Producer Company Formation and Its Compliances

Producer Company Formation and Its Compliances. Producer Company Formation & its Compliances
Producer Company is formed for the benefit of members of producer Company and its foundation has been laid on the mutual assistance to its members. The concept of Producer Company has been evolved to benefit the producers by securing the best price for their produce and rendering education, consultancy services, and providing ancillary services for the promotion of their interest. In addition to this, it is an avenue given to producer cooperative society to form it into a corporate entity.
As per Companies Act, 2013, Producer Company means a body corporate having objects or activities specified in Section 378B and registered as Producer Company under the Act or the Companies Act, 1956.
Recently, MCA has notified provisions relating to producer company as per Companies Act, 2013 in the notification dated 11th February 2021.
Steps Involved in Incorporation of Producer Company
Pre-Incorporation Compliance Check

To form a producer company, at least 10 individuals, each being a producer, or any two producer institutions or combination of 10 or more individuals or producer institutions should come together.

The memorandum contains the objects as specified under Section 378B of the Companies Act, 2013.

Share Capital of the proposed producer Company shall comprise equity shares only.

At least 5 Directors are required at the time of incorporation.

Name of Producer Company shall end with words “Producer Company Limited”.

Each proposed Director should possess the valid DIN if not then the DIN of not more than 3 directors can be obtained in SPICE+ Form and for remaining directors, Form DIR-3 needs to be filed.

Each producer member should have a certificate from the respective area agriculture officer printed on its Letterhead and to be duly signed mentioning that the member is currently engaged in the agricultural activities on the land on which he is authorized to perform such activities.

Proof demonstrating the ownership of the land of producer member e.g. Land Record where the details regarding name of the owner, hadbast no., tehsil no., district, khewat/Jamabandi no., khatoni no., khasra no., rakba, kanal, etc. is mentioned.

Incorporation Steps: -

Name application through simplified proforma for Incorporating company for electronically plus (spice+) inc-32-part A

The first step to incorporate a Producer Company is to apply the name on MCA Portal in SPICE+ Login by the applicant or promoter of the proposed company. It should be kept in mind that the name should comply with the requirements of incorporation rules and should be ended with the last word “Producer Company Limited”. It shall be valid for 20 days from the date of approval by the Central Registration Centre.
Attachment in Part A of SPICE+ INC-32: -
a) Main Objects of Proposed Producer Company and other relevant documents, if any.
Pay fees of Rs. 1000/-.
Maximum two re-submissions are allowed.

Application for incorporation through simplified proforma for Incorporating company electronically plus (spice+) inc-32-part B

After the approval of the name applied in the First Step, the applicant or the promoter of the proposed company will proceed to fill Part B Form of SPICE+ after logging the same on the MCA portal.
The following information should be kept ready for filing Form Part B of SPICE+:

Authorized and Paid-Up Share Capital of the proposed Company.

Registered office address of the proposed Company.

Details of subscribers and Directors i.e., PAN, Aadhar as a proof of permanent address, Latest Bank statement/Electricity bill, Mobile bill, Telephone bill (not older than two months) as a proof of present address, place of birth, occupation, educational qualification, e-mail id, contact no., duration of stay at present address, number of shares taken in the proposed company.

Contact number and e-mail id of the contact person of the company.

Area codes for applying PAN and TAN.

Passport size jpg images of all subscribers and directors of the proposed company.

Digital signature of the authorised applicant and the same should be registered on MCA portal.

Attachments: -

Self-attested PAN of all the subscribers as identity proof.

Self-attested Aadhar of all the subscribers as proof of permanent address.

Self-attested latest bank statement/electricity bill/telephone bill/mobile bill (not older than two months) as proof of present address.

Duly signed farming certificates from respective area agricultural officer along with land record proof.

Memorandum of association of proposed company which only contains the objects as defined in Section 378B of Companies Act, 2013. Further, it should also state the names, addresses, and occupations of subscribers who shall act as the first directors.

Articles of Association of the proposed company will be framed on the principles of mutual assistance for its members and as provided in the act.

Duly signed consent from the first directors in Form DIR-2.

Name approval letter received from central registration centre.

Proof of Registered office address i.e., lease deed, sale deed, etc.

No objection Certificate from the owner of premises for use by the company as its registered office

Utility bill not older than two months i.e., telephone, gas, electricity bill, etc. depicting the address of premises in the name of the owner

After successful completion of Part B of SPICE+, click on the check form and submit the same. The next step is to prepare an online form AGILE-PRO-S E-Form INC-35 being the linked form and accompanied with the incorporation form INC-32 as stated above.
For preparing the Application for registration of the GSTIN, EPFO, ESIC, Professional Tax Registration, Opening of Bank account & Shops and Establishment Registration (AGILE-PRO-S) E-FORM INC-35, below details must be required: -

Primary Business Activity of the proposed producer company.

Authorized directors’ details in case of opening provident fund account for instance name, father’s name, contact no., e-mail id, passport size jpg image.

Whether the registered office is taken on lease or not? If yes, period of the lease.

Whether the proposed company intends to apply GST?

OTPs for verification of two authorized signatories whose details will be entered in the form.

Identity proofs of authorized persons e.g., self-attested PAN card.

Permanent and present residential proofs of authorized persons i.e., self-attested Aadhar card and bank statement/electricity bill/mobile bill/telephone bill, etc. not older than two months respectively.

Specimen signature card to be duly signed by the authorized persons for registration with Employees’ Provident Fund Organization.

Name of bank account in which the proposed company will open its current account.

Digital Signature of the authorized applicant.

Attachments for AGILE-PRO-S (E-FORM INC-35)

Self-attested PAN of authorized persons as identity proofs.

Self-attested Aadhar of authorized persons as residential proof

Self-attested latest bank statement/electricity bill/telephone bill/mobile bill (not older than two months)

Specimen Signature Card for registration with EPFO.

For more information about AGILE-PRO-S, please visit the below link: -
https://www.mca.gov.in/MinistryV2/agile.html
After successful completion of AGILE-PRO-S, click on the check form and submit the same.
Following the next step is to affix Digital Signatures after downloading all the forms i.e., INC-32, INC-35 & INC-9 (this is auto-generated form) and upload them on the portal and paid fees for PAN/TAN and stamp duty which will be varied according to the state where the registered office of the proposed company will be situated and the authorized capital of the company.
Provisions Applicable to Private Companies will same applies to Producer Company
On registration, the Producer Company will come under the purview of the private limited company and the provisions as applicable to a private limited company will apply to the producer company subject to one exception that the limit of the number of members will not be applicable on producer company and it shall not become a public limited company.
Post Incorporation Compliances: -
As it is clear from the provisions of the act that provisions of a private company will apply to the producer company so all the compliances which private company is supposed to comply with, the same must be complied by the producer company, these are: -

At the time of incorporation if the registered office address is not finalized, then E-Form INC-22 is required to be filed for verification of its final registered office within 30 days from the date of incorporation

Appointment of first statutory auditor in the board meeting within 30 days of incorporation and file E-Form ADT-1 with ROC within 15 days from the date of appointment.

Conduct first board meeting within 30 days of incorporation

Open Bank account for receiving share application money and for conducting day-to-day transactions on behalf of the company.

Issue share certificate to the subscribers within 60 days from the date of incorporation.

File INC-20A within 180 days from the date of incorporation.

Maintain proper books of accounts, statutory registers of the company.

Filing of Disclosure of interest in Form MBP-1 by the directors in the first meeting.

Appointment of directors within 90 days of registration of producer company if the subscribers who sign the Memorandum designated as directors.

Hold at least four board meetings subject to once every three months.

Appointment of Chief Executive by Board.

Hold First Annual General Meeting within 90 days from the date of its incorporation.

Filing of annual return within 60 days of the date of AGM.

Filing of Financial statements within 30 days of the date of AGM.

Some important FAQs
1: - Minimum number of persons required to form a producer company?
Any ten or more individuals, each of them being a producer or any two or more producer institutions, or a combination of ten or more individuals and producer institutions can form a producer company.
2: - Can a producer company incorporate any objects of its choice in its Memorandum?
No, objects shall relate to all or any of the matters as specified in Section 378B of Companies Act, 2013.
3: - Do all the provisions as applicable to the private company be applied to the producer company?
Yes, on registration, the producer company shall become a body corporate as if it is a private limited company, without, however, any limit to the number of Members as applies to a private company.
4: - Minimum number of directors required to form a producer company?
Minimum 5 Maximum 15 directors
5: - What shall be the time limit for conducting the first Annual General Meeting of Producer Company?
Every producer company shall hold its first Annual General Meeting within 90 days from the date of its incorporation.
6: - Are INC-33 & INC-34 also uploaded as linked forms in SPICE+ for incorporation of producer company?
No, in case of incorporation of a producer company, Memorandum, and Articles of Association shall be framed as per the provisions of the Act and attached in INC-32 SPICE+.
7: - What can be considered as a farming certificate proof?
Every producer desirous to become a member of the producer company must have to submit valid farming certificate proof at the time of incorporation. Farming certificate proof will be the certificate from the respective area agricultural officer on its letterhead stating that the member is currently engaged in the production activities on the land which belongs to him.
HOW CAN COMPLIANCE CALENDAR HELP?
We at Compliance Calendar have a team of experts who will help and guide you at every step of incorporation, it can be related to the documents that will be mandatory to attach in SPICE+ and what things need to be taken care of so that it will be incorporated within a reasonable time without any hassle. If you have any questions, feel free to email us at info@ccoffice.in or contact at 9988424211

Producer Company Formation & its Compliances

Producer Company is formed for the benefit of members of producer Company and its foundation has been laid on the mutual assistance to its members. The concept of Producer Company has been evolved to benefit the producers by securing the best price for their produce and rendering education, consultancy services, and providing ancillary services for the promotion of their interest. In addition to this, it is an avenue given to producer cooperative society to form it into a corporate entity.

As per Companies Act, 2013, Producer Company means a body corporate having objects or activities specified in Section 378B and registered as Producer Company under the Act or the Companies Act, 1956.

Recently, MCA has notified provisions relating to producer company as per Companies Act, 2013 in the notification dated 11th February 2021.

Steps Involved in Incorporation of Producer Company

Pre-Incorporation Compliance Check

To form a producer company, at least 10 individuals, each being a producer, or any two producer institutions or combination of 10 or more individuals or producer institutions should come together.
The memorandum contains the objects as specified under Section 378B of the Companies Act, 2013.
Share Capital of the proposed producer Company shall comprise equity shares only.
At least 5 Directors are required at the time of incorporation.
Name of Producer Company shall end with words “Producer Company Limited”.
Each proposed Director should possess the valid DIN if not then the DIN of not more than 3 directors can be obtained in SPICE+ Form and for remaining directors, Form DIR-3 needs to be filed.
Each producer member should have a certificate from the respective area agriculture officer printed on its Letterhead and to be duly signed mentioning that the member is currently engaged in the agricultural activities on the land on which he is authorized to perform such activities.
Proof demonstrating the ownership of the land of producer member e.g. Land Record where the details regarding name of the owner, hadbast no., tehsil no., district, khewat/Jamabandi no., khatoni no., khasra no., rakba, kanal, etc. is mentioned.

Incorporation Steps: -

Name application through simplified proforma for Incorporating company for electronically plus (spice+) inc-32-part A

Attachment in Part A of SPICE+ INC-32: -

a) Main Objects of Proposed Producer Company and other relevant documents, if any.

Pay fees of Rs. 1000/-.

Maximum two re-submissions are allowed.

Application for incorporation through simplified proforma for Incorporating company electronically plus (spice+) inc-32-part B

After the approval of the name applied in the First Step, the applicant or the promoter of the proposed company will proceed to fill Part B Form of SPICE+ after logging the same on the MCA portal.

The following information should be kept ready for filing Form Part B of SPICE+:

Authorized and Paid-Up Share Capital of the proposed Company.
Registered office address of the proposed Company.
Details of subscribers and Directors i.e., PAN, Aadhar as a proof of permanent address, Latest Bank statement/Electricity bill, Mobile bill, Telephone bill (not older than two months) as a proof of present address, place of birth, occupation, educational qualification, e-mail id, contact no., duration of stay at present address, number of shares taken in the proposed company.
Contact number and e-mail id of the contact person of the company.
Area codes for applying PAN and TAN.
Passport size jpg images of all subscribers and directors of the proposed company.
Digital signature of the authorised applicant and the same should be registered on MCA portal.

Attachments: -

Self-attested PAN of all the subscribers as identity proof.
Self-attested Aadhar of all the subscribers as proof of permanent address.
Self-attested latest bank statement/electricity bill/telephone bill/mobile bill (not older than two months) as proof of present address.
Duly signed farming certificates from respective area agricultural officer along with land record proof.
Memorandum of association of proposed company which only contains the objects as defined in Section 378B of Companies Act, 2013. Further, it should also state the names, addresses, and occupations of subscribers who shall act as the first directors.
Articles of Association of the proposed company will be framed on the principles of mutual assistance for its members and as provided in the act.
Duly signed consent from the first directors in Form DIR-2.
Name approval letter received from central registration centre.
Proof of Registered office address i.e., lease deed, sale deed, etc.
No objection Certificate from the owner of premises for use by the company as its registered office
Utility bill not older than two months i.e., telephone, gas, electricity bill, etc. depicting the address of premises in the name of the owner

For preparing the Application for registration of the GSTIN, EPFO, ESIC, Professional Tax Registration, Opening of Bank account & Shops and Establishment Registration (AGILE-PRO-S) E-FORM INC-35, below details must be required: -

Primary Business Activity of the proposed producer company.
Authorized directors’ details in case of opening provident fund account for instance name, father’s name, contact no., e-mail id, passport size jpg image.
Whether the registered office is taken on lease or not? If yes, period of the lease.
Whether the proposed company intends to apply GST?
OTPs for verification of two authorized signatories whose details will be entered in the form.
Identity proofs of authorized persons e.g., self-attested PAN card.
Permanent and present residential proofs of authorized persons i.e., self-attested Aadhar card and bank statement/electricity bill/mobile bill/telephone bill, etc. not older than two months respectively.
Specimen signature card to be duly signed by the authorized persons for registration with Employees’ Provident Fund Organization.
Name of bank account in which the proposed company will open its current account.
Digital Signature of the authorized applicant.

Attachments for AGILE-PRO-S (E-FORM INC-35)

Self-attested PAN of authorized persons as identity proofs.
Self-attested Aadhar of authorized persons as residential proof
Self-attested latest bank statement/electricity bill/telephone bill/mobile bill (not older than two months)
Specimen Signature Card for registration with EPFO.

For more information about AGILE-PRO-S, please visit the below link: -

https://www.mca.gov.in/MinistryV2/agile.html

After successful completion of AGILE-PRO-S, click on the check form and submit the same.

Following the next step is to affix Digital Signatures after downloading all the forms i.e., INC-32, INC-35 & INC-9 (this is auto-generated form) and upload them on the portal and paid fees for PAN/TAN and stamp duty which will be varied according to the state where the registered office of the proposed company will be situated and the authorized capital of the company.

Provisions Applicable to Private Companies will same applies to Producer Company

On registration, the Producer Company will come under the purview of the private limited company and the provisions as applicable to a private limited company will apply to the producer company subject to one exception that the limit of the number of members will not be applicable on producer company and it shall not become a public limited company.

Post Incorporation Compliances: -

As it is clear from the provisions of the act that provisions of a private company will apply to the producer company so all the compliances which private company is supposed to comply with, the same must be complied by the producer company, these are: -

At the time of incorporation if the registered office address is not finalized, then E-Form INC-22 is required to be filed for verification of its final registered office within 30 days from the date of incorporation
Appointment of first statutory auditor in the board meeting within 30 days of incorporation and file E-Form ADT-1 with ROC within 15 days from the date of appointment.
Conduct first board meeting within 30 days of incorporation
Open Bank account for receiving share application money and for conducting day-to-day transactions on behalf of the company.
Issue share certificate to the subscribers within 60 days from the date of incorporation.
File INC-20A within 180 days from the date of incorporation.
Maintain proper books of accounts, statutory registers of the company.
Filing of Disclosure of interest in Form MBP-1 by the directors in the first meeting.
Appointment of directors within 90 days of registration of producer company if the subscribers who sign the Memorandum designated as directors.
Hold at least four board meetings subject to once every three months.
Appointment of Chief Executive by Board.
Hold First Annual General Meeting within 90 days from the date of its incorporation.
Filing of annual return within 60 days of the date of AGM.
Filing of Financial statements within 30 days of the date of AGM.

Some important FAQs

1: - Minimum number of persons required to form a producer company?

Any ten or more individuals, each of them being a producer or any two or more producer institutions, or a combination of ten or more individuals and producer institutions can form a producer company.

2: - Can a producer company incorporate any objects of its choice in its Memorandum?

No, objects shall relate to all or any of the matters as specified in Section 378B of Companies Act, 2013.

3: - Do all the provisions as applicable to the private company be applied to the producer company?

Yes, on registration, the producer company shall become a body corporate as if it is a private limited company, without, however, any limit to the number of Members as applies to a private company.

4: - Minimum number of directors required to form a producer company?

Minimum 5 Maximum 15 directors

5: - What shall be the time limit for conducting the first Annual General Meeting of Producer Company?

Every producer company shall hold its first Annual General Meeting within 90 days from the date of its incorporation.

6: - Are INC-33 & INC-34 also uploaded as linked forms in SPICE+ for incorporation of producer company?

No, in case of incorporation of a producer company, Memorandum, and Articles of Association shall be framed as per the provisions of the Act and attached in INC-32 SPICE+.

7: - What can be considered as a farming certificate proof?

Every producer desirous to become a member of the producer company must have to submit valid farming certificate proof at the time of incorporation. Farming certificate proof will be the certificate from the respective area agricultural officer on its letterhead stating that the member is currently engaged in the production activities on the land which belongs to him.

HOW CAN COMPLIANCE CALENDAR HELP?

We at Compliance Calendar have a team of experts who will help and guide you at every step of incorporation, it can be related to the documents that will be mandatory to attach in SPICE+ and what things need to be taken care of so that it will be incorporated within a reasonable time without any hassle. If you have any questions, feel free to email us at info@ccoffice.in or contact at 9988424211