Conversion Of OPC Into Private Company In India

Starting a business as a one-person company is often the perfect launchpad for solo founders. It gives limited liability, simple compliance, and full control. But as the business grows, the need for co-founders, private equity investors, a larger team, or ESOPs becomes unavoidable. That is when OPC begins to feel restrictive. If you started as an OPC and now want co-founders, investors, or ESOPs, converting to a Private Limited Company is the natural next step. This blog gives you the precise legal pathway, forms, timelines, and common pitfalls so you get it right the first time.

The conversion process is backed by clear legal provisions under the Companies Act. Section 18 of the Companies Act, 2013 allows a company to convert from one class to another. Rule 6 of the Companies (Incorporation) Rules, 2014, as amended on 1 April 2021, governs the conversion of an OPC into a Private or Public Company and also removed the old restrictions on paid-up capital and turnover. The main application for conversion is filed in e-Form INC-6. Additionally, Section 122 explains the special way an OPC passes resolutions through a simple entry in the minutes book signed by its sole member.

Private Company at a Glance

Before you begin the conversion, it helps to understand what you are converting into. A Private Limited Company is the default structure for multi-founder businesses in India, especially when you want investors, ESOPs, or faster scalability. Under Rule 6 of the Companies (Incorporation) Rules, 2014, any OPC except a Section 8 entity can convert into a Private Company voluntarily. The earlier two-year waiting period was removed on 1 April 2021, so you can apply for conversion at any time once you are ready. After conversion, you must meet the basic requirements of a Private Limited Company. This means you need at least two members and two directors. If you currently run the OPC alone, you will have to bring in one more shareholder and one more director during the conversion process. The conversion revolves around two core forms. First, you file MGT-14 to register the special resolution approving the conversion. Only after that can you file INC-6, which is the main application form for conversion under Section 18 of the Companies Act, 2013. One visible change you will notice is the company name. As an OPC, your name ends with “(OPC) Private Limited” because of the proviso to Section 12. After conversion, you must remove the “(OPC)” tag and adopt the standard Private Limited suffix.

Legal Framework

Before you move to the step-by-step process, it is important to understand the legal foundation that allows an OPC to convert into a Private Limited Company.

What the law says?

• Section 18 of the Companies Act, 2013
  This provision gives a company “of any class” the right to convert into another class by altering its Memorandum of Association and Articles of Association. The law also makes it clear that all existing debts, liabilities, and contracts continue without any change. So the conversion does not affect ongoing business obligations.
• Rule 6 of the Companies (Incorporation) Rules, 2014
  Rule 6 specifically governs the conversion of an OPC into a Private or Public Company. It states that an OPC may convert by increasing its members and directors to the minimum required level and filing the application in INC-6.
  The 2021 amendment simplified the process by removing the old mandatory conversion thresholds based on paid-up capital or turnover, and it also did away with INC-5, which was earlier required.
• Section 122 of the Companies Act, 2013
  Because an OPC has only one member, it does not hold regular shareholder meetings. Section 122 provides a simplified mechanism. Any decision, including the approval for conversion, can be passed by writing the resolution in the minutes book, signing it, and dating it. The date you write is legally treated as the date of the shareholders' meeting.

Prerequisites and Readiness Checklist

Before you file any form or alteration document, you need to make sure your OPC meets the minimum requirements of a Private Limited Company. This checklist helps you prepare everything in advance so the conversion runs smoothly without objections from the RoC.

Increase your team to at least two members and two directors

A Private Limited Company must have a minimum of two shareholders and two directors. If you are appointing a new director as part of this transition, you must file DIR-12 within 30 days of the appointment.

Draft a revised MOA and AOA

Your existing OPC documents contain a nominee clause and several OPC-specific provisions. These must be removed. Replace them with a standard Private Company Memorandum and Articles, including key provisions on share capital, rights, board powers, and private company restrictions.

Prepare the required lists and supporting documents

You will need a complete set of updated records for the conversion application. This includes:

• List of members and list of directors
• List of creditors with their consent or no-objection
• Latest audited financial statements
• Draft special resolution for conversion and for the change in the company name

Plan how you will bring in the second member

1. If you are issuing new shares to add the second shareholder, you must plan the allotment and file PAS-3 after the board approves the issue.
2. If you are transferring existing shares instead, you must execute a proper share transfer using Form SH-4.

Preparing these elements early ensures your MGT-14 and INC-6 filings are accurate and complete, reducing the chances of delays or resubmission from the RoC.

Conversion of OPC into Private Company: Step-by-Step Procedure

Before you file the main conversion form, the entire process moves through three clear phases. Phase 1 covers your internal approvals as an OPC, Phase 2 involves drafting and updating statutory documents, and Phase 3 is where you file INC-6 and complete the legal conversion with the RoC.

Phase 1: Internal Approvals (OPC mode under Section 122)

You begin the conversion inside the company by recording all decisions through the OPC method prescribed in Section 122. Since an OPC does not hold traditional shareholder meetings, you can approve everything by making a signed and dated entry in the minutes book. That date is deemed to be the date of the meeting.

First, record a special resolution that approves:

• Conversion of the OPC into a Private Limited Company
• Alteration of the MOA and AOA
• Change of the company name by removing “(OPC)”
• Appointment of any additional director(s) needed to meet the minimum requirement
• Issuance or transfer of shares if required to add the second member

Once the resolution is passed (through the Section 122 process), you must file MGT-14 with the Registrar of Companies within 30 days. This filing officially registers your special resolution with the government. Make sure to attach the altered MOA, altered AOA, and the signed resolution as part of the MGT-14 submission.

Phase 2: Conversion Application to RoC

Once your internal approvals are complete and MGT-14 has been filed, the next step is to submit the formal conversion application to the Registrar of Companies. You do this by filing INC-6, which is the official application form for converting an OPC into a Private Limited Company. The latest version of this form was updated through the 2023 notification, so make sure you use the most recent format available on the MCA portal.

Attach all mandatory documents with INC-6, including:

• Altered MOA and altered AOA
• Copy of the special resolution approving the conversion
• Details and consent of the proposed members and directors
• Updated list of creditors
• Latest audited financial statements

After you upload the form and pay the prescribed fees, the RoC will review the application to ensure you meet the requirements under Section 18 and Rule 6. If everything is in order, the RoC will issue a fresh Certificate of Incorporation, officially recognizing your entity as a Private Limited Company.

This new certificate marks the legal completion of the conversion process.

Phase 3: Post-Approval Filings and Housekeeping

After the RoC issues your fresh Certificate of Incorporation as a Private Limited Company, a few final compliance steps ensure that all statutory records and registrations reflect your new status. If you have appointed any additional directors during the conversion process and have not yet filed their appointment documents, submit DIR-12 immediately. This filing updates the MCA records to show the expanded board structure required for a Private Limited Company. If you brought in the second shareholder by issuing fresh shares, make sure you file PAS-3 within the statutory timeline. The deadline is 30 days from the date of allotment, or 15 days if the shares were issued through a private placement route.

Once your corporate structure is fully updated on the MCA portal, you need to update all statutory and regulatory records to reflect the new company name. Since the OPC name-tag requirement comes from Section 12, you must now remove “(OPC)” from all documents and materials. Update your PAN, GST registration, bank KYC, Shops and Establishments registration (if applicable), letterheads, website, invoices, and all statutory registers to match the new Private Limited Company name. Completing these housekeeping tasks ensures that your newly converted entity is fully compliant and recognized across all government and business platforms.

Documents and Attachments

When you file MGT-14 and INC-6, the RoC expects a clean, well-organized set of documents. Preparing these in advance helps avoid resubmissions or delays.

• Altered MOA and AOA (Private Company format): Your revised charter documents must reflect the removal of OPC provisions and the adoption of full Private Company articles.
• Copy of the special resolution: Include the signed resolution approving the conversion, alteration of MOA/AOA, and the change of name.
• List of proposed members and directors with their consents: This should clearly show the minimum two members and two directors required after conversion, along with their signed consents.
• List of creditors and latest audited financial statements: The RoC checks whether the conversion affects creditor interests, so this list and your financials are essential for verification.
• NOC or confirmations from creditors (as asked by RoC): While not always mandatory, many RoCs ask for a simple no-objection or confirmation letter. Including the old nominee’s acknowledgement is also considered good practice.
• ID and address proofs for any new directors or members: If the conversion involves appointing a director or bringing in a second shareholder, attach their identification documents (PAN, Aadhaar, or passport) and proof of address.

Timelines, Government Fees and Stamp Duty

Understanding the timelines and statutory fees helps you plan the conversion smoothly and avoid late-filing penalties.

MGT-14 timeline

You must file MGT-14 within 30 days of passing the special resolution. Since this resolution is recorded under the OPC process in Section 122, the date you sign the minutes entry becomes the official resolution date.

INC-6 timeline and fees

You can file INC-6 only after the RoC approves MGT-14. The government fees for INC-6 are prescribed under the Companies (Registration Offices and Fees) Rules, 2014. Since fees depend on your company’s authorized share capital, you should check the latest amount using the MCA Fee Calculator.

Stamp duty

Stamp duty varies by State and is auto-calculated on the MCA portal based on your registered office location. Since altered MOA and AOA are included, the duty may differ from your original incorporation documents.

Benefits of Converting to a Private Company

Converting your OPC into a Private Limited Company opens the door to growth, funding, and operational flexibility.

• You can add co-founders and investors without restrictions on the number of members.
• Access to equity funding, including angel investors, venture capital, and ESOPs.
• More credibility with banks, vendors, and government authorities due to the Private Limited structure.
• Broader management capability with multiple directors and a functioning board.
• Greater scalability, as Private Companies can issue fresh shares, onboard talent, and expand ownership easily.
• Better compliance alignment with future expansion, especially if you plan to bring in institutional investors.

These advantages make the Private Company format the preferred structure for startups and businesses that are ready to grow beyond the single-promoter OPC model.

Conclusion

Converting an OPC into a Private Company is a strategic move for businesses that are ready to scale, raise funds, add more shareholders, or adopt a more robust corporate structure. The process may seem detailed, but once you understand the phases, documentation, timelines, and compliance steps, the conversion becomes smooth and predictable. From passing the special resolution to filing INC-6 and updating corporate records, every action ensures that your company transitions into a more flexible and growth-oriented framework. If you are looking for long-term expansion, better governance, and wider investor confidence, the conversion of OPC into private company is one of the most beneficial steps you can take for your business.

Disclaimer: This article provides general legal information on OPC to Private Limited conversion. It is not a substitute for professional legal advice. For personalised guidance, consult our legal expert.

References

• Rule 6, Companies (Incorporation) Rules, 2014
• Section 18, Companies Act, 2013
• Section 122, Companies Act, 2013
• Form INC-6 (current form; substituted 19-Jan-2023).
• Name display proviso for OPC (Sec 12).