Many business people begin their businesses as a Sole Proprietorship due to the low conformity need. As the business and the incomes grow, there is a requirement to detach the bank accounts and the tax filings of the Sole Proprietor and that of the business. To accomplish this separation a desirable solution is to change the Sole Proprietorship into a Private Limited Company.
To convert a Sole Proprietorship into a Private Limited Company, an agreement has to be eliminate between the Proprietorship and the Private Limited Company (once it is incorporated) for the sale of the business. other , such Private Limited Company so incorporated requisite have “the takeover of a Sole Proprietorship Concern” as one of the purpose in its Memorandum of Association.

All the assets and the liability of the Sole Proprietory concern associate with the business instantly before the succession become the assets and the liability of the company.
The shareholding of the sole proprietor in the private limited company is not less than 50% of the total voting power in the company and his shareholding stay with to stand so for a time period of 5 years from the date of the succession.
The sole proprietor does not acquire any benefit or consideration, directly or indirectly, in any form or manner, other than by way of allotment of shares in the company.