As we All know Agricultural Industry is considered the backbone of our Indian Economy because 62% of the total population directly or indirectly depends on agriculture for their living. still, our Indian farmers aren’t only unorganized but are also in a deplorable state as they’re unfit to go advanced agricultural technologies due to a deficit of finances.

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Keeping into consideration their miserable and pitiable state, the Government decided to formulate an expert commission to examine the matter. Further, in the time 2002, the commission formulated brought the conception of Producer Companies in Indian Society. Since also, the Central Government has been working hard to elevate the status of Indian Producers
(Including Farmers and agriculturalists).

What is Producer Company?

A Producer Company is a mix of a Cooperative Society and a Private Company and is a company incorporated under Part IX- A of the Companies Act, 1956, and also Section 465( 1) of the Companies Act, 2013 to deal with the primary product of its active members related to Farming. Further, the main idea or the purpose of a Producer Company includes selling, distributing and exporting where few primary affairs.
Likewise, a Producer Company can be incorporated either with ten or further members being directors, or with two or further Producer institutions, or by its combination. also, like other business structures, the liability in a Producer Company is limited to the extent of the overdue Share Capital by its members. thus, a Producer company is considered to be a Private Limited
Company under the Companies Act, 2013. still, the ceiling on the maximum number of members doesn’t apply to the same. The incorporation and regulations of Producer Company are governed and regulated by the provision of the Companies Act, 1956, read with the Companies Act, 2013, and the rules made there under.

Benefits of Nidhi Company

What are the Authorized Activities that a Producer Company can Perform?
The Authorized Activities for a Producer company are mentioned under section 581 B of the Companies Act, 1956; the detailed list is enumerated below
  1. product, Procurement, Harvesting, Pooling, Grading, Marketing, Handling, Selling, or Exporting of the primary agrarian yield of the Members or Import produce for their benefit.
  2. Processing together with conserving, distilling, drying, venting, brewing, canning, and Packaging of the agrarian yield of its members.
  3. Manufacturing, dealing , or supplying the outfit, ministry, or consumables primarily to its members.
  4. Offering education grounded on the principle of collective backing to its members and others.
  5. Delivering consultancy services, specialized services, training, exploration and development( R&D), and all other Authorized needed for the creation of the interest of its members.
  6. Generation, transmission, and distribution of the power.
  7. The revitalisation of both land and water coffers regarding their use, conservation, and dispatches applicable to primary yield.
  8. Insurance of either the directors or their primary agrarian yield.
  9. Promoting ways grounded on the principle of collective backing.
  10. Welfare installations or measures for the benefit of members as may be determined by the Board.

Types of Producer Companies Exist in India

A. Product Businesses

Such a Entity deals with the product, procurement, or manufacturing of primary yield.

B. Marketing Businesses

Marketing business technically refers to an establishment engaged with the marketing or creation of primary yield or provision of educational services.

C. Specialized Service Businesses

Similar establishment primarily renders educational services and training to directors. It may
also be engaged with conditioning related to exploration and development.

D. Financing Business

As the name suggests, the fiscal business is the bone
That offers fiscal backing to companies mentioned in this list. Their major sluice of profit comes from the interest assessed on the expended quantum.

E. Infrastructure Businesses

These realities generally give the structure to directors in terms of water coffers, electricity,
land application, irrigation ways, and so on.


1. How many Directors are required to incorporate a Producer Company?

Ans. A minimum of 5 and a outside of 15 directors are demanded to register a Producer  Company in India.

2. What's the Minimum Capital demand to register a Producer Company?

Answer: The minimal capital demand to register a Producer  Company is Rs 5 lakhs.

3. Who can come a member of a Producer Company?

Answer: In India, any individual or association can come a member of a Producer  Company.


4. Is it obligatory for a Producer Company to get its account checked ?

Answer: Yes, as per the vittles of Companies Act, 2013, it’s obligatory for a Producer  Company
to gets its accounts checked .

5. Can a Foreign National or NRI come a Director in a Producer Company?

Answer: Yes, a Foreign National or NRI can come a Director in a Producer  Company. The only
demand is to gain noise( Director Identification Number). still, a Producer  company must have
at least one director who’s a occupant of India. The term “ occupant of India ” denotes the
person who has lived in India for at least 182 days in the last fiscal time. 

6. Do I need to be tête-à-tête present to register a Producer Company?

Answer: No, there’s no need for you to be physically present at our office to register a
Producer  Company as the entire enrollment process is online grounded. All you need to submit
the necessary documents as needed in the gate.

7. Can shares of a Producer Limited Company be transferred?

Answer: Yes, after carrying the previous blessing from directors, a member of a Producer
Company is eligible to transfer his/ her shares, together with the special rights( if in case any).

8. How important time will be taken by the Setupfilings counsels to incorporate a Producer Company?

Answer: generally, we insure presto and speedy enrollment . still, the same also depends upon the documents submitted by the aspirant, and it takes around a period of 30 days.

9. How is a designee appointed in the case of a Producer Company?

Answer: All the Producer  Company members need to nominate one person each in the prescribed manner as the designee. Further, the same should be done within 3 months of getting a member of a Producer  company.

10. What are the types of Producer Company current in India?

Answer: There are five types of Producer  Company current in India, which are product Businesses, Marketing Businesses, Technical Service Businesses, Backing Businesses, and structure Businesses.

11. What are the conditions to start a Producer Company?

Answer: The introductory conditions to incorporate a Producer  company are 10 or further individual, 2 or further Producer , or a combination of both.

12. What's the term of a director in a Producer Company?

Answer: A director can hold his/ her office in a Producer  company for a minimum of 1 and a outside of 5 times.

13. What are the advantages of a Producer Company in India?

Answer: There are several benefits or advantages of a Producer company in India. Some of them are a separate legal reality, limited liability, lesser creditability, easy operation, lower compliance, sue or be sued, acquire property, accept deposits, etc.

14. What's the Board Meeting demand for a Producer Company?

Answer: A Producer  company must have a minimum of 4 Board Meetings in a Financial Year. Further, the time gap between the two board meetings mustn’t exceed a period of 3 months.

15. What are the vittles regarding the inspection of a Producer Company?

Answer: According to the Articles of Association, a Producer  Company needs to get its book of accounts checked by an Internal Adjudicator on a regular base.

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Call us at +91-7738877316

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