GOVERNMENT OF INDIA
Ministry of Corporate Affairs
NOTICE INVITING COMMENTS ON THE DRAFT COMPANIES (Incorporation) SECOND AMENDMENT RULES 2016
Dated the 17th February, 2016
1. The draft
Companies COMPANIES (Incorporation) Second AMENDMENT
RULES 2016 i.e. conversion of unlimited liability company into limited
liability company has been placed on the Ministry’s website
at www.mca.gov.in. It
has been decided to invite suggestions/comments on the above draft.
2.
Suggestions/comments on above mentioned draft along with justification in brief
may be sent latest by 02.03.2016 through email at conv.ulc@mca.gov.in
It is requested that the name, Telephone number and address of
the sender should be indicated clearly at the time of sending
suggestions/comments.
Name, Address, Contact No. of Stake holder __________________
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SL.No
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Rule No.or Form No.
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Suggestion
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Justification
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To be published in the Gazette of India, Extraordinary, Part II,
Section 3, Sub-Section (i)]
Government of India
Ministry of
Corporate Affairs
NOTIFICATION
New Delhi, February, 2016
G.S.R. .—In exercise of the powers conferred by
sub-sections (1), (2) and (3) of section 18 read with sub-sections (1) and (2)
of Section 469 of the Companies Act, 2013 (18 of 2013), the Central Government
hereby makes the following rules further to amend the Companies (Incorporation)
Rules, 2014, namely:—
1.
(1) These rules may be called the Companies (Incorporation) Second Amendment
Rules, 2016.
(2)
They shall come into force from the date of their publication in the Official
Gazette.
2.
In the Companies (Incorporation) Rules, 2014,
(i)
After existing Rule 36, the following Rules
shall be inserted.-
37. Conversion of unlimited liability
company into limited liability company:-
(1) For
effecting the conversion of an unlimited liability company into limited liability
company, the company shall pass a special resolution in a general meeting and
thereafter, an application shall be filed in Form INC-27 in the manner hereinafter
provided.
(2) The
Company shall within seven days from the date of passing of the special resolution
in a general meeting, publish a notice of such proposed conversion in
newspapers (one in English and one in vernacular language) in the district in
which the registered office of the company is situate and shall also place the same on the website of the Company,
if any, indicating clearly the proposal of conversion of the company into
limited liability company, and seeking objections if any from the persons
interested in its affairs, to such conversion and cause a copy of such notice
to be dispatched to its creditors and debentures holders by registered post or
electronic mode or through courier with proof of dispatch. The notice shall
also state that the objections, if any, may be intimated to the Registrar and
to the company within twenty-one days of the date of publication of the notice,
duly indicating nature of interest and grounds of opposition.
(3) The
Company shall within sixty days of passing of the special resolution file an application as prescribed in sub rule
(1) for its conversion into Limited Liability Company alongwith the fees as
provided in the Companies (Registration
offices and Fees) Rules, 2014, by attaching the following documents,
namely:-
a.
Notice of the general meeting along with
explanatory statement;
b.
Copy
of the resolution passed in the general meeting;
c.
Copy of the newspaper publication;
d.
A copy of altered Memorandum of Association
as well as Articles of Association duly certified by any one of the directors
duly authorised in this behalf.
e.
Declaration from all the directors of the
Company that such conversion shall not affect any debts, liabilities,
obligations or contracts incurred or entered into by or on behalf of the
Company before conversion (except to the extent that the liability of the
members shall become limited).
f.
A complete list of creditors and debenture
holders, drawn up to the latest practicable date preceding the date of filing
of application by not more than thirty days, setting forth the following
details, namely:-
(i) the
names and address of every creditor and debenture holder of the Company;
(ii) the
nature and respective amounts due to them in respect of debts, claims or
liabilities:
(iii) declaration by a director of the
company that notice as required in
sub-rule (2) has been dispatched to all creditors and debenture holders with
proof of dispatch.
g.
A declaration signed by not less than two
directors of the company, one of whom shall be a managing director where there
is one, to the effect that they have made a full enquiry into the affairs of
the Company and, having done so, have formed an opinion that the list of
creditors is correct, and that the estimated value as given in the list of the
debts or claims payable on a contingency or not ascertained are proper estimates
of the values of such debts and claims and that there are no other debts of or
claims against the Company to their knowledge.
h.
A declaration of solvency signed by at
least two directors of the company, one of whom shall be the managing director where
there in one to the effect that the Board of Directors of the company have made
a full inquiry into the affairs of the company, as a result of which they have
formed an opinion that it is capable of meeting its liabilities and will not be
rendered insolvent within a period of one year from the date of declaration,
through a resolution, passed in a duly convened meeting.
i.
The company should also obtain a
certificate from the Statutory Auditors that the company is solvent and that it
is a going concern as on the date of passing of resolution by the Board
certifying solvency as per (h) above.
j.
NOC
from sectoral regulator, where necessary.
k. NOCs from all
secured creditors, if any.
(4) Declaration
from all the directors of the Company that no complaints are pending against
the company from the members or investors.
(5) Where
no objection has been received from any persons, who have been duly served with
notice, the application shall be decided by the Registrar on merits. Where an objection has been received, the
company shall either obtain the objector’s consent to the conversion or his
debt or claim has been discharged or determined or has been secured as the case
may be, to the satisfaction of the Registrar.
(6) The
certificate of incorporation consequent to conversion of unlimited liability
company to the limited liability company in Form INC-11A shall be issued to the
company upon grant of approval for conversion.
(7) Conditions to be complied with,
subsequent to conversion:-
(i)
Company shall not change its name for a period
of one year from the date of such conversion.
(ii)
The
company shall not declare or distribute any dividend without satisfying past
debts, liabilities, obligations or contracts incurred or entered into before
conversion.
(8) An Unlimited
Liability Company shall not be eligible for conversion into Limited Liability
Company in case ;-
(a) Its networth is
negative, or
(b) It has incurred losses continuously for the
past three financial years, or
(c) Scrutiny or inquiry or investigation is
pending and where it is completed and prosecution is pending against the
company or its directors under the provisions of the Companies Act, 1956/2013
as consequence thereof, or
(d) An application is
pending under the provisions of the Companies Act 1956/2013 for striking off
its name, or
(e) The company has defaulted in filing Annual
Returns and or financial statements under the provisions of the Companies Act.
(ii)
For the existing form INC-27 the following form INC-27 shall be substituted.
(iii)
After
the existing Form INC-11, the form no. INC-11A shall be inserted
Form
No. INC-11A
Certificate
of Incorporation pursuant to conversion of Unlimited Liability company into
Limited Liability Company
[pursuant to section 18 of the Companies Act, 2013 read
with Rule 37 of the Companies (Incorporation) Rules, 2014]
I hereby certify that……………(name
of the company prior to conversion) having unlimited liability has been
converted into……….(name of the company after conversion) company having limited
liability with effect from the date of this certificate on the company is
limited by shares/limited by guarantee.
The CIN of the company
is……………………………
Given under my hand
at…………… this………………… day of…………… two thousand………………
SEAL: …………………
Registrar of
Companies
…………………………
(State)
[F. No. 1/13/2013 CL-V]
AMARDEEP
SINGH BHATIA, Jt. Secy.
Note:
— The principal rules were published in the Gazette of India, Extraordinary,
Part-II, Section 3, sub-section (i), vide
number G.S.R. 250(E), dated the 31st March, 2014, amended vide number G.S.R 349(E) dated 1st May, 2015, amended vide G.S.R. 442 (E) dated 29.05.2015 and
lastly vide number G.S.R. 99(E) dated 22.01.2016.
Form
No. INC-11A
Certificate
of Incorporation pursuant to conversion of Unlimited Liability company into
Limited Liability Company
[pursuant to Rule 37 of the Companies (Incorporation)
Rules, 2014]
I hereby certify that
(name of the company) has been converted from……………. to………………….. with effect
from the date of this certificate on the company is limited by shares/limited
by guarantee.
The CIN of the company
is……………………………
Given under my hand
at…………… this………………… day of…………… two thousand………………
SEAL: …………………
Registrar of Companies
…………………………
(State)
Form
language o English o Hindi
Refer the instruction kit for
filing the form.
1. *Application
for o Conversion of private company
into public company
o Conversion of
public company into private company
o Conversion of
Unlimited Liability Company into Limited Liability Company
2. *(a)
Corporate
identity number(CIN) of company
  (b) Global Location Number
3. (a) Name of the Company
(b) Address of
registered office
  (c) email Id
of the company
4.
 *Reason(s) for conversion
5. *Particulars
of filing Form No. MGT-14 with
Registrar of Companies (RoC)
 (a)
SRN of Form No. MGT-14  (b) Date of passing the special resolution (DD/MM/YYYY) (c)
Date of filing Form No. MGT-14 (DD/MM/YYYY)
6. *
Particulars
of the order of Tribunal
(a)
Date of passing the order
 (b)
Date of receiving the order
7. *Name
of the company at the time of incorporation (to be displayed in the
certificate)
8. (a) Details of members present at the meeting where the
decision of conversion was taken and number of shares held by them
 (i)
*Number of members(ii) Number of shares held
by them (b)
Details of the members who voted in favour of
the proposal and number of shares held by them(i) *Number of members
(ii) Number of shares held
by them
(c)
Details of the members who voted against the proposal and number of shares
held by them
(i) *Number of members
 (ii) Number of shares held by them
(d) Details of members who abstained from voting and
number of shares held by them
(i) *Number of members(ii) Number of shares held by them
Attachments List of
attachments
1. *Minutes
of the members' meeting;
Articles of
Association;
as
per Rule 37(3)(e);
As per Rule 37(3)(g);
debentures holders; Attach
As per Rule 37(4)
Declaration
 To
the best of my knowledge and belief, the information given in this
application and its attachments are correct and complete. The company has
obtained all the mandatory approvals from the concerned authorities, departments
and substantial creditors. I have been authorized by the board of directors’
resolution number *
dated * 
(DD/MM/YYYY) to sign and submit this application.
To be digitally signed by
*Designation
*Director identification number of
the director; or
 DIN
or PAN of the manager or CEO or CFO; or
Membership
number of Company secretary
Note: Attention is drawn to provisions of Section 448 and 449 of the Companies Act, 2013 which
provide for punishment for
false statement / certificate and punishment for false evidence respectively.
By Diwakar Agrawal
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