Section 49 — Conversion of a company limited by guarantee to a company limited by shares and vice-versa

(1) A company limited by guarantee may be
converted into a company limited by shares with prior approval of the Commission
in writing by passing a special resolution in this behalf by the company limited by
guarantee amending its memorandum and articles of association in such a manner
that they include the provisions relating to a company limited by shares in the
articles and complying with all the requirements as may be specified.

(2) On an application for change in status of a company under sub-
section (1), if the Commission is satisfied that the company is entitled to be so
converted, such conversion shall be allowed by an order in writing.

(3) A copy of the order, confirming the conversion under sub-section
(2) duly certified by an authorised officer of the Commission shall be forwarded
to the company and to the registrar within seven days from the date of the order.

(4) A copy of the memorandum and articles of association as altered
pursuant to the order under sub-section (2) shall within fifteen days from the date
of the order be filed by the company with the registrar and he shall register the
same and thenceforth the memorandum and articles so filed shall be the
memorandum and articles of the newly converted company.

(5) If a company, being limited by shares, alters its memorandum and
articles in such a manner that they include the provisions which constitute it a
company limited by guarantee, the company shall—

(a) as on the date of the alteration, cease to be a company limited by
shares; and

(b) file with the registrar a copy of the memorandum and articles of
association as altered along with the special resolution.

(6) If default is made in complying with the provisions of any of the
preceding sub-sections, the company and every officer of the company who is in
default shall be liable to a penalty not exceeding of level 2 on the standard scale.