Tuesday, 30 January 2018

Producer Company Annual Compliances

Producer Company Concept was introduced in the year 2002. Producer Company is dealt by the provisions of the Companies Act 1956. The provisions of Section 465(1) of Companies Act 2013 stated that provisions of Companies Act 1956 shall mutatis mutandis to a Producer Company. It is a body corporate which will be incorporated as Producer Company in accordance with Companies Act 1956. The Company will have objectives or activities specified in Section 581B.


There are certain objectives mentioned in the Act Producer Companies can be incorporated into like Production, harvesting, promote the techniques of mutuality etc.

  •          The owner shall give to the person who is engaged in an activity connected or related to primary production.
  •           The Members need to be a primary producer.
  •         Producer Company can be called as Companies with Limited Liability & the liability of the members will be limited to an amount of unpaid share.
  •     Name of the company shall end with the words “Producer Company Limited
  •     The limit of a maximum number of members is not applicable to these Companies.


Annual Compliance of Producer Company

The Producer Company shall hold Annual General Meeting each financial year. The gap between two AGM shall not be more than 15 Months. First AGM shall be held within 90 days of its incorporation where the members shall adopt the articles of Producer Companies and shall appoint the Board of Directors.

The notice of AGM shall contain the following information -
  • Agenda of Annual General Meeting
  • Previous Annual General Meeting or Extraordinary General Meeting Minute
  • The names of candidates for election.
  • The audited balance-sheet and profit and loss accounts of the Producer Company and its subsidiary along with the Board of Directors Report.
  • Draft resolution for appointment of auditors
Details required in Annual Returns

The audited accounts which include balance sheet & profit and loss accounts & board report of Producer Company and its subsidiary company will be with respect to following:
  • Producer Company’s state of affairs.
  • Proposed sum to be passed on reserve.
  • The amount to be paid as limited return on share capital.
  • Proposed sum to be distributed as patronage bonus.
  • Any material changes and commitment, if any which has affected the financial position of the Producer Company and its Subsidiary. Above change, if any occurred between the date of annual accounts of the production company and date of the report of the board.
  • Matters related to energy conservation, environmental protection, expenditure or earnings in foreign exchanges.
  • Any other requirement to be specified by the Board.
Filing of Annual Return

Every Producer Company shall file proceeding of annual general meeting along with Director’s Report, the audited Balance sheet and the profit and loss account with Registrar within sixty (60) days of the date of Annual General Meeting & which will be filed with an annual return along with the required fees.

Penalties

However, any default by Directors of the Producer Companies amount to the penalty:
  • handing over the custody of the books of an account
  • fails to convene annual general meetings or other general meetings
The company may be punishable by the fine Rupee 1 Lakh. If the default is in the nature of continuation than the everyday penalty of rupees 10,000 is levied till the default continues.

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