Section 378F Companies Act 2013 - Memorandum of Producer Company
Section 378F of the Companies Act, 2013 specifies the particulars that must be stated in the Memorandum of Association of every Producer Company. It forms part of Chapter XXIA dealing with Producer Companies.
Meaning and purpose of Section 378F
The Memorandum of Association, commonly called the MOA, is the constitutional document that records the basic identity, objects, capital structure and other foundational particulars of a company. For a Producer Company, Section 378F prescribes additional and specific matters that the memorandum must contain.
The provision links the objects clause of a Producer Company to Section 378B. It also requires particulars of the subscribers, share capital, first directors, limited liability and the territorial extent of the company's objects where those objects extend beyond one State.
Section 378F - Memorandum of Producer Company
378F. Memorandum of Producer Company. The memorandum of association of every Producer Company shall state--
(a) the name of the company with "Producer Company Limited" as the last words of the name of such Company;
(b) the State in which the registered office of the Producer Company is to situate;
(c) the main objects of the Producer Company shall be one or more of the objects specified in section 378B;
(d) the names and addresses of the persons who have subscribed to the memorandum;
(e) the amount of share capital with which the Producer Company is to be registered and division thereof into shares of a fixed amount;
(f) the names, addresses and occupations of the subscribers being producers, who shall act as the first directors in accordance with sub-section (2) of section 378J;
(g) that the liability of its members is limited;
(h) against the subscriber's name, the number of shares each subscriber takes:
Provided that no subscriber shall take less than one share;
(i) that in case the objects of the Producer Company are not confined to one State, the States to whose territories the objects extend.
Legislative note: Inserted by the Companies (Amendment) Act, 2020, Section 52, with effect from 11 February 2021.
Requirements of the memorandum explained
| Clause | Requirement | Practical meaning |
|---|---|---|
| (a) | Name | The company name must end with "Producer Company Limited". |
| (b) | Registered office State | The memorandum must identify the State in which the registered office is to be situated. |
| (c) | Main objects | The main objects must consist of one or more objects permitted by Section 378B. |
| (d) | Subscribers | The names and addresses of the persons subscribing to the memorandum must be stated. |
| (e) | Share capital | The amount of share capital and its division into shares of a fixed amount must be specified. |
| (f) | First directors | The names, addresses and occupations of the producer-subscribers who are to act as the first directors must be stated in accordance with the statutory text. |
| (g) | Limited liability | The memorandum must state that the liability of members is limited. |
| (h) | Shares subscribed | The number of shares taken by each subscriber must appear against that subscriber's name, and each subscriber must take at least one share. |
| (i) | Territorial extent | If the objects are not confined to one State, the memorandum must identify the States to which the objects extend. |
Connection with Section 378B
Clause (c) of Section 378F makes the objects clause especially important. A Producer Company cannot frame its principal objects without reference to Section 378B - Objects of Producer Company. The memorandum should therefore describe the proposed activities in a manner consistent with the statutory objects permitted for Producer Companies.
Memorandum and Articles of Association
The memorandum under Section 378F should be read together with Section 378G - Articles of Association. The memorandum records the company's foundational particulars and permitted objects, while the articles contain the internal governance provisions and mutual assistance principles required for a Producer Company.
Amendment of the memorandum
After incorporation, an amendment of the memorandum of a Producer Company is governed by Section 378H - Amendment of Memorandum, subject to the Companies Act, 2013 and applicable filing requirements.
Official legal resources
For the current consolidated legislation, notifications and company filing services, refer to the official India Code and Ministry of Corporate Affairs portals. These official sources should be checked for subsequent amendments, notifications, rules and filing changes.
Key takeaway
Section 378F creates a mandatory checklist for the Memorandum of Association of a Producer Company. The document must correctly state the company's name, registered office State, statutory objects, subscriber details, share capital, first-director particulars, limited liability, share subscriptions and, where applicable, the States to which its objects extend.