Process of Conversion explained: this guide covers what Process of Conversion means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
As proposed in Budget Speech in respect of amendment in the provision of One Person Company. MCA has introduced “Companies (Incorporation), Second Amendment Rules, 2021 on 1st February 2021.
Most Important: Amendment in Process of Conversion of One Person Company to Private/ Public Company
Date of Effectiveness of these rules:
These new processes/rules came into effect on 1 April 2021.
Process of Conversion of OPC to Other Company:
STEP – 1: Holding of Board Meeting
OPC Shall hold a Meeting of the Board of Directors in case there is more than 1 director. In case OPC having only one director then the date of noting of resolution in the minute book shall be considered as the date of Board Meeting. Following resolutions shall be passed in BM:
- Conversion of OPC into another type of Company
- Alteration in MOA & AOA
STEP – 2: Alteration on MOA & AOA
OPC Shall alter its Moa & AOA by passing a shareholder resolution to give effect to the conversion.
Que: How to pass shareholder resolution in OPC?
As per Section 122(3), instead of holding of EGM or AGM, it shall be sufficient if, in the case of One Person Company, the resolution is communicated by the member to the company and entered in the minutes-book required to be maintained under and signed and dated by the member and such date shall be deemed to be the date of the meeting for all the purposes under this Act.
Steps of the passing of Resolution:
- Noting in Minutes Book
- Sign and date the Minutes
- Extract of Minutes as CTC
STEP – 3: Increase in Number of Member & Directors:
OPC Shall increase the number of members and directors as per the requirements of the Act for such class of Company.
Increase in No. of Director: OPC shall pass board as well as general meeting resolution for the appointment of Director. After passing of resolution OPC shall file DIR-12 with ROC.
Increase in No. of Members: OPC shall increase the number of members by allotment of new shares or transfer of existing shares.
STEP – 4: Filing of INC-6:
OPC shall file e-form INC-6 along with the following documents;
- Altered AOA and MOA
- Copy of Resolution
- List of proposed members and its director along with consent
- List of Creditors; and
- The latest audited balance sheet and profit and loss account.
https://youtu.be/UiZ0Q5af4Uc
STEP – 5: Issue of Certificate by ROC:
Once ROC satisfied that the requirement of this rule has been complied with, the ROC shall approve the form and issue the certificate.
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