Registration of One-person Company

One-person company is a proficient way to start a company. The concept was introduced in India through Companies Act, 2013. It is a method of self-employment introduced to boost up the economy of India.

Documents required to be submitted before the Registrar of Companies

1. The Memorandum of Association (MoA) which includes the objects to be followed by the Company or stating the business for which the company is going to be incorporated.
2. The Articles of the Association (AoA) which lays down the bye-laws on which the company will operate.
3. Consent of the nominee in Form INC – 3 along with his PAN card and Aadhaar Card.
4.  Proof of the Registered office of the proposed Company along with the proof of ownership and a NOC from the owner.
5. Affidavit and Consent of the proposed Director of Form INC -9 and DIR – 2 resp.
6. A declaration by the professional certifying that all compliances have been made.

Procedure to register an OPC

1. Obtaining Digital Signature- The director along with the nominee must obtain the digital signature certificate for processing the incorporation. The application for digital signature certificate requires:

• Passport size photo
• Address proof
• Identity proof
• Email Id
• Pan card

2. Obtaining Digital Identification Number- Director must obtain DIG also. It must be applied in SPICe Form along with the name and the address proof of the director.
3. Name approval application- the next step is to decide on the name of the Company. The name of the Company will be in the form “(OPC) Private Limited”. The Ministry permits two proposed Names and one re-submission (RSUB) while reserving Unique Names (RUN Service) for the Companies.
4. Filing forms with Ministry of Corporate Affairs- All the documents will be attached to SPICe Form, SPICe-MOA and SPICe-AOA along with the DSC of the Director and the professional, and will be uploaded to the MCA site for approval. After this, form 49A and 49B will be generated for the PAN and TAN generation of the Company which have to be uploaded to MCA after affixing the DSC of the proposed Director.

On verification, the Registrar of Companies (ROC) will issue a Certificate of Incorporation and can commence the business.

Conversion of private company into an OPC

          According to rule 7 of the Companies (Incorporation) Rules, 2014; a private company other than a company registered under sec. 8 of the act (company having charitable object) having paid up share capital of fifty lakhs or less or average annual turnover during the relevant period is 2 crore or less, may convert itself into an OPC by passing a special resolution in the general meeting.

Other compliances which are to be completed for the conversion are:

• Before passing such resolution, the company shall obtain a No objection in writing from the creditors and members.
• OPC shall file the resolution with the Registrar of Companies within thirty days from the date of passing.
• The company shall file an application in Form No. INC. 6 for its conversion along with the fees provided in the Companies (Registration offices and fees) Rules, 2014.
• The documents required along with the application are:

1. Declaration in the form of an affidavit from the directors that all creditors and members have given their consent for the conversion.
2. List of the creditors and members
3. Latest Audited Balance Sheet and the Profit- Loss Account.
4. Copy of No objection letter of the creditors.

Some points to be remembered:

1. A person can be a member of only one OPC.
2. A minor, foreign citizen, non resident or any person incapacitated by contract shall not eligible becoming a member.
3. The minimum and the maximum number of such directors can be 1 and 15 respectively, beyond which a special resolution will be required to be passed by the OPC.
4. Provision relating to quorum for meetings of Board does not apply to OPC where there is only one Director on its Board of Directors.

An OPC enjoys several privileges and exemptions under the Companies Laws in the form of exemption from conducting general and board meetings, provision of taxation of the entity separate from its owner’s income and separate legal entity of the company ensuring limited liability of the sole shareholder. However, these benefits are not without their own limitations as the setting up and maintenance of an OPC is cumbersome, time-consuming and heavy on the pocket.