A new idea known as the One Person Company was introduced in the Company Act of 2013. Sec 2(62) of companies act 2013 "One Person Company" means a company which has only one person as a member.
A private company should have at least 2 directors and two members, whereas a public company seems to have at least 3 directors and 7 members.
The converting of a PLC to an OPC has no effect on the company's prior responsibilities or commitments; such claims, liabilities, and obligations will be legally enforceable, and the future OPC will be liable.
The member grants the OPC its legal entity status. The OPC is a separate legal body that protects the single person who has incorporated it. The member's liability is limited to their shares, and they are not personally responsible for the company's loss. As a result, creditors have the right to sue the OPC rather than the member or director.
Because OPC is a private company, it is simple to raise funds from venture capitalists, angel investors, incubators, and other sources. Banks and financial institutions easily give loans to corporations rather than sole proprietorships. As a result, obtaining finances becomes simple & fast.
The Companies Act of 2013 exempts the OPC from specific compliance requirements. The cash flow statement does not have to be prepared by the OPC. The company secretary is not required to sign the account books or annual returns, which the director must only sign.
The incorporation of OPC is simple so that only one member and one nominee are necessary. A member can also be a director. The minimum authorized capital for forming an OPC is Rs.1 lakh, although there is no requirement for a minimum paid-up capital. As such a result, it is relatively easy to start compared to other types of businesses.
Even when there is only one member, the OPC has the feature of eternal succession. The single member must appoint a nominee while incorporating the OPC. When a member dies, the candidate takes over as president of the corporation.
A person can only be a member of one OPC.
Only a person who is an Indian citizen and resides in India can serve on an OPC as a member and nominee.
No, for a Private Limited Company to be converted to an OPC, the company's annual turnover must be less than Rs. 2 crores for the previous three financial years. As a result, your Private Limited company will not be able to convert to OPC.
No, for a Private Limited Company to be converted to an OPC, the company's paid up share capital must be less than or equal to Rs.5 lakh. As a result, your Private Limited company will not be able to convert to OPC.
OPC Shall be inform within sixty days of exceeding threshold limits to ROC.
The main advantages of conversion include the removal of the necessity for an Annual General Meeting, the ease with which annual returns can be filed, and the ease with which decisions can be made.
1. Only a person; (should not be minor).
2. Indian citizen.
3. A person who is a permanent resident of India.
• A one-person corporation is run by a single person, whereas a group runs a PLC.
• There is no provision in a PLC for appointing a nominee to a company member. There is only one person on the OPC, and the candidate will fill in for the member in their absence.
• There is only one director in OPC. A private limited company, on the other hand, has two directors.