which did not pass a special resolution of stockholders at the general meeting can go.

Legal Provisions

• Sections 2 (68) and 2 (71): Description of private and public company
• Section 3: Establishment of company
• Conducting Section 13 with Companies Rule 29 (Incorporation) Rules 2014: Amendment of Memorandum of Association (MoA)
• Read Section 14 with the Company's Rule 33 (Incorporation) Rules 2014: Exchange / Remodeling of Articles of Association
• Section 18: Conversion of First Registered Companies
• Section 149: The Board of Directors of the company is

Plans and schemes

• Section 13 of the Act deals with the change of memorandum stating that the company can change the memorandum with reference to ‘S. 61 of the Act. The section disclosed any change in the capacity of the protocol for determining that prior permission of the central authority was required. This section is an additional provision that except the term / omission, such consent is not required on the account of the exchange "Private" determines if the entire name is changed in that circumstances, prior approval is needed as envision in said Section.
• Section 14 of the Act deals with the amendment of memorandum and conversion of a public company into a private company, and it is also mentioned that prior permission is required. In addition, we need to understand this section with the Company Incorporation (Fourth Amendment) Rules 2018, which discusses and detailed the circumstances of the conversion of a public company to a private company.
• Section 18 of the Act speaks about the conversion of companies which are already registered under the provisions of the Act. Section 18 states that in the context of the relevant chapter relating to section 18 of the Act any class of companies may convert itself to another category of companies under the provisions of the Act under the provisions of the Act. Full compliance is required, and the registrar must be satisfied with the said compliance. This section further states that the registration of a company under this section will not affect any debts, liabilities obligations or contracts, it means that the liabilities cannot satisfy the conversion of a public company to a private company.
• As discussed in the first 14 of the Act, a public company can convert into a private company with prior permission from the central government. The conversion of a public company to a private company is explained in the Companies Incorporation (Fourth Amendment) Rules, 2018. The central government said video has the power to change the rules. These rules are revised from time to time. Because of this, we need to update the recent announcements which are updated from time to time on the MCA website.