A producer company could be well-defined as a lawfully recognized body of farmers/ agriculturists with the intent to improve the standard of their living and make certain a good status of their available support, earnings and profitability. A producer company in India is a corporation which is registered under the Companies Act and according to the Act, a Producer Company could be formed by 10 individuals (or above) or 2 institutions (or above) or by means of a combination of both (10 individuals and 2 institutions) having their business purpose as one of the following:
Procurement
Production
Harvesting
Grading
Pooling
Handling
Marketing
Selling, or
Export
of the primary producers of the Members or import of goods or services for their advantage.
The main goal of the producer company is to simplify the formation of co-operative business as corporations and to make it possible towards converting the existing co-operative business into corporations.
Producer Company in India Checklist
Any 10 or more than 10 producers (Individuals) could join together in order to form a production company but there is no upper limit on the number of members.
Any 2 or more than that producer institution could form a producer company.
A minimum capital of Rs. 500,000 is needed in order to incorporate a producer company.
There must be a minimum of 5 directors (maximum of 15) in a producer company.
It could never be converted into a public company though it could be converted into a multi-state co-operative society.
Documents required for producer company Registration
Documents requisite for producer company registration includes:
PAN Card/ Passport/ Election ID Card of each and every directors and shareholder
Latest Bank Statement Voters ID/Drivers License/passport of each and every directors and shareholder
Passport-sized photographs of each and every directors and shareholder
Any Utility bill copy as a residential proof (For rented property a scanned copy of Rent agreement along with NOC from the landlord; for owned Property, a copy of Property Papers)
Producer Company Registration Process
The procedure of registering a Producer Company is quite similar to that of a Private Limited Company. Digital Signature (DSC) and Director Identification Number (DIN) are required to be obtained first for the proposed first Directors of the business. When the Digital Signature (DSC) and Director Identification Number (DIN) are received, an application for name reservation must be filed with the relevant Registrar of Companies (ROC). There is a prerequisite under the Act that the name of a producer company should end with the words “Producer Limited Company”. When the proposed name is approved through the Registrar of Companies (ROC), an application for incorporation shall be filed in the set format for the incorporation of the Producer Company. When the Registrar shall be satisfied with the application as well as the required documents which are filed for incorporation of Producer Company, the Registrar would approve the same and issue Certificate of Incorporation.
Procedure and Documentation required for incorporating a Producer Company
a. The primary step is to get a Digital Signature Certificate (DSC) by all the directors. Documents needed in order to obtain a DSC are:
The Directors PAN Card
The Directors Aadhaar Card
Photograph
Email Id
Contact Number
b. When the DSC is obtained the next step is to get the Director Identification Number (DIN) through filing form DIR – 3 along with a self-attested Identity proof, address proof, and a photograph
c. Then the name of the production company is required to be finalized. Relating to that, Form INC – 1 to the Registrar of Companies (ROC) must be filed through giving 6 names in the order of preference together with the significance of the names. The name would have the words PRODUCER COMPANY at the end
d. When the name is approved by the ROC, the following documents are required to be prepared:
The Memorandum of Association shall be drafted through incorporating all the objects that the company aims to follow
The Articles of Association shall be drafted comprising all the by-laws of the company
A declaration through a professional is required to be drafted in the format of form INC – 8
An affidavit must be signed by all the subscribers of the suggested company declaring their lawful competency to act as the subscribers
A utility bill, as well as a NOC, must be taken from the owner whose address shall be used as the registered office of the corporation. In case it is not owned, a lease agreement is required to be attached to the form
The directors would provide their consent to act in the Form DIR – 2 and details in DIR – 8
e. Every drafted document is required to be attached to Form INC – 7, INC – 22 and DIR – 12 and uploaded on the website of the ROC.
After conducting proper verification, the ROC would issue a Certificate of Incorporation and the corporation could start its business operations.This type of company establishment promotes the primary producer who has a low-income group towards optimizing their income with collective bargaining and by means of selling the products directly to customers.
