One person company

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Guest

Guest (Querist)

11 January 2014 Dear All,

Can an existing private limited company be converted into One Person Company?

@VaibhavJ

@VaibhavJ (Expert)
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11 January 2014 Hi

Yes, u/s 3 it has legal validity so you can convert pvt ltd co. to OPC.

Thanks

Guest

Guest (Querist)

11 January 2014 Hi,

Where exactly is it mentioned that an existing company can be converted.

Could not find the relevant extracts.

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@VaibhavJ

@VaibhavJ (Expert)
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11 January 2014 Pl refer article: https://www.caclubindia.com/articles/one-person-company-18333.asp

Thanks

Guest

Guest (Querist)

11 January 2014 Hi,

it is no where mentioned that an existing company can be converted.

if it is so,then one of the directors out of two will have to resgin and such proceure is not mentioned.

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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09 August 2024 Yes, an existing private limited company can be converted into a One Person Company (OPC) in India. The process involves several steps, and certain requirements need to be fulfilled. Here’s a detailed explanation:

### Conversion of Private Limited Company to One Person Company (OPC)

**1. Eligibility Criteria:**

- **Shareholders and Directors:** A private limited company can be converted into an OPC if it has only one shareholder and one director (who can be the same person). This means that one of the directors of the private limited company will need to resign if there are currently two or more directors.

- **Paid-up Capital and Turnover:** The company should not have a paid-up capital exceeding ₹50 lakh or an annual turnover exceeding ₹2 crore. If the company exceeds these limits, it may not be eligible for conversion into an OPC.

**2. Procedure for Conversion:**

1. **Board Meeting:**
- Convene a Board Meeting to approve the conversion of the private limited company into an OPC and to discuss the resignation of the additional director.

2. **Shareholders Meeting:**
- Hold a General Meeting (AGM or EGM) of the shareholders to pass a special resolution approving the conversion.

3. **Resignation of Director:**
- If there are more than one director, one of them must resign. Ensure the resignation is formally recorded, and a new Director (if required) should be appointed to meet the legal requirement of having at least one director.

4. **File with ROC:**
- Submit the following documents to the Registrar of Companies (ROC):
- **Form INC-6:** Application for conversion into OPC.
- **Resolution of the Board and Shareholders:** Approving the conversion.
- **Resignation of the Director:** If applicable.
- **Other Required Documents:** Proof of ownership of the registered office, KYC of the sole member/director, etc.

5. **Certificate of Conversion:**
- After reviewing the application, the ROC will issue a Certificate of Conversion if everything is in order. This certificate confirms the conversion of the private limited company into an OPC.

**3. Post-Conversion Compliance:**

- **Update Corporate Records:** Update the company’s records and official documents to reflect the new status as an OPC.
- **Statutory Registers:** Ensure that all statutory registers are updated as per OPC requirements.

**4. Additional Notes:**

- **Existing Liabilities:** Ensure that the conversion does not adversely affect existing liabilities or obligations of the company.
- **Compliance:** The OPC must comply with the provisions of the Companies Act, 2013, specific to OPCs.

### Important Considerations:

- **Legal Advice:** Consult a legal professional or company secretary for detailed guidance and assistance with the conversion process.
- **ROC Compliance:** Ensure all ROC filings are accurate and complete to avoid any delays or issues with the conversion.

The Companies Act, 2013, and related rules do provide for the conversion of a private limited company into an OPC, but it’s important to follow the specific procedural requirements and obtain the necessary approvals.