28 Feb An Overview of Producer Companies under the Companies Act 2013
Explore the fundamentals of Producer Companies as governed by the Companies Act 2013, encompassing their formation, objectives, governance structure, taxation, compliance, and more, facilitating collaborative efforts in agricultural production and marketing.
Under the Companies Act 2013, a Producer Company is a distinct legal entity formed and registered with the aim of collectively engaging in the production, marketing, and selling of primary produce for the benefit of its members.
Key Highlights:
- Formation:
- Requires a minimum of 10 individuals or two or more institutions.
- Minimum of 5 directors, elected by members.
- Objectives:
- Promotes the interests of members in primary production activities.
- Governance:
- Managed by a board of directors elected by members.
- Liability:
- Members have limited liability, confined to their shareholding.
- Compliance:
- Mandated annual audits and filing of financial statements.
- Taxation:
- Subject to taxation similar to regular companies, eligible for agricultural tax benefits.
In essence, Producer Companies provide a structured platform for farmers to collaborate, enhancing agricultural activities and rural development in India under the regulatory framework of the Companies Act 2013.
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