Conversion of a Partnership into Private/Public Company

Incorporation is the need of the hour. The world gradually between a global market without any trade barriers flows. A small unincorporated organization led by some colleagues as corporatising can not think of without a large-scale development. Such incorporation, limited liability, perpetual succession, shares Transferability, its advantages as easy access to funds etc.

Key Benefits

        Automatic Transfer

All assets and liabilities of the firm immediately before the conversion become the assets and liabilities of the company.

No Stamp Duty

All movable and immovable properties of the firm automatically vest in the company. No instrument of transfer to be executed and hence no stamp duty is required to be paid is required.

No Capital Gain Tax

No capital gains tax on the transfer of property owned firm will be charged to the company.


Continuation of Brand Value

Goodwill and brand value and has retained ownership of the firm a better legal recognition of the success story of the past are released to enjoy.

Carry Forward and Set off Losses and Unabsorbed Depreciation

The accumulated loss and unabsorbed depreciation of owned firm, the successor company to be effective in the last year of conversion loss / depreciation is considered. Thus, the successor company in the hands of such damage can be for eight years.

    Key Conditions

• All partners of the partnership firm shall become shareholders of the company in the same proportion in which their capital accounts stood in the books of the firm on the date of the conversion.
• The partners receive consideration only by way of allotment of shares in company and The partners share holding in the company in aggregate is 50% or more of its total voting power and continue to be as such for 5 years from the date of conversion.

Key Requirements:

Registered partnerships with at least 7 Partners

The minimum share capital will be Rs. 100,000 (INR One Lac) for conversion into a private limited company

The minimum share capital will be Rs. 500,000 (INR five Lac) for conversion into a public limited company

The above requirement is not fulfilled by the firm, then the Partnership deed should be changed

Minimum 7 Shareholders

Minimum 2 Directors (private limited company) and 3 directors (public limited company)

Directors and shareholders can be same person

DIN (Director Identification Number) for all directors

DSC (Digital Signature Certificate) for two of the Directors

Steps in Conversion of a Partnership firm into a Company (Private/Public)

A company (private / public), apartnership firm in the conversion step (excluding the processing of additional EFORMS) is an Indian private / public limited company formation is similar to the steps involved.