Section 378ZP of Companies Act, 2013 - Strike Off Name of Producer Company
Section 378ZP forms part of Chapter XXIA of the Companies Act, 2013 dealing with Producer Companies. It provides a specific mechanism for striking the name of a Producer Company off the register in stated circumstances, while protecting the company's right to notice and a reasonable opportunity to present its case.
What Section 378ZP provides
Sub-section (1): The Registrar may strike off a Producer Company where it fails to commence business within one year of registration, ceases to transact business with its Members, or, after inquiry, is found no longer to be carrying on any object specified in Section 378B. Before such action, the Registrar must issue a show-cause notice to the Producer Company, send a copy to all directors, and give a reasonable opportunity to represent its case.
Sub-section (2): Where the Registrar has reasonable cause to believe that a Producer Company is not maintaining the prescribed mutual assistance principles, its name is to be struck off in accordance with Section 248 of the Companies Act, 2013.
Sub-section (3): A Member aggrieved by an order under sub-section (1) may appeal to the Tribunal within sixty days of the order.
Sub-section (4): If an appeal is filed, the strike-off order does not take effect until the appeal is disposed of.
Meaning and practical effect
The provision gives the Registrar of Companies a special strike-off power in relation to Producer Companies. The power is linked to the company's commencement and continuation of business, transactions with Members, pursuit of the objects permitted under Section 378B, and observance of the mutual assistance framework applicable to Producer Companies.
The notice requirement is an important procedural safeguard. A strike-off order under sub-section (1) should not be made without giving the Producer Company and its directors notice of the proposed action and a reasonable opportunity to respond.
Appeal to the Tribunal
A Member aggrieved by an order under Section 378ZP(1) may appeal within sixty days. The expression "Tribunal" under the Companies Act refers to the National Company Law Tribunal (NCLT). Where an appeal under Section 378ZP(3) is filed, sub-section (4) postpones the operation of the strike-off order until disposal of that appeal.
Relationship with Section 248
Section 378ZP(2) expressly uses the procedure contained in Section 248 where the Registrar has reasonable cause to believe that the Producer Company is not maintaining the applicable mutual assistance principles. Section 248 is the general Companies Act provision governing removal of company names from the register in specified circumstances.
Official legal resources
For the authoritative and updated statutory text, refer to the Companies Act, 2013 on India Code. Corporate filing and Registrar-related services are available through the Ministry of Corporate Affairs.