NGO Registration

NGOs in India

A Non-Governmental Organization (NGO) is an entity that works for the welfare of society and charitable purposes. NGOs being non-profit organizations, work towards the society as well as economic development of India. They promote Education, Health, Women Empowerment, Enterprise Development, Skill Building, Human Rights, Wildlife Protection, Arts, Science, Commerce, Sports, Education, Research, Social Welfare, Religion, Charity, and more. There are 3 types to set up NGOs in India are Trust, Society, and Section 8 Company. The NGO registration procedure in India comes under the jurisdiction of the laws formed under the procedure to register NGOs in India which are registered under the Indian Trusts Act, 1882, Societies Registration Act, 1860, and Companies Act, 2013.

NGO's are work to promote social and political change on a broad scale. They are free from the control of governmental control. These are said to be nonprofit organizations that work for the welfare of societies.

The Main Function of NGO

NGO’s being non-profit organizations, are not allowed to distribute the profit between members as a dividend. All the income and profits are intended to be used towards the social cause the NGO is helping and promoting their objectives.

Benefits of NGO Registration

Registering your company under NGO has several benefits which are as discussed below:

NGOs are helping the company save taxes and also exempt from several taxes. They invest the saved money in further projects. And it availing several taxation benefits to directors of the company.

NGOs do not need a higher share of capital to function but subscriptions can also help to support the proceedings undertaken by the company. NGOs raise funds from different donors. They also receive government grants under any scheme related to NGOs and or by the implementation of NGOs.

These Companies are not required to add the suffix Limited or Private Limited at the end of their name.

NGOs may apply for registration under the income tax act to get benefits under 12A, 80G, and 35Ac of income tax act in India.

Companies registered as NGOs under the Income Tax Return Act of 1961, it is easier to become or leave the membership of the Company, or otherwise, it is easier to transfer the ownership.

All companies registered as NGOs under the Income Tax Act 2013 are exempted from stamp duty, which accounts for more tax-saving methods for the company.

Key features of NGOs in India

NGOs are formed voluntarily.

NGOs are independent of government.

They are self-governed by the managing body or committee or trustees.

It produces money for the benefit of others and not for private profit or gains.

They are not for profit-making organization.

Their principal is to improve the welfare of society, and the prospects of disadvantaged people.

Laws Governing NGO Registration

For registration of NGOs in India following laws are governed: for Registration of Trusts, Trust Registration Indian Trusts Act, 1882, for Registration of Societies, Societies Registration Act, 1860, and for Section 8 Company Registration Companies Act, 2013.

TYPES OF NGO IN INDIA:

The non-governmental organization is incorporated as a trust under the India Trust Act, 1882. Trust organizations are irrevocable, which means these organizations cannot be changed or terminated unless such action has been approved by the beneficiary. For doing work for the public, a public charitable trust can be set up. Trust is registered using a document called a 'trust deed'. They are generally those who work with the eradication of poverty, giving education, as well as providing medical relief.

Trusts aren’t technically under any national rules and regulations, however, some states such as Gujarat and Maharashtra have public trust acts to regulate and oversee the affairs of NGOs.

Registration of Trust:

A trust is set up for doing work for the public. Different states in India have different Trust Acts. Gujarat and Maharashtra have their separate public trust which governs the trust. If any state doesn’t have its Trust Act, then the Indian Trust Act, 1882 is applicable.

The Registering Authority in the case of Trust is the Deputy Registrar of the relevant area.

The geographical area of operation is the whole of India.

Trust is registered using a document called a trust deed.

At the time of registration minimum of two trustees are required.

It is not much preferred in case of Grant of Subsidy by the government.

Trust can be registered under the Income Tax Act, 1961.

There is some annual compliance requirement.

Conditions to be fulfilled for Formation of Trust:

The Trust can be formed with a minimum of three members.

The maximum limit of members in the case of trust is 21.

Details of Members.

Trust name should be decided.

The main objective of formation of trust should be written on stamp paper

Registered office of Trust also decided.

The Board of trustees decided.

Documents required for registering a Trust in India:

Address Proof like electricity bill, mobile bill, telephone bill, bank statement, etc. (not older than two months)

ID proof like Aadhaar card, driving license, passport, voter ID

Submit the form with all documents and along with the payment for the registration process as per The Indian Trust Act, 1882. It takes around 8-10 working days for online process.

Societies

As the name suggests, the Societies Registration Act, 1860 governs the registration of literary, scientific, and charitable societies. Societies are also known as member-based organizations which function for philanthropic purposes. These organizations are almost always run under the control of a governing body or a management committee. Unlike trusts, societies come under the jurisdiction of the Indian law, known as the Societies Registration Act, 1860.

Registration of Societies

As per Section 20 of the Society Registration Act 1860, one can register the following societies:

Charitable societies

Societies for promoting science, culture, fine arts, etc.

Society for the diffusion of political education

Military Orphan Fund

Society for maintenance of libraries

The Registering Authority in the case of Society is Registrar or Deputy Registrar of societies of the state.

The main document supporting the formation is the Memorandum of Association and Rules & Regulations.

At the time of registration minimum of seven members are required there is no limit to the members.

It is not much preferred in case of Grant of Subsidy by the government.

It is not much preferred in case of Grant of Subsidy by the government.

It can be registered under the Income Tax Act, 1961.

There is some annual compliance requirement Annual filing with the Registrar of Societies. For registration of a society submit the papers along with payment. Once the paperwork is done, drafting of the Memorandum of Association (MoA) and By-laws of the society is carried out.

Following documents are required for the registration of society:

Name of the society

Registered office of the society

Main Object of the society

Address Proof of the members

Identity Proof of the members

Copies of MoA and By-laws of the society

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