ABC Limited is a registered public company having the following: i Directors and their Relatives 20 ii Employees 15 iii Ex-Employees (Shares were…

(a) According to section 2(68) of the Companies Act, 2013, "Private company" means a company having prescribed minimum paid-up share capital, and which by its articles, limits the number of its members to 200. However, where two or more persons hold one or more shares in a company jointly, they shall, for the purposes of this clause, be treated as a single member. It is further provided that following shall not be included in the number of members - (A) persons who are in the employment of the company; and (B) persons who, having been formerly in the employment of the company, were members of the company while in that employment and have continued to be members after the employment ceased. Accordingly, total Number of members in ABC Limited are: (i) Directors and their relatives 20 (ii) Joint shareholders (10x2) 10 (iii) Other Members 150 Total 180 (i) ABC Limited may be converted into a private company only if the total members of the company are limited to 200. In the instant case, since existing number of members are 180 which is within the prescribed maximum limit of 200, so ABC Limited can be converted into a private company. (ii) There is no need for reduction in the number of members for the proposed private company as existing number of members are 180 which does not exceed maximum limit of 200.