Producer Company – Need to introduce a Separate Law?
July 11, 2022
Producer Company – Need to introduce a Separate Law? - MMJC
Prime Minister has set a goal of doubling farmers’ income and recently the Government also announced a Scheme with a total budgetary provision of ₹6,865 crores. The professionals who will or who are handholding with such companies must understand the interplay between provisions of Chapter XXIA and other provisions of the Companies Act, 2013 (the Act), then only such professionals will be able to give proper advice to Producer Companies.
A Producer Company is a legal entity formed mainly by primary producers such as farmers, milk producers, etc. Professionals who will be engaged to manage the business will be from rural areas. A producer Company is a private company and provisions of Chapter XXIA. along with other provisions of the Act which apply to a private company and are not inconsistent with provisions of Chapter XXIA apply to a producer Company. Therefore, which provisions of other chapters of the Companies Act will apply to producer companies and up to what extent is the biggest area of ambiguity. Therefore, introducing separate laws will be in the interest of all stakeholders.