Procedure for Conversion of a Public Company into a Private Limited Company in India

 A Public Limited Company offers its shares to the public and is subject to stringent compliance under the Companies Act, 2013. While public companies have the advantage of raising capital from the public, they are also bound by strict disclosure norms, compliance requirements, and shareholder regulations. 


Many public companies choose to convert into a Private Limited Company to enjoy greater operational flexibility, reduced compliance burden, and better control over decision-making.

At Corpzo, we provide end-to-end assistance in the legal and procedural requirements for such conversions, ensuring a smooth transition in full compliance with the law.

Why Convert a Public Company into a Private Limited Company?

Some of the common reasons for conversion include:

  • Reduced Compliance Requirements – Fewer board meetings, filings, and reporting obligations.

  • Better Control – Limited number of shareholders, enabling faster decisions.

  • Operational Flexibility – Lesser regulatory restrictions on related party transactions, borrowings, and internal structuring.

  • Cost Savings – Reduced costs associated with statutory audits, compliance, and public disclosures.

  • Confidentiality – Private companies enjoy more privacy as they are not bound to disclose as much information publicly.

Legal Framework for Conversion

The conversion of a public company into a private limited company is governed by:

  • Section 14 of the Companies Act, 2013 – Alteration of Articles of Association (AOA) by special resolution.

  • Rule 41 of the Companies (Incorporation) Rules, 2014 – Procedure for conversion.

  • Approval of the Regional Director (RD) of the Ministry of Corporate Affairs (MCA).

Step-by-Step Procedure for Conversion

Step 1 – Board Meeting

  • Convene a board meeting to approve the proposal for conversion.

  • Fix the date, time, and agenda for an Extraordinary General Meeting (EGM) to obtain shareholder approval.

  • Approve the draft notice for the EGM, including the special resolution and explanatory statement.

Step 2 – Issue Notice of EGM

  • Send the notice of EGM to all shareholders, directors, and auditors at least 21 clear days before the meeting.

  • Include the agenda for passing a Special Resolution to alter the Articles of Association and change the company’s name if required.

Step 3 – Hold the EGM

  • Conduct the Extraordinary General Meeting.

  • Pass the Special Resolution approving the conversion.

  • Approve alteration in the Articles of Association (AOA) to reflect private company provisions, such as:

    • Restricting share transfer rights.

    • Limiting the number of members to 200.

    • Prohibiting public invitation for subscription to shares.

Step 4 – Filing with the Registrar of Companies (RoC)

  • File Form MGT-7 (annual return) and Form MGT-14 (filing of special resolution) with the RoC within 30 days of passing the resolution.

  • Prepare and submit:

    • Altered AOA and Memorandum of Association (MoA).

    • Certified copy of the special resolution.

    • Notice and explanatory statement of the EGM.

Step 5 – Filing Form INC-27 and Application to Regional Director

  • File Form INC-27 along with the application for conversion to the Regional Director (RD) through the MCA portal.

  • Attach:

    • List of creditors and debenture holders with their consent.

    • Declaration from directors confirming compliance.

    • No Objection Certificate (NOC) from regulatory authorities if applicable.

    • Affidavit verifying that the company has not accepted deposits in violation of the Act.

Step 6 – Approval from Regional Director

  • The Regional Director may seek clarifications or call for additional documents.

  • Upon satisfaction, the RD will approve the conversion and issue an order of approval.

Step 7 – Filing of RD Approval with RoC

  • File Form INC-28 with the RoC within 15 days of receiving the RD’s approval order.

  • The RoC will then issue a Fresh Certificate of Incorporation reflecting the company’s new status as a Private Limited Company.

Key Compliance Points

  • Ensure that the company has no outstanding unsecured deposits.

  • Obtain written consent from all secured creditors.

  • Update statutory records, company name boards, and letterheads.

  • Inform banks, financial institutions, and contractual parties about the conversion.

Timeframe for Conversion

The entire process usually takes 6–8 weeks, depending on the readiness of documents and the speed of approval from the Regional Director.

Documents Required for Conversion

  1. Copy of the Memorandum & Articles of Association (MoA & AOA).

  2. Board resolution and EGM resolution approving the conversion.

  3. Altered AOA and MoA.

  4. List of creditors and their consent.

  5. Declaration of compliance from a director.

  6. No Objection Certificates (if applicable).

  7. Proof of filing MGT-14, INC-27, and INC-28.

How Corpzo Can Help You Convert Your Public Company into a Private Limited Company

At Corpzo, we offer a complete turnkey service for conversion, including:

  • Pre-conversion consultation to check eligibility and compliance.

  • Drafting resolutions, notices, and altered AOA/MoA.

  • Filing all MCA forms (MGT-14, INC-27, INC-28).

  • Coordinating with the Regional Director for approvals.

  • Post-conversion compliance support.

Our team of company secretaries, legal experts, and compliance specialists ensures that your conversion process is quick, compliant, and stress-free.

Advantages of Choosing Corpzo

  • Expert Guidance – Experienced professionals handling corporate law matters.

  • Fast Turnaround – Efficient preparation and filing for timely approvals.

  • Transparent Pricing – No hidden charges, clear cost breakdown.

  • End-to-End Support – From planning to post-conversion compliance.

Conclusion

Converting a Public Limited Company into a Private Limited Company offers significant operational and compliance advantages. However, the process requires meticulous documentation, multiple filings, and regulatory approvals.

With Corpzo as your compliance partner, you can ensure a smooth, legally compliant, and timely conversion without unnecessary delays.

📞 Contact us today for expert assistance in the conversion process.
🌐 Visit: www.corpzo.com for more details.

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