Producer Company Registration Online in India

Register a Producer Company in India

Ever heard of producer companies? Well, they're like special clubs formed by farmers and other folks who grow things. These clubs help farmers sell their products in a smarter way. The cool part? If you're a member, you don't have to worry too much about the club's debts – it's like having a safety net!

Join us at FinLeg, and we'll guide you through a simple registration process. Let's team up to make your farming journey easier and more successful. With us, forming your producer company is as easy as growing your favorite veggies. No stress, just success!

What is a Producer Company?

A Producer Company encompasses individuals actively involved in various closely linked activities related to primary production. This broad term includes engaging in activities such as production, harvesting, procurement, grading, pooling, handling, marketing, selling, and exporting of the primary produce of its members. Additionally, it extends to the importation of goods or services. In essence, a Producer Company serves as an umbrella entity that brings together and supports those engaged in the diverse spectrum of tasks associated with primary production.

The key features of a Producer Company under the Companies Act typically include:

• Member Ownership: The members of a Producer Company are the primary producers themselves. They are the owners of the company.
• Activity Scope: The company is involved in activities related to primary production, such as agriculture, horticulture, animal husbandry, fisheries, and other related activities.
• Mutual Benefit: The primary objective of a Producer Company is to benefit its members economically. It aims to improve their income and livelihoods by providing a platform for collective action in various aspects of production and marketing.
• Limited Liability: Like other types of companies, members enjoy limited liability, which means their personal assets are protected in case of any financial liabilities of the company.
• Democratic Management: The management of a Producer Company follows democratic principles, with members having a say in decision-making processes.
• Government Regulations: The formation and functioning of Producer Companies are regulated by the Companies Act, and specific provisions related to Producer Companies are outlined in the Act.

By providing a legal framework for collective action, Producer Companies aim to enhance the socio-economic status of primary producers, promote efficiency in production, and facilitate better access to markets and resources.

Objects authorised to be carried out by Producer Company

The activities authorized for Producer Companies encompass a wide range of endeavors designed to benefit and support their members. A Producer Company is empowered to engage in the following activities:

• Processing of Produce: This includes processing, preserving, brewing, vinting, drying, distilling, canning, and packaging the produce of its members.
• Manufacture, Sale, or Supply of Equipment: The Producer Company can participate in the manufacturing, sale, or supply of equipment, machinery, or consumables to its producer members.
• Education on Mutual Assistance Principles: Providing education on mutual assistance principles to the producer members and others is within the purview of a Producer Company.
• Consultancy and Technical Services: Offering consultancy services, technical assistance, training, research and development (R&D), and other activities that promote the interests of producer members.
• Power Generation and Distribution: Involvement in the generation, transmission, and distribution of power, along with activities related to the conservation and communication pertaining to primary produce, as well as the revitalization of land and water resources.
• Insurance Services: Offering insurance for the primary produce and its producers is a sanctioned activity for a Producer Company.
• Promotion of Mutual Assistance Techniques: Actively promoting the principles of mutuality and mutual assistance among its members.
• Welfare Activities: Addressing the welfare of members as determined by the Board.
• Financial Services: Financing procurement, marketing, processing, or other activities, including extending credit facilities or providing financial assistance to producer members.
• Ancillary Activities: Engaging in any other activity, ancillary or incidental to the main objectives of the Producer Company, with the goal of promoting mutual assistance among the producer members and aligning with the principles of mutuality.

It's important to note that 'primary produce' under the Companies Act 2013 is defined broadly, covering agricultural products, animal husbandry, floriculture, horticulture, viticulture, pisciculture, re-vegetation, bee raising, forestry, forest products, farming plantation products, produce of handloom, handicraft, and other cottage industries."

Advantages of Producer Company

Producer Companies offer several advantages to their members, primarily those engaged in primary production activities. Here are some key advantages:

• Collective Bargaining Power: By coming together as a group, members of a Producer Company can negotiate better prices for their produce, purchase inputs at discounted rates, and collectively deal with market challenges. This enhances their bargaining power in the marketplace.
• Market Access: Producer Companies help members access larger markets, both domestic and international. Collective marketing and distribution efforts can lead to better market visibility and increased opportunities for sales.
• Economies of Scale: Pooling resources and efforts allows for economies of scale in production, procurement, and marketing. This can lead to cost savings and increased efficiency.
• Risk Mitigation: Collective action enables members to share risks and resources. This can be particularly beneficial in agriculture, where factors such as weather, pests, and market fluctuations can pose risks to individual farmers.
• Professional Management: Producer Companies provide a platform for professional management, which can help in strategic planning, implementing best practices, and adopting modern technologies. This contributes to increased productivity and profitability.
• Tax Benefit: Agriculture income is exempt u/s 10(1) of the Income Tax Act, 1961. However, exemption sometimes varies based on type of agricultural activity you carry out.
• Access to Credit and Financial Support: As organized entities, Producer Companies often find it easier to access credit and financial support from banks and financial institutions. This can help in funding agricultural activities, infrastructure development, and business expansion.
• Legal Recognition and Protection: Being registered under the Companies Act, Producer Companies enjoy legal recognition. Members benefit from limited liability, protecting their personal assets in case of financial issues within the company.
• Capacity Building: Producer Companies often engage in activities to build the capacity of their members. This includes training programs, workshops, and information sharing to enhance skills and knowledge related to modern agricultural practices and business management.
• Social and Community Development: Beyond economic benefits, Producer Companies can contribute to the overall development of the community. This may include the creation of infrastructure, schools, healthcare facilities, and other community-centric initiatives.
• Empowerment of Marginalized Producers: Producer Companies are particularly advantageous for small and marginalized producers who may face challenges in accessing markets and resources individually. Collective action empowers these groups and gives them a stronger voice in the economic landscape.

Overall, the advantages of Producer Companies stem from the principle of collective action, allowing members to address common challenges, share benefits, and achieve sustainable growth in their primary production activities.

Checklist for Registration of Private Limited Company in India

To register a Producer Company online in India, certain eligibility criteria must be met:

• Minimum Number of Members: The company should have a minimum of 10 individual producers or a minimum of 2 producer institutions as members.
• Minimum Number of Directors: A Producer Company must have at least 5 directors.
• Minimum Capital Requirement: The company is required to have a minimum capital of Rs. 5 lakhs.
• Company Name Requirement: The name of the company should conclude with the words 'Producer Limited Company'.
• Registered Office: The company must establish a registered office address located in India.

These criteria are essential to ensure the proper formation and functioning of a Producer Company, and adherence to these guidelines is crucial during the online registration process."

Minimum Documents required for registration of Private Limited Company in India

In India, the process of incorporating a Producer Company requires the submission of proper proof of identity and address. The Ministry of Corporate Affairs (MCA) accepts scanned copies of the following documents for the online registration of a Producer Company:

Identity and Address Proof for Directors and Shareholders:

• PAN Card or Passport (for foreign nationals/NRIs)
• Voter ID card, Passport, or Driving License
• Latest documents such as Electricity Bill, Mobile Bill, Bank Statement, or Gas Bill
• Passport-sized photograph and specimen signature (for directors only)
• Farmer/Producer Certificate (if applicable)

Registered Office Proof:

• Notarized rental agreement
• No-objection certificate from the property owner
• Sale deed or property deed (if the property is self-owned)

It's important to note that the registered office doesn't necessarily have to be a commercial space; it can also be a residential address, including your home.

Ensuring the submission of these documents is crucial for a smooth and successful incorporation process for a Producer Company."

Step-by-Step Guide to Creating a Private Limited Company in India

The registration process of your private limited Company is a complicated process with numerous requirements. However, as long as you have FINLEG, you need not be concerned because our professionals are able to assist you with each step of the private limited company registration process.

• Step 1 - Obtain Digital Signature(DSC).
• Step 2 - Apply for Director Identification Number (DIN).
• Step 3 - Reserve Unique name for Company by applying in MCA Portal.
• Step 4 - File E-MOA and E-AOA.
• Step 5 - Apply for PAN and TAN.
• Step 6 - Certificate of Incorporation along with PAN and TAN will be issued by ROC.

Frequently Asked Questions (FAQs)