Skip to content

CS Executive · Setting Up of Business, Industrial and Labour Laws · Selection of Business Organization

A farmers' group in Nashik wants a business entity that combines co-operative features of member ownership with a company's corporate framework, to process and market its members' primary produce. Which entity should they consider?

A Producer Company is the right choice. It is a company form designed for primary producers such as farmers, combining co-operative principles of member participation with the corporate legal framework. An OPC has a single member, a Section 8 company has charitable objects, and a Nidhi company is a mutual-benefit lender.

  1. AOne Person Company
  2. BProducer CompanyCorrect
  3. CSection 8 company
  4. DNidhi company

Explanation

A Producer Company under the Companies Act, 2013 is meant for primary producers such as farmers, combining co-operative principles with company form. An OPC has a single member, and a Section 8 company is for charitable objects. A Nidhi company deals in mutual benefit lending to members.

Did you get it right without looking?

One question tells you little. A timed set on Selection of Business Organization shows your real accuracy, how long you take and where you lose marks.

Practise Selection of Business OrganizationFree diagnostic mock

More Selection of Business Organization questions