University:
Cypress College
Course:
BUS 100 C | Introduction to Business
Academic year:

2019
Views:

306

Pages:

10
Author:

tar2tituhi

Incorporation of Companies Q1: How to incorporate Public Co., Pvt. Co., OPC, Ltd by Gr. Co., etc.? Describe the mode of forming an incorporated company. A: Mode of forming Incorporated Company This question is based on Section 3 of the Companies Act, 2013 read with the Companies (Incorporation) Rules, 2014. I. Basic Requirements to Form a Company Type of Company: In case of OPC (One Person Company): 1 person. In case of Public Company: 7 or more persons. In case of Private Company: 2 or more persons. Promoter: The person forming the company is called the promoter. A company to be incorporated under this model may be: Company Ltd. by shares. Company Ltd. by Guarantee. An Unlimited Company. Rule 6: Voluntary Conversion of OPC into Pvt. or Public Co. An OPC may be converted into Pvt. or Public Co. after increasing the minimum number of members and directors to 2 or 3, as the case may be. Such OPC must maintain the minimum paid-up capital as per the Act for a Public or Pvt. Co. by complying with the rules. An OPC can convert into any Pvt./Public Co. only after the expiry of 2 years from the date of its incorporation. Compulsory Conversion of OPC into Public/Pvt. Co. Grounds for Conversion: OPC shall cease to be an OPC if its paid-up capital exceeds fifty lakh rupees and its average annual turnover during the relevant period exceeds 2 crores. Rule 7: Conversion of Pvt. Co. to OPC A Pvt. Co. other than a Section 8 Co. having paid-up capital of 50 lakh or less and turnover of 2 crores or less may convert itself into OPC by passing a special resolution in the general meeting. The Pvt. Co. shall file a copy of the special resolution with the registrar within 30 days in form MGT-14. The company shall file an application in Form INC-6 with the registrar by attaching certain documents: Director's declaration confirming consent of creditors & members as regards conversion. List of members & creditors. Audited Balance Sheet & P&L. NOC of secured creditors. Consent of members. If the ROC is satisfied that all the above requirements are complied with, it shall issue a revised COI, mentioning that it has become an OPC. Incorporation of Company (Section 7) Filing of Documents and Information with ROC: MOA & AOA signed by all subscribers. Declaration of compliance given by: Persons engaged in incorporation. Persons named in articles as directors. Affidavit from subscribers stating that: He is not convicted of any offence. He has not been found guilty of any misconduct. All documents with ROC are correct and true to the best of his knowledge. Issue of COI: The ROC shall register all documents and issue COI. Assignment of Corporate Identity No. (CIN): After COI, ROC shall allot CIN, and the CIN shall be included in the certificate. Maintenance of Copies: The company shall maintain & preserve copies of all documents as originally filed. Furnishing False or Incorrect Information: If any person furnishes false or incorrect information, he shall be liable under Section 447. Company Incorporated by Furnishing False Information: If it is proved that the company was incorporated by furnishing false information, the promoters or persons named as first directors shall be liable. Effect of Registration (Section 9) The subscribers to the MOA and all others shall become members of the company. It shall be a body corporate having perpetual succession. It can acquire, hold, or dispose of property, both movable and immovable. It can enter into contracts by its name. It can sue or be sued by its name. It becomes a legal person separate from its members. Additional Q&A Q: Though six out of seven signatures to the MOA were forged, the company was registered and the COI was issued. Can the registration of the company be challenged subsequently on the ground of forged signatures? A: Yes, the registration of the company can be challenged but it will not in any way affect or cancel the registration of the company and the MOA. As per Section 10, subject to the provisions of the Act, MOA shall, when registered, bind the company and its members to the same extent as if they respectively had been signed by the company and by each member.