Mr. Y formed a One Person Company (OPC). For the year ending 31st March, 2018, it had clocked an average annual turnover of ₹2 crores and its paid up capital was raised from ₹5 lakhs to ₹50 lakhs. Comment on its conversi

Rule 6 of Companies (Incorporation) Rules, 2014 states that when the paid-up share capital of an One Person Company exceeds ₹50 lakhs or its average annual turnover during the relevant period exceeds ₹2 crores, it shall cease to be entitled to continue as a One Person Company. Conversion of OPC into a Private limited company or a Public company, shall be within 6 months of the date on which its paid-up share capital is increased beyond ₹50 lakhs or the last day of the relevant period during which its average annual turnover exceeds ₹2 crores, as the case may be. Applying the aforesaid provisions, in the given case the paid-up capital and turnover of One person Company has not exceeded the prescribed limit, there is no need for conversion of the OPC to a Private company or a Public company.