In this series on Producer Company we bring the legal aspect of formation.
Introduction
The concept of Producer company was introduced in May 2002 by introducing a new Part IXA in the Companies Act. The provisions from S. 581A – 581ZT were based on YK Alagh Committee’s recommendations.
Who can form a Producer company?
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Any 10 or more individuals, each being a producer relating to primary produce can form a Producer company.
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Any 2 or more producer institutions (an institution primarily having only
‘producers of primary produce’ as members) -
Any combination of individuals or producer institutions mentioned above.
For which Primary Produce a Producer company can be formed?
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These activities generally would include agriculture sector (including animal
husbandry, horticulture, floriculture, pisciculture, viticulture, forestry,
forest products, re-vegetation, bee-raising). -
Any primary activity which promotes the interests of the farmers.
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Produce of persons engaged in handloom, handicraft and other cottage industries.
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Any product / by product resulting from any of the above activities.
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Any other activity which enhances the production of the above-mentioned
activities.
What is the Status of a Producer Company?
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It is a company registered under Companies Act and will have ‘Producer Company Limited’ included in its name.
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Since it is a limited liability company, the liability of members would be
limited to the shareholding amount. -
Registrar of Companies Act will be the registration authority.