A Non-Governmental Organisation (NGO) is a recognized, an association of persons or a body of individuals. Such types of institution shall a definite name and objective and can be a registered one or an unregistered one. When registered, an NGO acquires a legal character.
Under Indian law, Non-Profit Organizations can be recognized in three forms:
- Section 25 companies
Section 25 companies can be said to be the most reliable strongest organizational structure:
- Indian Trusts have no unified law.
- Indian Societies have non-identical legal and institutional frameworks from state to state.
- Indian Companies (incl. Sec 25 companies), have one uniform and consistent law across the country – Companies Act 1956.
I. Trust Registration:
Legislation: the Indian Trusts Act 1882. Main Instrument: trust deed, containing:
· aims and objects of the trust,
· minimum and maximum number of trustees,
· how other trustees may be appointed or removed,
· how the trust should be managed,
· signature of both the settler/s and trustee/s in the presence of two witnesses,
· Executed on non-judicial stamp paper, etc.
Trustees: Minimum of 2 trustees.
Application for Registration: To the official having jurisdiction over the area in which the trust has to be registered.
The application form should be signed by the applicant before the
- deputy registrar,
- Regional officer or superintendent of the regional office of the charity commissioner or authorized registrar.
The application form should be submitted, along with a copy of the trust deed.
II. Society Registration
According to section 20 of the Societies Registration Act, 1860, the following societies can be registered:
- charitable societies,
- military orphan funds
- societies established for the promotion of literature, science or fine arts ,etc.
Legislation: Societies Registration Act, 1860, which is a federal act. In certain states, Main Instrument: The memorandum of association and rules and regulations.
Trustees: A minimum of seven managing committee members.
Application for Registration: Registration can be done either:
- at the state level or
- at the district level .
The procedure differs from state to state. However generally the application should be submitted along with:
- memorandum of association and rules and regulations;
- consent letters of all the members of the managing committee;
- authority letter duly signed by all the members of the managing committee;
- an affidavit sworn by the president or secretary of the society on non-judicial stamp paper, together with a court fee stamp; and
- a declaration by the members of the managing committee regarding that the funds of the society.
The memorandum of association and rules and regulations need not be executed on stamp paper.
III. Section-8 Company – (Old Section-25)
Company can be established for promotion of commerce, art, science, religion, charity or any other useful object.
Legislation: Section 8 of Indian Companies Act, 2013 (old section-25 of the Indian Companies Act, 1956).
Main Instrument: Memorandum and articles of association (no stamp paper required)
Board Members:A minimum of three members.
Application for Registration:
- An application must be made for availability of name to the registrar of companies.
- An application has be made in writing to the regional director of the company law board.
- The applicants must also provide registrar of companies a copy of the application and each of the other documents that had been filed before the regional director of the company law board.
- The applicants should also publish a notice in the prescribed manner at least once in a newspaper in a principal language of the region.
- The regional director shall determine whether the license should or should not be granted.