Companies Act Section 18 — Conversion of companies already registered
CHAPTER II INCORPORATION OF COMPANY AND MATTERS INCIDENTAL THERETO
Commercial / Corporate
Summary
Sub-section (1) allows a company that is already registered under one class to change itself into a company of a different class under the Act. This is done by changing the company's memorandum and articles of association, following the rules laid out in this Chapter.
Sub-section (2) deals with the process of conversion. When a company applies for conversion, the Registrar must first check that all the requirements of this Chapter for registering companies have been met. After that, the Registrar will close the company's earlier registration and issue a new certificate of incorporation, in the same way as when the company was first registered, after registering the updated documents mentioned in sub-section (1).
Sub-section (3) makes clear that converting the company does not wipe out any debts, liabilities, obligations, or contracts that the company had before the conversion. These remain valid and can still be enforced just as if the conversion had never happened.
Official Text
(1) A company of any class registered under this Act may convert itself as a company of other class under this Act by alteration of memorandum and articles of the company in accordance with the provisions of this Chapter.
(2) Where the conversion is required to be done under this section, the Registrar shall on an application made by the company, after satisfying himself that the provisions of this Chapter applicable for registration of companies have been complied with, close the former registration of the company and after registering the documents referred to in sub-section (1), issue a certificate of incorporation in the same manner as its first registration.
(3) The registration of a company under this section shall not affect any debts, liabilities, obligations or contracts incurred or entered into, by or on behalf of the company before conversion and such debts, liabilities, obligations and contracts may be enforced in the manner as if such registration had not been done.