Quick Answer
A Producer Company is governed by the Companies Act, 2013, specifically Part IXA, Sections 378A-378ZS, which originated from the Companies Act, 1956. Forming one requires a minimum of five individual producers or two producer institutions, or a mix of both, to satisfy the membership eligibility requirements for registration.
by CA V. Viswanathan
FCA, ACS, CFE, Registered Valuer (S&FA) | Since 2012
Understand eligibility, process, and compliance for forming a Producer Company under Companies Act, 2013 (Part IXA, Sections 378A-378ZS, originally from Companies Act, 1956).
A Producer Company is a corporate entity governed by the Companies Act, 2013, specifically under Part IXA, Sections 378A-378ZS. These legal provisions, originally derived from the Companies Act, 1956, outline the specific eligibility, formation process, and regulatory compliance required for such entities to operate as producer-focused organizations.
To form a Producer Company, you must have a minimum of five individual producers. Alternatively, the organization can be formed by at least two producer institutions, or it can consist of a combination of both individual producers and producer institutions to meet the structural membership requirements for registration.
The provisions for forming a Producer Company under Part IXA of the Companies Act, 2013, were originally derived from the Companies Act, 1956. These regulations provide the necessary legal framework for eligibility, the registration process, and ongoing compliance requirements for individuals and institutions involved in the sector.
Yes, institutions can be members of a Producer Company. The legal requirements state that a Producer Company can be formed by a minimum of two producer institutions, or a combination of individual producers and producer institutions, provided the minimum membership threshold for the entity is successfully reached.
Yes, the author, CA V. Viswanathan, is a Registered Valuer (S FA), as well as an FCA, ACS, and CFE. He has been serving as a Producer Company Advisor since 2012, providing expert guidance on eligibility, the formation process, and regulatory compliance under the Companies Act, 2013.
Producer Companies under Sections 378A-378ZU of the Companies Act 2013 are body corporates carrying on activities of production, harvesting, processing, procurement, marketing, etc. of primary produce of members. They blend cooperative-society principles with company-law structure.
Specific compliances: minimum 10 individual primary producers as members; one-member-one-vote irrespective of shareholding; restricted dividend distribution; audit by CA; specific financial-statement formats. Producer companies enjoy specific tax incentives and are eligible for various government schemes targeting primary producers.
This tool provides indicative output based on declared inputs. For complete advisory or compliance execution including any required regulatory filings, certifications, or representation, consult CA V. Viswanathan — FCA, ACS, CFE, IBBI Registered Valuer (IBBI/RV/03/2019/12333) — at +91 99622 60333. Free 30-minute consultation, with detailed scope and fixed-fee quote within 24 hours.