The concept of One Person Company (OPC) in India was introduced through the Companies
Act, 2013 to support entrepreneurs who on their own are capable of starting a venture
by allowing them to create a single person economic entity. One of the biggest advantages
of a OPC is that there can be only one member in a OPC, while a minimum of two members
are required for incorporating and maintaining a Private Limited Company or a Limited
Liability Partnership. Similar to a Company, a OPC is a separate legal entity from
its members, offers limited liability protection to its shareholders, has continuity
of business and is easy to incorporate.
Though a One Person Entity allows a lone Entrepreneur to run a business with Limited
Liability protection, a OPC does have a few limitations. For instance, every OPC
must nominate a nominee Director in the MOA or AOA who will become the owner of
the OPC in case the promoter Director is disabled. Also, a OPC must be converted
into a Private Limited Company if it crosses an annual turnover of Rs.2 crores and
must file audited financial statements with the Ministry of Corporate Affairs at
the end of each Financial Year. Therefore, it is important for the Entrepreneur
to carefully consider the features of a OPC prior to incorporation. AMRITAZ can
help incorporate a One Person Company (OPC) in India.