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CA K. Lal (Advisor)

Producer Company

Meaning of the Producer Company : A producer company is basically a body corporate registered as Producer Company under Companies Act, 1956 and shall carry on or relate to any of following activities classified broadly:-

(a) production, harvesting, processing, procurement, grading, pooling, handling, marketing, selling, export of *primary produce of the Members or import of goods or services for their benefit.

(b) rendering technical services, consultancy services, training, education, research and development and all other activities for the promotion of the interests of its Members.

(c) generation, transmission and distribution of power, revitalization of land and water resources, their use, conservation and communications relatable to primary produce.

(d) promoting mutual assistance, welfare measures, financial services, insurance of producers or their primary produce; *Primary produce has been defined as a produce of farmers arising from agriculture including animal husbandry, horticulture, floriculture, pisciculture, viticulture, forestry, forest products, re-vegetation, bee raising and farming plantation products: produce of persons engaged in hand-loom, handicraft and other cottage industries: by - products of such products; and products arising out of ancillary industries."Producer institution" means a Producer Company or any other institution having only producer or producers.

Incorporation of the Producer Company

Any of the following combination of producers can incorporate a producer company

• Ten or more producers (individuals); or
• Two or more producer institutions; or 
• Combination of the above two (10+2).
Registration of the producer company

  • In a Producer Company, only persons engaged in an activity connected with, or related to, primary produce can participate in the ownership. The members have necessarily to be primary producers.

  • These companies shall be termed as “Companies with Limited Liability” and the liability of the members will be limited to the amount, if any, unpaid on the shares

  • The name of the company shall end with the words "Producer Company Limited"

  • On registration, the producer company shall become as if it is a private limited company for the purpose of application of law and administration of the company (however it shall comply with the specific provisions of part IXA).

  • The maximum number of 50 members is not applicable to these companies.

Share Capital and Voting Right 

  • The share capital of a Producer Company shall consist of equity shares only.
  • Members' equity cannot be publicly traded but only transferred.
  • Voting when membership is 
    • Only of individuals then voting rights shall be based on a single vote for every member.

    • Only of producer institutions then voting rights on the basis of their participation.

    • Combination of both individual and producer institutions then voting rights shall be based on a single vote for every member.

Composition of The Management of the producer company

  • Every producer company is to have at least five and not more than 15 directors.

  • A full time chief executive should be appointed by the board and shall be entrusted with substantial powers of management as the board may determine.

Contact Details

producer company registration in delhi