How to Convert a Private limited to an OPC
There are many reasons one may convert a Private company to an One person Company (OPC) they may include but are not limited to :
- Number of directors falling below the staturoy minimum in a private company
- Number of shareholders falling below the staturoy minimum in a private company
- Business exigencies
- Business restructuring
Thankfully, the process of conversion is simpler than one may imagine. Before we understand how to go about it, lets also see who are NOT eligible to so convert their entities :
- Companies registered under section 8 of the Companies Act 2013 ( Not for profits)
- Companies with paid up capital in excess of fifty lakh rupees ( 5 million rupees)
- Companies with Average turnover in excess of two crore rupees ( 20 million rupees) The average turnover in this instance is to be considered over the lifespan of the firm
Now that we have that out of the way. The process of conversion involves :
- Obtaining no objection certificates ( NOCs) from Creditors and Members of the company
- Passing a special resolution and filing the same with the Registrar of Companies (ROC) within 30 days of passing, in form MGT14
- Filing of form INC-6 with the ROC with the requisite details and necessary attachments.
Once the INC-6 is approved, the company shall be granted a new certificate of incorporation evidencing its conversion. This however does not have any impact on the business, debtors or creditors of the company.
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