Conversion of a One Person Company (OPC) into a Private Limited Company in Puducherry (Pondicherry)

A One Person Company (OPC) can be converted in to a Private Limited Company in Puducherry (Pondicherry) as per Section 18 of the Companies Act, 2013. There are two ways through which a One Person Company (OPC) in Puducherry (Pondicherry) 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 Puducherry (Pondicherry).

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 Puducherry (Pondicherry).

Conversion of a One Person Company (OPC) into a Private Limited Company in Puducherry (Pondicherry)

Situated on the Coromandel Coast of the Bay of Bengal, as high as 90% of the total land is used for agriculture in Puducherry. Rice, bajra , ragi and pulses are the major food crops that are grown in Puducherry along with various cash crops such as cotton, sugarcane and groundnuts.

Puducherry, being a former French colony, witnesses a prominent presence of French culture. Puducherry is located about 135 km from Chennai and has a minor port between two major ports of Chennai and Tuticorin. Pennaiyar and Gingee are the major rivers in the region. A lighthouse has been identified by Ministry of Shipping to be developed for its initiative on Lighthouse Tourism. Tourism and Agriculture are major sectors contributing to the GDP of Puducherry. More than 35% of the population the UT of Puducherry depends on agriculture and allied activities. In terms of tourism figures, nearly 1.8 Mn tourist visited Puducherry in 2018

Puducherry also has mineral deposits of clay, limestone, phosphate rocks, lignite laterite and canker. Chemicals, leather, textiles, light engineering, electronics, metals, food processing and tourism and food processing are some of the major industries in Puducherry. Puducherry has the presence of over 1,700 industrial units producing chemicals and chemical-based products. Leather products are the largest exported item from the region. 61,700 MT of untapped marine resources offer a huge investment opportunity for marine products processing plants and packaged marine products.

Not only this, as per the latest report by World Bank, Puducherry ranked 27th 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 Puducherry (Pondicherry), 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 Puducherry (Pondicherry)

Voluntary conversion of a One Person Company (OPC) into a Private Limited Company in Puducherry (Pondicherry) 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 Puducherry (Pondicherry).

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

Compulsory Conversion of One Person Company (OPC) to Private Limited Company in Puducherry (Pondicherry)

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 Puducherry (Pondicherry) 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 Puducherry (Pondicherry)

Board Resolutions for conversion One Person Company OPC to Private Limited Company in Puducherry (Pondicherry)

• 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 Puducherry (Pondicherry), 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 Puducherry (Pondicherry) remain the same.