MCA has brought new rules for conversion of One Person Company (OPC) into a Public company or a Private company at any point of time after its incorporation / registration .
Earlier One Person Company (OPC) was allowed to convert into a Public company or a Private company only after the expiry of two years from the date of incorporation or when the paid-up share capital exceeds rupees 50 lakhs or if its average turnovers exceed INR 2 crores. These restrictions are removed by the Companies (Incorporation) Second Amendment Rules, 2021 notified on 01/02/2021. Now, ie with effect from 01/04/2020, One Person Company (OPC) can be converted into a Public company or a Private company ( except section 8 company) at any point of time after its incorporation / registration .
The procedure to convert One Person Company (OPC) into a Public company or a Private company as per the new rule is as follows:
- Ensure that there is a minimum of two members for private company / seven members for Public Company
- Ensure that there is a minimum of two directors for private company / three directors for Public Company
- Pass special resolution to give effect to the conversion and to alter its memorandum and articles &
- File an application with Registrar of Companies ( in e-Form No.INC-6) for its conversion into Private or Public Company along with
(a) Altered MOA and AOA;
(b) copy of resolution;
(c) the list of proposed members and its directors along with consent;
(d) list of creditors; and
(e) the latest audited balance sheet and profit and loss account.
Registrar of Companies ( RoC), on being satisfied that the requirements have been complied with, will issue new certificate of incorporation.