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One Persons Companies -- a new concept

One Persons Companies (OPCs)

The concept of one-person company is widely in practice in developed countries. In the recently passed (in Lok Sabha) Companies Bill 2012, this concept has been introduced in India also, to encourage unorganized proprietorship business to enter in to organized corporate world.
With introduction of OPC it is possible to form a company with only one member. OPC provides benefit of both form of business- the proprietorship and the company. With OPC business can be run same way as a proprietorship but by keeping liability of the member limited by share or by guarantee.
Many relaxations have been granted to OPC in compliances and proce­dural aspects because no public interest is involved in OPC.
Important provisions relating to OPC in Companies Bill 2012:
Detailed procedure to form OPC has been described in clause 3(1)( c) of Companies Bill 2012. According to this, OPC shall be a private limited com­pany in all respect except that it can be formed by single subscriber to the Memorandum of Association.
Perpetual succession : To comply with basic requirement of perpetual suc­cession, provision has been made to appoint nominee of original subscriber Company has to file with registrar, consent of one other person (nominee) who shall become member of the company in the case of death or inca­pacity of original subscriber of the company. Such nominee can withdraw consent by following the procedure to be prescribed in rules. The sub­scriber can also change the nominee by giving prescribed notice. Upon changing the nominee, member shall give intimation to company and com­pany in turn shall inform to registrar within prescribed time limit.
Minimum share capital shall be Rs.1 Lakh (similar to private limited co.). Types of company which can be formed as OPC are (1) Company limited by shares (2) Company limited by guarantee (3) Unlimited company. The word "One person company" to be written in brackets below name of company No. of directors : Minimum one director is required. Till director is ap­pointed, individual being member, shall be deemed the director Annual return shall be signed by Company Secretary and if there is no CS, it shall be signed by director of the company.
Annual General Meetings: OPC are exempted from holding AGM. Hence provision pertaining to general meetings/voting are not applicable to OPC.
Director's report: It shall include only explanation on qualification, reser­vation, disclaimers or adverse remarks of the auditors if any. No other information need not be given in directors' report of OPC.
Annual accounts: OPC will prepare profit & loss account, balance sheet and explanatory notes to be signed by only one director and submitted to the auditor for his report. Cash Flow Statement is not required.
Time limit: It is 180 days from the closure of financial year to file financial statement with the Registrar.
Provisions related to minimum board meeting and quorum : These shall not apply to OPC having only one director. In case of more than one director, it shall conduct at least one board meeting in each half year and time gap between two meetings should be minimum 90 days.
For business required to be transacted only at General Meeting through special or ordinary resolution, the member shall communicate the resolu­tion to the company, enter it into minutes book, sign and date. Meeting shall be deemed to have been held on the date so entered
For business required to be transacted at board meeting, it shall be sufficient if resolution is entered in to the minutes book, signed and dated. Such date shall be deemed to be the date of meeting of Board. 

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