Conversion as per Limited Liability Partnership Act, 2008

Conversion is the process of converting one type of business entity into another type of business entity. In the context of the LLP Act, conversion refers to the process of converting a partnership firm, a private company, or an unlisted public company into an LLP.

Conversion of a Partnership Firm into an LLP

A partnership firm can be converted into an LLP by following the following steps:

  1. The partners of the partnership firm must unanimously agree to convert the firm into an LLP.
  2. The partners of the partnership firm must prepare a new LLP agreement.
  3. The partners of the partnership firm must file a petition for conversion with the Registrar of Companies.
  4. The Registrar of Companies will issue a certificate of conversion.

Conversion of a Private Company into an LLP

A private company can be converted into an LLP by following the following steps:

  1. The shareholders of the private company must unanimously agree to convert the company into an LLP.
  2. The shareholders of the private company must pass a special resolution to convert the company into an LLP.
  3. The board of directors of the private company must file a petition for conversion with the Registrar of Companies.
  4. The Registrar of Companies will issue a certificate of conversion.

Conversion of an Unlisted Public Company into an LLP

An unlisted public company can be converted into an LLP by following the following steps:

  1. The shareholders of the unlisted public company must unanimously agree to convert the company into an LLP.
  2. The shareholders of the unlisted public company must pass a special resolution to convert the company into an LLP.
  3. The board of directors of the unlisted public company must file a petition for conversion with the Registrar of Companies.
  4. The Registrar of Companies will issue a certificate of conversion.

MCQs on Conversion

Here are some MCQs on the topic of Conversion as per the LLP Act, 2008:

  1. Which of the following entities can be converted into an LLP?
    • A partnership firm.
    • A private company.
    • An unlisted public company.
    • All of the above.
  2. What are the steps involved in converting a partnership firm into an LLP?
    • The partners of the partnership firm must unanimously agree to convert the firm into an LLP.
    • The partners of the partnership firm must prepare a new LLP agreement.
    • The partners of the partnership firm must file a petition for conversion with the Registrar of Companies.
    • All of the above.
  3. What are the steps involved in converting a private company into an LLP?
    • The shareholders of the private company must unanimously agree to convert the company into an LLP.
    • The shareholders of the private company must pass a special resolution to convert the company into an LLP.
    • The board of directors of the private company must file a petition for conversion with the Registrar of Companies.
    • All of the above.
  4. What are the steps involved in converting an unlisted public company into an LLP?
    • The shareholders of the unlisted public company must unanimously agree to convert the company into an LLP.
    • The shareholders of the unlisted public company must pass a special resolution to convert the company into an LLP.
    • The board of directors of the unlisted public company must file a petition for conversion with the Registrar of Companies.
    • All of the above.

Answers to the MCQs:

  1. The answer is (d). All of the above. Any of the entities mentioned can be converted into an LLP.
  2. The answer is (d). All of the above steps are involved in converting a partnership firm into an LLP.
  3. The answer is (d). All of the above steps are involved in converting a private company into an LLP.
  4. The answer is (d). All of the above steps are involved in converting an unlisted public company into an LLP.