Companies Act Section 378ZP — Strike off name of Producer Company
CHAPTER XXI
Commercial / Corporate
Summary
Sub-section (1) covers the main situations where the Registrar must strike off a Producer Company. This happens if the company fails to start business within one year of registration, or stops transacting business with its Members, or if the Registrar, after making an inquiry he considers appropriate, is satisfied that the company is no longer carrying out any of its objects as specified in section 378B. In such cases, the Registrar must make an order striking off the company's name, and the company ceases to exist immediately. However, before passing such an order, the Registrar must give the Producer Company a show cause notice, with a copy to all its directors, about the proposed action, and must give the company a reasonable opportunity to present its case.
Sub-section (2) deals with a separate situation. If the Registrar has reasonable cause to believe that a Producer Company is not maintaining any of the mutual assistance principles specified, he must strike its name off the register, following the provisions contained in section 248.
Sub-section (3) gives a right of appeal. Any Member of a Producer Company who is aggrieved by an order made under sub-section (1) may appeal to the Tribunal within sixty days of the order being made.
Sub-section (4) explains the effect of an appeal. Where an appeal is filed under sub-section (3), the order striking off the name will not take effect until the appeal is disposed of.
Official Text
(1) Where a Producer Company fails to commence business within one year of its registration or ceases to transact business with the Members or if the Registrar is satisfied, after making such inquiry as he thinks fit, that the Producer Company is no longer carrying on any of its objects specified in section 378B, he shall make an order striking off the name of the Producer Company, which shall thereupon cease to exist forthwith:
Provided that no such order cancelling the registration as aforesaid shall be passed until a notice to show cause has been given by the Registrar to the Producer Company with a copy to all its directors on the proposed action and reasonable opportunity to represent its case has been given.
(2) Where the Registrar has reasonable cause to believe that a Producer Company is not maintaining any of the mutual assistance principles specified, he shall strike its name off the register in accordance with the provisions contained in section 248.
(3) Any Member of a Producer Company, who is aggrieved by an order made under sub-section (1), may appeal to the Tribunal within sixty days of the order.
(4) Where an appeal is filed under sub-section (3), the order of striking off the name shall not take effect until the appeal is disposed of.