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One person Company (OPC) registration is that the given person has a business idea that needs to be represented in a corporate format and the idea solely can carried out by the same person with limited resources they have. OPC company can have more than one director, but the shareholder cannot be more than one, and also no person shall be allowed to incorporate more than 1 one-person company.
One Person Company is a revolutionary concept in Companies Act, 2013. A recognised new way of starting the business thereby providing the protection of limited liability. Section 2(62) of Companies Act, 2013 provides that One Person Company is a company that has only one natural person as its member. Therefore, OPC is a company where one shareholder is a member.
Where there is only one founder or promoter for business then OPC is created. OPC are more preferred over sole proprietorship concerns due to many benefits it enjoys because of its legal structure. It is very popular among start up entrepreneurs with new business ideas.
| OPC | SOLE PROPRIETORSHIP |
|---|---|
| Separate Legal Entity | Not a Separate Legal Entity |
| Limited Liability | Unlimited Liability |
| Perpetual Succession | No Perpetual Succession |
| Loan not the sole responsibility of the owner | Loan is sole responsibility of the owner |
| Registration required | Registration not required |
| Finance- credit record of OPC | Finance- credit record of the owner |
Separate Legal Entity
One Person company is a separate legal entity having distinct entity from its members, therefore it is separate at law from its shareholders, directors, promoters etc thereby enjoying a title of Separate Legal person in the eyes of law.
Own Assets in its name
One Person company, being a legal person, is very much capable of owning, enjoying and disposing of property in its own name. The property of the company is to be used for the company business and not for the personal benefit of its members.
Limited Liability
In case of OPC, liability of the members is limited upto the value of shares held by such person in the company.
Popular to raise funds
It is easier to raise funds in case of company and attract investments. Funds through loans can also be easily arranged without any complications. But foreign funding is not permitted.
Confidentiality
It is very much possible to maintain secrecy since One Person Company annual accounts are not published.
Self attested copies of PAN Card of the proposed director and nominee
Self attested copies of Adhaar Card of the proposed director and nominee. Duration of stay at this address (Months and years)
Self attested Passport/ Voter Identify Card / Driving License of the proposed director and nominee
Self attested Bank statement/ Electricity Bill/ Telephone Bill/ Mobile Bill of the proposed director and nominee
Passport size photographs of the director.
Mobile No. and E-Mail id of the director and nominee.
2-3 Proposed Names and objects to be conducted by the Company
Copy of Utility Bill Eg- Landline Bill or Electricity Bill where the registered office of the company is to be situated (Shall not ne older than 2 Months)
In case of rented premises- Rent Agreement + Electricity Bill + NOC
Educational qualification and Occupation of proposed director and nominee.
Place of birth of proposed director and nominee.
Proposed capital contribution.
Obtain Digital Signature Certificate (DSC) for the proposed Director
Obtain Director Identification Number [DIN] for the proposed Director.
Select suitable Company Name and make an application to the Ministry of Corporate Affairs for availability of name.
Draft Memorandum of Association and articles of Association [MOA & AOA]
Sign and file various documents including MOA & AOA with the Registrar of Companies electronically.
Payment of Requisite fee to Ministry of Corporate Affairs and also Stamp Duty.
Scrutiny of documents at Registrar of Companies (ROC).
Receipt of Certificate of Registration /Incorporation from ROC.
Only a natural person who is an Indian citizen and resident in India shall be eligible to act as a member and nominee of an OPC.
For the above purpose, the term "resident in India" means a person who has stayed in India for a period of not less than one hundred and eighty two days during the immediately preceding one financial year.
A person can be member in only one OPC.
Form INC-4 shall be filed in case of withdrawal of consent by the nominee or in case of intimation of change in nominee by the member.
The company shall file form INC-4 in case of cessation of member of OPC on account of death, incapacity to contract or change in ownership. In the same form, user needs to provide details of the new member of the OPC.