India is an agriculture-based country, which has great opportunities for a farmer producer company (FPO). Officially, there are over 10000 FPOs in India.
And, the scope is there for more registrations. People are now aware of these opportunities. They, especially farmers, know that it contributes significantly to India's GDP. In recent years, there has been a surge in the number of farmers who have started their own companies to produce and sell agricultural products.
For those who are interested in registering this type of company in India, understanding its registration procedure is necessary. The process of registering a farmer producer company (FPC) involves several steps. In this blog, you will come across the whole procedure.
Let's discover these steps.
Step 1: Formation of a Producer Group
The first step in the registration process is to set up a producer group (PG). This group can have 10 or more farmers who come together to collectively produce and sell their agricultural products. It must have a minimum of 10 members, and also, all members must be farmers. There is another condition associated. All members of this group must also be registered with the local agriculture department.
Step 2: Formation of a Producer Company
Once the group is set up, the next step is to register a producer company (PC) under the Companies Act, 2013. It can be registered as a private or public limited company. As aforesaid, the minimum number of members required to form it is five, and all members must be farmers or PGs. The company must have the word “Producer” in its name (as a prefix).
Step 3: Memorandum of Association and Articles of Association
The next step is to draft the Memorandum of Association (MoA) and Articles of Association (AoA). Both, the MoA and AoA are legal documents. These documents define the objectives, powers, and internal governance of the company. Here, you should remember that the MoA must include the name, registered office address, and the main objectives of the company. On the flip side, the AoA must clearly describe the rights and responsibilities of the members, directors, and other officers of the company.
Step 4: Obtaining Digital Signature Certificate (DSC), and Director Identification Number (DIN)
Moving toward the next step, it is necessary to obtain a digital signature certificate (DSC) and a director identification number (DIN). For those who don't know about a DSC, it is an electronic signature that is used to sign digital documents.
On the other hand, the DIN is a unique identification number that is assigned to each director of a company. Both, the DSC and DIN can be obtained online from the Ministry of Corporate Affairs (MCA), or with the support of any experienced & certified FPO registration consultant to avoid hassles.
Step 5: Filing of Incorporation Documents with Registrar of Companies
Once the MoA and AoA are applied for, and the DSC and DIN are obtained, you can file the incorporation documents with the Registrar of Companies (RoC). For this purpose, you should be ready with the following documents. These must be filed with the RoC:
To Get The MoA and AoA
Step 6: Payment of Registration Fees
Once the documentation step is over, move to the next step. It is to pay the registration fees. Now, the question is how much to pay as its registration fee. And the answer is that the fees depend on the authorised share capital of the company. The payment can be made online or through a demand draft.
Step 7: Verification of Documents by Registrar of Companies
As you pay out the registration fees, the RoC will verify the documents and issue a certificate of incorporation (CoI) if all the documents are in order. This certificate is proof that the PC is now a legal entity.
Step 8: Application for PAN and TAN
Once the PC is registered, you should apply for a permanent account number (PAN) for a tax deduction. Not only this, you have to go ahead and get a Tax Deduction and Collection Account Number (TAN). The PAN is required for all tax-related transactions, and the TAN is required for a deduction.