# Conversion of Section 8 Company into Another Kind of Company

## Why a strict procedure?

A Sec. 8 company holds a 'public-interest' character. Allowing it to convert into an ordinary company means letting promoters extract surplus that was meant for charity. Hence the law builds in public notice, stakeholder representation, and RD discretion.

## 1. Internal Approval

Pass a Special Resolution in a general meeting approving the conversion.
The Explanatory Statement annexed to the notice must set out the details of the conversion.
File application in Form INC-18 with the Regional Director (RD) along with fees, SR, and notice.

## 2. External Notification (Public Interest Check)

Serve notice — by registered post or hand delivery — to:

The Income Tax Officer having jurisdiction,
The Charity Commissioner,
Any CG/SG department having jurisdiction over the company, and
The Chief Secretary of the state where the registered office is situated.

Any such authority that wishes to make a representation to the RD must do so within 60 days of receiving the notice, after giving the company an opportunity to respond.

## 3. Public Notice in Newspapers and Web

Within 1 week of filing the application, publish notice:

At least once in a vernacular newspaper AND once in an English newspaper,
On the company's website (if any), and
On a CG-notified website.

## 4. Compliance Pre-Conditions

File all financial statements and annual returns up to the preceding FY.
If the application is made 3 months after the preceding FY, attach a financial position statement certified by a CA, not older than 30 days from filing.

## 5. RD's Role

The RD may approve conversion subject to terms and conditions.
Before imposing conditions or rejecting, the RD must give a reasonable opportunity of being heard.

## 6. Post-Approval Actions

Convene a general meeting and pass a Special Resolution to amend MOA/AOA.
File updated MOA & AOA with the ROC for a fresh Certificate of Incorporation.

## Workflow summary

```

SR (internal) → Form INC-18 to RD

→ Notice to IT/Charity Commr./CG/SG/Chief Secy (60 days for reps)

→ Newspaper + website publication (within 1 week)

→ All filings up-to-date (+ CA certified financial position if needed)

→ RD decision (with hearing) → fresh SR amending MOA/AOA → ROC → fresh COI

```

Worked example

### Example 1

Q. 'CharityCo' (a Sec. 8 company) wishes to convert. Its previous FY ended 31st March 2026; the application will be filed on 15th August 2026. What additional financial document is required?

A. Since the application is being filed more than 3 months after the end of the preceding FY, the company must attach a statement of financial position certified by a Chartered Accountant, dated not earlier than 30 days before filing (i.e., not earlier than 16th July 2026).

### Example 2

Q. Within how many days must objections be raised by the Income Tax Officer after receiving notice of conversion?

A. Objections must be made to the RD within 60 days of receipt of notice. Before making a representation, the authority must give the company an opportunity to respond.

⚠️ Common exam mistakes

Filing the application before serving notice on IT Officer/Charity Commr./CG/SG/Chief Secretary — all four must be notified.
Confusing the timeline — newspaper notice is within 1 week of filing; objections from authorities are within 60 days of receiving notice.
Skipping the fresh COI step — after RD approval, a fresh SR amending MOA/AOA and a fresh COI from the ROC are required.
Forgetting CA-certified financial statement is only required if application is filed more than 3 months after preceding FY.

Bare-Act text Section 8(4)(ii) · Companies Act, 2013 read with Rule 21 & 22 of the Companies (Incorporation) Rules, 2014 · click to expand

Sec. 8(4)(ii): A company registered under this section may convert itself into company of any other kind only after complying with such conditions as may be prescribed.

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Conversion of Section 8 Company into Other Kind

Worked example

⚠️ Common exam mistakes