DRBM Corporate Consulting Pvt. Ltd.

Corpage India Advisors Pvt. Ltd.

In Association with

Vithal Deshmukh & Associates

Chartered Accountants

And

RBK & Associates

Company Secretaries

Service Proposal for

Producer Companies

Preface

The concept of Producer Companies was introduced in 2002 by incorporating a

new Part IXA (section 581A to 581ZT) into the Companies Act, 1956 (“the Act”)

based on the recommendations of an expert committee led by an economist, Y.

K. Alagh.

Aim of the Committee was to -

• frame a legislation that would enable incorporation of cooperatives as

companies and conversion of existing cooperatives into companies;

• ensure the unique elements of cooperative business with a regulatory

framework similar to that of companies.

A producer company is basically a body corporate registered as Producer

Company under Companies Act, 1956 and shall carry on or relate to any of

following activities classified broadly:-

(a) production, harvesting, processing, procurement, grading, pooling,

handling, marketing, selling, export of *primary produce of the

Members or import of goods or services for their benefit :

(b) rendering technical services, consultancy services, training, education,

research and development and all other activities for the promotion of

the interests of its Members;

(c) generation, transmission and distribution of power, revitalization of

land and water resources, their use, conservation and communications

relatable to primary produce;

(d) promoting mutual assistance, welfare measures, financial services,

insurance of producers or their primary produce;

*Primary produce has been defined as a produce of farmers arising from agriculture including animal

husbandry, horticulture, floriculture, pisciculture, viticulture, forestry, forest products, re-vegetation, bee

raising and farming plantation products: produce of persons engaged in hand-loom, handicraft and other

cottage industries: by - products of such products; and products arising out of ancillary industries.

Registration

(a) In a Producer Company, only persons engaged in an activity connected

with, or related to, primary produce can participate in the ownership.

The members have necessarily to be primary producers.

(b) These companies shall be termed as “Companies with Limited Liability”

and the liability of the members will be limited to the amount, if any,

unpaid on the shares.

(c) The name of the company shall end with the words "Producer

Company Limited"

(d) On registration, the producer company shall become as if it is a private

limited company for the purpose of application of law and

administration of the company (however it shall comply with the

specific provisions of part IXA).

(e) The maximum number of 50 (200 as per Companies Act ’13) members

is not applicable to these companies.

Management:

• Every producer company is to have at least five and not more than 15

directors.

• A full time chief executive should be appointed by the board and shall be

entrusted with substantial powers of management as the board may

determine.

Benefit to Members:

• Members will initially receive only such value for the produce or products

pooled and supplied as the directors may determine. The withheld amount

may be disbursed later either in cash or in kind or by allotment of equity

shares.

• Members will be eligible to receive bonus shares.

• There is a provision is for the distribution of patronage bonus (akin to

dividend) after the annual accounts are approved — patronage bonus

means payment out of surplus income to members in proportion to their

respective patronage (not shareholding).

DRBM Corporate Consulting Pvt. Ltd.

---------------------------------------------------

Who We Are

We are a group of expert professionals from different fields including Chartered

Accountants, Company Secretaries, Cost & Management Accountants, Banking

Experts, Chartered Engineers, Valuers, Lawyers, and Retired Dignitaries from

Indian Administration Services etc.

DRBM Consulting is a network of professional firms and companies being

represented by DRBM Corporate Consulting Pvt. Ltd. For Producer Companies,

we can render following post-incorporation services:

• Auditing

• Taxation

• Banking & Finance

• Subsidies & Government Incentives

• Business Start-up and Project Management Consulting

� Auditing

We at DRBM, comprise reputed CA firms and senior Chartered Accountants. We

combine a multi-disciplinary approach with deep insight of the business model

and tools and techniques that ensures delivery of high quality audit & assurance

services.

We have developed resilient working methodologies which have assisted us to

design our approach towards conducting special types of audits like audit for

Producer Companies.

We provide following types of Auditing & Assurance Services to Producer

Companies:

� Statutory Audits under the Companies Act, 1956 / 2013

� Tax Audit under the Income Tax Act, 1961

� VAT Audit under the Maharashtra Value Added Tax Act, 2002

� Internal Audits

� Specialised Management Audits

� Secretarial Audits

� System Audits

� Stock Audits

� Taxation

Taxation has been viewed as a depriving charge on the profits. But we foresee it

as an item of cost and try to manage it in an efficient way so as to achieve

optimum profitability.

We provide following types of Taxation Services to Producer Companies:

� Obtaining Licenses, Registrations and Tax Clearances

� Tax Audits under Income Tax Act

� Tax Planning and Management Consultancy

� Filing of Annual Income Tax Returns

� Calculation, Preparation and Filing of Quarterly e-TDS Statements

� International Taxation and Transfer Pricing

� Tax Representations and attending assessments

� Filing and attending appellate proceedings

� Certifications required under various tax laws

� Banking & Finance

Finance is well known as the Back Bone of the Business. Organizations finance

their business operations by way of re-investing cash flows, sale of equity or by

raising funds from banks and financial institutions.

We, at DRBM, have enormous experience in the field of Banking and Finance. We

have strong network connections with Nationalized Banks, Co-op. Banks and

other Financial Institutions.

We provide following types of Banking & Finance Services:

� Preparation of Detailed Project Report and CMA data

� Project Appraisal and Conducting Feasibility Studies

� Calculating Cost of capital and taking Capital Budgeting decisions

� Consultancy for Raising Funds from Banks and Financial Institutions

� Liaison with the Bank Officials

� Availing subsidies under different schemes of the government

� Assessing and Assisting for various alternate sources of funding

� Consulting for Government Incentives and Subsidies

Government has always been a partner in your business’s growth. Under various

schemes of the Government, different benefits have been offered to business

ventures. Consulting for availing such incentives is indeed an intricate exercise

considering the complexities of the present day’s business models and corporate

structures.

We at DRBM, apply developed methodologies, standards and approaches to

derive the true value of a business. We have a strong team of experts having

worked at different implementing agencies of the government who know nitty-

gritties of government schemes. Our team also includes legal and technical

experts who take care of other formalities.

We provide following types of Consulting Services:

� Assessing eligibility under Government Incentives Schemes

� Preparation of Project Reports, Information Memoranda

� Initial Documentation, Credit Appraisal Reports

� Placing Application of the Implementing Authorities

� Liaison with Government Authorities

� Obtaining Eligibility Certificates

� Periodical Filing of Follow-up Reports

� Follow-up, assistance for sanction and disbursement of subsidies

DRBM Corporate Consulting Pvt. Ltd.

Contact us at

_______________________________________________________________________________

Aurangabad

Registered Office:

First Floor, Tapan Down Town,

Adalat Road, Aurangabad – 431001

�: +91-240-2333282, 2328968

�: +91-240-2328968

_________________________________________________________________________________

Pune

Branch Office:

F. No. 315, Bldng No. 22,

Lokmanya Nagar,

LBS Road, Pune – 411030

�: +91-9423781746,

9823679386

PAR Advisory Services Pvt. Ltd.

F. No. 31, A Wing,

Pushpanagari Appts.,

Rambaug Colony,

Paud Road, Pune – 411038

�: +91-9890056846

Corpage India Advisors Pvt. Ltd.

6, ‘Chintamani’,

Above Ajinkyatara Co-Op. Bank,

Shivtirtha Nagar, Paud Road,

Pune – 411038

�: +91-20-65000300

_________________________________________________________________________________

Mumbai

Branch Office:

Shop No. 1, Shingre Chawl,

Azad Road, Andheri (East),

Mumbai – 400093

�: +91-22-26875900, 9702012725

�: +91-22-26875700

_________________________________________________________________________________

Write us on – support@drbm.in / raghav.kulkarni@drbm.in / aalhad.deshmukh@drbm.in

Visit us on – www.drbm.in / Facebook / Linkedin

Partner / Member Firms:

© 2014 DRBM Corporate Consulting Pvt. Ltd.

This write-up / compilation is only for the informative purpose. The views represented in this document are

opinions of the author and based on the information gathered from external sources. Users are requested to

confirm correctness and contact DRBM Corporate Consulting Pvt. Ltd. for specific advice. This write-up is meant

for private circulation only. No part of this write-up may be copied / reproduced in any manner whatsoever

without prior consent of DRBM Corporate Consulting Pvt. Ltd.