Empowering farmers, artisans and primary producers to form a legally recognised collective entity — enabling better market access, shared resources, and mutual financial growth under the Companies Act, 2013.
A Producer Company is incorporated under the provisions of the Companies Act, 2013, but still governed by the provisions of Part IX A of the Companies Act, 1956 (Section 465(1) of Companies Act, 2013) — as if the Companies Act, 1956 has not been repealed — until a special Act is enacted for Producer Companies.
A Producer Company is a body corporate which deals primarily with the produce of its active Members, with the main 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.
Permitted Activities (by itself or through other entities):
Processing including preserving, drying, distilling, brewing, vinting, canning and packaging of produce of its Members
Manufacture, sale or supply of machinery, equipment or consumables mainly to its Members
Providing education on mutual assistance principles to its Members and others
Rendering technical services, consultancy services, training, research and development and all other activities for promotion of Member interests
Generation, transmission and distribution of power; revitalization of land and water resources, their use, conservation and communications relatable to primary produce
Insurance of producers or their primary produce
Promoting techniques of mutuality and mutual assistance among Members
Welfare measures or facilities for the benefit of Members as decided by the Board
Any activity ancillary or incidental to the activities above, or that promotes principles of mutuality and mutual assistance among Members
Financing of procurement, processing, marketing or other specified activities — including extending credit facilities or financial services to Members
Min. 10 members required; no upper limit on maximum members
Minimum capital of ₹5,00,000 required for incorporation
Limited liability for members — limited to shares held in the company
Formed exclusively for the benefit of its own members
Minimum 5, Maximum 15 Directors required for formation
Treated as a Private Limited Company — shall never become or be deemed a Public Limited Company
Depending on the agricultural activity carried on, certain tax benefits can be availed under the Income Tax Act, 1961
Processing including preserving, drying, distilling, brewing, vinting, canning and packaging of Members' produce for better market value.
Manufacture, sale or supply of machinery, equipment or consumables mainly to its Members for improved productivity.
Providing education on mutual assistance principles, technical services, consultancy, R&D and other activities for promotion of Member interests.
Generation, transmission and distribution of power; revitalization of land and water resources, conservation and communications relatable to primary produce.
Insurance of producers or their primary produce, protecting Members from unforeseen losses due to natural or market risks.
Financing of procurement, processing, marketing or other specified activities — including extending credit facilities or financial services to Members.
Promoting techniques of mutuality and mutual assistance among the Members to build a strong cooperative network.
Welfare measures or facilities for the benefit of Members as may be decided by the Board from time to time.
Any other activity ancillary or incidental to the activities above, or that promotes principles of mutuality and mutual assistance among Members.
A Producer Company is registered under the provisions of the Companies Act, 2013 through the procedure prescribed under the Act and Rules and Regulations made thereunder.
The proposed name of the Company is applied by the promoter by paying requisite fee online through the RUN (Reserve Unique Name) Web Service. The applied name will be processed by the Central Registration Centre (CRC), and approval or rejection will be communicated to the applicant. To avoid rejection, the name must follow the guidelines under Companies (Incorporation) Rules, 2014. Once approved, the name is available for 20 days to complete the incorporation. The name must end with the words "Producer Company Limited".
Digital Signatures of all the Members and at least one Director (if members and directors are different) need to be obtained for incorporation. KYC details required:
Once the name is approved by the department, the documents — including the Memorandum of Association (MOA) and Articles of Association (AOA) — are prepared as per the guidelines under the Act for the incorporation of the Company.
Incorporation of the Company is done through e-form namely Simplified Proforma for Incorporating Company electronically (SPICe). After preparation of documents, Form SPICe – INC-32 will be filed along with eMOA (INC-33) and eAOA (INC-34) with the Central Registration Centre (CRC) of the Ministry of Corporate Affairs, along with the requisite Stamp Duty charges.
Once the entire process is completed and the concerned department is satisfied with all the compliances, the Certificate of Incorporation will be issued along with allotment of PAN (Permanent Account Number) and TAN (Tax Deduction Account Number) of the Company. The proposed company will then become a separate legal entity and can transact business in its own name.
