One Person Company


  • Purview
  • Special Features
  • Exemptions
  • Procedure to incorporate OPC
  • Conversion
  • Benefits
  • Limitations
  • An international Perspective
  • Conclusion


One person company is a revolutionary concept brought by the Companies Act 2013 enabling entrepreneurs do business as proprietorship but without any personal liability. OPC as defined by the act is “one person company means a company which has only one member”. OPC are incorporated as private limited company, where a single person enjoys opportunities  to start business with a structure of organized business, recognizing it as a separate legal entity. The expert committee of Dr JJ Irani first recommended the concept of OPC.


Special Features

  • There will be only one share holder and the only shareholder must be an Indian citizen and resident of India.
  • The shareholder shall nominate another person who shall become shareholder in case of death/incapacity of the original shareholder.
  • Minimum paid up share capital of One lakh or such higher paid up as may be prescribed.
  • Incorporated as private  limited company and all the provisions related to the private company are applicable to an OPC unless otherwise excluded.
  • There must be minimum one and maximum 15 director. The sole shareholder may also be the sole director.
  • The provision of holding the AGM is not applicable to OPC .
  • OPC is required to hold minimum 2 board meeting ,one each half of calendar year and gap between two meeting must not be more than 90 days.
  • The transfer of shares and invitations to public to subscribe for the securities of the company is prohibited.

Exemptions : [Sec 98 & Sec 100 to Sec 111] :

  • Sec 98 – Power of Tribunal to call meetings of members
  • Sec 100 – Calling of Extraordinary general meeting
  • Sec 101 – Notice of meeting
  • Sec 102 – Statement to be annexed to notice
  • Sec 103 – Quorum for meetings
  • Sec 104 – Chairman of meetings
  • Sec 105 – Proxies
  • Sec 106 – Restriction on Voting rights
  • Sec 107 – Voting by show of hands
  • Sec 108 – Voting through electronic means
  • Sec 109 – Demand for poll
  • Sec 110 – Postal Ballot
  • Sec 111 – Circulation of member’s resolution

Procedure to incorporate as an OPC

  1. Obtain Digital Signature Certificate [DSC] for the proposed Director.
  2. Obtain Director Identification Number [DIN] for the proposed director.
  3. Select suitable Company Name, and make an application to the Ministry of Corporate Office for availability of name.
  4. Draft Memorandum of Association and Articles of Association .
  5. Sign and file various documents including MOA & AOA with the Registrar of Companies electronically.
  6. Payment of Requisite fee to Ministry of Corporate Affairs and also Stamp Duty.
  7. Scrutiny of documents at Registrar of Companies .
  8. Receipt of Certificate of Registration/Incorporation from ROC


An OPC cannot covert voluntarily  into any kind of company unless two years have expired from the date of incorporation of OPC ,except threshold limit is increased beyond 50 lakhs or its average annual turnover during the relevant period exceeds 2 crores.


  • The liability of the members and the nominee in a OPC is limited  to the unpaid subscription money.
  • The company continues to function due to perpetual succession enabled by nominee.
  • It will be covered under the tax bracket of a company.
  • It has been exempted from various procedural formalities not otherwise available to private companies such as conducting AGM,EGM etc.
  • OPC enables small entrepreneur to set up a company by allowing the share holders to directly access and target market and avail credit facilities, bank loan eliminating the middle man.


  • OPC, though introduced with an objective to encourage corporatization, has also lead to practical hassle. Looking for a person as nominee has spoiled the benefit of OPC which was not finding a person for venture. The freedom extended to withdraw their consent has added to it,
  • NRI are not allowed to incorporate  OPC,
  • Though several exemptions has been provided ,yet the procedural complexities ,lots of paper work has made it less attractive.
  • The concept of OPC is not recognized under Income Tax Act.

An international perspective

One person company  has been well established  in countries like USA, China, Singapore, France and many other European countries. The Indian version of OPC is thought to be revolutionary in accelerating the economic development promoting entrepreneurship.  The concept of OPC holds a bright future in developing country like NEPAL. There are many small entrepreneurs who are forced to share their profits with middleman and unlimited liability is also an obstacle. OPC would provide tremendous opportunities for millions of native people with small capital as in areas like handloom , handicraft, and pottery . OPC provides platform to start business with a formal structure, as a separate legal entity and many more opportunities. So, other countries should also consider to adopt this concept.


The unorganized sector of proprietorship gets organized and the hybrid of proprietor ship and company i.e OPC gives a big push to entrepreneurship and corporatization leading to a sound economy. OPC is next big thing in India and it will be favourable  for the economic conditions in India through its small to medium sized business. It gives greater flexibility to an individual or a professional to manage his business and enjoy benefits of a company. India looks forward for the success of OPC.


Happy Reading !!

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kriti ( CA Final )

I am a Chartered accountant student who is always eager to learn and travel new places . Being a CA student study is part of life and I enjoy every aspect of our profession .

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