Producer Company Registration

Producer Company Registration Procedure in India

Producer Company Registration Procedure

Producer Company is defined under the Companies Act and its object is specified under section 581B. It is a company registered as a Producer Company under the Act. In this article, we will discuss the producer company registration procedure in detail.

What is permitted business activity by Producer Company?

Producer Company activities are related to production, harvesting, grading, pooling, handling, marketing, selling, and packaging of produce, manufacture, the sale of machinery, etc. mainly to its members, export of the primary product of the members or import of goods or services for their benefit. Other activities include generation, transmission and distribution of power and also promoting mutual assistance, welfare measures, financial services.

Producer Company Registration Procedure

The producer company registration procedure is as stated below:

Pre incorporation requirements:

  • At least 10 producer;
  • At least 5 directors.

Spice+ shall have 2 parts-

In order to reserve name in case of new companies-

  • Login to MCA website;
  • Click on new application;
  • Fill the required information and save the application.

For incorporation of Company, follow the following procedure:

  • Prepare documents for incorporation;
  • Once the documents are prepared, applicant is required to fill the information in Spice+ e-form;
  • Prepare MOA and AOA (Electronic or Physical);
  • Fill details regarding GST, EPFO, Bank Account in AGILE PRO;
  • Fill details of INC-9;
  • Download PDF of all web based forms;
  • File forms with MCA;
  • Incorporation certificate shall be generated with CIN, TAN and PAN details.
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Producer Company is a company limited by shares, and thus the liability of the members is limited to their shares in the company.

Documents required for the purpose of Producer Company Formation

  1. PAN Card;
  2. Passport size photograph;
  3. ID proof;
  4. Address proof.
  • MOA & AOA of the producer company.
  • Declaration & Affidavit by the directors and members.
  • Address proof in relation to the location of Producer Company.
  • Documents related to the property where the registered office of the company located, whether rented/owned property.
  • Any other document necessary.

Basic Requirement for Producer Company Registration

  • In a producer company, the number of directors should be more than five but less than fifteen. The directors will be appointed within a period of ninety days from the date of incorporation.
  • Every producer company shall have an internal audit of its accounts at such interval and in such manner as prescribed in the article by a Chartered Accountant as defined in clause (b) of sub-section (1) of section 2 of the Institute of Chartered Accountants Act, 1949.
  • The auditors of the production company are required to make the report on matters such as debts due and obligations, check the balance in cash & securities, details of assets & liabilities, advances to directors and memberships.

Advantages of Producer Company Registration

The advantages of the producer company are following:

Advantages of Producer Company Registration
  • It is a separate legal entity having limited liability.
  • Producer Company offers greater credibility in comparison to unregistered producer companies. It is governed by the central government.
  • In Producer Company, changes in management can be done easily by filing forms with Registrar of Companies.
  • They are entitled to own, sell or alienate a property under its own name.
  • They can accept deposits and provide loans to its farmers, agricultural members and can charge reasonable interest from them.
READ  Change in Directors of Producer Company

Benefits to Members in a Producer Company

  • Every member shall initially receive only such value for the product or products pooled and supplied by the board of producer company may determine, and the withheld price may be distributed in cash or in kind or by allotment of equity shares, in proportion to products supplied to the producer company during the financial year to such extent and in such a manner, subject to such conditions as decided by the board.
  • Every member shall on the share capital contributed, receive only a limited return,

Provided that every such member may be allotted bonus shares in accordance with the provisions contained in the act.

  • The surplus remaining after making provision for the payment of limited return, may be disbursed as patronage bonus, among the members in proportion to their participation in the business of the producer company either by way of cash or by allotment of equity shares, or both, as may be decided by the members at the general meeting.

Donation by Producer Company

A producer company by passing the special resolution in the general meeting make donation or subscription to any institution or individual for the purpose of promoting the social and economic welfare of producer members or producers or the general public. The aggregate amount related to donation or subscription in any financial year shall not exceed three percent of the net profits of the producer company in the financial year immediately preceding the financial year in which the donation or subscription was made.

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Producer Company cannot make directly or indirectly donation to any political party or for any other political purpose to any person by subscription.


The producer company registration procedure is similar to that of Private limited Company. In case you have any query related to Company Registration, feel free to contact Enterslice.

Read our article:Companies Amendment Act, 2020 – Key Features

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