The concept of producer companies was introduced to allow farmers to come together and act as a single entity that has a greater negotiating power. A producer company is nothing but a group of farmers/producers whose main income is derived from agricultural/related produce. It is believed that the concept of Producer company comes from a saying-“United We stand, Divided We Fall”
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A producer company is the one that has its objects mentioned in section 581B of companies act 1956. A producer company must have any one or more of the following mentioned objects to qualify as a producer company
Credit facilities and other financial services to its members.
Our experts at CharteredMunshi will guide you through the entire registration process of a producer company. Let's discuss these steps in detail. Starting from the very basics
Farmers are backbone of every country as farmers are the people who feed our hungry ever growing population, yet farmers are the ones who are deprived of basic human necessities. Our government has brought about many changes in farm laws from time to time for upliftment of farmers, although a fact cannot be denied that situation of farmers has not changed since independence but in a free democratic world where the developed nations are planning to find water and air on MARS by spending trillions of dollars on space technology our INDIAN farmers are still committing suicide when they are unable to repay back a loan of mere thousand rupees. One such move by the government was to bring incorporation of producer company under companies act 1956.
Steps involved in registering a producer company is similar to incorporating a private limited company. Here are the steps involved for registering a producer company
Liability of members of producer company is limited to unpaid amount (if any) on shares held by them in producer company.
NO. After registering a producer company it will become a body corporate just like a private limited company, under no circumstances whatsoever a producer company become or deemed to become a public limited company.
There is no limit on maximum number of members of a producer company.
A producer company by passing a special resolution can alter its MOA, however new objects should be persistent with objects contained in section 581B of the act. This special resolution certified by at least 2 directors should be filled with MCA within 30 days.
Yes a co-operative society can convert into a producer company , however such co-operative society should be a multi-state co-operative society.
A producer company should have at least a minimum of 5 directors and a maximum of 15 directors.
The shares of producer company cannot be transferred in general, however after previous approval of board a person may transfer his shares to an active member. A share of producer company can be transferred to a producer only.
Yes, a producer company can provide donation to an institution or an individual for promoting general welfare of its members or producers or general public.However,such donation should not increase more than 3 % of net profits of previous year. Noi producer company will make donation to any political party or electoral trust.
Yes, a producer company can provide loans in form of credit facility to its members for a period not exceeding 6 months. A loan against security can also be given to members for a period exceeding 3 months but not more than seven years.
Yes a producer company for promotion of its objectives can invest in securities giving highest returns available from fixed deposits, bonds issued by government, can acquire shares of another producer company, can form subsidiary company and subscribe to its share capital. Producer company can also invest in shares of another company which is not a producer company, however this investment in company other than producer company cannot be more than 30% of its paid up capital and free reserves.
CharteredMunshi offers hassle free registration of Producer company in Pan INDIA. Our experts will guide you with complete registration process which is mostly online. After incorporation also we will assist you in day to day functioning of producer company. Fill out our form and our expert will call you for assisting and registering your producer company in INDIA.