A personally restricted agency is an agency this is held privately via way of means of a small organization of individuals. A personal agency wishes to have no less than administrators and individuals. The range of administrators may be 15, and the range of individuals may be 2 hundred below the Companies Act, 2013.
One Person Company (OPC) is a brand new idea brought withinside the Companies Act, of 2013. An unmarried man or woman can check in for an OPC. There ought to be the simplest one member in an OPC. There can not be multiple members, however, it may have most than 15 administrators.
The conversion of 1 agency elegance to any other elegance, i.e. conversion of a personal restricted agency into OPC is supplied below in Section 18 of the Companies Act, 2013 (‘Act’) and Rule 7 of the Companies (Incorporation) Rules, 2014. The compliance necessities are much less in OPC than in personally restricted groups; thus, personally, restricted groups select to transform into OPC.
Conditions for Conversion of Company to OPC
- The member of the brand-new OPC has to be a herbal person.
- The member of the brand new OPC has to be a citizen of India, i.e. who has stayed in India for one hundred twenty days withinside the previous economic year.
- The member of the OPC has to now no longer be a member of every other OPC or be a nominee of every other OPC.
- A minor can not be a member or a part of OPC.
- The enterprise to be transformed into an OPC have to now no longer be installed as a Section eight enterprise.
Process of Converting a Company to OPC
Hold Board Meeting
The agency administrators need to meet and determine on a date for engaging in the assembly of the shareholders, called the Extraordinary General Meeting (EGM). The observation for containing the board assembly needs to be dispatched to the contributors a minimum of seven days earlier than the board assembly date. The board assembly timetable needs to be said withinside the observation. The observation needs to be handed as a unique decision to be followed with the aid of using the shareholders regarding the conversion of a personal agency to OPC.
The timetable of the board assembly needs to be:
- For approval from the administrators for the conversion of the personal agency into OPC.
- For solving the location, date, day, and time of the Extraordinary General Meeting (EGM).
- For the approval of the EGM observe the side of its timetable and explanatory statement.
- For authorizing any of the administrators to difficulty the permitted EGM observation.
Call for Extraordinary General Meeting (EGM)
Observation for the Extraordinary General Meeting (EGM) needs to be despatched to all of the agency’s administrators, contributors, and auditors. The observation for EGM needs to be despatched a minimum 21 days earlier than the date of the EGM.
No Objection Certificate (NOC) from Creditors
The agency needs to get a No Objection Certificate (NOC) from the prevailing lenders and shareholders earlier than passing a unique decision withinside the EGM. The NOC needs to be received in writing.
Hold Extraordinary General Meetings (EGM)
The EGM needs to be carried out at the assigned time, date, and location as in line with the observation. The EGM needs to be held for the subsequent purposes:
- Check for the quorum of the assembly.
- Check for the presence of the agency auditor. If the agency auditor isn’t present, take a look at if the go-away of absence is granted or is now no longer below Section 146 of the Act.
- Pass a unique decision to get shareholders’ popularity of Conversion of Private Company into OPC and get acclaim for the altered MOA (Memorandum of Association) and AOA (Articles of association).
Form Filing to ROC
The agency needs to report positive e-bureaucracy with the Registrar of Companies (ROC) for conversion of a personal agency into One Person Company (OPC), that are as follows:
- Form MGT-14: Form MGT-14 needs to be filed with the ROC within 30 days of passing the unique decision for changing a personally constrained agency into OPC.
- Form INC-6: The utility for changing a personal agency into OPC needs to be filed to the RoC in Form INC-6 at the side of the specified files.
Issue of Certificate
The ROC will affirm the submitted e-bureaucracy and connected files filed with the aid of using the personal agency for changing into OPC. When the ROC is happy that the personal constrained agency has complied with the requirements, he/she can be able to difficulty certificates for the conversion of the personal agency into OPC.
The conversion of a personal agency to OPC might now no longer have an effect on the contractual responsibilities and duties of the agency earlier than conversion, and such liabilities, claims, and responsibilities could be enforceable with the aid of using the law. The transformed OPC could be chargeable for the liabilities, claims, and responsibilities of the personally constrained agency.