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CS Executive · Company Law and Practice · Directors

Vaishali Agro Producer Company Ltd, an ordinary Producer Company, wants to reduce its board. Under the provisions on Producer Companies, which board size is permissible, and what is the position of an inter-State co-operative society that became a Producer Company?

A Producer Company must have at least five and not more than fifteen directors. An inter-State co-operative society incorporated as a Producer Company may have more than fifteen only for one year from the date of its incorporation as a Producer Company.

  1. ABetween five and fifteen directors; such a society-turned-company may exceed fifteen for one year from incorporation as a Producer CompanyCorrect
  2. BBetween three and twelve directors; no exception exists for such a society
  3. CAt least five with no upper limit; the society may exceed it for three years
  4. DBetween five and fifteen directors; the society may exceed fifteen indefinitely

Explanation

Section 378-O requires at least five and not more than fifteen directors. The proviso lets an inter-State co-operative society incorporated as a Producer Company have more than fifteen for one year from incorporation as such. Other options change the limits or the period.

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