A one person company (“OPC”) is a private company with only one member. The OPC is governed by Section 2(62) and the provisions of the Companies Act, 2013 (“the Act”), and it enjoys several exemptions from the compliance requirements applicable to other companies.
The Compliance
The OPC must have a nominee, and the nominee's consent must be filed with the ROC. The OPC must hold at least one board meeting in each half of the calendar year, with a gap of not less than ninety days between the two meetings. The OPC is exempt from the requirement to hold an annual general meeting, and it is exempt from the cash flow statement requirement.
The OPC must file the annual return in Form MGT-7A, and it must file the financial statements in Form AOC-4. The OPC is exempt from the rotation of auditors and the secretarial audit.
The Conversion
An OPC must convert into a private limited company or a public company where its paid-up share capital exceeds ₹50 lakh or its average annual turnover exceeds ₹2 crore. The conversion is done by altering the memorandum and the articles, and the company must file the application in Form INC-6.
The conversion is also voluntary, and the OPC can convert at any time by passing a special resolution. The conversion does not affect the company's assets, liabilities, or contracts, and the company continues as a private limited company.
The Compliance After Conversion
After conversion, the company is subject to the full compliance regime applicable to a private limited company—the board meetings, the general meetings, the audit, the secretarial standards, and the statutory filings. The company must appoint the additional directors and comply with the provisions relating to the independent directors where applicable.
Call to Action
Anuj Desai & Associates advises OPCs on the compliance and conversion—from the board meetings and the annual filings to the voluntary or mandatory conversion. If your OPC is approaching the conversion threshold, we can help you plan the transition.
📧 office@anujdesaiassociates.com
📞 9619456656
🌐 https://anujdesaiassociates.com
🔗 linkedin.com/in/ca-anuj-desai-122547230
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