Section 378J Companies Act 2013: Option for Inter-State Co-operative Societies to Become Producer Companies
Section 378J of the Companies Act, 2013 provides a statutory route by which an eligible inter-State co-operative society may apply to the Registrar for registration as a Producer Company under Chapter XXIA of the Act.
Meaning of "inter-State co-operative society"
For Chapter XXIA, Section 378A(c) defines an "inter-State co-operative society" by reference to a multi-State co-operative society under the Multi-State Co-operative Societies Act, 2002. The definition also covers a co-operative society registered under another law which, after formation, extends any of its objects to more than one State by participation of persons or by extending activities outside the State, directly, indirectly, or through an institution of which it is a constituent.
What Section 378J permits
Section 378J operates notwithstanding Section 378C(1). It permits an inter-State co-operative society whose objects are not confined to one State to apply for registration as a Producer Company. The provision prescribes the supporting resolution, statements and declarations, the naming requirement, the Registrar's certification process and the legal effect of transformation.
| Requirement | Section 378J position |
|---|---|
| Eligible applicant | An inter-State co-operative society with objects not confined to one State, subject to the statutory conditions. |
| Members' approval | A special resolution of not less than two-thirds of the total members for incorporation as a Producer Company. |
| Producer Company objects | The society must be engaged in one or more objects specified in Section 378B. |
| Certification | On compliance, the Registrar is required to certify registration within 30 days of receipt of the application. |
| Effect | Upon registration, the society stands transformed into a Producer Company and is thereafter governed by Chapter XXIA, subject to the statutory saving for prior acts or omissions. |
Section 378J - Statutory provision
(1) Notwithstanding anything contained in sub-section (1) of section 378C, any inter-State co-operative society with objects not confined to one State may make an application to the Registrar for registration as Producer Company under this Chapter.
(2) Every application under sub-section (1) shall be accompanied by--
(a) a copy of the special resolution, of not less than two-thirds of total members of inter-State co-operative society, for its incorporation as a Producer Company under this Act;
(b) a statement showing--
(i) names and addresses or the occupation of the directors and the Chief Executive, if any, by whatever name called, of such co-operative; and
(ii) list of members of such inter-State co-operative society;
(c) a statement indicating that the inter-State co-operative society is engaged in any one or more of the objects specified in section 378B;
(d) a declaration by two or more directors of the inter-State co-operative society certifying that particulars given in clauses (a) to (c) are correct.
(3) When an inter-State co-operative society is registered as a Producer Company, the words "Producer Company Limited" shall form part of its name with any word or expression to show its identity preceding it.
(4) On compliance with the requirements of sub-sections (1) to (3), the Registrar shall, within a period of thirty days of the receipt of application, certify under his hand that the inter-State co-operative society applying for registration is registered and thereby incorporated as a Producer Company under this Chapter.
(5) A co-operative society formed by producers, by federation or union of co-operative societies of producers or co-operatives of producers, registered under any law for the time being in force which has extended its objects outside the State, either directly or through a union or federation of co-operatives of which it is a constituent, as the case may be, and any federation or unions of such co-operatives, which has so extended any of its objects or activities outside the State, shall be eligible to make an application under sub-section (1) and to obtain registration as a Producer Company under this Chapter.
(6) The inter-State co-operative society shall, upon registration under sub-section (1), stand transformed into a Producer Company, and thereafter shall be governed by the provisions of this Chapter to the exclusion of the law by which it was earlier governed, save in so far as anything done or omitted to be done before its registration as a Producer Company, and notwithstanding anything contained in any other law for the time being in force, no person shall have any claim against the co-operative institution or the company by reason of such conversion or transformation.
(7) Upon registration as a Producer Company, the Registrar of Companies who registers the company shall forthwith intimate the Registrar with whom the erstwhile inter-State co-operative society was earlier registered for deletion of the society from its register.
Documents required with the application
Under Section 378J(2), the application must be supported by the prescribed statutory material. This includes the qualifying special resolution, particulars of directors and the Chief Executive if any, the list of members, a statement establishing engagement in one or more Section 378B objects, and a declaration by at least two directors confirming the correctness of the specified particulars.
Requirement of a two-thirds special resolution
The conversion cannot proceed merely on a board decision. Section 378J(2)(a) requires a copy of a special resolution supported by not less than two-thirds of the total members of the inter-State co-operative society for its incorporation as a Producer Company under the Companies Act, 2013.
Connection with Section 378B
Section 378J(2)(c) links eligibility to the objects of a Producer Company under Section 378B. Accordingly, the applicant society must state that it is engaged in one or more of the statutory Producer Company objects.
Name after registration
Under Section 378J(3), after registration the words "Producer Company Limited" form part of the company's name, preceded by a word or expression identifying the entity.
Registration within 30 days
Where the requirements of Section 378J(1) to (3) are satisfied, sub-section (4) requires the Registrar, within 30 days from receipt of the application, to certify that the applicant inter-State co-operative society is registered and incorporated as a Producer Company under Chapter XXIA.
Legal effect of transformation
Section 378J(6) provides that, on registration, the inter-State co-operative society stands transformed into a Producer Company. It is thereafter governed by Chapter XXIA to the exclusion of the law that previously governed it, subject to the saving in the provision for matters done or omitted before registration. The section also addresses claims arising merely by reason of the conversion or transformation.
Deletion from the earlier co-operative register
Under Section 378J(7), the Registrar of Companies who registers the Producer Company must forthwith inform the Registrar with whom the erstwhile inter-State co-operative society was registered so that the society can be deleted from that register.
Related provisions
Section 378J should be read with Section 378A for definitions, Section 378B for permitted Producer Company objects, Section 378C for formation and registration, and Section 378K for the effect of incorporation on shareholders.
Official legal resources
For the authoritative and updated text, refer to the official Companies Act, 2013 published by the Ministry of Corporate Affairs and the India Code database. Chapter XXIA was inserted by the Companies (Amendment) Act, 2020.
This page is intended as a legal information resource. For a filing or conversion involving a particular society, the applicable Act, rules, MCA filing requirements and current portal procedures should be checked before filing.