Company converted from public to private approved by Tribunal under Companies Act, 2013

The Tribunal approved the conversion of a public company into a private company under Sec. 14(1)(b) of the Companies Act, 2013. The Tribunal held that the notification by the Ministry of Corporate Affairs rendered Rule 33 of the Companies (Incorporation) Rule, 2014 redundant, emphasizing the necessity of Tribunal approval for conversion. It was reasoned that the powers under Sec. 14(2) of the Act supersede old provisions, and the statute prevails over rules. The conversion process was found to be in the company's interest without prejudicing members or creditors, with directions to communicate the altered articles to the Registrar within 15 days.

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Issues: Conversion of public company into private company under Sec. 14(1)(b) of Companies Act, 2013.

Analysis:
1. The petition was filed under Sec. 14(1)(b) of the Companies Act, 2013, which allows a company to alter its articles for conversion from public to private company, subject to Tribunal approval.
2. A Ministry of Corporate Affairs notification clarified the applicability of provisions of the Companies Act, 1956 until corresponding provisions of the Companies Act, 2013 were notified.
3. The Tribunal held that the operation of Rule 33 of the Companies (Incorporation) Rule, 2014 became redundant due to the notification, making the Tribunal's approval necessary for conversion.
4. The Tribunal reasoned that the powers conferred to it by Sec. 14(2) of the Act superseded old provisions, and the statute prevails over rules in interpreting the law.
5. Sec. 14 of the Act outlines the process for altering articles for conversion, requiring Tribunal approval and registration with the Registrar of Companies within fifteen days.
6. The MCA also framed NCLT Rules, 2016, including Rule 68 for conversion of public to private companies, which the petitioner complied with in their petition.
7. The Tribunal found the conversion in the interest of the company, causing no prejudice to members or creditors, and allowed the conversion with directions to communicate the altered articles to the Registrar within 15 days.

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