One Person Company Registration Services in Purnea

Ministry of Corporate Affairs G.S.R Notification No. 250(E) bearing date 31st March 2014, notifying the Companies (Incorporation) Rules, 2014 to the Companies Act, 2013, provides for the  One Person Company Formation.

Rule 3 of Companies (Incorporation) Rules, 2014 stipulates the following:

• Incorporation of a One Person Company as a private limited company.
• OPC allowed to have only one member at any point of time and may have one or more directors.
• An OPC can have a minimum of one director and a maximum of 15. The maximum limit can be increased by a special resolution, like any other company.
• Another individual as nominee director as an adequate safeguard for perpetual succession.
• Only natural persons who are Indian citizens resident in India are eligible to become OPC member and nominee. The term “resident in India” denotes a person who has stayed in India for a period of not less than 182 days during the immediately preceding one calendar year.
• A person is not eligible to incorporate more than one OPC and is not eligible to become the nominee in more than one OPC.
• Paid up capital not to exceed Rs.50 lakhs or average annual turnover not to exceed Rs.2 crores in three immediate preceding consecutive years. In either instance, OPC will lose its status as an OPC.
• An OPC cannot voluntarily convert into any other kind of legal entity unless a period of 2 years has lapsed from the date of incorporation. The exception to this rule is only in cases where capital or turnover limits as specified above are reached.

Now that you know everything about it, let’s move on to how to register an OPC. Prepare all the necessary documents listed below, and then head over to the mca.gov.in website to complete the following steps.

Disadvantages of forming an OPC are-

• Ineligible to carry Non- Financial Business Activities,
• Can’t convert voluntarily in any form of the company before two years of incorporation and prohibited to convert itself at any time into section 8 Company.
• Restrictions of a Private Limited Company apply to OPC also.
• It is more suitable for small entrepreneurs due to limited share capital structure.

• Scanned copy of PAN Card or Passport (Foreign Nationals & NRIs)
• Scanned copy of Voter’s ID/Passport/Driver’s License
• Scanned copy of Latest Bank Statement/Telephone or Mobile Bill/Electricity or Gas Bill
• Scanned passport-sized photograph Specimen signature (blank document with signature)

FOR THE REGISTERED OFFICE

• Scanned copy of Latest Bank Statement/Telephone or Mobile Bill/Electricity or Gas Bill
• Scanned copy of Notarised Rental Agreement in English
• Scanned copy of No-objection Certificate from property owner
• Scanned copy of Sale Deed/Property Deed in English (in case of owned property)

The concept of OPC allows a single person to run a company limited by shares, and Sole proprietorship means an entity where it is run and owned by one individual and where there is no distinction between the owner and the business. The distinction between both the structures is as follows:

• Limited Liability – Fundamentally the basic difference between a sole proprietorship and an OPC is the way and manner in which the liability is treated in an OPC. OPC is different from sole proprietorship because it is a completely separate entity and that is the distinction between the promoter and the company. The liability of the share holder will be limited to the unpaid subscription money in his name. On the other hand the liability in a sole proprietorship, the person/owner is alone liable for the claims which will be made against the business.
• Tax Bracket – Though the concept of an OPC has been incorporated in the Companies Act, 2013 but the concept of same does not exist in tax laws as yet, as a result an OPC can be put in the same bracket of taxation as other private companies. According to Income TA,1961 a private limited company is under the bracket of 30% on total income with an additional surcharge of 5% if the income exceeds 10 million with an addition to 3% of education cess.
• Succession – In an OPC there is a nominee designated by the member. The nominee which will be a Natural Born citizen of India and who resides in India. The nominee shall in the event of death of the member become a member of the company and will be responsible for the running of the company. But in the case of sole proprietorship this can only happen through an execution of WILL which may or may not be challenged in the court of law.
• Compliances – A One Person Company has to file annual returns etc just like a normal company and would also need to get its accounts audited in the same manner. On the other hand a sole proprietorship would only need to get audited under the provisions of Section 44 AB of the Income Tax Act, 1961 once its turnover crosses the certain threshold.

Despite the fact that the concept of OPC is still new in Indian Entrepreneurship and hence extremely progressive, it will set aside time for such a concept to be consolidated with full efficiency, however as the time will pass by, OPC will have a sparkling future and will be considered as one of the best business idea The reason behind it is the ease of incorporation of same with fewer compliances and less paperwork. The foreign investor will be dealing with only a single member to form his corporate relationship and not with a score of other shareholders or directors where the chances of disparity in ideas. Any foreign company or investor who proposes to establish any business in India could do so through merger or joint venture with the member of OPC. The concept of OPC has a bright and promising future in India and is also expected to get good foreign investments, Joint Ventures, and Mergers etc.

• Only a natural person (Not Association of persons, Body of Individuals, Company, or any other entity) who is a resident of India in preceding calendar year (stayed in India for 182 days) can form OPC.
• You cannot incorporate more than one OPC or be the nominee of more than one OPC.
• There is threshold of paid up capital (Rs. 50 lakh) and average annual turnover (Rs. 2 crore in 3 immediate preceding financial year) beyond which the status of OPC is lost.
• Rules of OPC do not permit Non-Banking Financial Institutions.

On meeting above criteria, the first step to incorporate OPC is to get Digital Signature Certificate (DSC) {1}. Application for incorporation of companies is done online under MCA -21. DSC is required to digitally sign all documents submitted online under Information Technology Act, 2000 and it ensures authenticity of documents submitted. DSC is issued by Certifying Authorities, registered with Controller of Certifying Authorities .