About Producer Company

Producer as any person engaged in any activity connected with or relatable to any primary produce (Produce: “things that have been produced or grown, especially by farming”). A Producer Company is thus a body corporate having an object that is:

production, harvesting, procurement, grading, pooling, handling, marketing, selling, export of primary produce of the Members or import of goods or services for their benefit.

 

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Register my Producer Company

Our Professional Fees : INR 19,999/-

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Our scope of work

    1. Any amount of Capital;

    2. Application for 5 Director Identification Numbers;

    3. Application of 5 Digital Signatures (validity 2 years);

    4. Name Approval;

    5. Drafting of Memorandum and Articles of Association;

    6. Drafting of other additional documents;

    7. Preparation of various eforms;

    8. PAN & TAN Application

    9. Resubmission of eforms, if any;

    10. Obtaining Certificate of Incorporation from Registrar;

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Know more about Producer Company

Producer Company

"Producer Company" means a body corporate having objects or activities specified as follows:

(a) production, harvesting, procurement, grading, pooling, handling, marketing, selling, export of primary produce of the Members or import of goods or services for their benefit;  (b) processing including preserving, drying, distilling, brewing, vinting, canning and packaging of produce of its Members ; (c) manufacture, sale or supply of machinery, equipment or consumables mainly to its Members ; (d) providing education on the mutual assistance principles to its Members and others ;  (e) rendering technical services, consultancy services, training, research and development and all other activities for the promotion of the interests of its Members ; (f) generation, transmission and distribution of power, revitalisation of land and water resources, their use, conservation and communications relatable to primary produce ; (g) insurance of producers or their primary produce ; (h) promoting techniques of mutuality and mutual assistance ; (i) welfare measures or facilities for the benefit of Members as may be decided by the Board ; (j) any other activity, ancillary or incidental to any of the activities referred to in clauses (a) to (i) or other activities which may promote the principles of mutuality and mutual assistance amongst the Members in any other manner ; (k) financing of procurement, processing, marketing or other activities specified in clauses (a) to (j) which include extending of credit facilities or any other financial services to its Members.

 

1. Director:

  • Minimum no. of directors required is 5 out of which 1 shall be Indian Resident.
  • Any natural person can be a director of the company.
  • Director Identification No. (DIN) and Digital Signature Certificate (DSC) are required to be a director of the company
  • Directors are the managers and they are responsible for day to day functioning of the Producer Company.

 

2. Shareholder:

  • Minimum no of shareholders required are 10 each of them being a producer or any two or more Producer institutions, or a combination of ten or more individuals and Producer institutions.
  • Director and Shareholders can be the same.
  • Shareholders are the owners of the company

 

3. Capital:

  • There are 2 types of capital i.e. Authorize Capital (It is the capital up to which company is authorize to raise from the member and it can be increase as and when required.), Paid Up Capital (It is the capital which is paid up by the members of the company and it can be increase as and when required.)
  • There is no such requirement for minimum capital, hence the company can be formed with the capital starting from INR 1.

 

4. Registered Office:

  • Any place can be made as the registered office of the company even the residential place can be used as the registered office of the company.

 

5. Registering Authority:

  • Ministry of Corporate Affairs.

 

6. Required Documents

> Proof of Registered office address (Conveyance/ Lease deed/Rent Agreement/Maintenance Bill)

> Copy of the utility bills of the registered office (Electricity Bill/Telephone Bill not older than two months)

 

    Directors / Shareholders

> PAN Mandatory- Indian National / Passport – Foreign National

> Proof of Identity – Voter Id/Passport/Driving License

> Proof of Address (Electricity Bill/Bank Statement/Telephone Bill/Mobile Bill not older than 2 months)

*All documents for Indian National – To be self-attested

*All documents of Foreign National – To be self-attested & apostilled

Obtain DSC (Digital Signature Certificate)

01

Prepare SPICe+ form (Part A – Name availability and reservation request)

02

Prepare SPICe+ Part B form (Company information i.e. directors, capital etc.)

03

Prepare e-form SPICe+ MOA (INC-33) ,SPICe+ AOA (INC-34) and SPICe+ AGILE-PRO (INC-35)

04

Download all the e-forms prepare online and affix DSC on all the e-forms.

05

Attached the require documents with form SPICe+ and upload the e-forms to MCA portal.

06

Verification of documents / forms by RoC

07

Issue of Certificate of Incorporation by RoC

08

Advantages

Producer Company’ being hybrid between a private limited company and a cooperative society, it combines the goodness of cooperatives and efficiency of corporate company.
i. The members will initially receive the value for the produce or products pooled and supplied as the directors may determine. This amount is given out later either in cash or in kind or by allotment of equity shares. ii. Members will be eligible to receive bonus shares in proportion to the shares held by them. iii. The surplus after provision for payment of limited return and reserves may be given out as patronage bonus, among the Members. Patronage bonus means payment out of surplus income to members in proportion to their respective patronage. Patronage, on the other hand, is the use of services offered by producer companies to their members by participation in their business activities.
The Indian Income Tax Act, 1961(“the IT Act”) specifically exempts tax on agricultural income under section 10(1). However, the exemption for such agricultural income shall sometimes differ on the basis of the kind of agricultural activity undertakes.
The members of the Producer Company are primary producers, and thus, are in need of financial assistance from time to time. Hence, a special provision is made by the Act 61 of Producer Company of giving loans to its members. The Company can provide financial assistance to its members through:- credit facility, loans and advances etc.
NABARD has taken up the cause of supporting and to meet the needs of Producer Companies. It set up a Rs. 50 crore Producer Organisation Development Fund (PODF) in 2011, out of its operating surplus.

Disadvantages

Practically many a times Producer Companies struggle to establish practicably sustainable business models and achieve significant revenues and returns to their members.
Care is to be taken to carry the advantages and positive implications of Producer Companies as there are some serious issues to be addressed for their effectual functioning.
If a decision had to be made about a certain issue, one worker isn't able to make the decision; they would have to get the opinions of all the workers before making a final decision. This can be very time consuming.
Factors of Comparison Private Company Public One Person Company Limited Liability Partnership Partnership Sole Proprietorship
Capital Min: INR 1 & Max:No Limit Min: INR 1 & Max:No Limit Min: INR 1 & Max:2 Crore Min: INR 1 & Max:No Limit Min: INR 1 & Max:No Limit Min: INR 1 & Max:No Limit
Director Minimum 2 Minimum 3 Minimum 1 - - -
Shareholder Minimum 2 Minimum 7 Minimum 1 - - -
Designated Partner/Parter - - - Minimum 2 Minimum 2 -
Taxation 30%(25% if turnover does not exceed 250 Crore) 30%(25% if turnover does not exceed 250 Crore) 30% 30% 30% As per Slab Rates
Statutory Audit Compulsory Compulsory Compulsory If Contribution exceed INR 25 Lacs; If Turnover exceed INR 40 Lacs Not Required Not Required
Investor Preference High Low Low Medium Very Low Very Low
Compliance Cost Mdeium High Low Low Low Low
Regulator Registrar of Companies SEBI/Registrar of Companies Registrar of Companies Registrar of Companies Registrar of Firms -
Time take for Registration 5-7 working days 5-7 working days 5-7 working days 20-25 working days 10-12 working days 5-7 working days