Documents required in Spice+ form
Converting a partnership firm to a private limited company involves several legal and procedural steps. This transformation allows the firm to benefit from the advantages of a corporate structure, such as limited liability, perpetual succession, and easier access to capital. In this article, we will discuss the process of converting a partnership firm to a private limited company in detail. Converting a Partnership firm to a private limited company, which becomes a separate legal entity, reduces the risk of liability, and the personal assets will remain untouched except in case of fraud. The incorporation and compliance procedure of a private limited company is as per the Companies act, 2013, and the shares are held privately.
The essential pre-requisite conditions for converting the Partnership firm into a Private Limited Company are-
Documents required in Spice+ form
Requisite steps to be followed for the conversion of a Partnership Firm into a Private Limited Company are:
Step 1-Conducting a meeting of the partners for the Conversion of the Partnership Firm into a Private Limited Company
Apply For DSC And DIN For All Proposed Directors and Shareholders of The Company- It is one of the pre-requisites to apply for DSC and DIN of the proposed directors and shareholders.
Step -2 Obtain name Approval in the RUN form.
File an application in the RUN form on the MCA website click here to get the Incorporation done for the proposed company after conversion.
A Partnership firm can apply for the same name, provided the name should be unique as per the rules of the Companies Incorporation Rules 2014 and subject to the availability of the name.
The proposed director or shareholder shall provide the necessary attachments along with the proposal for the conversion of the partnership firm.
Step -3 File Form URC-1
File Form URC-1 within 30 days of name approval along with the necessary documents in the form of attachments with ROC.
Step - 4 Publish an advertisement in Two Newspaper
As per section 374(b) of the Companies Act, 2013 firm opting for Incorporation under the provision of Part I of Chapter XXI shall publish an advertisement about Incorporation.
An advertisement shall be in Form No. URC-2. Further, the advertisement shall be published in 2 newspapers-
Step – 5 Draft MOA and AOA
Once the Name and E-FORM URC-1 are approved by the Registrar, the applicant company is required to draft the Memorandum and Articles of Association and other relevant documents required for Incorporation.
Step -6 Issue of Certificate of Incorporation
File SPICE+ along with the required documents and if the Registrar is satisfied with the documents and information filed by the applicants. The Registrar shall issue a COI (Certificate of Incorporation) to the applicant company.