There are limitations on Proprietary form such as capital, lack of transferability, unlimited liability etc when the firm grows it is inevitable on the part of businessman to get it converted into company.
CONDITIONS SUBJECT TO WHICH TRANSFER IS COMPLETE:
The Proprietor receives consideration only by way of allotment of shares in company.
The Proprietor share holding in the company in aggregate is 50% or more of its total voting power and continue to be as such for 5 years from the date of conversion.
Shop Act Licence or Equivalent licence/NoC issued by the Gram Panchayat
Minimum Share Capital shall be Rs. 100,000 (INR One Lac) for conversion into a Private Limited Company
Minimum Share Capital shall be Rs. 500,000 (INR five Lac) for conversion into a Public Limited Co.
Minimum 2 Directors (for Private Limited Co.) and 3 Directors (for Public Limited Co.)
The directors and shareholders can be same person
DIN (Director Identification Number) for all the Directors
DSC (Digital Signature Certificate) for one of the Directors