The Companies (Amendment) Act, 2002

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The Companies (Amendment) Act, 2002


[31st December, 2002.]

An Act further to amend the Companies Act, 1956.

BE it enacted by Parliament in the Fifty-third Year of the Republic of India as follows:-


Short title and commencement.

1. Short title and commencement.-(1) This Act may be called the Companies (Amendment) Act, 2002.

(2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.


Insertion of new Part IXA.

2. Insertion of new Part IXA.-In the Companies Act, 1956 (1 of 1956), after Part IX, the following Part shall be inserted, namely:-




581A. Definitions.-In this Part, unless the context otherwise requires,-

(a) "active Member" means a member who fulfils the quantum and period of patronage of the Producer Company as may be required by the articles;

(b) "Chief Executive" means an individual appointed as such under sub-section (1) of section 581W;

(c) "limited return" means the maximum dividend as may be specified by the articles;

(d) "Member" means a person or Producer institution (whether incorporated or not) admitted as a Member of a Producer Company and who retains the qualifications necessary for continuance as such;

(e) "inter-State co-operative society" means a multi-State co-operative society as defined in clause (p) of section 3 of the Multi-State Co-operative Societies Act, 2002 (39 of 2002) and includes any co-operative society registered under any other law fo the time being in force, which has, subsequent to its formation, extended any of its objects to more than one State by enlisting the participation of persons or by extending any of its activities outside the State, whether directly or indirectly or thro gh an institution of which it is a constituent;

(f) "mutual assistance principles" means the principles set out in sub-section (2) of section 581G;

(g) "officer" includes any director or Chief Executive or Secretary or any person in accordance with whose directions or instructions part or whole of the business of the Producer Company is carried on;

(h) "patronage" means the use of services offered by the Producer Company to its Members by participation in its business activities;

(i) "patronage bonus" means payments made by a Producer Company out of its surplus income to the Members in proportion to their respective patronage;

(j) "primary produce" means-

(i) produce of farmers, arising from agriculture (including animal husbandry, horticulture, floriculture, pisciculture, viticulture, forestry, forest products, re-vegetation, bee raising and farming plantation products), or from any other primary activit or service which promotes the interest of the farmers or consumers; or (ii) produce of persons engaged in handloom, handicraft and other cottage industries;

(iii) any product resulting from any of the above activities, including by-products of such products;

(iv) any product resulting from an ancillary activity that would assist or promote any of the aforesaid activities or anything ancillary thereto;

(v) any activity which is intended to increase the production of anything referred to in sub-clauses (i) to (iv) or improve the quality thereof;

(k) "producer" means any person engaged in any activity connected with or relatable to any primary produce;

(l) "Producer Company" means a body corporate having objects or activities specified in section 581B and registered as Producer Company under this Act;

(m) "Producer institution" means a Producer Company or any other institution having only producer or producers...

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