About the client:
R&A Associates advised and assisted a client for conversion of an Unlisted Public Company to a Limited Liability Partnership (LLP). The conversion must be in line with the provisions of Companies Act, 2013 and the Limited Liability Partnership Act, 2008. The Income tax act provision mentioned under Section 47 (xiiib) and the provisions of the Stamp Act also have to be referred to before initiating the conversion.
The client which R&A assisted is primarily engaged in the business of construction of residential buildings, apartments, commercial complex, developing colonies, townships, multiplexes, malls, farm houses, resorts and undertakes plotting.
Our Association and work– We have been associated with the client for over two years. The process of conversion of an Unlisted Public Company to a Limited Liability Partnership Firm involves series of activities which take around two to three months for completion and the same are enumerated below:
- Review the latest Financial Statements of the Company in terms of its assets and liabilities to ascertain the eligibility for conversion.
- Examining the share holding structure of the Company and the proposed capital contribution of the partners in the LLP and their profit sharing ratio.
- Ascertaining the filing status of the Company with the Ministry of Corporate Affairs (MCA) so as to ensure that all pending filings are done and forms whose filing status is pending for approval are approved immediately to proceed with the conversion.
- Preparation of detailed step-by-step action plan along with the checklist of information required from the client.
- Advising the Company for arranging the No Objection Certificate (NOC) from all its secured creditors to ensure that the conversion process is smooth.
- If the Company has Foreign Direct Investments, then a detailed and thorough check on FEMA compliances shall be done and necessary approvals shall be obtained from RBI with regards to conversion.
- Ensuring the consent for conversion of an unlisted public company to Limited Liability Partnership is obtained from all the stakeholders including bankers and RBI, if applicable.
- Finalizing the composition of the LLP in terms of its name, the Designated Partners, Partners, Partners contribution in proportion to the shareholding structure and other modalities.
- Undertaking the procedural formalities for conversion with the first step being name application with the Central Registration Centre (CRC).
- Upon the name approval which will be valid for three (3) months from the date of approval, preparation and filing of necessary Forms for Conversion and for Incorporation of LLP with their respective annexures has to be undertaken.
- Once the Central Registration Centre (CRC) is satisfied with the documents submitted, it shall issue a Certificate of Conversion in Form 19 stating the said LLP is registered pursuant to Section 58(1) of the LLP Act, 2008.
- Advising the client on the post conversion compliances and intimation to all the concerned regulatory authorities
- The LLP has to mention in its office correspondence, the name and registration number of the Company from which it was converted.
Our extensive experience of documentation and coordination with the regulator ensured that the entire process was completed smoothly within the committed timelines.
R&A Associates has also assisted few other clients to convert their Private Limited Companies to Limited Liability Partnership [LLP].
Do write to us in case you want to know more at support@rna-cs.com