One Person Company and its basic procedure:
“One Person Company (OPC) is one of the business type companies. It comes with the special feature that the single individual can run a business. This one person company legally operated from Companies Act, 2013″.
One Person Company (OPC) is one of the business type companies. It comes with the special feature that the single individual can run a business. This one person company legally operated from Companies Act, 2013. It increases the economic level and motivates the individual to start a business. One Person Company easiest way of business while in the time of incorporation. As per the legality one Person Company operates with the minimum level of restriction. This is one of the featured qualities prevail in the One Person Company. Then who are eligible for applying the One Person Company? The Indian citizen and the individual who has stayed nearly six months are the only eligible category applies for the OPC registration.
Incorporation process for One Person Company:
However, the Individual ready to starts his business under OPC the business investment restricted from one lac to two Crores. The business calculation which is never exceeds the above mention limitations then OPC will be the best option. In the time of business incorporation many of them confused with OPC (One Person Company) and sole proprietorship. These two are seems to be little bit similar but they varied in certain degrees. The nature of liability is one of the major concerns. One person Company included with the special nature separate legal entity.
This feature is not common in the sole proprietorship. In One Person Company the promoter of the company not required to pay the debts in OPC. One Person Company offered with many benefits which not enjoyed by the other mode of companies like Private Limited Company or Public Limited Company. At the time of Company formation, Memorandum of Association required the basic details such as the name of the owner for OPC and other basic requirements. The nominee is one of the notable categories in one person Company.
The process of appoint a business nominee:
In case of any reasons like disability or the natural demise the individual owner of OPC must nominate a person. Such person not interfere the business until such business calamities. If the nominee becomes the natural person he must appoint his nominee as the previous continuation. In the nominee procedure, the minor citizens are not allowed to nominate. More than the entire requirement he must be the Citizen of India.
In the filing of nominee for One Person company the Individual who would be the nominee must approve his permission through written consent. Then only he will be the member of the One Person Company. In case any changes required for appoint a nominee for the OPC, the nominee must provide a notice with mentioning the issue on ROC. Most of the lawyers and experienced people in the business often advised to nominate the blood relatives rather than a third person to avoid forth coming issues. It may be seems to be legal requirement. But when the natural calamity acquired the nominee immediately entitled with the OPC and its assets.
OPC- a single owner entity:
- As a single owner company, OPC does not require the formal business meetings which followed in the private Limited Companies and Public Limited Companies.
- The owner’s personal financial status and asset credentials do not affect the growth of the One Person Company.
- It is a beneficial method for the individual who ready to start the Small scale business in India.
- The capital business investment may start from 1 lac to the maximum amount of 50 lakhs.
- To avoid the business managing issue one person Company allowed appointing more than one director.
- It can be easily converted into Private Limited Companies.
- The provisions which are mandatory followed in the Private Limited Company same to the OPC. Subsequently, the conversion is easy one.
- It comes with the least availability of issues and problems compare with other public limited Companies and private sector Companies.
The fruitfulness of One Person Company:
It is one of the easy funding business entities which is aptly suitable for the individual who dream on the medium level of business. More than that the business controls are lay on an Individual’s hand who governs this company. The free control of business is the desired quality of the One Person Company. Easy funding is the other feature comes in this One Person Company. The Income Tax laws more beneficial and favoured to the One Person Company. This beneficiary never expect from other mode of business entities. The fund collecting and borrowing for the development of One Person Company is not a complex one.
The banks and other investors who are offer the loan and money sanctioning with the priority of OPC. Because it is never require huge volume of amount. At the same time, Private Limited Company and Public sectors not easily can the loan amount. It is considered as a heavy task and time consumption work. The paper works in the time of registration comes with easy manner. The minimal level of proofs and documents is only required in the registration process. In recent research the swift economic growth of the nation relies on the one person industries rather than the Multi-national companies.
The legal requirements for One Person Company:
The business entity which indulged in the One Person Company comes with the commercial purpose, Industrial Purpose or any other thing. The functionality of the business must be resides in India. Address proof and pan card details need for the direct and indirect members of the One Person Company. From the owner of the entity to directors and least importance of nominee all are must have such proofs. No objection certificate on the provided details like address proof and identity must be gain importance.
To complete and start the business with the fast way the name of the concern must be unique and different. This same uniqueness must follow in the trademark registration. Company name and logo registration and other official activities need for the company grow up must be different one. Then only the new company free from the objection and opposition compliance. It is not a great drawback but they delay your business progress. In the time of incorporation process, the legal documents much needed. They included only with the small number of paper works DIR-3, INC-1, INC-2 and INC-3 are the papers required. Individual of the OPC never expect business consulting with other members. He is the sole decision maker of his company.
Paper proof required for the OPC:
In the initial stage, all business entity follows the same procedures. DSC approval is the essential for all business corporate. DSC stands for Digital signature. The digital signature prevents the fraudulence and ambiguity situation occur in the business. By having this certification he can sign any business document through the electronic ways. It needs not your physical presence at every time of new contracts and assignments. Don’t have too many doubts on this. It is the official procedure legally accepted by the Ministry of Corporate Affairs.
Name registration is another process, it also one of the crucial thing. It stands as the sole identity of your business entity. The Name registration must be unique and apt to the mode of your business. If it appropriate or already chose by the opponent in the same market may leads to legal issues and problems. So, complete this process with proper care. How the name stands with uniqueness then the name process also fastly finish able.
MOA, ROA and ROC role in the business entity:
Memorandum of Association and Article of Association are common papers not only for OPC but also other business methods. These two are considered as the legal evidence. What mode of business registered officially? Where OPC located physically? All are keenly mentioned on those papers. It officially announces all the members who all are involved in the business. Their typical role, legal rights and restrictions all are mentioned on this. If any equality right need to the partner or director it is taken into the serious way. Simply, it is a horoscope of a business.
ROC stands for registrar of Companies. It directly handled by the Ministry of Corporate affairs. It is the legal body approves a company is a legal one or not. Company administration and Limited liabilities are the major factor comes into the hands of Registrar of Companies. Every company in India approved only by this registrar of Company. This government has the legal right to check and seize the company and other account details with the order and support of Indian law.
Now a days the entire young aspirant ready to start their own business venture and want to shine in the business market. Before entering into the business world, they must clear with the basic procedure and ideas which may require avoiding the illegal activities on your business entity. Solubilis one of the leading service providers and consultancy on all the business procedures. From Incorporation to until filing your GST they will complete all the process without any delay. Thanks for their guidelines on One Person Company.