Tuesday, May 12, 2015

ONE PERSON COMPANY

               
          Companies Act 2013 has introduced a new concept which is “one person company”. In India, in the year 2005 the JJ Irani expert committee recommended one person company.
                 
One person company is a one shareholder corporate entity, where legal and financial liability is limited to the company. A one person company is a kind of private company having only one member. It should have minimum one director. So, a one person company should be registered as a private company with one member and one director.

Types of one Person Company:
                One person company can be categorized into=>
1.       One Person Company limited by share.
2.       One Person Company limited by guarantee.
3.       Unlimited one Person Company.

Rule 3 of companies (incorporation) Rules 2014=> One Person Company:


    1.          Only a natural person who is an Indian citizen and resident in India is eligible to form one person company.
2.       A person can form only one “One Person Company”.
3.       Minor shall not be eligible to form one person company and nominee of the member.
4.       Company can’t be incorporated or converted into company u/s 8 of the act.
5.       Such company can’t carry out non-banking financial investment activities including investment in security or other body corporate.

6.       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 threshold limit its average annual turnover during the relevant period exceeds 2  crore rupees.
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      contact by one person company:
                                                           OPC which is either limited by share of limited by guarantee may entered into a contract with the sole member of the company who is also a director of the company, the company shall unless the contract is in writing ensure that the terms of the contract are recorded in memorandum or recorded in minute of the first board meeting held next after entering into contract and the company shall inform the registrar about every such contract within 15 days from the date of approval by the board of director.

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