Converting a Partnership Firm into a Private Limited Company


Mandatory Conditions

All partners of the partnership firm shall become shareholders of the company in the same proportion in which their capital accounts stood in the books of the firm on the date of the conversion.

1. Voluntary conversion of OPC to Private Limited.

The partners receive consideration only by way of allotment of shares in company and the partners shareholding in the company in aggregate is 50% or more of its total voting power and continue to be as such for 5 years from the date of conversion.

Requirement

  • Registered Partnership firm with minimum 7 Partners
  • Minimum Share Capital shall be Rs. 100,000 (INR One Lac) for conversion into a Private Limited Company
  • Minimum Share Capital shall be Rs. 500,000 (INR five Lac) for conversion into a Public Limited Co.
  • If the above requirement is not fulfilled by the firm, then the Partnership deed should be altered
  • Minimum 7 Shareholders
  • Minimum 2 Directors (for Private Limited Co.) and 3 Directors (for Public Limited Co.)
  • The directors and shareholders can be same person
  • DIN (Director Identification Number) for all the Directors
  • DSC (Digital Signature Certificate) for two of the Directors

Process

  • Filing of requisite form for Conversion
  • Preparation of Foundation documents of the Company
  • Filing for name approval
  • Filing of Incorporation documents
  • Receiving certificate of incorporation