Differences between Company, LLP and OPC

TG Team 24 Aug 2015 5,399 Views 0 comment Print Company Law | Articles

Sanoj Kumar

Differences between Public Limited Company, Limited Liability Partnership (LLP), Private Limited Company and One Person Company [OPC]

S. N.	Particulars	Public Ltd. company	LLP	Private Ltd. Company	OPC
1	Statute	It is governed by “The Companies Act, 2013”.	It is governed by “The Limited Liability Partnership Act, 2008“.	It is governed by “The Companies Act, 2013”.	It is governed by “The Companies Act, 2013”
2	Incorporation documents	Memorandum of Association and Articles of Association are the main incorporation documents.	Limited liability partnership agreement is the main Incorporation document.	Memorandum of Association and Articles of Association are the main incorporation documents.	Memorandum of Association and Articles of Association are the main incorporation documents.
3	Number of Partners/ Shareholders	Shareholders: Minimum Seven members.	Minimum two partners and Maximum limit is not specified.	Shareholders: Minimum Two and maximum Two Hundred Members.	Shareholders: Only One Shareholder.
4	Maintenance of Accounts and Audit	Maintenance of accounts is Compulsory and Audit if applicable	Accounts are required to be audited if the turnover exceeds Rs.40 Lakhs or contribution exceeds Rs.25 Lakhs.	Maintenance of accounts is Compulsory and Audit if applicable	Maintenance of accounts is Compulsory and Audit if applicable
5	Filing of Annual Return and Financial Statements.	Filing of Financials is compulsory, within 30 days from the date of Annual General Meeting. Filing of Annual Return is compulsory, within 60 days from the date of Annual General Meeting.	Filing of Annual Return is compulsory within 60 days from the close of the financial Year. Accounts and Solvency to be filed within 30 days from the end of six months of the financial year to which the Statement of Account and Solvency relates	Filing of Financials is compulsory, within 30 days from the date of Annual General Meeting. Filing of Annual Return is compulsory, within 60 days from the date of Annual General Meeting.	Filing of Financials and Annual returns is compulsory, within 180 days from the date of closure of financial year.
6	Liability of Partners	Liability of members is Limited to Capital of the company.	Liability of partners is Limited to Capital Contribution in all Cases except ‘deliberate fraud’.	Liability of members is Limited to Capital of the company.	Liability of member is Limited to Capital of the company.
7	Admission of minor as participants	Minor cannot be appointed as a Director, Legal Guardian can hold the shares on behalf of the minor.	Minor cannot be admitted either as a Partner/Designated partner in the LLP.	Minor cannot be appointed as a Director, Legal Guardian can hold the shares on behalf of the minor.	Minor cannot be appointed as a Director, and also as the Sole Shareholder.
8	Suit against and by	A Public company can always sue and can be sued in its own name.	LLP can always sue and can be sued in its own name.	A private company can always sue and can be sued in its own name.	A OPC private company can always sue and can be sued in its own name.
9	Management/ Directors	Management is done by Board of Directors. (Minimum 2 and maximum 15)	Management is done by Designated Partners. (Minimum 2)	Management is done by Board of Directors. (Minimum 2 and maximum 15)	Management is done by Board of Director(s). (Minimum 1 and maximum 15)
10	Director Identification Number/	Each Director requires to have a unique DIN before being appointed as a Director of Public Company.	Each designated Partner requires having a DPIN before being appointed as a Designated Partner of LLP.	Each Director requires to have a unique DIN before being appointed as a Director of Private Company.	Each Director requires to have a unique DIN before being appointed as a Director of OPC Private Company.
11	Interest on Capital contribution by participants	Interest on capital is not allowed as deduction.	Interest on capital is allowable as deduction in the hands of LLP subject to limits.	Interest on capital is not allowed as deduction.	Interest on capital is not allowed as deduction.
12	Management remuneration	Management remuneration is subject to Section 197.	Management remuneration is allowable as deduction in the hands of registered firm subject to limits.	Management remuneration is allowable as deduction in the hands of private company and there is no limit specified.	Management remuneration is allowable as deduction in the hands of OPC company and there is no limit specified.
13	Distribution of profit	Public company has to pay dividend distribution tax on dividend. Profit is exempt in the hands of shareholders.	No tax is to be paid on the distribution of profit by the LLP. Profit is exempt in the hands of partners.	Private company has to pay dividend distribution tax on dividend. Profit is exempt in the hands of shareholder.	OPC Private company has to pay dividend distribution tax on dividend. Profit is exempt in the hands of shareholder.
14	Loans and advances by the entity to the participants	Subject to Section 185 of Companies Act, 2013.	It is not taxable. Except in the case of private company converted into LLP for the first three years after conversion.	It is taxable as deemed dividend u/s 2(22)(e) of the Income Tax Act, 1961, if certain conditions are met.	It is taxable as deemed dividend u/s 2(22)(e) of the Income Tax Act, 1961, if certain conditions are met.
15	Nomenclature	Name to contain ‘Public Limited’ as suffix.	Name to contain ‘Limited Liability Partnership’ or ‘LLP’ as suffix	Name to contain ‘Private Limited’ as suffix	Name to contain ‘Private Limited (OPC)’ as suffix
16	Meetings of Partners/Directors/Shareholders	Board Meetings and General Meetings are compulsory. Board Meetings: First Board meeting: within 30 days from the date of incorporation. Subsequent Board meetings: Minimum number of four meetings, every year, with a gap of not more than 120 days between two consecutive meetings of the Board. Annual General Meetings: 1stAGM: 9 months from the close of financial year. Subsequent AGM: 6 months from the close of financial year. Gap between two AGM: Not more than 15 months from the last AGM.	As per the terms mentioned in the LLP Agreement.	Board Meetings and General Meetings are compulsory. Board Meetings: First Board meeting: within 30 days from the date of incorporation. Subsequent Board meetings: Minimum number of four meetings, every year, with a gap of not more than 120 days between two consecutive meetings of the Board. Annual General Meetings: 1stAGM: 9 months from the close of financial year. Subsequent AGM: 6 months from the close of financial year. Gap between two AGM: Not more than 15 months from the last AGM.	Board Meetings are mandatory but convening of Annual General meeting is not compulsory. Board Meetings: First Board meeting: within 30 days from the date of incorporation. Subsequent Board Meetings: a minimum of one Board meeting in each half of a calendar year and the gap between the two meetings is not less than ninety days.
17	Quorum for meetings	In case of Board meetings: 1/3rd of the total directors, subject to a minimum of 2 Directors. In case of General Meetings: 5-less than 1000 members 10-1000 to 5000 members 15-more than 5000 members.	As per the LLP Agreement	In case of Board meetings: 1/3rd of the total directors, subject to a minimum of 2 Directors. In case of General Meetings: Two Shareholders physically present	In case of Board meetings: 1/3rd of the total directors, subject to a minimum of 2 Directors, if there is more than one Director. In case of one Director, then the sole director will be the quorum.
18.	Foreign Direct investment [FDI] in the form of capital/contribution/equity.	FDI in a Public Company is allowed based on sector specific Restrictions i.e., either percentage or based on Automatic or prior approval route. Further FDI in certain sectors have FDI-linked performance related conditions, which are to be complied.	FDI in LLP is allowed in such sectors/activities, where 100% FDI is allowed under automatic route, without any FDI-linked performance related conditions. Even such entry is subject to prior Government / FIPB approval. FDI is not allowed in: (a) Sectors with less than 100 % FDI under automatic route, (b) Sectors with Approval route, activities such as Agricultural/plantation and Print media and Sectors in which FDI is prohibited	FDI in a Private Company is allowed based on sector specific restrictions i.e., either percentage or based on Automatic or prior approval route. Further FDI in certain sectors have FDI-linked performance related conditions, which are to be complied.	FDI is not allowed, as it is the requirement for a member of a OPC to be a Indian citizen and resident in India shall be eligible to incorporate a One Person Company i.e., shall be a member of the OPC.
19	Rotation of Director	Exact 1/3^rd of director liable to retire by rotation.	Not applicable	Not applicable	Not applicable
20	Transfer of Shares	Freely transferable	Restricted	Restricted	Restricted
21	Audit Committee	Company having PUC- 10 crore T/O- 100 crore Borrowings exceeding-50 crore	Not applicable	Not applicable	Not applicable
22	Women director	Company having PUC-100crore T/O-300 crore	Not applicable	Not applicable	Not applicable
23	Independent Director	Company having PUC- 10 crore T/O- 100 crore Borrowings exceeding-50 crore	Not applicable	Not applicable	Not applicable
24	Borrowing u/s 180(1)(c )	Applicable By Board- Existing +proposed=PUC+Free reserves. If exceeds then Special resolution.	Not applicable	Exempt	Not applicable
25	Related party transaction u/s 188	Applicable	Not applicable	Not applicable	Not applicable
26	Right issue u/s 62	Applicable	Not applicable	Not applicable	Not applicable
27	Eligibility, qualification and disqualification u/s 141(3)(g)	Applicable	Not applicable	Not applicable if PUC is less than 100crore.	Not applicable
28	Appointment of Director other than Retiring Director u/s 160	Deposit 1 lacs	Not applicable	Not applicable	Not applicable
29	Resolutions and agreements filed with ROC	Subject to section 179(3) and to be filed within 30 days from date of passing resolution.	Not applicable	Exempted	Not applicable