Entrepreneurship is a fancy term given to any business that is started by one individual or a group of individuals. Often overused, this term is defined as the creation of a business or multiple businesses. It is established with the objective to solve a problem that is inculcating in the society. The most important step in the entrepreneurship process is the selection of a business type. The most ideal business type for an entrepreneur is to establish a One Person Company. The Incorporation of One Person Company can be easily done by following certain steps mentioned in the registration process.
Any person, who has a business idea that, according to him, can serve as a solution to problems of the people and society is called an entrepreneur. Entrepreneurs have also come up with ideas that have solved problems around the world.
Entrepreneurs could be of different types depending on certain factors.
Entrepreneurship is not an easy job. Some essential tasks of an entrepreneur include managing all business related activities, taking significant business decisions that would drive the business to earn profits. The entrepreneur also ensures that people are receiving benefits from the solution that the business is providing to them.
Some significant aspects of entrepreneurship is discussed below –
· Entrepreneurship helps in the creation of employment opportunities
· Entrepreneurs come with innovative ideas and solutions which makes people’s lives easier
· Entrepreneurship contribute to the national income of the country
· Entrepreneurship help in reducing poverty
· Entrepreneurs contribute in the social services
Women entrepreneurship has become a major business type in which women are coming forward and contributing massively in the Indian economy. With the objective of finding modern solutions to modern problems, businesses lead by women, are achieving great successes. With every women entrepreneur entering in the business sector, it is proved that they have the capability of launching and achieving great successes within certain duration.
Starting a One Person Company (OPC) is beneficial for women as this particular company type comes with many benefits. The most essential benefit is the freedom that comes with managing a One Person Company. OPC allows individuals to own and manage their business without any interference from other individuals. Women, who want to take up the responsibility of lifting up the company to new heights, opt for this business type and consider it as the most desirable option.
A One Person Company (OPC) is a company type that is started, owned and managed by only one individual. All the business related activities and significant decisions are taken by him. There is absolutely no intervention of any kind from any other individual, unless he allows it.
In order to start One Person Company, it is essential to register the company as per the rules and regulations mentioned in the Companies Act. Also, all the documents required for OPC Registration, requested by the authority, must be arranged and submitted before the prescribed time period.
According to Companies act 2013, Section 2(62), One Person Company is defined as a company that consists of only one person as a member.
· A company limited by shares,
· A company limited by guarantee,
· An unlimited company
· A One-person company must have a minimum share capital of Rs 1 lakh.
· As per Companies Act, 2013, the Director of the firm must appoint a nominee as it is mandatory.
· Section 149 of the Act mention that the company must hold at least one board meeting in every half of the calendar year.
· One of the most significant features of a One Person Company (OPC) is that it consists of only one member. This individual acts as both the Shareholder and the Director.
· The company must submit an annual report which must be signed by the Company Secretary (CS). If the secretary is not available, then the director can sign the report.
· As per Section 40 of the Act, filing cash flow statement is not mandatory while filing the financial statements of the business for a particular year.
One person company is the most the common and the most desirable option amongst individuals because it offers many benefits. Further, One Person Company Registration is essential that must be fulfilled by the business owners and entrepreneurs in order to enjoy the benefits.
One of the most crucial aspects that an individual can enjoy in a company is the feature of “Limited Liability”. A one-person company operates on this feature which is crucial for an organization. Limited liability means that the liability on the directors and other members is limited to the amount contributed by them. As per this feature, the personal assets of the members of the organization is not affected, in situations where the company incurs losses or if it goes into debt.
No prerequisite of minimum capital
There is no obligation or any prior conditions set for the requirement of a minimum capital at the time of establishment of one-person company, but, the capital amount must not exceed the maximum amount of Rs 50 Lakhs.
Lesser compliances to follow
Minimum paperwork is required at the time of registration of the company and even after its launch. As compared to other company types, the compliances for this company are also lesser.
Minimum chances of legal disputes
There are minimum chances of the occurrence of legal disputes in situations when the power is in the hands of one authority. There are lesser chances of disagreements between the partners and directors of the company.
Complete control on the business
The owner of the company has all the control of the business activities. All the important decisions will be taken by him only. There is no interference of any other individual, unless the owner requests for his opinion in the decision making process.
Thus, this advantage allows him to enjoy a maximum level of freedom when it comes to handling tasks at work.
Feature of Continuous Existence
In a One Person Company, the owner of the company is supposed to appoint a nominee who will be handed over the responsibility of all the business activities at the time of the owner’s illness or death. This means this business type has the advantage of continuous existence. This feature means that the business activity of the organization is not affected in case of illness or death of its owner/director.
Easy to set up the company
The set up process of an OPC is simple and the steps for its registration are less complicated in terms of documentation and processing duration.
It is significant to understand how the process of registration works so that all steps in the process can be followed in an appropriate manner. Before starting a One Person Firm, the individuals are required to follow the steps in the registration procedure. The process contains certain requirements including submission of significant documents. All of this must be completed by them in order to receive the approval after which the organization can be started.
Filling an application form to obtain Digital Signature Certificate
The first step is to file an application to acquire Digital Signature Certificate. Also known as DSC, Digital Certificate is a digital key issued by the concerned authority for the purpose of validating and certifying an individual’s identity. These certificates make use of public key encryptions for the creation of signatures.
One of the most important steps in the One Person Company Registration Process is acquiring a Digital Signature Certificate. DSC is utilized to sign important documents electronically ad thus it is mandatory to obtain it.
Name approval of the company through RUN
The company must get the company name approved by the Reserve Unique Name (RUN). RUN is a service offered by the Ministry of Corporate Affairs (MCA) to simplify the company name approval process. The fees demanded by the applicant for the name approval is Rs 1000.
File INC-32 Form or SPICe Form
The next step is to file a SPICe form and submit the mandatory documents along with the form. The documents that must be submitted are as mentioned below –
· Copy of PAN card of the applicant,
· Copy of Voter card or passport or driving license,
· Passport-sized photograph of the applicant,
· An updated and latest bank statement or telephone bill,
· MOA (Memorandum of Association)and AOA (Articles of Association) of the company,
· Copy of sale deed or property deed (if the property is owned by the applicant),
· Copy of Rent Agreement,
· No-Objection Certificate (NOC) from the owner of the property if the property is rented,
· Other important documents as required by the authority.
Obtaining certificate of Incorporation
The last step in the registration process is to acquire the certificate of incorporation. It is acquired to the company after proper evaluation from the authorities. The applicant also receives Corporate Identity Number (CIN) from the Registrar of Companies (ROC).
A citizen and a resident of India fall under the eligibility criteria for the establishment of OPC. Only those members can act as a member. The term ‘resident in India’ implies to a person who has been in India for a time period of not less than 182 days during the period immediately preceding the financial year.
Documentation is an absolute necessity for any company registration, for a successful completion of the registration process. Thus, all the documents essential for registration of One Person Company, requested by the authority, must be arranged well in advance and submitted to them, if the individual wishes to acquire the registration with the prescribed time period and start his business.
· Memorandum of Association (MOA) and Articles of Association (AOA)
· Affidavit copy of the director and the subscriber
· NOC from the landlord and rent agreement if the property is located in a rented office
· Proof of ownership in case of owned property.
· Utility bills in any form which includes electricity bill, telephone bill of the registered office address.
· Identity proof of the applicant(owner) such as PAN Card, Driving License
After appropriate knowledge gathering with regards to One Person Company and the various benefits it provides, it can absolutely be said that OPC can definitely ace the business game, for all individuals, both men and women. Women entrepreneurs in the country can accomplish any business goals and objective they set, only if they make the right choice when it comes to choosing the type of company.