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Microlesson · 5-min read

Applicability of Chapter VII to One Person Company [Section 122]

# Section 122 — How Meetings Work for One Person Company (OPC)

## The Big Picture

OPC has only one member (and may have only one director). Many meeting-related provisions become meaningless in that context. Section 122 therefore:

1. Excludes certain provisions altogether, AND

2. Substitutes a simpler resolution-by-entry mechanism.

## 1. Provisions That DO NOT Apply to OPC — Section 122(1)

SectionHeading
Section 98Power of Tribunal to call meetings of members
Section 100Calling of EGM
Section 101Notice of meeting
Section 102Statement annexed to notice
Section 103Quorum
Section 104Chairman of meetings
Section 105Proxies
Section 106Restrictions on voting rights
Section 107Voting by show of hands
Section 108Voting through electronic means
Section 109Demand for poll
Section 110Postal ballot
Section 111Circulation of members' resolutions

> Logic: With one member, there is no need for notice/quorum/proxy/poll mechanics.

## 2. Ordinary Business at AGM — Section 122(2)

The ordinary businesses under Section 102(2)(a) (financial statements, dividend, retirement of directors, auditors) shall be transacted in OPC as provided in sub-section (3) — i.e., through the simplified resolution route below.

## 3. Simplified Resolution Mechanism — Section 122(3)

For any business required to be transacted at an AGM or other general meeting of a company by ordinary or special resolution, in an OPC it is sufficient if:

1. The resolution is communicated by the member to the company;

2. The resolution is entered in the minutes-book maintained under Section 118;

3. The minutes-book is signed and dated by the member.

> Date of signing = Date of meeting for all purposes under the Act.

## 4. Board Resolution in Single-Director OPC — Section 122(4)

If the OPC has only one director, any business required to be transacted at a Board meeting is validly transacted if:

1. The resolution by such director is entered in the minutes-book (Section 118);

2. The minutes-book is signed and dated by the director.

> Again, the date of signing = date of the Board meeting.

## Penalty for Default — Rule 30

If default is made in complying with this rule:

  • Company AND every officer / other person in default → fine up to ₹5,000;
  • Continuing contravention → further fine up to ₹500 per day after the first.

## Quick Summary Flow

Member/Sole Director → Communicates resolution → Entry in Minutes Book (Sec 118) → Signed & Dated → Deemed date of meeting

Worked example

### Example 1

Example 1: Mr. A is the sole member of an OPC. The auditor's appointment needs to be ratified. Process? ✅ Mr. A communicates the resolution to the OPC; the resolution is entered in the minutes book under Section 118; he signs and dates the entry. That date is deemed to be the date of the AGM.

### Example 2

Example 2: XYZ (OPC) Ltd. has two directors. Can Section 122(4) be used to pass a Board resolution by entry in the minutes book? ❌ No — Section 122(4) applies only when there is one director on the Board. With two directors, normal Board meeting provisions apply.

### Example 3

Example 3: Sole director-cum-member fails to enter the resolution in the minutes book. Penalty? ✅ Fine up to ₹5,000 + ₹500/day continuing — on both the company and the officer in default (here, the sole director).

⚠️ Common exam mistakes

  • Listing Section 96 (AGM) as inapplicable to OPC — it is not in the exclusion list of Section 122(1).
  • Applying Section 122(4) (single-director shortcut) to an OPC with more than one director — it only works when there is one director.
  • Forgetting that the date of signing the minutes is statutorily deemed to be the date of the meeting — important for time-limit computations (e.g., filings).
  • Mixing up exclusions — Sections 99 and 96 are not excluded by Section 122(1); only Section 98 and Sections 100 to 111.
Bare-Act text Section 122 / Rule 30 · The Companies Act, 2013 read with Rule 30 of Companies (Management and Administration) Rules, 2014 · click to expand
Section 122(1): The provisions of section 98 and sections 100 to 111 (both inclusive) shall not apply to a One Person Company. (2) The ordinary businesses as mentioned under clause (a) of sub-section (2) of section 102 which a company is required to transact at an annual general meeting, shall be transacted, in case of One Person Company, as provided in sub-section (3). (3) For the purposes of section 114, any business which is required to be transacted at an annual general meeting or other general meeting of a company by means of an ordinary or special resolution, it shall be sufficient if, in case of One Person Company, the resolution is communicated by the member to the company and entered in the minutes-book required to be maintained under section 118 and signed and dated by the member and such date shall be deemed to be the date of the meeting for all the purposes under this Act. (4) Notwithstanding anything in this Act, where there is only one director on the Board of Director of a One Person Company, any business which is required to be transacted at the meeting of the Board of Directors of a company, it shall be sufficient if, in case of such One Person Company, the resolution by such director is entered in the minutes-book required to be maintained under section 118 and signed and dated by such director and such date shall be deemed to be the date of the meeting of the Board of Directors for all the purposes under this Act.
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