Section 18 of the Companies Act, 2013: Conversion of Companies Already Registered
Section 18 of the Companies Act, 2013 permits a company already registered under the Act to convert from one class of company to another, subject to alteration of its memorandum and articles and compliance with the applicable provisions of Chapter II and the Companies (Incorporation) Rules, 2014.
Updated: 16 September 2026
Meaning and scope of Section 18
A company is registered in a particular legal class or category, such as a private company, public company, company limited by shares, company limited by guarantee or unlimited company. Section 18 provides the statutory mechanism by which an already registered company may convert into another class permitted by the Companies Act, 2013.
The expression conversion in this context does not ordinarily create a new legal entity. The company continues, but its constitutional documents and registration are altered to reflect the new class. The Registrar of Companies issues a fresh certificate of incorporation after the applicable statutory requirements are satisfied.
Section 18: conversion of companies already registered
Sub-section (1): alteration of memorandum and articles
A company of any class registered under the Companies Act, 2013 may convert itself into a company of another class by altering its memorandum of association and articles of association in accordance with Chapter II of the Act.
Sub-section (2): registration of conversion
When conversion is required under Section 18, the company applies to the Registrar. After the Registrar is satisfied that the provisions applicable to registration have been complied with, the former registration is closed, the altered documents are registered and a fresh certificate of incorporation is issued in the manner applicable to first registration.
Sub-section (3): existing obligations continue
Conversion does not extinguish debts, liabilities, obligations or contracts incurred or entered into before conversion. They remain enforceable as if the conversion had not taken place.
Section 18 must be read with other applicable provisions, particularly Section 13 on alteration of the memorandum and Section 14 on alteration of articles, together with the relevant incorporation rules.
General procedure for conversion of a registered company
The exact procedure depends on the type of conversion. A company should identify the proposed class, verify the conditions applicable to that class and then follow the relevant provisions of the Act and rules. In general, the process may include the following steps:
- Review the existing memorandum and articles of association and identify the amendments required for the proposed class.
- Obtain the necessary Board approval for the proposal and for calling a general meeting, where required.
- Pass the required members' resolution, including a special resolution where the Act requires one.
- File the special resolution and related documents in the prescribed form, where applicable.
- Obtain approval of the competent authority where the particular conversion requires prior approval.
- File the applicable conversion webform and altered constitutional documents with the Registrar of Companies.
- Complete any additional conditions applicable to the new class of company.
- After approval, obtain the fresh certificate of incorporation reflecting the converted status.
Important forms and approvals
| Conversion or compliance | Key provision / form | Practical point |
|---|---|---|
| Private company to public company | Section 14; Form INC-27 | Requires alteration of articles and the prescribed corporate approvals and filings. |
| Public company to private company | Section 14; Rule 41; Forms RD-1 and INC-27 | Approval of the Central Government, exercised through the Regional Director, is required before the conversion takes effect. |
| Unlimited company to limited company | Section 18; applicable incorporation rules; Form INC-27 | Additional requirements under the Companies (Incorporation) Rules, 2014 apply. |
| Company limited by guarantee to company limited by shares | Section 18; applicable incorporation rules; Form INC-27 | The current MCA INC-27 webform provides for this conversion, subject to applicable conditions. |
The MCA instruction kit for the current INC-27 webform states that it is used for conversion of private and public companies and also covers specified conversions involving unlimited liability companies and companies limited by guarantee. For public-to-private conversion, an approved RD-1 service request number is required.
Public company to private company: Regional Director approval
For conversion of a public company into a private company, the second proviso to Section 14(1), read with Rule 41 of the Companies (Incorporation) Rules, 2014, requires approval of the Central Government. The application is dealt with by the jurisdictional Regional Director through Form RD-1. The company must also comply with the prescribed notice, creditor and other procedural requirements under Rule 41 before completing the conversion filings.
Effect of conversion on debts, liabilities and contracts
Section 18(3) protects continuity. A conversion does not wipe out or reduce liabilities merely because the company's class changes. Debts remain payable, contractual obligations continue, and rights against the company remain enforceable. Likewise, conversion does not by itself release the company from obligations incurred before the fresh certificate of incorporation is issued.
Fresh certificate of incorporation
Once the Registrar is satisfied that the statutory requirements for conversion and registration have been fulfilled, the Registrar registers the altered documents and issues a fresh certificate of incorporation reflecting the converted class. The company should thereafter update its statutory records, disclosures, stationery, website and other records wherever the changed status must be shown.
Documents commonly relevant to conversion
Depending on the conversion, documents may include the altered memorandum and articles, certified resolutions, explanatory statement, declarations, lists of members or creditors, approvals from regulators where applicable, the Regional Director's order where required, and other attachments specified in the relevant MCA webform. The current instruction kit for the particular webform should be checked before submission.
Official resources
- India Code - Companies Act, 2013
- Ministry of Corporate Affairs - MCA portal
- MCA Instruction Kit - Form INC-27
Disclaimer: This article is for general legal information. Company conversion requirements can vary with the company's class, capital structure, regulatory status and facts. Verify the latest Act, rules, notifications and MCA filing instructions before filing.