Producer Company allows farmers cooperatives to function as a corporate entity under the Ministry of Corporate Act.
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Producer Company allows farmers cooperatives to function as a corporate entity under the Ministry of Corporate Act.
Every member of the Company will receive a value for the product or products pooled and supplied as determined by the Director. The amount will be distributed in cash or by allotment of equity shares. This may be subject to the conditions of the Board.
Members can get bonus shares in proportion to the amount held. Members of Producer Company are also eligible to get financial assistance by way of credit facility for a period not exceeding 6 months.
The additional amount that may be remaining after making provision for payment of limited return and reserves can be distributed as patronage bonus. This will be in proportion to their participation in business activities either in cash or through equity shares.
Any 10 or more producers or individuals can join together to form a production company but there is no maximum limit on the number of members. Or, any 2 or more producer institutions can form a producer company.