As per companies Act 2013 Private Company is deemed to be public company if it is subsidiary of a company not being a private company.
So if that private company is deemed to be public company then all the provision of public company will be applicable to deemed public company(Private company).... Let’s See

Definition of public company
As per Section 2(71) of companies Act 2013  Public Company means a company which is not private company                                                                                                                          (Minimum paid-up share capital criteria is omitted)

Deemed Public Company Means
   A company which is subsidiary of a company not being a private company shall be deemed to be public company for the purpose of the act.

Definition of Private company
 As per Section 2(68) of companies Act 2013 a company which by its article restricts the right to transfer its share; except in case of OPC , limits the number of its members to two hundred
(Minimum paid-up share capital criteria is omitted)

Except Section 2(71) the act is silent on nature and characteristic of such private companies being subsidiary of public companies. so I express my view through this article and ascertain that such private companies require registration on being deemed public company or which requirement should be followed and how to check that private  company is deemed public company

Ways in which private company can become public Company:

•    Firstly By own desire, voluntarily under Section 14 of the Act. Under this method, private company passes general resolution to convert itself into public Limited Company.

•    Secondly By operation of law.

There is no need to pass resolution for change of name, when private company becomes 'deemed limited’. There are differences between the two methods under which a private company becomes a public company.

•    Under the first method stated above, a private company, when it converts itself into a public company under section 14 of the Act, becomes public company and all the provisions relating to public companies under the Act become applicable to it.

•    Under the second method, there are certain provisions of the Act, which do not apply to deemed public company.

Thus, all the provisions of public company apply to company, which converts itself under section 14 from private to public.

There is a case law on it in 2006, in case of
 Hillcrest Realty Sdn. Bhd v.Hotel Queen Road
The Company Law Board, Delhi Bench held at all the provisions in the Articles to maintain the basic characteristics of a private company in terms of section 3(1)(iii) will continue to govern the affairs of the company even though it is a subsidiary of a public company. It was held by the Delhi CLB Bench that the basic characteristics of a private company in terms of section 3(1)(iii) do not get altered just because it is a subsidiary of a public company in view of fiction in terms of section 3(1)(iv)(c) that it is a public company. It was further held by the Bench that it may be a public company in terms of other provisions of the Act but not with reference to its basic characteristics.  

Restrictions! Deemed Public:-
All the provisions of Public Company applicable on deemed public Company except following below given restriction as mentioned in Article of Association of Company
•    Restricts the right to Transfer its shares;
•    Limits the number of its Members to Two Hundred:
•    Prohibits any Invitation to The Public to subscribe for any securities of the company;
Along with provisions applicable on public Company it has to comply with the restriction mentioned above.
Some Simple examples of disadvantages of become Deemed Public Company:

    Interested Directors can’t participate or vote in Board meeting.
    Related Parties are not allowed to vote in General Meeting.
    Appointment of Managerial Personnel subject to approval of Shareholder Meeting.
    Appointment of Director required candidature.
    Rotation of Auditor becomes mandatory irrespective of capital and turnover.
    Deposit from members is allowed only by complying of the provision of section 73.
    Offer for Right issue can’t be open before 3 days and can’t be close before 15 days.

As mentioned above, due to its nature, private companies enjoy several relaxations and several sections have exempted private companies from the regulatory regime of the Act unless such private companies are the subsidiaries of public companies. All the Provision applicable on public Company under the Act except mentioned above will be applicable on Deemed Public Company
 
Article By:-
Akshit Gadhiya.