CONVERSION OF PRIVATE COMPANY INTO ONE PERSON COMPANY

To avail the advantages of One Person Company, many of the Corporates are willing to convert their small Private companies into One Person Company (OPC). The conversion will reduce the compliance manifold, this is one of the key reasons of such a conversion. 

Which Private Company can convert into OPC:

Any private company other than a Company registered under section 8 of the Companies Act, 2013 (or section 25 of the Companies Act, 1956) having a paid-up capital of less than Rs. 50 Lac and an average turnover of less than Rs. 2 Crore, in the specified period, can convert itself into OPC.

Laws governing conversion of Private Company Into OPC:

• Section 18 of Companies Act, 2013
• Rule 7(4) of the Companies (Incorporation) Rules, 2014

Procedure :

1. Board Meeting: 

• Approve the conversion subject to approval of members;
• Authorise Directors for providing Affidavit that the conforming that all members and creditors of the company have given their consent for conversion, the paid up capital company is rupees 50 lakhs or less or turnover is less than rupees 2 crores as the case may be;
• Authorise Directors for taking NOC from all the members & Creditors of the Company on the Conversion.
• Calling of General Meeting

     2. General Meeting:

• Pass Special Resolution for conversion of company into OPC

    3. E-filing & Attachments:

        

• MGT - 14: Withing 30 days of passing of the Special Resolution
• INC-6: With NOC received from members & Creditors, Affidavit by Directors, Special Resolution, List of Members & Creditors, Latest Audited Balance Sheet & Profit & Loss Account.INC-6 shall be filed after MGT-14 has been filed and approved. 
• INC-3: The Consent of Nominee in INC - 3 alongwith his/her PAN card and residential proof shall also be attached with INC-6.

~By Nikita Singh~