Conversion of LLP into Private Company

Limited Liability Partnership Act, 2008 does not cover the provision of conversion of LLP into Company but Section 366 of the Companies Act, 2013 and Company (Authorized to Register) Rules, 2014 allows LLP to convert into a Company as per the provisions contained therein. Many Limited Liability Partnerships (LLPs) are now converting itself into a Private Limited Company for more growth & expansion and for infusing equity capital.

PRE-REQUISITES FOR CONVERSION:

1. Check whether LLP has filed its statutory returns upto date and file all LLP agreements including supplementary agreements with Registrar of Companies (“RoC”).
2. All filed forms should be in the approved status.
3. LLP must have at least 2 partners.
4. The exact name of the LLP shall continue, and the word “LLP” shall be substituted by “Private Limited.” No change of name is permitted.
5. Ensure that secured creditors of the company, prior to its registration under this Part, have either consented to or have given their no objection to company's registration under this Part;
6. A company shall be registered in pursuance of this section as a company limited by shares only if it has a permanent paid-up or nominal share capital of fixed amount divided into shares, also of fixed amount, or held and transferable as stock, or divided and held partly in the one way and partly in the other, and formed on the principle of having for its members the holders of those shares or that stock, and no other persons;.

       7.    Written consent from the majority of members whether present in person or by proxy at a general meeting agreeing for registration under this part.

Process of Conversion of LLP into Company

1. File Spice+A

Name Approval has to be obtained from the ROC by submitting an application in Spice+A. Object clause of Company must be attached.

2. Publish newspaper notice in form URC-2

A notice seeking objections, if any within twenty one clear days from the date of publication of notice and the said advertisement shall be in Form No. URC. 2, which shall be published in a newspaper in English and in any vernacular language, circulating in the district in which Limited Liability Partnership is situated.

3. Notice to Registrar(LLP)

A copy of the notice shall also be served to registrar(LLP)

Further the notice as published in newspaper and the copy of the notice served on Registrar (LLP) with proof of service, shall be attached with Form No. URC. 1.

The Registrar shall, after considering the application and the objections, if any, received by him within thirty days from the date of publication of advertisement, and after ensuring that the company has addressed the objections, suitably decide whether the registration should or should not be granted.

3. Filing form No URC – 1 & SPICe & SPICe MOA and SPICe AOA

After getting the approval of name from Registrar of Companies and after 21 days from the publication of newspaper advertisement, the applicant should file the form No URC-1 & SPICe along with the following documents.

Attachments to URC-1

1. A list showing the names, addresses, and occupations of all persons named therein as partners with details of shares held by them respectively, showing separately shares allotted for consideration in cash and for consideration other than cash along-with the source of consideration and distinguishing, in cases where the shares are numbered, each share by its number, who on a day, not being more than six clear days before the day of seeking registration, were partners of the Limited Liability Partnership or firm as the case may be;

2. List of the persons proposed as the first directors of the company, alongwith DIN, passport number, if any, with expiry date, residential addresses and their interests in other firms or bodies corporate along with their consent to act as directors of the company;

3. A list including the names & addresses of partners of LL

4. A copy of LLP agreement and supplementary agreement if any, & certificate of registration duly verified by two designated partners.

5. A written consent of majority partners of LLP

6. No Objection Certificate from secured creditor along-with charge holder, if applicable;

7. Copy of newspaper advertisement.

8. Statement of accounts, prepared not later than fifteen days preceding the date of seeking registration and certified by the Auditor together with the Audited Financial Statements of the previous year, wherever applicable shall be attached with Form No. URC. 1

9. A copy of latest income tax return

10. Undertaking by proposed first directors with regard to compliance with stamp act.

11. In case of the registration of Limited Liability Partnership into a company under these rules, a declaration by the said Limited Liability Partnership that it has filed all documents which are required to be filed under the Liability Partnership Act with the Registrar (LLP) and the declaration shall be attached with  Form No. URC. 1

  Attachments to SPICe

   1. Consent & Declaration by first Directors in form DIR-2

   2. ID Proof and Address Proof of Directors; (PAN card and Aadhar card)

  3. Resolution of Partners for conversion of LLP into Company;

  4. Proof of regd. Office like Rent Agreement/Sale deed

  5. Latest Electricity bill (Not older than 2 Months)

  6. NOC of Owner of Office, If Regd office is rented.

Post conversion compliance

Filing of form INC 22

This form pertain to intimation about the Registered office address to the ROC within 30 days of incorporation of company.

Documents Required for INC 22

1. Proof of regd. Office like Rent Agreement/Sale deed.

2. Latest Electricity bill (Not older than 2 Months)

3. Geotagged photograph of Registered office showing the External & internal Building

 of the company within 30 days for verification of registered office of the company