Producer Company

Producer Company Registration in India

A Producer Company is a unique legal structure that brings together farmers or agriculturists to improve their quality of life, provide financial support, and enhance their income. This company combines the features of both private limited companies and cooperatives. The primary objective is to encourage cooperative businesses to transition into company structures, creating a more formal, professional, and sustainable agricultural model.

At IndiaFills.com, we provide expert guidance to help you seamlessly complete the registration process for your Producer Company, ensuring legal compliance under the Companies Act, 2013. Our team simplifies the steps involved, ensuring that your Farmer Producer Organisation (FPO) is set up correctly, empowering your agricultural venture. 🌾

What is a Producer Company?

A Producer Company, also known as a Farmer Producer Organisation (FPO), is a legally recognized entity created by a group of farmers or agriculturists. Its primary objective is to enhance the livelihoods of its members by facilitating the production, marketing, and export of their agricultural produce. This model operates as a hybrid between a private limited company and a cooperative society, governed by the principles of mutual benefit and democratic participation.

Legal Framework for Producer Companies

Producer Companies are governed by the Companies Act, 2013 and operate under specific regulations laid out in Part IX A of the Companies Act, 1956. The key provisions for Producer Companies include:

• Section 465 of the Companies Act, 2013 governs their incorporation.
• The objectives of the company must align with those specified in Section 581B of the Companies Act, 1956.

Key Objectives of a Producer Company

The objectives of a Producer Company revolve around promoting the welfare of its members. These include:

1. Agricultural Activities: Engaging in activities like production, procurement, grading, marketing, and export of agricultural products.
2. Processing & Preservation: Undertaking activities such as packaging, preservation, drying, and distilling to add value to the members’ produce.
3. Supply of Equipment & Consumables: Providing necessary machinery, tools, and consumables to members to improve agricultural productivity.
4. Educational and Technical Services: Offering training, consultancy, and research to improve agricultural practices.
5. Insurance and Welfare: Providing insurance products for the protection of producers and their produce, as well as implementing welfare measures for the benefit of members.

Advantages of a Producer Company

There are several key benefits to establishing a Producer Company, including:

• Hybrid Structure: Combines the professional management of a Private Limited Company with the mutual benefits of a Cooperative Society.
• Ownership by Primary Producers: Membership is restricted to primary producers, ensuring the company’s focus remains on benefiting its members.
• Limited Liability: Members’ financial responsibility is limited to their share contribution, protecting personal assets.
• Minimal Capital Requirement: A minimum paid-up capital of Rs. 1 lakh and minimum authorized capital of Rs. 5 lakh makes it easier for small groups to set up a Producer Company.
• National Scope: Producer Companies can operate nationwide, allowing for a broad market presence and growth potential. 🌍

Membership and Governance Structure

• Membership: A Producer Company must have at least 10 primary producers or producer institutions to form the company. Membership is achieved by purchasing shares in the company.
• Governance: The company is managed by a Board of Directors, who are elected by the members. The Board must consist of a minimum of five directors, serving a term of five years, with the possibility of re-election for up to two consecutive terms.

Capital Requirements

• Minimum Authorized Capital: Rs. 5 lakh.
• Minimum Paid-up Capital: Rs. 1 lakh.
• Flexibility: The authorized capital can exceed Rs. 5 lakh based on the company’s needs.

Steps to Register a Producer Company

1. Obtain a Digital Signature Certificate (DSC): The proposed directors must obtain a DSC, which is required to sign documents electronically.
2. Obtain a Director Identification Number (DIN): Each director must acquire a DIN. This can be done by submitting Form DIR-3 or through the SPICe+ form, along with required documents like identity proof and address proof.
3. Name Reservation: The company name must end with the words “Producer Company.” You need to submit Form SPICe+ to propose a name for approval from the Registrar of Companies (ROC).
4. Preparation of Documents:
   • Memorandum of Association (MoA): Outlines the company’s primary objectives.
   • Articles of Association (AoA): Defines the rules for the company’s operations.
   • Other Forms: Includes forms like Form INC-22 (for the registered office) and Form DIR-12 (for appointing directors).
5. Filing for Incorporation: Once all documents are prepared, the application for incorporation is filed with the ROC using Form SPICe+. The application will contain details of the company’s proposed structure, directors, and registered office.
6. ROC Verification and Certificate of Incorporation: The ROC will review the submitted documents and, upon approval, issue a Certificate of Incorporation, marking the company’s legal establishment.
7. Post-Incorporation Steps: After the company is incorporated, you will need to apply for a PAN and TAN and open a bank account in the company’s name.

Compliance Requirements for Producer Companies

• Audit & Financial Reporting: Producer Companies must maintain proper financial records and undergo an annual audit. The audited reports must be presented at the Annual General Meeting (AGM) and filed with the ROC.
• Taxation: Producer Companies are subject to corporate tax laws but may avail of benefits related to agricultural activities.
• Annual Return: The company is required to file an annual return detailing membership, operational activities, and financial status with the ROC.

Why Choose IndiaFills.com for Producer Company Registration?

At IndiaFills.com, we offer comprehensive support throughout the Producer Company registration process:

• Expert Assistance: Our professionals provide end-to-end support, ensuring smooth documentation and legal compliance.
• Timely & Efficient Service: We help you complete the process in the shortest time possible, ensuring that your company is operational and legally sound.
• Post-Incorporation Services: We provide additional services like PAN/TAN application, GST registration, and ongoing compliance management, ensuring your Producer Company remains compliant with regulatory requirements.

Conclusion

Starting a Producer Company is an excellent way to bring farmers together to improve their income, expand their business, and leverage collective resources. With IndiaFills.com, you can be assured of expert guidance, efficient service, and a hassle-free registration process. 🌱

Contact IndiaFills.com today to begin your journey towards establishing a successful Producer Company and empowering your agricultural venture.