PRODUCER COMPANY REGISTRATION
Producer Company primarily deals with agriculture and post-harvest processing activities. It is mainly registered with the main object of production, harvesting, procurement, grading, pooling, handling, marketing, selling and export of primary produce of the Members or import of goods or services for their benefit. Producer Company requires ten or more producers (individuals); or two or more producer institutions; or combination thereof. The members have necessarily to be primary producers. Producer Company shall have at least five and not more than fifteen directors over 85% of the Farmers in India are small and marginal farmers with land holdings of less than 2 hectares. This fragmentation in farmers and farm lands, leads to disorganization and it is not viable for Indian farmers to adopt the latest technologies. By organization of these farmers into producer companies, economies of scale can be unlocked and the livelihood of farmers can be improved. Thus the concept of Producer Company is aimed at empowering farmers by creating farming clusters organized as Producer Company.
What is the Producer Company ?
Agriculture is the very important sector of Indian Economy. Indian agriculture sector accounts for 18 % of India's Gross Domestic Product (GDP) and provides employment to around 50% of the countries workforce. Producer Company as a legal entity was enacted in 2003 as per section IX A of the Indian Companies Act 1956. Since the above enactment, the PC has been hailed as the organizational form that will empower and improve the bargaining power, net incomes, and quality of life of small and Marginal Farmers/ Producers in India.
In Producer Company, each member can have only one vote, he/ she can contribute different amounts of share capital to the Company. The shares of the Producer Company members cannot be transferred outside the membership. A Producer Company should have a minimum of 10 members or two producer entities or a combination thereof can form a Producer Company. By virtue of assigning equal voting rights to each member, the issues of management control by small and marginal producers has been resolved in the design of Producer Company.
What will you receive in Company registration package ?
Advantages of Private Limited Company Registration
1.Separate Legal Entity (Management & ownership is separate):
Producer Company is a legal entity and a juristic person established under the Companies Act, 2013. Hence, a company has a wide range of legal capacities and the members (Shareholders/Directors) of a company have no personal liability to the creditors of a company for company's debts.
2. Perpetual succession gives longest business life:
Producer Company has 'perpetual succession', which means uninterrupted existence until it is legally dissolved. A company being a separate legal person, is unaffected by death or other departure of any member and it continues to be in existence irrespective of changes in ownership.
3.Large scale Borrowing Easily available:
Producer Companies can raise equity funds and/or borrowed funds both at very attractive rates and easily due to large asset base and recognition as Listed Companies. Various types od securities can be issued such as equity shares, preference shares, debentures, bonds, commercial papers and also can accept the deposits as per provisions of the Companies Act, 2013. Banks and Financial Institutions also give preference for funding to a large Public Limited Companies rather than partnership firms or proprietary concerns or small med sized Companies.
3. Owning Property in own name:
A Company being an artificial person, can acquire, own, and alienate, property in its own name. The property owned by a company could be machinery, building, intangible assets, land, residential property, factory, etc., No shareholder can make a claim upon the property of the company - as long as the company is a going concern.
What are the minimum requirements for Registering a Company in India?
- Minimum 5 Directors
- Minimum 10 Shareholders *
- There is no minimum capital requirements
- DSC of all the promoter - shareholders of proposed Company
- DIN of the Directors
- Unique Name for the proposed Company
- Registered office Address of the Company
* (The Directors and Shareholders can be the same or different persons.)
What is next after registration of Company ?
- Appointment of 1st Auditors
- Opening of Bank Accounts
- Filing of Declaration for Commencement of Business in form INC-20A
- Minutes of Board meeting and their committees
- GST registration of the Company
- Obtaining the IEC No.
- Trade Marks/ Copyright Registration
- Start up registration
- Share Certificates to the subscribers
- Statutory Registers preparations
- Filing of Form AOC-4
- Filing of Form MGT-7
What is the procedure for Company registration ?
Step 1: Obtain the DSC Tokens of all the shareholders
Step 2: Apply for Name Reservation
Step 3: Prepare and filing of Form Spice Form INC-32 for incorporation
Step 4: Obtain the Certificate of Registration
Step 5: File Form INC-20A for Declaration of Commencement of Business
The entire process for registration of Company will take at least 10 to 15 working days from the receipt of all the necessary documents and filing with the ROC.
What Documents are required for Company Incorporation ?
- Copy of PAN Card of all Directors & Promoters
- Passport size photograph of Directors & Promoters
- Copy of Voter identity card/ Passport/ voting ID card of Directors & Promoters
- Certified copy of 7/12 documents and Form 8-A of all individual farmer as issued from the Municipal or Tehsildar office
- Certificate as to the land ownership and sole income source
- Copy of Rent agreement (If rented property)
- Electricity/ Gas bill/ Water Bill/ Electricity Bill/ Bank Statement for Office of Company
- Copy of Index II or Property Tax Receipt (If owned property)
- Landlord NOC (Format will be provided)
Precautions to be taken while name reservation
- Meaningful: The name of your company should have some meaning even though more than two words combination is used. The name taken by the promoters of the Company should not be able to be challenged by anyone.
- Unique: It should not create resemblance with the existing Company or LLP names or even the Trade Marks (either registered or in the process of registration).
- Activity reflecting: In the name of your proposed Company, activity or main business object should be reflected or represented.
- Should not be illegal / offensive: The name of your company should not be against law. It should not be abusive or against the customs and beliefs of any religion.