Press Information Bureau

Government of India

Ministry of Corporate Affairs

19-September-2012 14:16 IST

Condition to be Imposed for Conversion of Ordinary Society Into Producer Company, Part-Ix A of the Companies Act,1956.

The Ministry of Corporate Affairs has decided to impose certain conditions for conversion of ordinary Society into Producer Company, Part-IX A of the Companies Act,1956.

In a Circular issued by the Ministry recently it has been stated that on receipt of an application/form seeking conversion of a Cooperative Society (Society not registered as the Multi State Society) into a Producer Company, the Registrar of Companies (ROCs) will seek a written consent from the local Cooperative Department of the concerned State certifying that the Society desirous of being converted into a Producer Company under the Companies Act, 1956. Further, the ROCs must satisfy themselves fully that the applicant society has indeed extended its activities outside the State where it is registered as a Cooperative Society under the local/State Level law governing Cooperative Societies which are not inter-State Cooperative Societies.

In case of any doubt a reference may be made to the Ministry for further guidance before incorporation under Section 581 J(5). This circular is effective from 10th of this month.

It is noteworthy that the question of acceptance of documents by the Registrar of Companies for conversion of a Cooperative Society (not registered as the Multi State Society) under Section 581 J(5) of the Companies Act has accordingly been examined in the Ministry.

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Conversion conditions for cooperative societies: ROCs must obtain local cooperative consent and verify inter-state activity before conversion. The Registrar of Companies must obtain written certification from the local Cooperative Department confirming a non multi state society's desire to convert into a Producer Company and must satisfy itself that the society has extended activities outside its State of registration; any doubts are to be referred to the Ministry of Corporate Affairs for guidance before incorporation under the statutory conversion provision.