IPLF: Getting your One Person Company Registered

To provide more support to the budding entrepreneurs for their efforts in developing different innovations, the concept of One Person Company registration was introduced in the Companies Act 2013. This was primarily done to support entrepreneurs who are willing and able to start a venture on their own. This model allows an individual to create a single person economic entity. Section 2(62) of the Companies Act defines a One-Person Company as a company that has only one person as to its member. Generally, members of a company are the people who have subscribed to the memorandum of association, or the company’s shareholders. Therefore, in furtherance of this understanding, an OPC is a company that has only one shareholder as its member. These companies are usually created when there is only one founder/promoter for the business such as entrepreneurs whose businesses lie in the early stages. These entrepreneurs now prefer OPCs over the sole proprietorship business model because of the several advantages that OPCs offer. One of the biggest advantages of an OPC is that it is a separate legal entity that is distinguished from its promoter. Therefore, it has its assets and liabilities, which implies that the promoter is under no obligation to personally repay the debts of the company.

Features

OPC has certain features which make it distinguishable from other entities. The nature of such OPC is of a private company which has also been described in Section 3(1)(c) of the Companies Act. It speaks that a single person can form a company for any lawful purpose. It further describes OPCs as private companies. Having few differences with that of members, OPCs can have only one member where other private companies can have multiple members. This also means that the OPCs need to have a minimum of one person as the director. While in the process of registration, the sole member of the company needs to provide a nominee. Having only one member, and upon the death, this nominee can choose to be a sole member or even reject to do so. Therefore, the OPC does not follow any such perpetual succession. Further, no amount of minimum paid-up capital has been described by OPCs. With all such features, OPCs do enjoy several privileges.

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Process our team undertake while getting it registered

• At the outset, the primary first step in registration is confirming the availability of the proposed company name and the selection of up to six names in order of preference.
• Once the proposed name is approved or is available, we apply for the OPC registration.
• It is advisable to obtain a Digital Signature Certificate (DSC) if it’s not available with the party. It is an essential requirement during the form submission.
• Director Identification Number (DIN) is mandatory. It is advisable to obtain DIN if a Director does not have one.
• OPC is incorporated within 10 – 15 business days from the date of application

Details Required

• Proposed name of the company and the list of activities that the company will be engaged in.
• Suitably drafted Memorandum of Association (MOA) and Articles of Association (AOA) duly stamped with payment of stamp duty and signed.
• Address proof of the place of business of the OPC (Rent agreement in case of rented premises, Index II or property tax paid receipt, etc. in case of owned premises).
• Details of nominee and nominee’s consent.
• Identity proof of the sole shareholder, director(s), and nominee for the sole shareholder. (Passport, Voter ID, Driving License, Aadhar card).
• Address proof of the sole shareholder, director(s), and nominee for the sole shareholder (Should be in their name) (Any one of Bank Statement, Electricity
• Bill, Telephone Bill, Mobile Bill, Rent Agreement in case of rented premises).
• The initial capital of the company.
• PAN Card and other address proof of Director and Nominee.
• Affidavit and consent of Director

There are some of the special privileges that OPC has. They need not hold any general meetings and it is not necessary to have a cash statement in their financial statements. The director can sign the annual return which in other cases, a company secretary needs to do. No such provisions are there for the independent director. Also, several provisions that relate to the meetings and quorum do not apply.

For more information regarding the team services and registration of the OPCs kindly contact the IPLF team.

Author: Saransh Chaturvedi an associate at IP & Legal Filings, in case of any queries please contact/write back to us at support@ipandlegalfilings.com.