OPC Private limited company

According to the Companies Act, 1956, Minimum 7 members are required to form a Public limited company while only 2 members are needed to register a private limited company. As per provision of section 2(62) of the companies act, 2013, one can start a one-person company in India which requires only one member to form a legal entity and provides legal protection to the shareholders in the form of limited liability.

The main benefit of forming a one-person company is that it is a separate legal entity which requires only one member and provide its sole shareholders limited liability of protection. It is simple to incorporate for the continuance of the business. All those provisions which are applicable to private companies are also applicable to the one person company (OPC).


How to form a One person company

According to the Rule 3 of the Companies (Incorporation) act, 2014, the one person company member should be a resident of India. He/she should be an Indian citizen and a resident of India. He/she should not be a minor. The resident of India means a person who lives in India for a time period of at least 182 days in a financial year.

The natural person means a normal person. It is not an entity such as a HUF, a corporate body, a partnership firm, or a sole proprietorship. A foreign citizen or non-resident Indian is not allowed to make an OPC in India. Minimum one director is required for the formation of OPC. It must have one promoter also. Director & promoter can be the same person. As per rule 3 of companies (incorporation) rules, 2014, a person is not eligible to become a member or a nominee of more than one OPC.

It is very essential to choose the nominee of one person company member. The consent of the nominee is required in a written form. A nominee can only take up the charge and become the member of the company, if the member is died or incapable of contract.


What Is Included In Our Package?

Eligibility Consultation

Document Preparation

Application Drafting

Government Fees


Step by step procedure for One Person Company Registration

  1. 1

    The first step to form a one person company is to get the Digital Signature Certificate (DSC) of the director of the company. For this purpose, the following documents are needed: -

    • Phone Number
    • Email ID
    • Photo
    • PAN Card
    • Aadhar Card
    • Address Proof
  2. 2A person who wants to form a one person company needs to apply for a director’s identification number via form DIR – 3 with proof of address and name of the director.

  3. 3Choosing the name of the proposed company: The promoter of one person company (OPC) needs to apply for the company name via E form INC 1 and has to submit the same to the registrar of companies for incorporation. You have to pay rupees 1,000 via debit card or net banking to complete the process. For example – Name of the OPC will be “ABC(OPC) Private limited”.

  4. 4

    You need to submit the following documents to the Registrar of Companies: -

    • Articles of Association
    • Memorandum of Association
    • Consent of Nominee in form INC – 3 on behalf of director or promoter
    • Aadhar card and PAN card of nominee
    • NOC and proof of ownership from the owner along with the proof of the registered office
    • Consent and affidavit of the director in form DIR – 2 and INC – 9.
    • The final declaration from the professional to certify all compliances.
  5. 5

    Approval or Filling of forms with Ministry of Corporate Affairs: -

    All the documents will be attached to Articles of Association (AOA), Memorandum of association (MOA) and SPICe form along with the digital signature certificate of the professional and the director. All these documents will be uploaded on the website of ministry of corporate affairs for approval.

  6. 6

    Issuance of Certificate of Incorporation

    After completing the verification procedure, ROC issues the certificate of incorporation for the commencement of business.


Concerns Regarding OPC Registration

  • For one Person Company (OPC), Rupees one lakh is the minimum authorized share capital.
  • The maximum and minimum number of members for one person company (OPC) is only one.
  • A minor cannot become a nominee or member of a one person company (OPC)
  • An OPC may be formed either as a company limited by shares or limited by guarantee or by unlimited liability.
  • An OPC limited by shares needs to fulfill the following requirements-

    • The minimum paid up capital of the OPC is RS. 1, 00,000.
    • You are not permitted to transfer these shares to anyone.
    • A person running an OPC is not able to make any offer or invitation to the public to subscribe for company securities.
    • After two years from the date of incorporation, OPC cannot voluntarily convert into any other type of company. The exception is when its average annual turnover is more than rupees two crores, or its paid-up share capital is more than rupees fifty lacs.
    • Similar Taxes are imposed on OPC just like a private limited company.

Factors to choose While Choosing The OPC Name

Simple & Short

The name of your OPC should be meaningful for your business and it should fit into the branding strategy of the company.

Distinct

Your OPC name should not be similar or identical to an existing trademark, company or LLP name.

Suffix

There is no need to finish OPC name with “Limited or “Private limited”.

Should not be offensive/illegal

The LLP name should not be illegal or abusive.

The name should as per the laws

The name of your OPC should not violate any laws.


Frequently Asked Questions

The first step to incorporate an OPC is to submit the form INC -1 which is used for the availability of name. After the name approval, INC-2 needs to be filled within 61 days to complete the procedure.
The OPC will mandatorily convert itself into public or private company if its annual average turnover of immediately previously three consecutive financial years is more than rupees two crores or if its paid up share capital is more than rupees fifty lakh rupees.
After exceeding the threshold limit, you need to submit INC- 5 within 60 days.
The time limit for filing the form INC-6 is 30 days if the conversion in voluntary but if the conversion is mandatory, then the time limit is 6 months.
A normal person who is an Indian citizen and a resident of India will be eligible to act as a member of an OPC.
A Person can be a member of one OPC only.
Form INC-4 is to be filled in case of withdrawal of consent by the nominee of an OPC or In case of intimation of nominee change by the member.

When a normal person is a member in One Person Company and if the same person becomes the member in other OPC by virtue of being a nominee in that OPC, then he/she needs to fulfills the eligibility criteria of a member in one OPC (i.e. duration of 180 days).


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