Producer Company

A Producer Company is a special type of company formed under Section 581A to 581ZL of the Companies Act, 1956 (still applicable through Companies Act, 2013), designed to benefit farmers, producers, and agricultural workers.

It is a hybrid of a cooperative society and a private limited company, primarily aimed at empowering primary producers (farmers, milk producers, handloom weavers, fishermen, etc.) by giving them a structured platform for collective business.

A Producer Company must be registered with the Registrar of Companies (ROC) and consist only of “Producer Members” engaged in primary production or related activities.

Advantages

Separate Legal Entity: Producer Company is a legal entity and a juristic person established under the Act. It can own property, incur debts, and the members have no liability to the creditors for such debts.
Perpetual Existence: Producer Company has 'perpetual succession', meaning it continues to exist until legally dissolved, unaffected by the death or departure of any member.
Borrowing Capacity: Producer Company can borrow funds through debentures, deposits, or financial institutions, which often prefer lending to such companies over partnerships or proprietary concerns.
Easy Transferability: Shares can be transferred by signing a share transfer form and handing over the share certificate to the buyer.
Owning Property: As a juristic person, Producer Company can acquire, own, and sell property in its own name. No member can claim ownership of company property while it is operational.
Limited Liability: Members are liable only to the extent of their shareholding, protecting personal assets from company debts.

Process

Producer Company Incorporation –
G K B & Associates can incorporate a Producer Company in 14 to 20 days, subject to ROC processing time.

Obtaining DSC & DIN –
Digital Signature Certificate(DSC) and Director Identification Number(DIN) is required for the proposed Directors of the Producer Company. DIN and DSC can be obtained for the proposed Directors within 2-3 days.

Name Approval –
A minimum of one and a maximum of two proposed names must be submitted for RUN (Reserve Unique Name) to the MCA. Subject to availability, naming guidelines and MCA processing time, Name Approval can be obtained in 2 to 3 business days.

Company Incorporation –
Incorporation documents can be submitted to the MCA along with an application for incorporation. MCA will usually approve the application for incorporation in 5-7 days, subject to their processing time.

Documents Required

From Directors:
ID Proof and Address Proof (Aadhar) for Director. As ID proof, PAN Card is mandatory.
For Registered Office:
Latest utility bill (electric bill/telephone bill) or latest tax receipt/ownership deed of the property for the property to be used for registered office.

Frequently Asked Questions

What is a Producer Company in India?

A Producer Company is a special type of company formed under the Companies Act, 2013, specifically for farmers, producers, and rural entrepreneurs. Its objective is to support production, harvesting, procurement, processing, and marketing of goods and services.

Who can form a Producer Company in India?

A Producer Company can be formed by 10 or more individual producers, 2 or more producer institutions, or a combination of both. Members must be engaged in primary production activities such as farming, dairy, poultry, or handicrafts.

Why should I register a Producer Company instead of a cooperative society?

A Producer Company provides limited liability, better legal structure, perpetual succession, and corporate governance while still focusing on producer welfare. It also has more credibility for funding and investments

What are the minimum requirements for setting up a Producer Company?

A Producer Company requires a minimum of 10 members, at least 5 directors, and a registered office in India. There is no maximum limit on members.

How long does it take to register a Producer Company in India?

On average, registration takes 20–30 working days, depending on document verification and approvals from the Ministry of Corporate Affairs (MCA).

Producer Company