Start your own Producer Company Registration in India - Filing Lounge
Producer Company is defined as a body corporate having objects or activities specified in section 581B under Companies Act, 2013. Section 581B includes various objects like production, harvesting, grading, pooling, insurance of producer, promoting technique of mutual assistance etc.
Various benefits of Producer Company are:
- Members benefits- eligible to receive bonus shares in proportion to existing shares, initial receiving of value of products supplied by directors and patronage bonus like provision for payment of limited return and reserves etc.
- Tax benefits- exemption on agricultural income under section 10(1) of Income Tax Act, 1961 and partial exemptions on processing an agricultural item.
- Loan benefits- credit facility provided to member for at least six months and repayment period between three months to seven years etc.
Before proceeding with the registration of the company a few things have to be kept in mind-
- The total number of producers can be 10 or more in a producers company
- Any two or more producer organizations can form a producer’s company
- Minimum capital requirement of a producer company is Rs 500,000
- The number of directors for a producer company is minimum five and maximum fifteen.
- A producer’s company cannot be converted into a public company but by following the right procedure it can be converted into multi-state co-operative society.
The registration process of a producer company is similar to a Private Limited company:
1. Obtaining required documents- The very first step is to obtain a digital signature certificate i.e. a certificate issues to certify the identity of a person and director identification number i.e. a 8 digit unique number allotted by central government to any person who wants to be a director or is already an existing director. Other documents are also acquired from directors like self attested copies of permanent account number (PAN) card, Aadhar card and contact details like name and address.
2. Filing company name- Like other companies the name of Producer Company is also filed under a form. The prescribed form for producers company if Form- 1A. To register a company’s name form 1A if filed with the prescribed amount to the registrar of companies. If the name is available then the registrar of companies will inform about the availability of name before continuing the procedure.
3. Drafting of documents- The next step is to draft documents like Memorandum of association and Article of association to proceed to the next step. Section 2(56) of companies act 2013 give power to a Memorandum of Association (MOA). A memorandum of association is a charter that defines the activities and scope of an MOA. Section 2(5) of companies act 2013 gives power to frame, alter articles of association. Articles of association are a document that manages the internal affairs of a company like the creation of by-laws or rules and regulations. It is mandatory to file both these documents.
4. Filing of documents- Statutory declaration from any of the concerned persons is filed regarding the formation of company. These documents include affidavit signed by subscribers of the company, Utility bill, Director’s consent and No objection certificate.
5. Issue of certificate- If the documents are satisfactory then a certificate is issues through which the company will become a corporate body alike to private company. It may take 7 days to get certificate of incorporation from the registrar of companies. A producer’s company can become a multi-state cooperative company but under no circumstances it can convert to a public company.
It is advantageous to form a producer company as it is easily adaptable, has simple regulatory framework and it serves for the betterment of its members and workers.
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