Does section 378ZQ override all other laws?

No. Chapter XXIA prevails only to the extent of an inconsistency; otherwise applicable provisions continue.

Does the rest of the Companies Act apply to Producer Companies?

Yes, to the extent it is not varied by or inconsistent with Chapter XXIA, subject to the relevant specific provisions.

Section 378ZQ Companies Act 2013: Producer Company Law Override

Section 378ZQ of the Companies Act, 2013 provides an overriding-effect rule for Producer Companies. Where a provision of Chapter XXIA conflicts with another provision of the Companies Act, another law in force or an instrument operating under such a law, Chapter XXIA prevails to the extent of the inconsistency. Rules that do not conflict continue to apply.

Key principle: Section 378ZQ does not exempt Producer Companies from every other law. It gives precedence to Chapter XXIA only where there is a genuine inconsistency.

Section 378ZQ: Statutory provision

The provisions of this Chapter shall have effect notwithstanding anything inconsistent therewith contained in this Act or any other law for the time being in force or any instrument having effect by virtue of any such law; but the provisions of any such Act or law or instrument in so far as the same are not varied by, or are inconsistent with, the provisions of this Chapter shall apply to the Producer Company.

Section 378ZQ was inserted by section 52 of the Companies (Amendment) Act, 2020 (Act 29 of 2020), effective 11 February 2021. The final clause is read together with the opening non-obstante clause: provisions that are not varied by or inconsistent with Chapter XXIA remain applicable.

Meaning of the overriding clause

The expression "notwithstanding anything inconsistent" is commonly called a non-obstante clause. Its purpose is to resolve a conflict between legal provisions. Chapter XXIA contains special rules for the formation, membership, governance, management, accounts, audit and other matters concerning Producer Companies. Those special rules take priority where they cannot operate consistently with a more general requirement.

The second part of section 378ZQ preserves other applicable requirements wherever they are compatible with Chapter XXIA. It therefore establishes priority in case of conflict, not a general immunity from compliance.

What is covered by section 378ZQ?

Other provisions of the Companies Act, 2013: general company-law provisions continue unless displaced by a specific, inconsistent Chapter XXIA rule.
Other laws currently in force: the override operates only where the relevant law conflicts with Chapter XXIA, subject to the proper interpretation and scope of each enactment.
Instruments made under law: rules or other legally effective instruments cannot defeat an inconsistent Chapter XXIA provision merely because they were issued under another enactment.
Compatible provisions: requirements that can operate alongside Chapter XXIA remain applicable to the Producer Company.

Practical application to Producer Companies

For a question concerning a Producer Company, identify the specific rule in Chapter XXIA (sections 378A to 378ZU), identify the other potentially applicable legal provision, and examine whether compliance with both is possible. If the rules are compatible, both ordinarily apply. If they are genuinely inconsistent, section 378ZQ gives Chapter XXIA priority to the extent of that conflict.

Read section 378ZQ with section 378ZR, which addresses the application of provisions relating to private companies, and the relevant subject-specific provisions of Chapter XXIA. Section 378ZP separately deals with strike-off of a Producer Company; section 378ZS addresses re-conversion into an inter-State co-operative society.

Illustrative interpretation

Governance: If Chapter XXIA expressly prescribes a special method or condition for a Producer Company's internal governance that differs from a general company-law provision, the special rule may prevail to the extent of inconsistency. Other governance duties that do not conflict are not automatically removed.

Regulatory compliance: Taxation, labour, filing and other legal duties should not be assumed to disappear merely because an entity is a Producer Company. The applicability of each requirement must be tested against the actual statutory wording and any specific exemptions.

Legislative background and commencement

Chapter XXIA, including section 378ZQ, was introduced into the Companies Act, 2013 by the Companies (Amendment) Act, 2020, section 52, with effect from 11 February 2021. The provisions supply a dedicated framework for Producer Companies. For the authoritative current text, amendments and notifications, consult the official legislative and regulatory sources below.

Official legal sources

Frequently asked questions

Does section 378ZQ override the entire Companies Act?

No. It overrides inconsistent provisions only to the extent of the conflict; compatible provisions continue to apply.

Does a Producer Company need to follow other laws?

Yes. Section 378ZQ expressly preserves the application of other provisions that are not varied by or inconsistent with Chapter XXIA.

When did section 378ZQ come into effect?

It came into force on 11 February 2021, following insertion by the Companies (Amendment) Act, 2020.