IS POSSIBLE IF WE APPOINT MORE THAN ONE DIRECTOR IN OPC?
Yes, it is possible to appoint more than one director in an One Person Company (OPC). The Companies Act, 2013 allows an OPC to have a minimum of one director and a maximum of 15 directors. The member of the OPC is presumed to be the first director of the company until the other directors are lawfully appointed by the member.
Appoint more than one director in an OPC, the following steps need to be followed:
- The member of the OPC needs to pass a resolution appointing the additional directors.
- The resolution needs to be filed with the Registrar of Companies (ROC) along with the requisite fees.
- The ROC will then issue a fresh certificate of incorporation to the OPC reflecting the appointment of the additional directors.
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Some of the benefits of appointing more than one director in an OPC:
- It can help to decentralize the management of the company.
- It can provide additional expertise and experience to the company’s board of directors.
- It can help to mitigate the risk of the company being controlled by a single individual.
Some of the drawbacks of appointing more than one director in an OPC:
- It can increase the administrative burden on the company.
- It can lead to disagreements and conflicts between the directors.
- It can make it more difficult for the company to make decisions.
more detailed explanation of the steps involved in appointing more than one director in an OPC:
- Passing a resolution appointing the additional directors: The first step is to pass a resolution appointing the additional directors. The resolution should be in writing and should be signed by all of the directors of the company. The resolution should specify the names and addresses of the additional directors, as well as their terms of office.
- Filing the resolution with the ROC: Once the resolution has been passed, it needs to be filed with the ROC. The ROC can be found at the following website: https://www.mca.gov.in/ The filing fee for appointing additional directors is Rs. 1000.
- Issuance of a fresh certificate of incorporation: Once the ROC has received the resolution, it will issue a fresh certificate of incorporation to the company reflecting the appointment of the additional directors. The fresh certificate of incorporation will be valid for a period of 30 years.
Some of the advantages of appointing more than one director in an OPC:
- Decentralized management: Having multiple directors can help to decentralize the management of the company. This can be beneficial if the company is growing rapidly or if the member of the company does not have the time or expertise to manage all aspects of the business.
- Additional expertise and experience: Appointing additional directors can bring in additional expertise and experience to the company’s board of directors. This can be helpful in areas such as finance, marketing, or operations.
- Mitigated risk: Having multiple directors can help to mitigate the risk of the company being controlled by a single individual. This can be important if the member of the company is unable to continue managing the company due to illness, death, or other unforeseen circumstances.
Some of the disadvantages of appointing more than one director in an OPC:
- Increased administrative burden: Appointing additional directors can increase the administrative burden on the company. This is because the company will need to hold board meetings, keep minutes of meetings, and file annual returns with the Registrar of Companies (ROC).
- Disagreements and conflicts: Having multiple directors can lead to disagreements and conflicts between the directors. This can be disruptive to the company and can make it difficult to make decisions.
- Difficult decision-making: If the directors of an OPC are unable to reach a consensus on a decision, the company may be unable to take any action. This can be a problem if the company needs to make quick decisions in order to respond to market changes or other challenges.
However, there are also some risks associated with appointing more than one director in an OPC:
- It can increase the cost of running the company.
- It can lead to disagreements and conflicts between directors.
- It can make it more difficult to keep information confidential.
- It can make it more difficult to make quick decisions.
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