Section 378D: Membership and voting rights of Members of Producer Company
This section is for defining the membership and voting rights of members in a Producer Company.
The section, clause by clause
What the section says
In plain terms
(1)(a) In a case where the membership consists solely of individual Members, the voting rights shall be based on a single vote for every Member, irrespective of his shareholding or patronage of the Producer Company.
Voting rights in a Producer Company are based on one vote per member if the membership consists solely of individuals, while for Producer Institutions, voting rights are determined by their participation in the business of the company in the previous year, unless it's the first year when rights are based on shareholding.
(1)(b)In a case where the membership consists of Producer Institutions only, the voting rights of such Producer Institutions shall be determined on the basis of their participation in the business of the Producer Company in the previous year, as may be specified by articles:
provisoProvided that during the first year of registration of a Producer Company, the voting rights shall be determined on the basis of the shareholding by such Producer Institutions.
(1)(c)In a case where the membership consists of individuals and Producer Institutions, the voting rights shall be computed on the basis of a single vote for every Member.
(2)The articles of any Producer Company may provide for the conditions, subject to which a Member may continue to retain his membership, and the manner in which voting rights shall be exercised by the Members.
A Producer Company's articles can specify conditions for membership and how voting rights are exercised by members.
(3)Notwithstanding anything contained in sub-section (1) or sub-section (2), any Producer Company may, if so authorised by its articles, restrict the voting rights to active Members, in any special or general meeting.
A Producer Company can restrict voting rights to active members in special or general meetings if authorized by its articles.
(4)No person, who has any business interest which is in conflict with business of the Producer Company, shall become a Member of that Company.
A person with a conflicting business interest cannot become a member of a Producer Company.
(5)A Member, who acquires any business interest which is in conflict with the business of the Producer Company, shall cease to be a Member of that Company and be removed as a Member in accordance with the articles.
A member who acquires a conflicting business interest must cease to be a member and will be removed according to the company's articles.
The right-hand column is written from the section text, not quoted from it, and it has no legal force. Where the two differ, the left-hand column is the law.
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Reproduced from the official India Code print for reference. Check the current text on India Code before you rely on it, and read the section alongside its Rules. Nothing here is legal advice.