Procedure of conversion of private ltd. company into LLP

PREREQUISITES

1. No-Pending of E-forms filed by Company.

2. No Charges should subsist at MCA site

3. One financial year must over

4. Update filing of all forms and returns

5. Update - income tax filings.

2. PROCEDURE

a. Board Resolution regarding Change of Company’s Status.

b. Filing of form 1 - Name availability

c. Filing of form 2 - Incorporation document and subscriber’s statement (With subscriber Sheet and Proof of address)

d. Filing of form 18 - Application and Statement for conversion of a private company/ unlisted Public company into limited liability partnership (LLP)

Attachments:

a. Statement of shareholders (may be attached in a tabular form)

b. Incorporation Document & Statement in Form 2 filed electronically.

c. Statement of Assets and Liabilities of the company duly certified as true and correct by the Chartered Accountant in practice.

d. List of all the creditors along with their consent to the conversion (may be given in the form of a tabular statement).

e. Approval of the governing council (In case of professional private limited companies)

f. NOC from Income Tax authorities.

g. Approval from any other body/authority as may be required.

h. Particulars of pending proceedings from any court/Tribunal etc.

i. Rejection letter of Registrar of any earlier application for conversion.

j. Particulars of convictions, rulings, orders, judgment of Courts in favor or against the private limited company which are subsisting.

k. Other optional attachments as may be required.

Things to be ensured before or at time of filing of Form 18

i. Individual Consent/statement (as per Part-B of form 18) from shareholders

ii. Only shareholders can be partners

iii. Security interest in the assets, if any, to be disclosed (may be a pledge)

iv. Latest IT filing acknowledgement to be enclosed

v. Details of prosecution initiated against or show cause notice u/CA on Com. (can be verified at Master Data)

vi. consent of all the secured creditors with list, if any,

vii. Statement of Assets and Liabilities of the company duly certified as true and correct by the auditor & 2 Directors

e. Filing of form 3 - Information with regard to limited liability partnership agreement and changes, if any, made therein

1. Within 30 days of date of registration of the LLP

2. With signed LLP agreement- (on Stamp Paper)

f. Form 19: Registrar will issue the certificate of registration on conversion of the private limited company into LLP

g. Filing of Form 14 - (Form for intimating the Registrar of Firms/ Registrar of Companies of conversion of the firm/ company into limited liability partnership within 30 days of such conversion.

Attachments:

a. Copy of Certificate of Incorporation of LLP formed.

b. Copy of incorporation document submitted in Form 2 (with the Registrar of Firms)

c. Other optional attachments as may be required.

3. The limited liability partnership shall ensure that for a period of twelve months commencing not later than fourteen days after the date of registration, every official correspondence of the limited liability partnership bears the following, namely:—

a. a statement that it was, as from the date of registration, converted from a company into a limited liability partnership; and

b. the name and registration number of the company from which it was converted.

CHECKLIST FOR CONVERSION OF COMPANY INTO LLP

STEP-1:- Obtain DPIN for all proposed designated Partners (Form-7)

STEP-2:-Obtain digital signature for all proposed designated partners for the purpose of electronic filing of documents.

STEP-3:- Apply for securing name of proposed LLP (Form-1)

STEP-4:- Make application for conversion of company into LLP (Form-18) with all necessary attachments.

Attachments are:-

1. Statement/consent of all the shareholders.

2. Statement of assets and liabilities of company duly verified by auditor i.e balance sheet (not more than 30 days old at the time of filing the documents)

3. Approval from respective authorities, if any, such as IRDA, SEBI, RBI, ICSI, ICAI, ICWAI, BAR COUNCIL etc.

4. List of unsecured creditors and their consent.

5. Other documents such as details of pending cases and proceedings, convictions, earlier rejection if any etc.

STEP-5:- File form-2(attach subscriber sheet as per format given in form-2)

STEP-6:- File form-3&4(attach agreement and consent of partners)

STEP-7:- Obtain registration of conversion from Registrar.

STEP-8:- Intimate about conversion to Registrar of Companies within 15 days from such date (form-14) (attach copy of COI of LLP)

Eligibility for conversion of private companies into limited liability partnership.

(1) A company may convert into a limited liability partnership by complying with the requirements as to the conversion set out in this Schedule.

(2) A company may apply to convert into a limited liability partnership in accordance with this Schedule if and only if—
(a) there is no security interest in its assets subsisting or in force at the time of application; and

(b) the partners of the limited liability partnership to which it converts comprise all the shareholders of the company and no one else.

(3) Upon such conversion, the company, its shareholders, the limited liability partnership into which the company has converted and the partners of that limited liability partnership shall be bound by the provisions of this Schedule that are applicable to them.

CS Nisha Sharma