The concept of One Person Company (OPC) was introduced to encourage unorganised proprietorship business to enter into organised corporate world. One Person Company as the name suggest means the Company which has one person as member.
Like any other form of business entity, One Person Company is a separate entity distinct from its members, limited liability protection to shareholders and has a perpetual succession.
One Person Company is suitable option for proprietors or new entrepreneurs who wants to start a Company individually without adding any other member.
Since no public interest is involved in One Person Company, many relaxations with respect to compliances have been granted to such Companies.
DEFINITION UNDER THE ACT
According to Section 2(62) of the Companies Act, 2013 “One Person Company” means a company that has only one person as a member.
NATURE OF OPC
Pursuant to the provisions of section 3(1)(c) of the Companies Act, 2013 OPC will be termed as private company.
MEMBER AND DIRECTORS
In OPC there will be only one member and a single director is sufficient. An individual member can also be the director.
ELIGIBILITY
Only a natural person who is an Indian citizen and whether resident in India or otherwise
- Shall be eligible to incorporate a OPC;
- Shall be a nominee for the sole member of a OPC
The term resident here means a person who has stayed in India for a period of not less than 120 days during the immediately preceding financial year.
NOMINATION
The subscriber to the memorandum of OPC shall nominate a person after obtaining his prior written consent in FormINC-3, who shall become a member of OPC in the event of subscriber’s death or his incapacity to contract.
The name of such person nominated shall be mentioned in the memorandum of OPC and the same to be filed with Registrar at the time of incorporation.
CHANGE IN NOMINATION
When a person nominated by the subscriber or member of a OPC withdraw his consent by giving a notice in writing to such sole member and to OPC, then the sole member shall nominate another person as nominee within 15 days of the receipt of the notice of withdrawal and shall send an intimation of such nomination in writing to the Company, along with the written consent of such other person so nominated in FormINC-3.
Further the Company shall within 30 days of receipt of the notice of withdrawal of consent shall file with Registrar, a notice of such withdrawal of consent and the intimation of the name of another person nominated by the sole member in FormINC-4 along with fee as provided in the Companies (Registration offices and fees) Rules, 2014 and the written consent of such another person so nominated in FormINC-3.
MANDATORY CONVERSION OF OPC IN CERTAIN CASES (OMITTED)
Mandatory conversion of OPC in case the paid-up capital of an OPC exceeds Rs. 50 Lacs or its average annual turnover of immediately preceding 3 financial years exceeds Rs. 2 crores, has been OMITTED with effect from 01st April, 2021
CONVERSION OF OPC INTO A PUBLIC COMPANY OR PRIVATE COMPANY
1. The OPC by altering its memorandum and articles and passing a resolution under section 122(3) of the Act, can give effect of conversion.
2. A OPC may convert itself into a Private or Public Company, other than a company registered under section 8 of the Act, after increasing the minimum number of members and directors to two or seven members and two or three directors, as the case may be, and maintaining the minimum paid-up capital as per the requirements of the Act for such class of company and by making due compliance of section 18 of the Act for conversion.
3. The OPC shall file an application in e-Form No.INC-6 for its conversion into Private or Public Company, other than under section 8 of the Act, along with fees as provided in the Companies (Registration offices and fees) Rules, 2014 by attaching documents, namely:
(a) Altered MOA and AOA;
(b) Copy of resolution;
(c) The list of proposed members and its directors along with consent;
(d) List of creditors; and
(e) The latest audited balance sheet and profit and loss account.
4. On being satisfied that the requirements stated herein have been complied with,the Registrar shall approve the form and issue the Certificate.
DOCUMENTS REQUIRED FOR INCORPORATION OF OPC
- Pan card of proposed member and director(s)
- Driving licence or Aadhar card or voter IDor passport or bank pass book (As a proof of Identity)
- Latest Electricity bill or Telephone bill or Mobile bill or Bank Statement (As a proof of residence)
- Latest utility bill or rent agreement (As a proof of registered office address)
- No objection certificate (NOC) in case of rented place.
- Proof of identity of authorised signatory for opening bank account.
- Proof of address of authorised signatory for opening bank account.
- Passport size photo of authorised signatory.
PROCEDURE FOR INCORPORATION OF OPC
Application for registration of OPC can be made through a single application for name reservation, allotment of DIN, Incorporation of new company, allotment of PAN and TAN.
This single application can be made through SPICe+ (with RUN or without RUN) in SPICe+ Form (INC-32) along with other linked forms like e-MOA (INC-33), e-AOA (INC-34), AGILE-PRO and INC-9
The forms must be filed in following manner:
(1) Preparing and filing of SPICe+ Form INC-32
Attachments to SPICe+ Form INC-32 are
- DIR-2- Consent to act as director duly signed by first director(s)
- Proof of identity and residence of subscriber(s)
- Proof of identity and residence of nominee
- Proof of registered office address
- No objection Certificate for using premises for registered office (In case of rented place)
(2) Preparing and filing of e-MOA (INC-33)
(3) Preparing and filing of e-AOA (INC-34)
(4) Preparing and filing of INC-9- declaration of first director(s)
(5) Preparing and filing of AGILE-PRO:
Attachments to AGILE-PRO
- Proof of identity of authorised signatory for opening bank account
- Proof of address of authorised signatory for opening bank account
- Passport size photo of authorised signatory
- Specimen signature of authorised signatory
(6) Once the forms are filled completely, download the pdf forms, attached DSC of first director(s) along with professional and upload the same in following sequence:
- SPICE+ Form INC-32
- eMOA
- eAOA
- AGILE-PRO
- INC-9
(7) Registrar will verify the same and if satisfied will register the Company and issue incorporation certificate.
RESTRICTIONS ON OPC
- No minor shall become member or nominee of the OPC or can hold share with beneficial interest.
- OPC cannot be converted into section 8 Company.
- OPC cannot carry out Non-Banking Financial Investment activities including investment in securities of any body corporates.
ANNUAL COMPLIANCES OF OPC
1. Board Meetings
The requirement of a minimum number of board meetings to be convened shall not apply to OPC having only one director.However, in case of OPC having more than one director, then such OPC shall hold at least 1 board meeting in each half of calendar year and gap between 2 meetings shall not be less than 90 days.
2. Disclosure of Directors’ Interest
Every Director of the Company in First meeting of Board of Director in each Financial Year shall disclose his interest in other entities in form MBP-1 with the Company. In case there is any change in disclosure then at the first Board Meeting after such change.
3. Annual General Meeting (AGM)
OPC is not required to hold any Annual General Meeting.
4. Appointment of Statutory Auditor
OPC shall mandatorily appoint statutory auditor pursuant to the provisions of section 139 of the Companies Act, 2013. OPC is required to get its books of accounts audited by Chartered Accountant in a prescribed manner.
5. Filing of Financial Statements
Every OPC shall prepare and file its financial statements in prescribed form AOC-4 within 180 days of from the closing of the financial year. Financial statements must be signed by one director.
6. Filing of Annual Return
Every OPC shall prepare and file its Annual Return in prescribed form in MGT-7 before 30th September every year. Annual Return must be signed by Company Secretary and in case of absence it will be signed by director of the Company.
7. Filing Directors KYC
Every individual holding Director Identification Number (DIN) as on 30th March of a financial year shall file KYC with MCA on or before 30th September every year.
8. Filing MSME-I Return
All the Companies who gets supplies of goods or services from Micro and Small Enterprises and whose payment to such Micro and Small Enterprise suppliers exceed 45 days from the date of acceptance or deemed acceptance of the goods or services, must file MSME-I Return on or before 30th April (For October to March) and on or before 31st October(For April to September)
9. Filing Return of Deposits- DPT-3
Every Company other than Government Company shall file Return of Deposits for any outstanding loan or amount irrespective of the fact whether such amount falls under the definition of deposits or not on or before 30thJune every year.
The author can also be reached at csneharedekar@gmail.com
Disclaimer: Please note that the above article is based on the interpretation of related laws, which may differ from person to person and is not legal advice.
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