One person company means a company is kind of private and has only one person as a member. An OPC shall have a minimum of one Director and only one member will be registered as a private company.
Rule 3:- Pursuant to the provision of the companies Rule 3 of chapter 2nd the Companies (Incorporation) Rules, 2014, only a natural person who is an Indian Citizen and resident in India:-
- Shall be eligible to incorporate One Person Company.
- Shall be a nominee for the sole member of the One Person Company.
The memorandum of OPC shall indicate the name of another person with his consent in writing within the prescribed form INC-3 who shall in the event of the subscriber’s death or his incapacity the contract become a member of the company.
Some key points regarding OPC:-
- A natural person will not be a member of more than a Person Company at any point in time and the said person shall not be a nominee of more than a One Person Company.
- No minor shall become a member or nominee of the One Person Company or can hold a share with beneficial interest.
- Such a company cannot be incorporated or converted into section 8 of the Companies Act, 2013.
- No such company can convert voluntarily into any kind of company unless two years have expired from the date of incorporation of one person company, except the threshold limit (paid-up share capital is increased beyond 50 lakhs and its average turnover during the relevant period exceeds two crores rupees. Here “Relevant Period” means the period immediately preceding 3 consecutive financial years.