Convert Private Limited to Public Limited Company
To convert private limited to public limited, shareholders pass a special resolution altering the articles under Section 14, and the company files MGT-14 within 30 days and INC-27 with the altered articles. You need at least seven members and three directors. The ROC then issues a fresh certificate with “Private” dropped from the name.
What it is
Converting a private company into a public company means rewriting its articles so they no longer carry the private-company restrictions, such as the limit of 200 members and the restriction on transferring shares. The word “Private” is dropped from the name. It stays the same company, with the same PAN. Only its class changes.
Section 14(1) of the Companies Act, 2013 lets a company alter its articles by special resolution, including to convert from private to public. The first proviso says the company ceases to be a private company from the date of that alteration. The name changes under Section 13, and the filings go on the MCA V3 portal: MGT-14 for the special resolution and INC-27 for the conversion under Rule 33 of the Companies (Incorporation) Rules, 2014.
No government approval is needed. Only the reverse move, public to private, requires an order of the Central Government.
Who it applies to
Your shareholder list is nearing 200
A private company’s articles cap its members at 200. Picture a Faridabad family business whose shares have spread across cousins and their children. Once the register nears 200 names, conversion is the way forward.
You plan a public issue
Only a public company can offer securities to the public through a prospectus under Section 23(1). Conversion comes before any public issue.
A public company now controls you
Say a public company buys a majority stake in your company. You become its subsidiary and are deemed public under the proviso to Section 2(71). Converting brings your articles and name in line with how the law already treats you.
Why it matters
Grow past 200 members
A public company can have any number of members, so ownership can widen past the 200-member ceiling.
Let shares change hands freely
Section 58(2) makes a public company’s securities freely transferable. Contracts between shareholders about transfers still bind the parties who sign them.
Prepare for a heavier rulebook
Public companies file board resolutions under Section 179(3) in MGT-14, keep shares in demat form under Rule 9A and lose small-company relief on their annual ROC filings. Plan for this before you convert.
Documents required
From the company
- Certified copy of the board resolution
- Notice of the general meeting with the explanatory statement
- Certified copy of the special resolution
- Altered MoA (name clause) and altered AoA
- Minutes of the general meeting
- DSC of an authorised director
For new members
- Share transfer deed in Form SH-4, duly stamped, if existing holders transfer shares
- Board approval and allotment papers, with PAS-3, if new shares are issued
- PAN and address proof of each incoming member
For new directors
- DIN, or a DIR-3 application if the person has none
- DIR-2 consent to act as director
- DIR-8 declaration of non-disqualification
- MBP-1 disclosure of interest
How it works
Bring in seven members and three directors
Existing shareholders transfer a few shares, or the company allots fresh ones, until there are at least seven members. New directors join, with DIR-12 filed within 30 days. In practice, this step takes the longest, so we start here.
Approve the plan at a board meeting
The board approves the proposal, the draft altered MoA and AoA, and the notice calling a general meeting. The notice needs 21 clear days unless members agree to shorter notice.
Pass the special resolution
Shareholders approve the new articles under Section 14 and the new name under Section 13. Under Section 114(2), votes in favour must be at least three times the votes against.
File MGT-14 within 30 days
We file the special resolution with the notice, explanatory statement and altered documents on the MCA V3 portal, as Section 117 requires.
File INC-27 with the altered articles
Section 14(2) requires the altered articles to reach the Registrar within 15 days. We file INC-27 with the special resolution, the minutes and the altered MoA and AoA.
Collect the fresh certificate and update records
The Registrar issues a fresh certificate of incorporation in the new name. We then move letterheads, bank records, your GST registration and other licences to the new name.
Timelines
Give 21 clear days’ notice
Section 101 needs 21 clear days’ notice of a general meeting. A meeting other than the AGM can be called at shorter notice with the consent of a majority in number of members holding at least 95% of the paid-up voting capital.
File the altered articles within 15 days
Under Section 14(2), the alteration and a printed copy of the altered articles must be filed with the Registrar within 15 days. INC-27 is the form for this.
File MGT-14 within 30 days
Section 117 requires a special resolution to be filed in MGT-14 within 30 days. DIR-12 for a new director has the same 30-day limit.
What happens if you miss the deadlines
Pay 2× to 12× the fee, plus a penalty
MGT-14 filed late pays 2× to 12× the normal fee, depending on the delay. Section 117(2) adds a penalty of ₹10,000 plus ₹100 per day, up to ₹2 lakh for the company and ₹50,000 for each officer in default.
Fall below seven members and risk personal liability
Under Section 3A, if a public company carries on business for more than six months with fewer than seven members, every member who knows it is severally liable for the debts contracted during that time.
Wait for the certificate before using the new name
Here is the catch: Section 13(3) makes a change of name effective only when the Registrar issues the fresh certificate. Until then, invoices and letters carry the old name with “Private Limited”.
What changes after conversion
| As a private company | As a public company | |
|---|---|---|
| Members | 2 to 200 | 7 or more, no upper limit |
| Directors | At least 2 | At least 3 |
| Name ends with | “Private Limited” | “Limited” |
| Share transfers | Restricted by the articles | Freely transferable |
| Board resolutions under Section 179(3) | No MGT-14 needed | MGT-14 within 30 days |
| Demat of shares | Rule 9B, if not a small company | Rule 9A, plus half-yearly PAS-6 |
| Annual return | MGT-7A if a small company | MGT-7 (no small-company status) |
| Managerial remuneration | No Section 197 ceiling | Capped at 11% of net profits under Section 197 |
| Independent directors and KMP | Whole-time CS at ₹10 crore paid-up capital | Independent directors and whole-time KMP at the Rule 4 and Rule 8 thresholds |
Take a Faridabad auto-parts company owned by two founders who are also its only directors. To convert, it needs five more shareholders, say family members or senior staff taking a few shares each, and a third director. That is the whole gap. The bigger shift comes later: under Rule 4, two independent directors once paid-up capital reaches ₹10 crore, turnover ₹100 crore, or loans, debentures and deposits pass ₹50 crore. Rule 8 brings whole-time KMP at ₹10 crore of paid-up capital.
Frequently asked questions
How do I convert a private limited company into a public limited company?
Pass a special resolution under Section 14 altering the articles and the name, file MGT-14 within 30 days and file INC-27 with the altered articles. Before that, make sure the company has at least seven members and three directors. The Registrar then issues a fresh certificate of incorporation with “Private” removed from the name. No Regional Director approval is needed in this direction.
Do we need Central Government approval to drop “Private” from the name?
No. Section 13(2) normally requires Central Government approval for a change of name, but its proviso exempts a change where the only difference is deleting or adding the word “Private” on conversion. The special resolution and the ROC filings are enough. If you also want to change other words in the name, that becomes a regular name change and follows the full process.
How many members and directors does a public company need?
At least seven members under Section 3(1)(a) and at least three directors under Section 149(1). A company with two shareholders and two directors adds five members, through an SH-4 share transfer or a fresh allotment, and one director. Each new director needs a DIN, and DIR-12 is filed within 30 days. We line these up before the general meeting.
From which date does the company become public?
The company ceases to be a private company from the date of the alteration of its articles, under the first proviso to Section 14(1). The new name, however, takes effect only when the Registrar issues the fresh certificate of incorporation under Section 13(3). So between the resolution and the certificate, keep using the old name, and plan the stationery change for the day the certificate arrives.
What are the deadlines for MGT-14 and INC-27?
MGT-14 is due within 30 days of passing the special resolution under Section 117. The altered articles must be filed within 15 days under Section 14(2), and INC-27 is the form used. MGT-14 filed late pays 2× to 12× the normal fee. We file both together soon after the meeting, so neither deadline comes close.
Does the company get a new PAN or CIN?
The PAN stays the same because the company itself does not change. The Registrar issues a fresh certificate of incorporation in the new name, and the CIN is revised to show the public class. You then update the name with the bank, the GST portal, the Income Tax e-filing portal and other registrations. A GST amendment is due within 15 days of the change.
Must shares be dematerialised after conversion?
Yes. Rule 9A requires every unlisted public company to issue securities only in demat form and to facilitate dematerialisation of its existing securities. Shareholders must dematerialise before transferring shares. The company also files PAS-6 within 60 days of each half-year. Nidhis, government companies and wholly owned subsidiaries are exempt. Already demat under Rule 9B as a private company? Then most of the work is done.
Can a public company convert back to private later?
Yes, but it is harder. Converting a public company into a private one needs a special resolution and an order of the Central Government under the second proviso to Section 14(1), applied for through the Regional Director. INC-27 is then filed within 15 days of receiving the order. Going private to public needs no such order, so plan the move carefully before you make it.
What it costs
Our fee plus the government fee that applies to your case, quoted before you commit. Tell us the situation and we will price it exactly.
Government fees, for reference:
| Item | Government fee |
|---|---|
| MGT-14 (special resolution) | ₹200 to ₹600, by authorised capital |
| INC-27 (conversion) | Normal filing fee under the Companies (Registration Offices and Fees) Rules, 2014 |
| DIR-12 (each new director) | ₹200 to ₹600, by authorised capital |
| DIR-3 (new DIN) | ₹500 |
| Stamp duty on a share transfer | 0.015% of the consideration |
| Event-based forms filed late | 2× to 12× the normal fee |
Ready to begin?
Tell us who holds your shares and who sits on your board today, and we will map out what needs to change before the special resolution.