One Person Company is newly introduced concept in "The Companies Act 2013", it is entity to the existing list i.e. apart from forming a public or private limited company, it has now enabled the formation of a new entity “One-Person Company” hereinafter called "OPC".
Q1. What is One Person Company?
An OPC means a company with only one person as its member [section 3(1) of 2013 Act]. The draft rules state that only a natural person who is an Indian citizen and resident in India can incorporate an OPC or be a nominee for the sole member of an OPC.
The financial statement, with respect to One Person Company, may not include the cash flow.
Q2. Who is a Nominee?
The memorandum of One Person Company shall indicate the name of the other person, with his prior written consent in the prescribed form, who shall, in the event of the subscriber’s death or his incapacity to contract become the member of the company and the written consent of such person shall also be filed with the Registrar at the time of incorporation of the One Person Company along with its memorandum and articles.
Q3. Where you have to mention “OPC”?
The words ‘‘One Person Company’’ shall be mentioned in brackets below the name of such company, wherever its name is printed, affixed or engraved.
Q4. Who has to sign the Annual Return?
In relation to One Person Company and small company, the annual return shall be signed by the company secretary, or where there is no company secretary, by the director of the company.
Q5. Is holding AGM (Annual General Meeting) mandatory? And what is the duration of Boards Meeting?
Holding annual general meeting shall not be mandatory for One Person Company.
One Person Company shall hold at least one meeting of the Board of Directors in each half of a calendar year and the gap between the two meetings is not less than 90 days.
Q6. Which provision doesn't apply to OPC?
The provisions of section 98 and sections 100 to 111 (both inclusive) shall not apply to a One Person Company.
Q7. One Person Company Limited by shares
Where One Person Company limited by shares or by guarantee enters into a contract with the sole member of the company who is also the director of the company, the company shall, unless the contract is in writing, ensure that the terms of the contract or offer are contained in a memorandum or are recorded in the minutes of the first meeting of the Board of Directors of the company held next after entering into contract.
Q8. Rules regarding 1 Director
In case of a One Person Company—
Where the company is having only one director, all the businesses to be transacted at the meeting of the Board shall be entered into minutes book maintained under section 118 such minutes book shall be signed and dated by the director;
The resolution shall become effective from the date of signing such minutes by the director
Q9. Rules regarding Passing of Resolution
In case of a One Person Company—
The resolution required to be passed at the general meetings of the company shall be deemed to have been passed if the resolution is agreed upon by the sole member and communicated to the company and entered in the minutes book maintained under section 118;
Such minutes book shall be signed and dated by the member;
The resolution shall become effective from the date of signing such minutes by the sole person.
Q10.Death of the Sole Member
In case of a One Person Company—
On the death of the sole member, the person nominated by such member shall be the person recognised by the company as having title to all the shares of the member;
The nominee on becoming entitled to such shares in case of the member’s death shall be informed of such event by the Board of the company;
Such nominee shall be entitled to the same dividends and other rights and liabilities to which such sole member of the company was entitled or liable;
On becoming member, such nominee shall nominate any other person with the prior written consent of such person who, shall in the event of the death of the member, become the member of the company.
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