Conversion of Private Limited company to OPC

Converting a Private Limited Company to a One Person Company (OPC) is a strategic move to simplify compliance and operations. The process is governed by Section 18 of the Companies Act, 2013, and Rule 7 of the Companies (Incorporation) Rules, 2014.

Eligibility Criteria

• The sole member must be a natural person and an Indian citizen (resident in India for at least 120 days in the preceding financial year).

• The individual cannot be a member or nominee of any other OPC.

• Minors are not eligible to be members or nominees.

• The company must not be registered under Section 8 (non-profit) or involved in specific restricted financial activities.

Step-by-Step Conversion Process

1. Board Meeting: Convene a Board Meeting to obtain in-principle approval for the conversion. The Board should fix the date, time, and venue for an Extraordinary General Meeting (EGM) and approve the notice and explanatory statement.

2. Obtain NOCs: Before the EGM, secure written No Objection Certificates (NOCs) from all existing creditors and members of the company.

3. Hold EGM: Conduct the EGM, ensuring a proper quorum and the presence of the auditor (or granting them leave of absence). Pass a Special Resolution to approve the conversion and the alteration of the company’s Memorandum of Association (MOA) and Articles of Association (AOA).

4. File Form MGT-14: File this form with the Registrar of Companies (ROC) within 30 days of passing the special resolution. Attach the notice of the EGM, a certified copy of the resolution, and the altered MOA/AOA.

5. File Form INC-6: Once MGT-14 is processed, file Form INC-6 with the ROC within 30 days. This is the primary application for conversion.

6. Certification: Upon verification of the forms and documents, the ROC will issue a new Certificate of Incorporation reflecting the transition to an OPC.

Key Documentation Required

• Notice and minutes of the Board Meeting and EGM.

• Certified copy of the Special Resolution.

• Altered MOA and AOA.

• No Objection Certificates (NOCs) from all creditors and shareholders.

• Latest audited financial statements (Balance Sheet and Profit & Loss Account).

• List of creditors and members.

• Affidavit from directors confirming compliance.

• Nominee consent form (Form INC-3).

Post-Conversion Requirements

Once the new Certificate of Incorporation is received:

• Update PAN & TAN: Apply for a new PAN card reflecting the OPC status.

• Banking: Inform your bank to update the company’s records and status.

• Authorities: Notify relevant regulatory departments, including GST, regarding the change in company status.

• Stationery: Update your company letterheads, invoices, and official documents to include the new name (which must include "OPC" or "One Person Company").

Summary: The conversion from a Private Limited Company to an OPC requires passing a special resolution at an EGM after obtaining NOCs from creditors and members, followed by filing Forms MGT-14 and INC-6 with the ROC. Post-conversion, you must update your PAN, bank details, and official stationery to reflect the new status.