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Question
Explain the following term/concept.
One Person Company
Solution
(1) A company, in which one person holds almost the whole of its share capital and has other members just to meet the legal requirement of a minimum number of members, is known as one person company. It is a private company.
(2) It has to comply with all the formalities of a private company that are specified in the Act or rules. The concept of a One-person Company was introduced through the Companies Act, 2013.
(3) It is managed, operated, and controlled by a Single-member called promoter. The liability of its member is limited to the extent of his capital investment in the company. It is superior than Sole Trading Concern of business organisation.
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