One Person Company (OPC)

Introduction

 

One person company is introduced by Companies Act 2013.OPC is a concept where a single person can constitute a company i.e. a company having one person as a member.

Persons involved in OPC

 

Sole member - An Indian citizen or a resident of India who subscribe the memorandum of association and article of association as a member.

Nominee member  - An Indian citizen or a resident of India nominated by the sole member. The nominee member shall become the shareholder in the event of subscriber’s death or his/her incapacity to contract.

Director - OPC must have minimum one director and may have maximum 15 directors. The sole member can himself become the sole director.

Rules and Regulations

 

• Only a natural person who is an Indian citizen or resident of India can form an OPC.
• One person cannot incorporate more than OPC or be a nominee of an OPC.
• Nither a minor can become the member or a nominee of an OPC or can hold shares with beneficial interest.
• Such company cannot incorporate or convert to a company under section 8.
• OPC cannot carry out non-banking financial investment activities including investment of securities of anybody corporate.
• No such company can convert to any other form of company voluntarily unless 2 years  has expired from the date of incorporation except threshold limit (paid up share capital) is increased beyond 50lakh rupees or its average annual turnover during the period exceeds 2 crore rupees.

N.B: Explanation-Here the term “resident of India means who has stayed in India for a period of not less than one hundred and eighty two days during the immediately  preceding one calendar year.