Conversion of a One Person Company (OPC) into a Private Limited Company in Chennai, Tamil Nadu

A One Person Company (OPC) can be converted in to a Private Limited Company in Chennai, Tamil Nadu as per Section 18 of the Companies Act, 2013. There are two ways through which a One Person Company (OPC) in Chennai, Tamil Nadu can be converted into a Private Limited Company i.e. voluntarily conversion or mandatorily conversion. In any of these conversions, the Memorandum of Association and Article of Association of the One Person Company (OPC) needs to be changed as per the section 18 and section 122 of the Companies Act, 2013 in Chennai, Tamil Nadu.

As per Section 18 Companies Act, 2013 following conditions need to me made:

• • Get written consent from all the creditors
  • Pass the resolution of conversion

• Minimum paid-up capital requirement of Rs 1,00,000 to be met
• Minimum number of 2 directors and 2 members need to be met

Form INC-6 is to be filed to the Ministry of Corporate Affairs for conversion of One Person Company (OPC) into a Private Limited Company in Chennai, Tamil Nadu.

Conversion of a One Person Company (OPC) into a Private Limited Company in Chennai, Tamil Nadu

Tamil Nadu is the state with largest number of factories in India, with estimated number of over 37,220 units. Tamil Nadu has been a hub for manufacturing sector and remained an undisputed leader in various industries that includes pharmaceuticals, leather products, chemicals, automobiles, textiles, etc. The state of Tamil Nadu has the largest capacity of renewable energy in India with total capacity at 16 GW along with the total installed power capacity of 32,620 MW. Being among the top 10 manufacturing hubs in the world with installed capacity of more than 17 lakhs cars. With 37 operational Special Economic Zones (SEZs), highest number in India, Tamil Nadu Ranked 9th globally for its net share of wind energy in the total power generation.

Situated in the southern part of India, Tamil Nadu share its boundaries with Karnataka, Andhra Pradesh and Kerala. On the other sides, it is surrounded by Bay of Bengal in east and Indian Ocean in the south. Tamil Nadu has the extensive road and rail network, a well-developed infrastructure along with seven airports. The coastline of the state is more than 1000 km long with 26 ports that includes 4 major ports. Tamil Nadu ranks third in “Export Preparedness Index” in 2020.

Not only this, as per the latest report by World Bank, Tamil Nadu ranked 14th out of 36 states in terms of ease of doing business.

Two Types of Conversion

For converting a One Person Company (OPC) into a Private Limited Company in Chennai, Tamil Nadu, both voluntarily conversion and mandatory conversion, the provisions of Sec 18 of the Indian Companies Act of 2013, and the Rule 7(4) of the Companies (Incorporation) Rules of 2014 needs to be followed.

Voluntary Conversion of One Person Company (OPC) to Private Limited Company in Chennai, Tamil Nadu

Voluntary conversion of a One Person Company (OPC) into a Private Limited Company in Chennai, Tamil Nadu is only allowed after two years from the date of incorporation have been completed. However, if the paid-up share capital of the One Person Company (OPC) is more than Rs. 50 lakhs or if the average turnover is more than Rs. 2 crores then within two months of the phenomenon occur, the One Person Company (OPC) can be converted into a Private Limited Company in Chennai, Tamil Nadu.

One Person Company (OPC) has to file form INC 5 for informing the registrar of companies about voluntary conversion in Chennai, Tamil Nadu within sixty days.

Compulsory Conversion of One Person Company (OPC) to Private Limited Company in Chennai, Tamil Nadu

The Companies Act, 2013 laid down certain conditions if a One Person Company (OPC) meets, the OPC needs to be compulsorily converted into a Private Limited Company in Chennai, Tamil Nadu within 6 months of meeting the following conditions:

• The paid capital of the One Person Company (OPC) exceeds Rs. 50 lakhs and
• The annual turnover of is more than Rs 2 Cr in three immediate previous consecutive financial years

The conversion is made by just passing a special resolution in the general meeting. It is checked for a No objection certificate in written from the creditors, and the other members before the resolution are passed.

Process to convert One Person Company OPC to Private Limited Company in Chennai, Tamil Nadu

Board Resolutions for conversion One Person Company OPC to Private Limited Company in Chennai, Tamil Nadu

• Shareholders of the One Person Company (OPC) hold a general meeting and pass the resolution to increase the number of directors and shareholders.
• To convert a One Person Company (OPC) to a Private Limited Company in Chennai, Tamil Nadu, there should be at minimum 2 shareholders and 2 directors.
• Shareholders pass a resolution to alter the Memorandum of Association and Articles of Association of the One Person Company (OPC).
• File the e-form INC-5 with registrar of companies within 60 days of crossing the threshold limits of the paid-up capital or the turnover, informing that it has ceased to be a One Person Company (OPC).
• Further file e-Form INC-6 on the website of MCA within 6 months from the date of conversion
• The introduction of One Person Company (OPC) into legal system came into existence to encourage the entrepreneurs to enter into the corporate world. It will not only enable the individual capabilities to contribute economic growth but will also generate employment opportunity.

Provisions of Companies (Incorporation) Rules of 2014 followed by the newly formed Private Limited Company. The existing debts, liabilities, obligations or contracts of the One Person Company (OPC) in Chennai, Tamil Nadu remain the same.