Topic 57 Conversion UnlistedPublicCo Schedule4

THE LEGAL BRIDGE

Judiciary Examination Study Material

Topic 57

Conversion from Unlisted Public Company to LLP

Schedule 4 & Section 57 — Additional Conditions & Why It's Rarely Used

Pillar 7 — Conversion to LLP (Sections 55–59 + Schedules 2–4)

Module Overview

Section 57 read with Schedule 4 enables an unlisted public company to convert into an LLP — the most restrictive and least frequently used of the three conversion routes. This topic covers the additional eligibility conditions unique to unlisted public companies (no outstanding deposits; no outstanding debentures), the procedure, and why this route is rarely used in practice.

57.1 Section 57 + Schedule 4

Section 57

Subject to the provisions of this Chapter, an unlisted public company may convert into a limited liability partnership in accordance with the provisions of Schedule 4.

57.2 Schedule 4 — Eligibility Conditions

Condition	Shared with Schedule 3?	Details
All shareholders consent	Yes	All shareholders must consent to conversion
All shareholders become partners	Yes	All shareholders immediately before conversion must become LLP partners
No subsisting security interests	Yes	No charge, mortgage, or security interest on company assets
No pending prosecution	Yes	No pending prosecution against company or directors
Annual filings current	Yes	All Companies Act filings must be up to date
No outstanding public deposits	NO — ADDITIONAL FOR SCHEDULE 4	All public deposits (under Section 73/74 CA 2013) must be fully repaid before conversion
No outstanding debentures	NO — ADDITIONAL FOR SCHEDULE 4	All outstanding debentures must be fully redeemed before conversion

57.3 Why Schedule 4 Is Rarely Used

Burden of repaying deposits and debentures: Unlisted public companies that have accepted public deposits or issued debentures must fully repay them before converting. This is operationally burdensome and financially draining.
Wrong economic direction: An unlisted public company large enough to have deposits/debentures is unlikely to want to convert to an LLP, which cannot issue shares or raise public capital.
Near-listing considerations: Some unlisted public companies are on the path to listing — converting to an LLP would permanently foreclose that option.

57.4 Schedule 3 vs Schedule 4 — Key Differences

Condition	Schedule 3 (Private Company)	Schedule 4 (Unlisted Public Company)
Public deposits	Not applicable	Must be fully repaid — ADDITIONAL condition
Debentures	Not applicable	Must be fully redeemed — ADDITIONAL condition
Share capital type	Private company shares	Public company shares — wider shareholder base
Practical frequency	Common — regularly used	Rare — almost never used in practice

📌 EXAM TIP: Schedule 4: (1) Section 57 + Schedule 4; (2) UNLISTED public companies only — listed companies CANNOT convert; (3) Two ADDITIONAL conditions vs Schedule 3: no outstanding deposits AND no outstanding debentures; (4) Rarely used in practice — burden of repaying deposits/debentures before conversion; (5) Same base conditions as Schedule 3 (no charge, all shareholders consent, etc.).

Key Point	Core Content
Section 57 + Schedule 4	Conversion of unlisted public company to LLP
Additional condition 1	No outstanding public deposits (must be repaid before conversion)
Additional condition 2	No outstanding debentures (must be redeemed before conversion)
Listed companies	Cannot convert under any Schedule — absolutely prohibited
Rarely used	Repaying all deposits and debentures is operationally burdensome
Same base conditions	No charge; all shareholders consent; all become partners; no pending prosecution