As per the previous Companies Act, where provisions were specifically meant for the public and private limited companies, there was no provision stating the formation of one-person company. However, as per Section 2(62) of the Companies Act, 2013 a company consisting of only 1 Director and 1 Member is also legally recognized as One-Person Company.
A One-person company shall be registered with the Ministry of Corporate Affairs [MCA] under the Companies Act, 2013 and have a separate legal entity. Hence, unlike a sole proprietorship or partnership firm, the liability is limited to the extent of share capital held by the member, director. The maximum number of persons allowed to form a One-person Company is 2. As far as foreign ownership is concerned, it is only allowed if one person is the director and the other is the nominee. They can however not be foreign citizens. The company can only be transferred to one person. The tax charged is 30% on profits made along with cess and surcharge. The tax is fled with the registrar of the company.
1) Obtain Digital Signature Certificate (DSC) of the proposed director for which the documents required are: Address proof, Aadhaar card, PAN card, Photo, Email-Id and Phone No.
2) Obtain Director Identification Number (DIN) of the director complying to the SPICe form (in case of new companies), DIR-3 (in case of existing companies).
3) Apply for approval of name of firm by applying with the Form SPICe 32 or using Reserving Unique Names (RUN) service by Ministry of Corporate Affairs (MCA)
4) The submission of Memorandum of association (MOA) and Articles of Association (AOA) with the registrar.
5) NOC from the director on appointment of nominee according to form INC-3
6) Affidavit and consent of director- form INC-9 and DIR 2 resp.
7) A declaration specifying compliance of all rules and procedure.
8) Filing of forms with MCA for generating the PAN and TAN for the company.
9) Certificate of Incorporation by registrar of companies (ROC)
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