FAQs on One Person Company


The government of India introduced the concept of OPC in the Companies Act, 2013 in order to promote entrepreneurs and ease of doing business. One person company is a kind of business structure which is basically a combination of both two businesses that are sole proprietorship and private limited company. There are various points which a person must know before incorporating an OPC for successful incorporation.

This blog will answer all the basic and most important questions related to OPC Incorporation in India.


What is OPC?

OPC is defined under Section 62 of the Companies Act, 2013. It is a One Person Company and it has only one person as shareholder or member and it can have minimum 1 director and maximum 15 directors.


Who is eligible to incorporate an OPC in India?

According to Rule 3 of the Companies (Incorporation) Rules, 2014, only a natural person can incorporate an OPC in India and that too when he/she is a –

  • Major
  • Sound Mind Person
  • Indian Citizen
  • Person Resident in India
  • Not a member of any other OPC


Who shall be a Person Resident in India?

This question is answered under Explanation 1 of Rule 3 of Companies (Incorporation) Rules, 2014. This Explanation states that any person who has stayed atleast for the period/span of 182 days in India in an immediately preceding financial year shall be referred as Person Resident in India for the purposes of OPC Incorporation.


Whether an OPC is required to appoint Nominee and why?

Yes, the member of the OPC has to mandatorily appoint a nominee, so that he/she can become the member of the company in case of death of member, his insanity or his incapacity to enter into a contract due to which the member ceases to be a member of the company.


Who is eligible to become a Nominee of OPC?

Any natural person who is Indian Citizen and Resident of India can be appointed as a nominee of OPC.

Nominee is required to give his prior consent in Form INC-3 at the time of incorporation of company stating that he is eligible and willing to become a nominee for a company.

Moreover, a nominee can withdraw his consent of being a nominee at any time after the incorporation for any reason by giving notice of withdrawal to the member of the OPC and to the OPC as well.


How many Directors can be appointed in OPC?

According to the Companies Act, 2013, there must be atleast one director in the OPC and it can have maximum 15 directors.


Whether an OPC is eligible to become a member of another Private Limited Company in India?

The answer is “YES”, as there is no restriction is imposed on an OPC from becoming a member of Private Limited Company.


How much paid-up and authorized share capital can an OPC have?

Like Private limited company, there is no minimum requirement of paid-share capital for OPC in India as well. Thus, OPC can have any amount of paid up share capital. While the OPC must have minimum authorized share capital of Rs.1,00,000.

However, an OPC can have maximum paid-up capital of Rs.50 Lakh. In case the paid up capital of OPC exceeds Rs. 50 Lakh then it shall compulsorily be converted into Private Limited Company.


Can OPC be converted into Private Limited?

The Companies (Incorporation) Rules have put a threshold limit of Rs.50Lakhs on OPC. It means that OPC cannot have paid-up capital exceeding Rs. 50 Lakh.

An OPC can be converted into Private Limited by two methods that are voluntarily and compulsorily. Provided that the OPC must have completed 2 years from its incorporation. 

It can voluntarily be converted at anytime by the OPC. However, an OPC shall be converted into private limited company when its paid-up capital exceeds Rs.50 Lakh or its average annual turnover of 3 consecutive financial years immediately preceding the relevant financial year exceeds Rs.2 Crore.


Whether nominee of OPC can be changed?

Yes, the member of the OPC can change the nominee at anytime for any reason by giving notice in writing to the company about the change of nominee. However, the proposed nominee shall be eligible to become a nominee.


In how many OPCs is a person allowed to become a nominee?

A person who is eligible to become a nominee can become a nominee in only one OPC.


Does a nominee require DSC and DIN?

No, a nominee does not require DSC for signing incorporation documents or nominee consent document as all the documents are required to be signed on paper and then these will be attached in the forms. Likewise, a nominee does not need DIN as DIN is used by Directors.

Nominee is required to have PAN in his name only.


Can an OPC undertake NBFC activities?

No, an OPC cannot undertake any NBFC activity. Ensure this before writing MOA of OPC.



Every person must observe and follow these key points before incorporating OPC in order to avoid mistakes. In case of any query related to OPC incorporation, Contact Your Trustworthy Advisors Manthan Experts for incorporating your company at an affordable price.

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Knowledge Source:

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