Producer Company

What is Producer Company?

 

Agriculture is one of the biggest sector in India employing over 50% of total workforce of the country and contributing a major share in the Indian economy. Considering this and to optimize the growth of Agriculture and Agrarian society in India and to bring better governance and standardize the agricultural activities with technical advancement and collective growth of the community as a whole, the concept of "Producer Company" was introduced in 2002 which majorly helped Indian Producers with their growth and income.

 

A Producer Company is a company, formed with an objective of production, harvesting, procurement, grading, pooling, handling, marketing, selling, export of primary produce of the Members or import of goods or services for their benefit. Term “Produce” means things that have been produced or grown, especially by farming. This means that, a Producer Company deals primarily with agriculture and post-harvest processing activities. Producer Company allows farmers cooperatives to function as a corporate entity under the Ministry of Corporate Act. It is a Special type of entity exclusively for Producers.

Choose Your Package

Silver

₹ 19999/-

  • 10 Digital Signature Certificates
  • 5 Director Identification Numbers
  • Name Approval Application
  • Stamp duty on INR 5 Lakh Authorized Capital
  • Producer Company Incorporation Certificate
  • 10 e-Copies of Share Certificate
  • Copy of e-MOA & e-AOA
  • e-PAN
  • e-TAN
  • ESIC Registration through SPICe Plus
  • PF Registration through SPICe Plus
  • Bank Account opening (feature) through SPICe Plus

Gold

₹ 31999/-

  • 10 Digital Signature Certificates
  • 5 Director Identification Numbers
  • Name Approval Application
  • Stamp duty on INR 5 Lakh Authorized Capital
  • Producer Company Incorporation Certificate
  • 10 e-Copies of Share Certificate
  • Copy of e-MOA & e-AOA
  • e-PAN
  • e-TAN
  • ESIC Registration through SPICe Plus
  • PF Registration through SPICe Plus
  • Bank Account opening (feature) through SPICe Plus
  • GST Registration
  • SSI/MSME Registration
  • INC-20A Filing
  • Appointment of 1st Auditor
  • 1 Year GST Return Filing upto 100 entries (12 GSTR-3B and 4 GSTR-1)

Platinum

₹ 59499/-

  • 10 Digital Signature Certificates
  • 5 Director Identification Numbers
  • Name Approval Application
  • Stamp duty on INR 5 Lakh Authorized Capital
  • Producer Company Incorporation Certificate
  • 10 e-Copies of Share Certificate
  • Copy of e-MOA & e-AOA
  • e-PAN
  • e-TAN
  • ESIC Registration through SPICe Plus
  • PF Registration through SPICe Plus
  • Bank Account opening (feature) through SPICe Plus
  • GST Registration
  • SSI/MSME Registration
  • INC-20A Filing
  • Appointment of 1st Auditor
  • 1 Year GST Return Filing upto 100 entries (12 GSTR-3B and 4 GSTR-1)
  • 1st Income Tax filing upto turnover of Rs. 50 Lakhs
  • 1st Annual Filing upto turnover of Rs. 50 Lakhs
  • Form ADT 1 (Auditor Appointment in AGM)
  • Form AOC -4 (Form for filing financial statement and other documents with the Registrar)
  • Form MGT -7 (Form for filing annual return by a company)
  • 5 DIR-3 KYC for 5 Directors
  • Accounting Book Keeping up to 100 Transactions
  • Professional certification on MGT-7 & AOC-4

 

Conditions to form a Producer Company

 

 

 

 

 

 

 

 

 

 

 

 

Who can become a Member in Producer Company?

 

 

 

Things Producer Company Aims

 

The producer company primarily deals with the production of its active members. It is allowed to carry on any of the following activities by itself or through other entities on behalf of the members.

 

 

 

 

 

 

 

 

 

 

 

 

 

Over the period Producer Company has gained popularity due to the following: 

 

 

 

 

 

 

In India, a vast majority of farmers are marginal farmers with minimal land holdings individually. This restricts them to use the latest technologies in farming. This results in to lower economies of scale. A Producer Company is aimed at organizing a group of marginal farmers and ensuring larger economies of scale.

 

 

Documents Required To Register A Producer Company

 

 

1. Passport size Photograph of all the Directors and Shareholders

 

2. PAN and Aadhar card of all the Directors and Shareholders

 

3. ID proof of all the Directors and Shareholders (Driving License/Voter ID/Passport)

 

4. Address Proof of all the Directors and Shareholders (Bank statement/Electricity Bill/Telephone Bill) not older than 1.5 months having name of the respective Director and Shareholder.

 

5. Registered Office Address Proof (Electricity Bill/Water Bill/Gas Bill or any other utility bill) not older than 1.5 months

 

Specific Requirements:

 

1. A Private Limited Company must have a registered office in India. Documents like bank statement or electricity bill should be recent.

 

2. A utility bill, rent agreement or sale deed and an  NOC (Non-Objection Certificate) from the landlord with his / her consent to use the office as a registered office of a company must be submitted as well.

 

3. Proof of farming in the form of 7/ 12 extracts of Agricultural Land or certificate from District Tahsildar (proof of farming will differ from state to state)

 

 

Steps To Register Your Producer Company

 

 

1. Experienced and dedicated personnel assigned for engagement.

 

2. Collection of required documents along with a simple checklist.

 

3. Verification of the Documents as required for Incorporation by our incorporation experts.

 

4. Process of application of Digital Signature Certificate.

 

5. Name approval application submitted to MCA.

 

6. Drafting of the essential documents by our Assigned Personnel based on the MCA approved name.

 

7. Signing of documents by the Directors and Shareholders.

 

8. Submission of documents along with Incorporation Form to MCA for approval.

 

9. Once MCA approves, it will grant Certificate of Incorporation and the company will be Incorporated.

 

 

Advantages Of Producer Company

 

 

Separate Legal Entity

 

A Producer Company is a legal entity and a juristic person established under the Act. Therefore, a Producer Company has a wide legal capacity and can own property and also incur debts. The members (Directors) of a farmer producer company have no liability to the creditors of a Producer Company.

 

Tax Benefits

 

If the companies are registered as farmer-Producer Company with an annual turn over of Rs. 100 Crores, then such companies will have 100% tax deduction and earning profit out of the same will not bother to pay any tax. The government has extended a 100% deduction to farmer Producer Company.

 

Limited Liability 

 

Limited liability in a farmer Producer Company means that if the company goes through some financial distress because of business activity, the personal assets of members of the Producer Company will not be used to pay the debts of the Producer Company. The members liability will be limited only.

 

Loans & Investments 

 

The members of the Producer Companies are initial producers, hence they need finance from time to time. NABARD bank offers loans to the farmers for a period not extending six months to meet the needs. In the event, if the members need finance for farming they can effortlessly take from the NABARD bank for a specific time.

 

Transferability

 

Interest in Producer Company can easily be transferred by transferring its shares. The Board of Management of a Producer Company organization controls the exercises of the Producer Company. Its board of management is easily transferable as such. This can be effected simply through the filing of forms with Registrar of Company (ROC).

 

Perpetual Succession

 

A Producer Company has ‘perpetual succession’, that is continued or uninterrupted existence until it is legally dissolved. A Producer Company, being a separate legal person, is unaffected by the death or other departure of any member but continues to be in existence irrespective of the changes in membership.

 

7. Better Management: Rather than a single farmer managing their entire business, producer companies' work is divided among the directors. The entity is governed by the Management Board, which has a tenure of five years. A producer company has a separate legal existence, which means that it is not affected by any of its members' death.

 

 

Other Benefits of registering a Producer Company

 

 

Producer Companies avail the following benefits:

 

 

 

 

 

 

 

Compliances Required By Producer Company

 

 

Statutory Auditor Appointment 

 

All registered Indian Companies must appoint a Statutory auditor within 30 days of incorporation. The auditor also needs to be appointed within 15 days from the conclusion of AGM. Therefore, the due date for ROC Form ADT 1 would be 14th October every year.

 

Declaration Of Commencement Of Business 

 

The capital mentioned in the MOA [Memorandum of Association] must be deposited in a bank and commencement certificate must be obtained from MCA within 180 days of incorporation.

 

Accounting 

 

Every Producer Company shall maintain proper books of accounts which shall represent an accurate and fair value of the state of affairs of the company. Accounting is necessary for the statutory audit. Annual filing and Income tax return filing which is mandatory.

 

Statutory Audit 

 

Every Producer Company registered under the Companies Act, 2013, irrespective of its sales turnover or nature of business or capital must have its book of accounts audited each financial year.

 

MAT Audit

 

It is mandatory for the Producer Company to get their accounts audited under MAT i.e. Minimum Alternate Tax. The objective of the introduction of MAT was to bring into the tax net “zero tax companies” which in spite of having earned substantial book profits and having paid handsome dividends, do not pay any tax due to various tax concessions and incentives provided under the Income-tax Law.

 

Income Tax Filing

 

Companies registered in India must file income tax return each year in Form ITR-6. The due date for the same is 30th September each year.

 

Form AOC 4:

 

Financial Statements in Form AOC-4 to be filed with the Balance Sheet, Profit and Loss Account, Directors’ Report, Cash Flow Statement, Auditor’s Report, and the Consolidated Financial Statement.

 

Form MGT 7:

 

The Producer Company requires to file Annual Return in Form MGT-7 regarding the latest information about the directors and shareholders of the Producer Company.

 

DIR 3 KYC

 

All directors are required to file a form to do the KYC with the RoC in form DIR 3 KYC, if you have already submitted the form then one needs to verify the OTP over email and mobile no. otherwise all new director needs to submit this form.

 

Form MBP 1

 

Every director shall in its first board meeting disclose about the interest in any company, firm or other AOI (including any shareholding interest) by filing Form MBP 1.

 

Form DIR 8

 

Every Director of the Company has to file the disclosure of non-disqualification in each Financial Year.

 

Form DPT 3

The Return of Deposit should be filed before the Registrar of Companies in FORM DPT-3.

 

 

 

 

Starting Your Own Producer Company With UpriseLegal

 

 

With our experienced and skilled personnel, We at UpriseLegal makes process of registering your Producer Company very smooth and helps you in each and every step of company formation. We follow law to the core and uses our knowledge to avoid any hassles in your business so that you can rise and grow! You may get in touch with our compliance manager on 9173512402 or email us at [email protected] for free consultation.