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

A group of farmers in Nashik wants a body corporate to process and market their members' produce, with ownership limited to primary producers. Which form of business organisation under the Companies Act, 2013 suits this purpose?

A Producer Company is suitable. The Companies Act, 2013 provides for it as a body corporate owned by primary producers such as farmers, formed to carry on activities like processing and marketing their produce. Nidhi, OPC and Section 8 companies serve different purposes.

  1. AProducer CompanyCorrect
  2. BNidhi Company
  3. COne Person Company
  4. DSection 8 company formed for charity

Explanation

Chapter XXIA of the Companies Act, 2013 provides for Producer Companies, owned by primary producers, for activities like processing and marketing of their produce. A Nidhi company deals in mutual benefit lending among members. An OPC has only one member. A Section 8 company promotes charitable objects.

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