A Producer Company is a company, formed with an objective of production, harvesting, procurement, grading, pooling, handling, marketing, selling, export of primary produce of the Members or import of goods or services for their benefit. Term “Produce” means things that have been produced or grown, especially by farming. This means that, a Producer Company deals primarily with agriculture and post-harvest processing activities.
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Producer Company Features
1. Separate Legal Entity
A Producer Company is a legal entity and a juristic person established under the Act. Therefore, a Producer Company has a wide legal capacity and can own property and also incur debts. The members (Directors) of a farmer producer company have no liability to the creditors of a Producer Company.
2. Tax Benefits
If the companies are registered as farmer-Producer Company with an annual turn over of Rs. 100 Crores, then such companies will have 100% tax deduction and earning profit out of the same will not bother to pay any tax. The government has extended a 100% deduction to farmer Producer Company.
3. Limited Liability
Limited liability in a farmer Producer Company means that if the company goes through some financial distress because of business activity, the personal assets of members of the Producer Company will not be used to pay the debts of the Producer Company. The members liability will be limited only.
4. Loans & Investments
The members of the Producer Companies are initial producers, hence they need finance from time to time. NABARD bank offers loans to the farmers for a period not extending six months to meet the needs. In the event, if the members need finance for farming they can effortlessly take from the NABARD bank for a specific time.
Interest in Producer Company can easily be transferred by transferring its shares. The Board of Management of a Producer Company organization controls the exercises of the Producer Company. Its board of management is easily transferable as such. This can be effected simply through the filing of forms with Registrar of Company (ROC).
6. Perpetual Succession
Producer Company has ‘perpetual succession’, that is continued or uninterrupted existence until it is legally dissolved. A Producer Company, being a separate legal person, is unaffected by the death or other departure of any member but continues to be in existence irrespective of the changes in membership.
Process of Registration
1. Documentation – A compliance manager will get in touch with you to collect your documents along with a simple checklist. You need to fill up that checklist and submit along with your documents for verification. Our team of experts will verify the documents provided by you and take the procedure further. The compliance manager dedicated to you will keep you updated on the progress of Company Registration throughout the process.
2. Name Approval – Once your documents along with Checklist are submitted, we shall proceed with the application of your Digital Signature and subsequently the approval of name for your Producer Company. You may suggest up to three names of your choice for your Producer Company. Names should be unique and suggestive of the Company’s business. We will proceed with application for name for your Producer Company in Part A of SPICe Plus form.
3. Producer Company – We will draft the MOA (Memorandum of association) and AOA (Articles of association). We will file the incorporation documents with MCA through in part B of a form called “SPICe Plus (SPICe +)” along with the subscription statement. Usually, MCA approves the forms within 4-5 days once filed and issues Incorporation Certificate with CIN. PAN & TAN are allotted alongside. You may then proceed to open your Company Bank Account.
1. Photograph of all the Directors and shareholders
2. PAN Card of all the Directors and shareholders
3. Self-Attested ID Proof of all the Directors (Driving License/Passport/Voter ID)
4. Electricity Bill or any other utility bill for the address proof of the Registered Office
5. Proof of farming in the form of 7/ 12 extracts of Agricultural Land or certificate from District Tahsildar (proof of farming will differ from state to state)
Frequently Asked Questions
“Producer” means any person engaged in any activity or connected with or relatable to any primary produce and primary produce of farmer is defined as produce of farmer arising from agriculture including animal husbandry, horticulture, flori-culture, Fish-farming, viticulture, forestry, forest products, re-vegetation, bee raising and farming plantation products), or from any other primary activity or service which promotes the interest of the farmers or consumers or produce of persons engaged in hand loom, handicraft and other cottage industries or any product resulting from any of the above activities, including by-products of such products.
“Producer Institution” means a producer company or any other institution having only producer or producers or Producer Company or Producer Companies as its member whether incorporated or not having any of the objects referred to in section 581B and which agrees to use the services of the Producer Company or Producer Companies as provided in its articles.
It is valid lifelong once granted, until and unless revoked.
The formation and regulation of the Farmer Producer Company is governed under the provisions of the Companies Act, 1956, along with Companies Act, 2013, and the rules made thereunder.
A minimum of five people is required to register a Producer Company in India.
A Producer Company can be of six types as described below-
The main type of Producer Companies are those involved in a production, procurement or manufacture of any primary produce for its members (for further sale) and to others.
Even a business involved in the marketing or promotion of primary produce or provision of educational services to members and others can constitute itself as a Producer Company.
Any business offering technical assistance to producers, providing training and educational services or conducting research and development can register as a Producer Company.
Any business financing producer activities, be it in the production, marketing or development domain, can register itself as a Producer Company.
Businesses involved in providing infrastructure to producers, whether in the form of electricity, water resources, irrigation techniques, land utilization, or consultation with regard to the same, may constitute themselves as a Producer Company.
With TeamIndia.com, Farmer Producer Company incorporation usually takes 30 days. This is subject to government approvals time and completeness of your documentation.
TeamIndia.co.in provides Producer Company Registration all across India.
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