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Step by Step Process of Incorporation of One Person Company (OPC) in India as per Companies Act
Dr. JJ Irani made the recommendation to the committee in 2005. In India, the One Person Company was first launched in 2013. The One Person Company's incorporation procedure has been described in the Draft Rules created under the Companies Act of 2013. A one-person business is a business with just one director. The one-person company is incorporated as a private company, so it is subject to all the rules that apply to private companies. There are several clear guidelines that must be followed while forming a one-person company. These are described below.
Only a natural person who is recognized to be an Indian citizen and a resident of India has the absolute right to incorporate the One Person Company, according to the regulations written in the Companies Act of 2013. He also has the authority to establish the One Person Company as the single member of this new legal structure.
An individual who has resided in India for a period of time longer than 182 days is referred to as a" resident of India." It should have happened right away in the preceding fiscal year. It should be emphasized that only five One Person Companies (OPC) may be incorporated by a single person.
A specific person who is qualified to join the One Person Company must be nominated by the original owner, who is also the one who incorporated the One Person Company. When the original owner has passed away or becomes unable to fulfil his obligations under the contract, he should be able to fulfil his obligations. In the Memorandum of the One Person Company, the nominee's name must be mentioned. Additionally, the one-person business' designated person must give their consent.
According to the Companies Act of 2013, the maximum increase in paid-up shares is fifty lakh. The company will automatically convert into a Private Limited or Limited Company if the amount surpasses the cap of fifty lakh rupees or if something similar to the turnover reaches two crores rupees. A minimum of six months must pass before the One Person Company can convert, during which time either the average annual turnover must surpass two crore rupees or the paid-up share capital must have increased by more than fifty lakh rupees.
The government issued a notice. The Companies(Incorporation) Rules, 2014 have been modified by GSR 91(E) dated 01 February 2021; these new rules, which are known as the Companies (Incorporation) Second Amendment Rules, 2021, will go into effect on April 1st, 2021. Non-Resident Indians are now able to create a one-person company in India under the current amendment. (a) shall be qualified to establish an OPC; as of April 1, 2021, One Person Companies may be reorganized into any type of corporation without restriction on paid-up capital or turnover. OPC refers to a company that was incorporated with just 1 member, as opposed to the customary need of at least 2members for the formation of a business.
The potential director gets a certificate for a digital signature. To receive a digital signature certificate, the following documents must be presented.
The recommended director submits a DIN application on form SPICe together with documentation of their identity and address. The option offered to the current corporation is Form DIR-3. Up to three directors may use the SPICe form.
The word "private limited" is at the end of the name of the sole proprietorship. The SPICe and RUN web services of the ministry of corporate affairs accept requests for name approval. The ministry has now approved both of the company's proposed names.
Following documents are to be submitted
Since there is only one director in a one-person firm, a candidate is chosen to carry out the director's responsibilities in the event that he passes away or becomes unable of doing so. Along with his pan card and aadhaar card, the nominee's consent is obtained on Form INC-3.
The FORM SPICe has all the documentation attached. The SPICe articles of association and SPICe memorandum of association, as well as the director's digital signature certificate, will be posted on the website of the ministry of corporate affairs.
The certificate of incorporation will be issued by the registrar of companies once all the required documents have been submitted and have been verified.
Q1- How many names may the individual firm suggest when it is incorporated?
Ans.- A one-person business may request two possible names.
Q2- Is the director nominee provided for the one-person company required for document submission?
Ans.- Yes, the corporation must provide the name of a director nominee because, in the event that the director is unable to perform his obligations, the nominee will assume those responsibilities.
Q3-Is it necessary to submit a separate application for both a PAN card and a TAN?
Ans.- No, a separate application for a pan card and tan is not necessary. Tan and pan numbers are created automatically at in corporationtime.
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