1. FARMERS
PRODUCER
ORGANISATION
BUSINESS PLAN
By
ACCELERATOR BUSINESS CENTRE
INDORE

2. Formation and Promotion of 10,000
Farmer Producer Organizations (FPOs)
 To provide handholding and support to new FPOs up to 5 years from the year
of creation in all aspects of management of FPO, inputs, production,
processing and value addition, market linkages, credit linkages and use of
technology etc.
 To provide effective capacity building to FPOs to develop agriculture-
entrepreneurship skills to become economically viable and self-sustaining
beyond the period of support from government.
 farmer- producers’ organization incorporated/ registered either under Part
IXA of Companies Act or under Co-operative Societies Act of the concerned
States and formed for the purpose of leveraging collectives through
economies of scale in production and marketing of agricultural and allied
sector.

3. Broad Services and Activities to be
undertaken by FPOs
 Supply quality production inputs like seed, fertilizer, pesticides and such other inputs at
reasonably lower wholesale rates.
 (ii) Make available need based production and post-production machinery and equipment like
cultivator, tiller, sprinkler set, combine harvester and such other machinery and equipment
on custom hiring basis for members to reduce the per unit production cost.
 (iii) Make available value addition like cleaning, assaying, sorting, grading, packing and also
farm level processing facilities at user charge basis on reasonably cheaper rate. Storage and
transportation facilities may also be made available.
 (iv) Undertake higher income generating activities like seed production, bee keeping,
mushroom cultivation etc.
 (v) Undertake aggregation of smaller lots of farmer-members’ produce; add value to make
them more marketable.
 (vi) Facilitate market information about the produce for judicious decision in production and
marketing.
 (vii) Facilitate logistics services such as storage, transportation, loading/un-loading etc. on
shared cost basis.
 (viii) Market the aggregated produce with better negotiation strength to the buyers and in
the marketing channels offering better and remunerative prices.

4. Implementation mechanism
 National Project Management Agency (NPMA) by SFAC
 State Level Consultative Committee (SLCC) by Agriculture Department
 District level Monitoring Committee (D-MC)
 Implementing Agencies - SFAC, NCDC and NABARD, State Agency
 Cluster Based Business Organizations (CBBOs)
 SFAC will form and promote those FPOs to be incorporated under Part IX A of
Companies Act.
 NCDC will form and promote those FPOs to be registered under any Co-
operative Societies Act of the States.
 NABARD will form and promote those FPOs which are registered either under
Part IX A of Companies Act or registered under any Co-operative Societies Act
of States.

5. Cluster- Based Business Organizations
(CBBOs)
 Implementing Agencies will set up Cluster- Based Business Organizations (CBBOs)
at the State/Cluster level to form and promote FPOs as per their requirements;
however, targets for produce clusters, full or part of the State or region will be
allocated by Project Management Advisory and Fund Sanctioning Committee (N-
PMAFSC).
 In a State, based on geography, produce clusters, cropping pattern, etc., there
may be one or more than one CBBO.
 The CBBOs should be supported with five categories of specialists from the domain
of (i) Crop husbandry; (ii) Agri. marketing / Value addition and processing; (iii)
Social mobilization; (iv) Law & Accounts; and (v) IT/MIS in agriculture &
agriculture marketing.
 The Formation and Incubation cost of CBBO, limited to maximum of Rs. 25 lakh /
FPO of support or actual which is lesser, is to be provided for five years from the
year of formation.

6. FPO Management Cost
Under the scheme, financial support to Farmer Producer Organization (FPO) @ up to
maximum of Rs. 18 lakh / FPO or actual, whichever is lesser is to be provided during
three years from the year of formation. The indicative financial support broadly
covers-
(i) The support for salary of its CEO/Manager (maximum up to Rs.25000/month)
(ii) Accountant (maximum up to Rs. 10000/month);
(iii) one time registration cost(one time up to maximum Rs. 40000 or actual
whichever is lower);
(iv) Office rent (maximum up to Rs. 48,000/year);
(v) utility charges (electricity and telephone charges of office of FPO maximum up to
Rs. 12000/year);
(vi) One-time cost for minor equipment (including furniture and fixture maximum up
to Rs. 20,000);
(vii) Travel and meeting cost (maximum up to Rs.18,000/year); and (vii) misc.
(cleaning, stationery etc. maximum up to Rs. 12,000/year).
(viii) Any expenditure of operations, management, working capital requirement and
infrastructure development etc.,

7. Provision for Equity Grant
Equity Grant shall be in the form of matching grant upto Rs. 2,000 per farmer member of FPO
subject to maximum limit of Rs. 15.00 lakh fixed per FPO
(i) It shall be a legal entity as per para 2 of this guidelines.
(ii) It has raised equity from its Members as laid down in its Articles of Association/ Bye laws, as
the case may be.
(iii) The number of its Individual Shareholders is in accordance with the terms hereto read
together with the Scheme.
(iv) Minimum 50% of its shareholders are small, marginal and landless tenant farmers as defined
by the Agriculture Census carried out periodically by the Ministry of Agriculture, GoI. Women
farmers’ participation as its shareholders is to be preferred.
(v) Maximum shareholding by any one member shall not be more than 10% of total equity of the
FPO.
(vi) A farmer can be member in more than one FPO with different produce clusters but he/she
will be eligible only once(for any one FPO that he/she is a member) for the matching equity grant
up to his/her share.
(vii) In the Board of Directors (BoD) and Governing Body (GB), as the case may be, there shall be
adequate representation of women farmer member(s) and there should be minimum one woman
member.
(viii) It has a duly constituted Management Committee responsible for the business of the FPO.
(ix) It has a business plan and budget for next 18 months that is based on a sustainable, revenue
model as may be determined by the Implementing Agency.

8. Credit Guarantee Facility
 In order to ensure access of FPOs to credit from mainstream Banks and Financial
Institutions, there is a need to create a dedicated fund. The dedicated Credit
Guarantee Fund (CGF) will provide suitable credit guarantee cover to accelerate
flow of institutional credit to FPOs by minimizing the risk of financial institutions
for granting loan to FPOs so as to improve their financial ability to execute better
business plans leading increased profits
 with NABARD and NCDC respectively under the Scheme with matching grant from
DAC&FW for the purpose of extending guarantee to the eligible lending
institution(s) against their collateral free lending to eligible FPOs;
 Eligible Lending Institution (ELI) means a Scheduled Commercial Bank for the
time being included in the second Schedule to the Reserve Bank of India Act, 1934,
Regional Rural Banks, Co-operative Banks, Cooperative Credit Society, NEDFI, or
any other institution, NBFC as may be decided by the NABARD and/or NCDC, as the
case may be

 The credit guarantee cover per FPO will be limited to the project loan of Rs. 2
crore, credit guarantee cover will be 75% of bankable project.

9. STEPS FOR PROMOTING FARMERS
PRODUCER ORGANISATION
 SELECTION OF AREA- Contiguous Villages Cluster Area
 HOMOGENOUS CROPS – Select crops in Ravi and Kharif
 SELECTION OF PROMOTORS- Minimum 11 like minded
Farmers whom socio-economic status is same
 SELECTION OF BOD- Minimum 5 BOD 1 woman member
 TAKING DIN NUMBER
 TAKING PAN NUMBER
 TAKING DIGITAL SIGNATURE
 Minimum Members – 300 to 500 50% Small & Marginal

10. FARMERS PRODUCER ORGANISATION
 VISION – GROW FOR GROWTH
 MISSION – PROMOT SUSTANABLE AGRI-BUSINESS
 REDUCE SUPPLY CHAIN IN BOTH ENDS
 GROW HUGE QUNATITY WITH SAME QUALITY USING SAME
PACKAGE OF PRACTICE
 DEVELOP CROPWISE CLUSTER
 START MARKET WORKING FOR FARMERS
 LINKS MISSING DOTS FOR DEVELOPING FACTORY TO FARM
AND FARM TO FACTORY SUPPLY CHAIN

11. STEPS FOR PROMOTING FARMERS
PRODUCER ORGANISATION
 TAKING FPO NAME
 TAKING FPO LOGO
 PREPARE MOA AND AOA
 APPLICATION TO ROC
 BUILDING FOR OFFICE
 TAKING PAN FOR FPO
 TAKING GST

12. STEPS FOR PROMOTING FARMERS
PRODUCER ORGANISATION
 TAKING NOC FROM LABOUR DEPARTMENT
 OPENING BANK ACCOUNT
 PREPARE A BUSINESS PLAN
 APPLICATION TO DDA FOR FERTILISER, SEEDS &
PESTICIDE
 BUILDING FOR GOWDON
 RAGISTRATION WITH EFASAL
 TAKING O FORM & PC

13. EFFECTS OF INCORPORATION
 SHARE CAPITAL
 CAPITAL
 SHARE CAPITAL OF PRODUCER COMPANY
 PRODUCER FOR ALTERATION OF CAPITAL
 INCREASE OF CAPITAL
 CONSOLIDATION/DIVISION OF SHARE INTO SHARES
 DIMINUTION OF CAPITAL
 CANCELLING THE SHARE WHICH is NOT TAKEN UP
 REDUCTION OF CAPITAL
 ISSUE OF BONUS
 SHARE CERTIFICATE

14. EFFECTS OF INCORPORATION
 BOARD OF DIRECTORS
 BOARD OF DIRECTORS OF A PRODUCER COMPANY
 QUALIFICATIONS OF DIRECTORS
 NUMBER OF DIRECTORS
 APPOINTMENT OF DIRECTORS
 FIRST DIRECTORS: APPOINTMENT BY SUBSCRIBERS TO MEMORANDUM
 APPOINTMENT OF DIRECTORS IN GENERAL MEETING
 APPOINTMENT OF DIRECTOR BY BOARD
 POWER TO PREVENT CHANGE IN BOARD OF DIRECTORS
 REMOVAL OF A DIRECTOR AND CESSATION OF DIRECTORSHIP
 4.6.1 REMOVAL BY SHAREHOLDERS
 4.6.2 REMOVAL OF DIRECTORS BY THE CENTRAL GOVERNMENT
 4.6.3 REMOVAL BY TRIBUNAL
 4.6.4 RETIREMENT OF A DIRECTOR
 4.6.5 RESIGNATION OF DIRECTORS
 VACATION OF OFFICE OF DIRECTORS
 PENALTY FOR WITHHOLDING OF COMPANY’S PROPERTY

15. MANAGEMENT OF PRODUCER COMPANY
 MEETING OF THE BOARD OF DIRECTORS
 NOTICE CALLING A MEETING OF THE BOARD
 QUORUM
 SITTING FEE
 POWERS AND FUNCTIONS OF THE BOARD
 RESOLUTION BY CIRCULATION NOT ALLOWED
 RESTRICTIONS ON THE POWER OF THE BOARD
 PROHIBITIONS AND RESTRICTIONS REGARDING POLITICAL CONTRIBUTIONS

16. MANAGEMENT OF PRODUCER COMPANY
 POWER OF THE BOARD TO MAKE CONTRIBUTIONS
 DOANTIONS OR SUBSCRIPTION BY A PRODUCER COMPANY
 CONTRIBUTIONS TO THE NATIONAL DEFENCE FUNDS, etc.
 DIRECTORS’ LIABILITIES
 LIABILITIES TO OUTSIDERS
 LIABILITIES TO THE COMPANY
 LIBLITIES TO THE SHAREHOLDERS
 LIABLITIES FOR STATURY DEFAULTS AND VIOLATIONS
 DIRECTOR’S LIBLITIES FOR ACTS OF CO-DIRECTORS
 LIABILITIES AS AN OFFICER IN DEFAULT
 THE COURT’S POWER TO GRANT RELIFE IN CERTAIN CASES

17. MANAGEMENT OF PRODUCER COMPANY
 COMPONDING OF CERTAIN OFFENCES
 SPECIAL PROVISIONS REGARDING LIABLITY OF DIRECTORS OF THE PRODUCER
COMPANY
 LEGAL POSITION OF DIRECTORS
 5-10DUTIES OF DIRECTORS
 COMMITTEE OF DIRECTORS
 BOARD’S SANCTION FOR CONTRACTS
 DISCLOSERE OF INTERESTES BY DIRECTORS
 POSITION OF AN INTERESTED DIRECTOR
 REGISTER OF DIRECTORS, MANAGING DIRECTORS, MANAGERS AND SECRETARY

18. MANAGEMENT OF PRODUCER COMPANY
 REGISTER OF CONTRACTS, COMPANIES AND FIRMS IN WHICH DIRECTORS ARE
INTERESTED
 REGISTOR OF DIRECTOR’S SHAREHOLDERS
 CHIEF EXECUTIVE AND HIS FUNCTIONS
 SECRETARY OF PRODUCER COMPANY & SECRETARIAL COMPLANCE
 REMUNERATION TO DIRECTORS
 CHIEF EXECUTIVES AND WHOLE TIME DIRECTORS
 DIRECTORS AND OFFICE OR PLACE OF PROFIT

19. MEMBERSHIP
 MEMBER OF A COMPANY-DEFINATION
 MODES OF ACQUIRING MEMBERSHIP
 SUBSCIBERS TO THE MEMORANDUM
 AGREEMENT IN WRITING
 ESTOPPEL
 JOINT MEMBERSHIP
 MEMBERS OF A PRODUCER COMPANY

20. MEMBERSHIP
 CESSATION OF MEMBERSHIP
 RIGHTS OF MEMBERS
 LIABLITIES OF MEMBERS
 VOTING RIGHTS OF MEMBERS
 MEMBERS’ BENEFITS
 SPECIAL USER RIGHTS
 TRANSFERABLITY OF SHARES NOMINATION AND ATTENDANT RIGHTS
 SURRENDER OF MEMBERSHIP

21. GENERAL MEETINGS
 MEETINGS: NEED AND IMPORTANCE
 KINDS OF COMPANY MEETING
 ANNUAL GERENAL MEETING
 IMPORTANCE OF ANNUAL GERENAL MEETING
 STATUTORY REQUIREMENT
 BUSINESS TO BE TRANSACTED AT ANNUAL GENERAL MEETING
 TIME AND PALCE OF ANNUAL GENERAL MEETING
 7.4 EXTRAORDINARY GENERAL MEETING
 7.4.1 EXTRA-ORDINARY GENERAL MEETING CONVENED BY BOARD
 7.4.2 EXTRA-ORDINARY GENERAL MEETING ON REQUISITION
 7.4.3 POWER OF NATIONAL COMPANY LAW TRIBUNAL TO ORDER


22. GENERAL MEETINGS
 CALLING OF EXTRAORDINATRY GENERAL MEETING
 CLASS MEETINGS
 PROCEDURE FOR CLASS MEETING
 MEETING OF CREDITORS
 NOTICE OF GENERAL MEETING
 LENGTH OF NOTICE
 TO WHOM IT MUST BE GIVEN
 CONTENTS OF THE NOTICE
 DOCUMENTS ACCOMPANYING THE NOTICE OF GENERAL MEETING
 NOTICE AND PROXY
 ORDINARY BUSINESS AND SPECIAL BUSINESS
 QUROM
 CHAIRMAN OF GENERAL MEETING
 PROXIES

23. GENERAL MEETINGS
 RESOLUTIONS
 ORDINARY RESOLUTION
 SPECIAL RESOLUATION
 RESOLUATIONS REQUIRING SPECIAL NOTICE
 CIRCULATION OF MEMBER’S RESOLUATION
 RESOLUATION PASSED AT ADJOURNED MEETING
 SPECIAL PROVISIONS FOR ANNUAL GENERAL MEETING
 FIRST ANNUAL GENERAL MEETING
 FILING OF PROCEEDING WITH THE REGISTERAR
 REPRESENTATINS OF PRODUCER INSTITUTIONS IN A GENERAL MEETING
 VOTING RIGHTS

24. GENERAL MEETINGS
 REGISTRATION OF RESOLUTIONS AND AGREEMENTS
 ADJOURNMENT
 MEENING OF ADJOURMENT
 OCCASION FOR ADJOURNMENT
 WHETHER FRESH NOTICE IS REQUIRED
 POSTPONEMENT
 DISSOLUTION
 MINUTES OF PROCEEDINGS OF MEETINGS

25. RAISING FUNDS-DEVELOPING BUSINESS PLAN
 EXECUTIVE SUMMERY
 STATEMENT OF PURPOSE
 BUSINESS DISCRIPTION
 MARKETING PLAN
 PRODUCTION PLAN
 OPERATION AND MANAGEMENT PLAN
 FINANCIAL MANAGEMENT AND ANALYSIS

26. RAISING FUNDS-DEVELOPING BUSINESS PLAN
 RISKS
 RELATIONSHIP WITH PROMOTING AND SPOSORING AGENCIES
 SUSTANABILITY
 KEY POLICY- QUALITY POLICY, PROCURMENT POLICY
 LEGAL REQURERMENTS
 LICENCES
 TEXATION

27. ORGANISATIONAL MANAGEMENT
 ORGANOGRAM
 SERVICE PROVIDERS
 ROLES OF DIFFERENT PERSONAL
 TRAINING POLICY- STAFF AND MEMBERS
 PRODUCTION PLAN
 PREQUREMENT PLAN

28. FINANCIAL MANAGEMENT
 BANKING
 13,2 INSURANCES
 BUDGET
 CASHFLOW FORCASTING
 ACCOUNTING SYSTEM
 VOUCHER SYSTEM
 CASH TRANSACTION
 PURCHASE PROCEDURE
 INVENTORY OF FIXED ASSET
 DISCLOSER OF FIXED ASSETS
 PHYSICAL VARIFICATIO OF ASSTES
 DELEGATION OF POWER

29. MARKETINGPLAN
 INPUT PURCHAGING WHOLESALE DEALERSHIP
 14.1 OUTPUT MARKETING DIERECT SALLING TO PROCESSERS
 COSTING, PRICING AND ESTIMATING

30. LOANS AND ANVESTMENTS
 LOANS TO MEMBERS AND DIRECTORS
 LOANS TO OTHERS
 INTER CORPORATE INVESTMENTS
 INVESTMENT IN OTHER COMPANIES, FORMATION OF SUBSIDIARIES

31. BOOKS AND ACCOUNTS
 NEED FOR ACCOUNTS
 BOOKS OF ACCOUNT TO BE KEPT BY A PRODUCER COMPANY
 PERSONS RESPOSIBLE FOR KEEPING OF BOOKS OF ACCOUTS
 BALANCESHEET
 PREPARATION OF BALANVE SHEET AND PROFIT AND LOOS ACCOUNT
 ADOPTION OF BABALCE SHEET AND PROFIT AND LOOS ACCOUNT
 AUTHENTICATION OF BABALCE SHEET AND PROFIT AND LOOS ACCOUNT
 CIRCULATION OF BABALCE SHEET AND PROFIT AND LOOS ACCOUNT AND AUDITOR’S
REPORT

32. BOOKS AND ACCOUNTS
 FILLING OF ANNUAL ACCOUNTS WITH REGISTRAR
 DIRECTOR’S REPORT
 INSPECTION OF BOOKS OF ACCOUNT, etc.
 ACCOUNTS OF HOLDING AND SUBSIDIARY COMPNIES
 INTERNAL AUDIT
 DONATIONS OR SUBSIDIARY COMPANY
 GENERAL AND OTHER RESERVES
 ISSUE OF BONUS SHARES

33. AUDIT OF ACCOUNTS
 NEED FOR AUDIT
 APPLICATION OF PROVISIONS OF SECTIONS 224, etc.
 QUALIFICATION OF AUDITORS
 DISQUALIFICATION OF AUDITORS
 APPOINTMENT OF AUDITORS
 APPOINTMENT OF FIRST AUDITORS
 SUBSEQUENT APPOINTMENT OF AUDITORS
 AUTOMATIC RE-APPOINTMENT OF AUDITORS
 APPOINTMENT OF AUDITORS OTHER THEN RETIRING AUDITOR
 FILLING CASUAL VACANCY
 POWER OF THE CENTARL GOVERNMENT TO APPOINT AUDITORS

34. AUDIT OF ACCOUNTS
 REMUNERATION OF AUDITOR
 REMOVAL OF AUDITORS
 LIABLITIES OF AN AUDITOR
 CIVIL LIABLITLTY
 CRIMNAL LIABILITY
 LEGAL POSITION OF AUDITORS
 OWERA AND DUTIES OF AUDITORS
 SPECIAL DUTIES OF AUDITORS OF PRODUCER COMPANY

35. AMALGAMATION, MERGER OR DIVISION
 COMPROMISES AND ARRANGMENTS, etc.
 AMALGAMATION, MERGER OR DIVISION
 RESOLUTION OF DISPUTES
 SETTEMENT OF DISPUTES BY ARBITRATION
 NATURE OF DISPUTES
 REFERENCE OF QUESTION TO ARBITRATOR
 PRINCIPLES FOOLOWED IN THESE PROVISIONS

37. CONTECT US
 DR. RAVINDRA PASTOR
 Phone Number +919425166766
 Email ID- info@efasal.com
 Website- www.efasal.com
THANKS