As per Section 2(62) of Companies Act, 2013 read with Rule 3 of Companies (Incorporation) Rules, 2014, “One Person Company” means a company which has only one person as a member, and that person should be a natural person who is an Indian citizen and resident in India*-
(a) shall be eligible to incorporate a One Person Company;
(b) shall be a nominee for the sole member of a One Person Company.
*resident in India means a person who has stayed in India for a period of not less than one hundred and eighty two days during the immediately preceding financial year.
1. No minor shall become member or nominee of the One Person Company or can hold share with beneficial interest.
2. OPC cannot be incorporated or converted into a section 8 company under the Act.
3. OPC cannot carry out Non-Banking Financial Investment activities including investment in securities of any body corporates.
4. No Natural Person Shall be a Member and Nominee of more than a One Person company at any point of time.
Terms and Condition for Voluntary Conversion of OPC to Private/Public Company:
1. Atleast Two Years must have expired from the date of incorporation of One Person Company.
Terms and Conditions for Compulsory Conversion of OPC to Private/Public Company:
1. Where the paid up share capital of an One Person Company exceeds fifty lakh rupees and its average annual turnover during the relevant period exceeds two crore rupees, it shall cease to be entitled to continue as a One Person Company.
2. Such OPC have to compulsory convert itself into Private/Public Company within six months from the date on which it’s Capital and turnover exceeds the above limit.
E-FORMS REQUIRED TO BE FILED FOR CONVERSION:
1. In Case Directors are to be appointed the same should be done by filing Form DIR-3 (In Case DIN to be obtained) and Form DIR-12 (In Case of appointment in Board of Directors), In Case of Private Company, Two Members and Two Directors are required and In case of Public Company, Seven Members and Three Directors are required.
2. For Conversion of OPC to Private/Public Company as per section 18 and 122 of Companies Act, 2013, Memorandum and Articles of Association are to be altered and adopted As per section 13(1) and Section 14(1) of Companies Act, 2013 and In Case Company is Increasing its Authorized Share Capital (Creation of Addition Equity Shares) the same is to be done by filing Form MGT-14 within thirty days of passing the resolution.
3. Form SH-7 is to be filed within thirty days of such alteration or increase, in Case Company is Increasing its Authorized Share Capital (Creation of Addition Equity Shares) as per Section 64(1) read with Rule 15 of Companies (Share Capital and Debentures) Rules, 2014.
4. Pursuant to Section 18 of Companies Act, 2013 read with Rule 7(4) of Companies (Incorporation) Rules, 2014, OPC within Sixty days of exceeding the Compulsory Conversion limits for Conversion intimate the Registrar in Form INC-5 informing that it has ceased to be One Person Company.
5. Form INC-6 for Conversion of OPC into Private/Public Company is to be filed within six months from the date on which threshold limit for Compulsory Conversion was exceeded and within thirty days in case of Voluntary Conversion.
DOCUMENTS REQUIRED FOR FILING THE ABOVE FORMS:
PROCEDURE TO CONVERT THE ONE PERSON COMPANY INTO PRIVATE/PUBLIC COMPANY:
1. Calling and Convening of Board Meeting for following Agenda items:
2. In case of One Person Company, there is no need to convene an extra ordinary general meeting like private and public Companies. As per the provisions of Section 122 of the Companies Act, 2013, in case of OPC, it shall be sufficient if the resolution is communicated by the member to the Company and entered in the minutes-book and signed and dated by the member and such date shall be deemed to be the date of the meeting for all the purposes.
3. File the above mentioned Form within prescribed time period and fees as provided in Companies (Registration offices and fees) Rules, 2014.