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Converting your One Person Company (OPC) to a Private Limited Company is a wise move if you want to increase the potential of your business. Through this conversion, you can increase the number of shareholders, draw in more funding, and improve the market perception of your business. But it’s crucial to complete the conversion legally and compliantly, following the guidelines set forth in the Companies Act of 2013. A seamless transition is ensured by handling this process correctly, protecting your business’s reputation and positioning it for long-term success.
According to the requirements of the Companies (Incorporation) Rules of 2014 (the “Rules”) and Section 18 of the Companies Act, 2013 (the “Act”), the One Person Company (OPC) may be changed into a Private Limited Company (PLC). The current responsibilities, liabilities, contracts, and debts of OPC will not be impacted by the company’s conversion to a private limited company.
According to the guidelines in section 18 of the Companies Act, 2013, as well as section 122 of the Act, changes to the OPC’s Memorandum of Association (MOA) and Articles of Association (AOA) are required for the conversion of OPC. A private limited company must have two directors and at least two members in order to be incorporated. You must submit the INC-6 form to the Ministry of Corporate Affairs, Government of India, in order to request the conversion of an OPC into a private limited company.
One Person Company (OPC) conversions into other business structures, including private limited companies, fall into one of two categories: voluntary conversions or mandatory conversions.
All directors must receive a Notice of Board Meeting at least seven days in advance, as required by Section 173 of the Companies Act and Secretarial Standard (SS-1). A shorter notice period might be given in the event of an emergency. The agenda, agenda notes, draft resolutions, and any supporting documentation should all be included in the notice.
To speed up the OPC conversion process, important motions will be passed at the board meeting. Important resolutions consist of:
i) Designation of Extra Directors: As the company’s structure changes following the conversion, appoint directors as appropriate.
ii) Plan the EGM (extra-ordinary general meeting): Decide on the day, time, and location of the EGM. iii) EGM Notice and Explanatory Statement Approval: Give your approval to the notice and explanation draft as mandated by Section 102 of the 2013 Companies Act. iv) MOA and AOA Draft Approval: The Memorandum of Association (MOA) and Articles of Association (AOA) drafts should be reviewed and approved.
Prepare the draft minutes and distribute them to the directors for their input within 15 days of the board meeting ending. Hand delivery, speed post, registered post, courier, or email can all be used for this. Prepare and sign the board meeting minutes in accordance with business policies.
According to Section 122(3) of the Companies Act, 2013, a resolution must be passed in order to amend the Memorandum of Association (MOA) and Articles of Association (AOA) of a One Person Company (OPC) in line with Rule 6(1) of the Companies (Incorporation) Rules, 2014.
A One Person Company (OPC) must designate directors who fulfil the minimal statutory requirements in order to be converted into a private limited company. Usually, this calls for the nomination of a minimum of two directors, but depending on the circumstances and structure of the business after the conversion, three may be required in some cases.
The procedures listed below must be followed in order to call a general meeting and formally convert an OPC into a private limited company
All shareholders should receive a Notice of the General Meeting that includes the meeting’s date, time, and place. Each shareholder’s registered address shall get this notification, and the notice period must follow the guidelines set forth by the Companies Act.
Add the meeting’s agenda, specifically mentioning the OPC’s conversion to a private limited company as a topic of discussion, to the notice. Attach an Explanatory Statement explaining the rationale for the proposed conversion, its ramifications, and its advantages in accordance with Section 102 of the Companies Act of 2013.
The resolution for the OPC’s conversion will be considered in the General Meeting. After deliberating on the proposal, shareholders will cast their votes. The Companies Act of 2013 requires that the resolution be passed by the necessary majority.
After the meeting, draft the General Meeting Minutes to document the decisions, discussions, and vote results. These minutes should be kept up to date and signed in order to satisfy any legal documentation obligations.
In order to finish the legal procedure following the General Meeting that authorizes the conversion of an OPC to a Private Limited Company, certain forms and papers must be submitted to the Registrar of Companies (ROC) within the allotted time frames.
A copy of the Special Resolution adopted at the General Meeting must be sent to the ROC using Form MGT-14. A crucial step in recording shareholder consent for the conversion is this form.
According to Rule 6(3) of the Companies (Incorporation) Rules, 2014 and Section 18 of the Companies Act, 2013, Form INC 6 is necessary for OPCs. Timeline for Submission: The conversion from a One Person Company (OPC) to a Private Limited Company can now be filed at any time under the most recent legislation. As required by the Companies (Registration Offices and Fees) Rules, 2014, make sure you submit Form INC 6 along with the required paperwork.
In accordance with the Companies (Registration Offices and Fees) Rules, 2014, the following paperwork must be presented with Form INC 6:
The Registrar of Companies (ROC) will check the information in the application and all supporting documentation to make sure it is accurate and compliant after the application has been submitted and the necessary costs have been paid. If everything is in order following a comprehensive review, the ROC will issue a Certificate of Conversion. A new Certificate of Incorporation (Form INC-25) will be provided upon the ROC’s approval of Forms MGT-14 and INC-6 (filed for a company’s name change or conversion), in accordance with Section 13(3) of the Companies Act, 2013 and Rule 29(2) of the Companies (Incorporation) Rules, 2014. This certificate reflects the company’s new name and validates its new status as a Private Limited Company. This certificate’s issue formally validates the business’s creation under its new name and structure, so establishing its legal standing as a private limited company.
To make sure that all documents and operations reflect the new structure, a One Person Company (OPC) that has successfully converted to a Private Limited Company must follow a number of post-conversion compliances.
The following procedures can be used to convert an OPC to a Private Limited Company:
i) A board resolution authorizing the OPC’s conversion to a private limited company must be passed.
ii) Verify Eligibility: The OPC needs to have more than one member and have paid-up capital that satisfies the minimum requirements for a private business in order to be eligible for conversion.
iii) File with the MCA: Using the INC-6 and the required supporting documentation, the conversion application is sent to the MCA.
iv) Approval: Following application submission, the MCA will check the paperwork. If all is in order, the conversion will be accepted, and the Private Limited Company will receive a new certificate of incorporation.
According to the Companies Act, there is no minimum amount of paid-up capital needed to convert an OPC to a Private Limited Company. Nonetheless, the capital must to be in line with the needs of the new corporate form and the nature of the company itself
Processing of the application typically takes 15 to 30 working days after it is submitted to the MCA, depending on the verification process and the accuracy of the supporting documentation.
Usually needed documents for converting an OPC to a private limited company: i) Approval of the conversion by a board resolution.
ii) The director or directors’ and shareholders’ proof of identity and address.
iii) The most recent OPC financial statements . iv) Verification of Registered Office.
v) The solo member or director’s consent to the conversion.
It is possible for the current OPC directors to serve as directors of the recently converted Private Limited Company. However, depending on the circumstances, you could need to designate an additional director because the company will require at least two.
Yes, as long as the company name and structure stay the same, the OPC’s PAN (Permanent Account Number) and TAN (Tax Deduction and Collection Account Number) will not change upon the conversion to a Private Limited Company.
If the current name of the business does not meet the requirements for a Private Limited Company, it may be changed. Unless the nature of the firm or other regulatory requirements necessitates a change, the company’s name will often stay the same.
It is true that the Ministry of Corporate Affairs charges fees for form submission. The fees are determined by the form you file (such as INC-6) and the company’s authorized capital. These fees are listed on the fee schedule section of the MCA website.
i)Increased funds: With more stockholders, it is simpler to raise funds.
ii) Greater Control: Possession of several directors and shareholders.
iii) Responsibility Protection: All stockholders have limited responsibility.
iv)Corporate Expansion: Promotes cooperation, possibilities, and corporate growth.
It is possible to transform an OPC into a Public Limited Company if it satisfies the legal requirements for a Public Limited Company and has more than seven members.
Converting your Public Limited Company into a Private Limited Company provides greater control, flexibility, and ease of operations.
Whether you’re restructuring, limiting external involvement, or focusing on internal growth, this conversion helps you:
✅ Simplify compliance and reduce regulatory burdens
✅ Gain more control over decision-making and ownership
✅ Protect confidentiality and streamline operations
✅ Avoid extensive SEBI/public listing obligations
✅ Focus on long-term strategic planning without market pressure
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