ON THE BASIS OF MEMBERS (CLASSES OF COMPANIES UNDER THE ACT)

 On the basis of members:

(a) One person company: The Companies Act, 2013 introduced a new class of companies which can be incorporated by a single person.

Section 2(62) of the Companies Act, 2013 defines one person company (OPC) as a company which has only one person as a member.

One person company has been introduced to encourage entrepreneurship and corporatization of business. OPC diuers from sole proprietary concern in an aspect that OPC is a separate legal entity with a limited liability of the member whereas in the case of sole proprietary, the liability of owner is not restricted and it extends to the owner’s entire assets constituting of oflcial and personal.

The procedural requirements of an OPC are simplified through exemptions provided under the Act in comparison to the other forms of companies.

According to section 3(1)(c) of the Companies Act, 2013, OPC is a private limited company with the minimum paid up share capital as may be prescribed and has at least one member.

OPC (One Person Company) - significant points

•  Only one person as member. 
•  Minimum paid up capital – no limit prescribed. 
• The memorandum of OPC shall indicate the name of the other person, who shall, in the event of the subscriber’s death or his incapacity to contract, become the member of the company. 
•  The other person whose name is given in the memorandum shall give his prior written consent in prescribed form and the same shall be filed with Registrar of companies at the time of incorporation. 
•  Such other person may be given the right to withdraw his consent. 
• The member of OPC may at any time change the name of such other person by giving notice to the company and the company shall intimate the same to the Registrar. 
•  Any such change in the name of the person shall not be deemed to be an alteration of the memorandum. 
•  Only a natural person who is an Indian citizen and resident in India (person who has stayed in India for a period of not less than 182 days during the immediately preceding one calendar year)- 

                      -  shall be eligible to incorporate a OPC;

                      -  shall be a nominee for the sole member of a OPC.

•  No person shall be eligible to incorporate more than one OPC or become nominee in more than one such company. 
•  No minor shall become member or nominee of the OPC or can hold share with beneficial interest. 
•  Such Company cannot be incorporated or converted into a company under section 8 of the Act. Though it may be converted to private or public companies in certain cases. 
•  Such Company cannot carry out Non-Banking Financial Investment activities including investment in securities of anybody corporate. 
•  OPC cannot convert voluntarily into any kind of company unless two years have expired from the date of incorporation, except where the paid up share capital is increased beyond fifty lakh rupees or its average annual turnover during the relevant period exceeds two crore rupees. 
•  If One Person Company or any oflcer of such company contravenes the provisions, they shall be punishable with fine which may extend to ten thousand rupees and with a further fine which may extend to one thousand rupees for every day after the first during which such contravention continues.