Rule 41 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Rule 41 sets the procedure for a public company that wants to become a private company under the second proviso to section 14(1). Within sixty days of the special resolution the company applies to the Regional Director in e-Form RD-1, with documents, declarations by key managerial personnel, a list of creditors and newspaper and individual notices. The Regional Director decides after any hearing, and the order is filed in Form INC-28.
This article is as amended up to G.S.R. 579(E) dated 26 August 2025 (rule text per the MCA e-book to G.S.R. 411(E) of 16 July 2024; later notifications substitute forms only). Later amendments should be checked. To convert a company, see our compliance advisory service.
The application goes to the Regional Director in e-Form RD-1 within sixty days of the special resolution, with the altered e-MoA and e-AoA, meeting minutes with the names of dissenters, a Board resolution or power of attorney, and KMP declarations. The company advertises in Form INC-25A at least twenty-one days before filing and serves creditors by registered post. The order is filed in Form INC-28 within fifteen days of receipt.
Rule 41(1): the application and its documents
An application under the second proviso to sub-section (1) of section 14 for conversion of a public company into a private company shall, within sixty days from the date of passing of the special resolution, be filed with the Regional Director in e-Form No. RD-1, along with the fee as provided in the Companies (Registration Offices and Fees) Rules, 2014, accompanied by:
| Clause | Document |
|---|---|
| (a) | e-Memorandum and e-Articles with proposed alterations, including the alterations pursuant to sub-section (68) of section 2 |
| (b) | A copy of the minutes of the general meeting at which the special resolution was passed, with details of votes cast for and against and the names of dissenters |
| (c) | A copy of the Board resolution or Power of Attorney, dated not earlier than thirty days, authorising the application |
| (d) | A declaration by a key managerial personnel that, pursuant to section 2(68), the company limits its members to two hundred, and that no deposit has been accepted in violation of the Act and rules |
| (e) | A declaration by a key managerial personnel that there has been no non-compliance of sections 73 to 76A and certain other listed sections of the Act and rules |
| (f) | A declaration by a key managerial personnel that no resolution is pending to be filed under a listed sub-section, and that the company was never listed on any Regional Stock Exchange or, if it was, that all necessary procedures were followed for complete delisting under the applicable SEBI rules and regulations |
The proviso says that where no key managerial personnel is required to be appointed, the declarations are filed by any of the directors. The e-book prints some section numbers in clauses (e) and (f) unclearly (for example "777" and "779"); check the official text for the sections listed. The reference to Regional Stock Exchanges and SEBI rules is quoted as printed; check the current law.
The e-book's note says the documents in clause (a) were changed from "draft copy" to e-Memorandum and e-Articles by the Amendment Rules, 2023 of 19 January 2023.
Rule 41(2) to (5): particulars, list of creditors and notices
- Particulars (2): the application sets out the date of the Board meeting and of the general meeting; the reason for conversion and its effect on shareholders, creditors, debenture holders, deposit holders and other related parties; details of any conversion in the last five years and outcome with copy of order; and whether the company is registered under section 8.
- List of creditors (3): attached, drawn up to the latest practicable date not more than thirty days before filing, with names and addresses, the nature and amounts due, and the estimated value of any contingent or unascertained debt. An affidavit signed by the Company Secretary, if any, and not less than two directors (one the managing director, where there is one) states that a full enquiry has been made and the list and estimates are correct.
- Inspection (4): a duly authenticated copy of the list is kept at the registered office; any person may inspect and take extracts during ordinary hours of business on payment of ten rupees per page to the company.
- Notices (5): at least twenty-one days before the date of filing, the company advertises in Form INC-25A in a vernacular newspaper and an English newspaper widely circulated in the State; serves individual notice by registered post with acknowledgement due on each debenture holder and creditor; and serves a notice by registered post with acknowledgement due on the Regional Director and the Registrar and on the regulatory body, if the company is regulated under any law.
Rule 41(6) to (9): decision, objections, conditions and filing of the order
| Sub-rule | What happens |
|---|---|
| 41(6)(a) | No objection and the application complete in all respects: it may be put up for orders without hearing and the Regional Director passes an order approving it within thirty days from receipt |
| 41(6)(b) | If the Regional Director calls for information or finds defects, he gives intimation within thirty days of receipt on the last intimated e-mail address, and the company resubmits within fifteen days; a maximum of two re-submissions is allowed |
| 41(6)(c) | If information or rectification is not provided to his satisfaction, he rejects with reasons within thirty days from filing or from the last re-submission |
| 41(7)(i) | Where an objection is received, or the Regional Director has a specific objection under the Act, it is recorded in writing; he holds hearings within thirty days as required, directs the company to file an affidavit recording the consensus, and passes an order approving or rejecting with reasons within thirty days from the date of hearing |
| 41(7)(ii) | If no consensus, he may approve if satisfied, having regard to all the circumstances, that the conversion would not be against the interests of the company or made to contravene or avoid the Act, with reasons recorded in writing; proviso: no conversion if any inquiry, inspection or investigation has been initiated or prosecution is pending under the Act |
| 41(8) | On completion of such inquiry, inspection or investigation without prosecution envisaged or pending, conversion shall be allowed |
| 41(9) | The order conveyed by the Regional Director is filed with the Registrar in Form INC-28 within fifteen days of receipt of approval, with the fee under the Fees Rules |
Clause (d) of sub-rule (6), which provided deemed approval, and the earlier deemed-approval wording in sub-rule (7), were removed by the Amendment Rules, 2021, effective 25 January 2021. Under the current rule there is no deemed approval for this conversion; wait for an order. That differs from rule 40 (change in financial year), where deemed approval applies; see our article on rule 40.
Example: Brook Valley Industries Limited passes a special resolution to become a private company. Within sixty days it files RD-1 with the altered e-MoA and e-AoA, the meeting minutes naming the dissenters, a Board resolution dated within the last thirty days, and KMP declarations that members are limited to two hundred and no deposit was accepted in violation of the Act. It published INC-25A and sent registered-post notices at least twenty-one days before filing. The Regional Director approves, and the company files the order in INC-28 within fifteen days of receipt.
After the order
Rule 33(2) adds that for a public to private conversion the SRN of RD-1 is mentioned in Form INC-27, filed with the altered e-MoA and e-AoA within fifteen days of receipt of the Regional Director's order; see our article on rules 10 and 33. Rule 41(9) itself names Form INC-28 for the order; read both rules together when planning the filings. For the Act, see our guides to section 14 and sections 17 and 18.
Need help converting a public company into a private company?
The sixty-day filing clock, the declarations and the creditor notices must all line up. TaxClue can plan the sequence, prepare the documents and track the order; see our compliance advisory page.
Key takeaways
- RD-1 to the Regional Director within sixty days of the special resolution.
- Documents include minutes with the names of dissenters and three KMP declarations.
- INC-25A advertisement and registered-post notices at least twenty-one days before filing.
- No deemed approval under rule 41 since the 2021 amendment; the Regional Director passes an order.
- The order is filed in INC-28 within fifteen days of receipt.
- Conversion is not allowed while an inquiry, inspection, investigation or prosecution is pending.
Read next
- Rules 10 and 33: entrenchment provisions and alteration of articles
- Rule 40: change in financial year, RD-1
- Rules 37 and 39: converting unlimited and guarantee companies
- Section 14 of the Companies Act, 2013: alteration of articles
Disclaimer: Based on the Companies Act, 2013 rules named above as consolidated in the MCA e-book (consulted on 3 October 2026), with the later notifications the article names. Later amendments, fees, forms and the Companies Act, 2013 provisions referred to should be checked. This article is general information, not legal advice; check the official text before acting.