NGO Registration Process in india: Section 8 Company, Society and Trust

NGO REGISTRATION PROCESS IN INDIA 

Introduction

The purpose of an NGO basically to work for the betterment of society. Each law determines the different Ngo Registration Process In India, an NGO can be registered as a society, trust, or company under Section 8 of the Companies Act, 2013, which totally depends on the activity of the organization. A non-government organization is a voluntary group that works for a social cause and for the benefit of society at large, like human rights, animal welfare, environmental cleanliness, etc.

There are different types of NGO registration in India, and NGO registration can be done in three ways to run the business for the benefit of society.

• Section 8: This is a limited liability company that is formed for the purpose of social welfare and is registered under the Companies Act, 2013.

• Societies Registration: Societies are operated under the authority of a governing body for a charitable purpose. Such NGOs are registered under the Societies Registration Act, 1860.

• A trust is a charitable trust registered under the Trust Act of 1882. In a trust, the owner transfers his assets to the trustee for the benefit of the beneficiary.

Section 8 of the Companies Act, 2013

A Section 8 company is a non-profit organization that aims to promote charitable activities, art, science, education, and sports. The profits of such companies are utilized for promoting these objectives and not distributed any income to shareholders of the company.

The essential purpose of registering a Section 8 company is to encourage non-profitable goals, including but not limited to trade, arts, commerce, education, charity, environmental protection, sports research, and social welfare. To register a Section 8 company, a minimum of two directors are required, and there is no requirement for a minimum paid-up capital to set up such a company.

In NGO, the profit generated by Section 8 of the companies cannot be used for any purpose other than charitable objectives and cannot be distributed among shareholders.

Legal requirements for the Section 8 Company

Before incorporation, there is a need to follow the specific legal requirements that must be fulfilled.

Number of Directors

A minimum of two directors is required if Section 8 wants to incorporate as a private limited company. However, a minimum of three directors is required if the company wants to be incorporated as a public company.

Number of Members

If Section 8 aims to function as a private limited company, then the limit for members is 200; however, there is no such limit for a public company.

Capital Requirements and Name

In Section 8, there is no requirement to maintain a minimum paid share capital, and there is no obligation to affix terms like private limited or limited in their name.

Company Objects

All objectives of the company shall be related to the non-profit and social welfare of society. The MOA and AOA must clearly mention the objectives of the company. Any profits the Section 8 entity generates must be utilized for charitable purposes or reinvested in the entity.

Document requirements for Section 8 of the company

• Copy of identity proof and address proof (including PAN card and bank statement).
• AOA (INC 31) and MOA (INC 13)
• Proof of office address (copy of utility bill like electricity, water, or gas bill) not older than 2 months
• DIR2: Consent of directors
• Estimated Annual Income and Expenditure of Successive 3 Years with the Signature of Directors
• Declaration of Director
• Details of director interest in other entities
• Digital Signature Certificate

Note: There will be a tick on the AOA of the company to remove those points from AOA, like dividend and reserve points, Shares is converted into stock, and all OPC provision points will be removed from AOA.

By providing these documents, you can register your company on MCA and follow the legal process as below:

• Obtain DSC for filling out the form on the MCA portal for all the directors.
• Through the incorporation process, it automatically generates the maximum of 3 DINs, and there is no need to file the DIR3 form.
• Reserve the company name (Spice+ Form); the name should be unique, and attach objects of the company.
• File the application for incorporation (Spice Part B, INC31, INC13, Agile Pro, and INC9) with all the all the above documents.
• Obtain a License for Section 8 Company
• Obtain a Certificate of Incorporation.

SOCIETY REGISTRATION

This is also for social welfare, but a different act is applicable for registering, which is the Society Registration Act, 1860.

Eligibility Criteria for Society Registration

• Minimum Members: A minimum of 7 members is required to form a society.
• Common objectives: social, cultural, charitable, scientific, or other non-profit objectives
• Jurisdiction: Must be formed within the jurisdiction.
• Legal Capacity: Members should have the legal capacity to enter into contracts.

Documents Required for Society Registration

• Covering request letter addressed to the register of societies
• MOA of the proposed society, 2 copies
• Rules and Regulations of the Proposed Society: 2 Copies
• Affidavit in the prescribed format by the president, secretary, or general secretary on Rs 10 or no judicial stamp paper regarding the relationship between the subscriber: one copy in the original
• NOC-CUM-Affidavit by the Owner: 1 Copy
• Attested copy of documentary proof in the shape of a sale deed or lease deed
• Residential proof of all desirous persons

After the collection of all documents, submit all these documents to the government of NCT, the office of the registrar of the society where the district is located near your location.

TRUST REGISTRATION

Prerequisites

• Two or more individual as a founders
• Compliance with the Indian Trust Act of 1882
• No one is disqualified
• Conformity with legal objectives
• Non Harmful Objectives
• Appropriately Drafted Trust Deed

Documents Required for Trust Registration

• Trust Deed with stamp value
• 2 Photographs of party
• PAN cards
• Address Proof
• Authentication from partners
• Utility Bill
• Income Tax Certificates ( 12A and 80G)

Procedure for Trust Registration

• Name of the Trust should be appropriate
• Settlers of the Trust
• Prepare MOA
• Draft the Trust Deed
• Review by registrar
• Certificate of Trust Registration

DISCLAIMER: The information provided in this article is intended for general informational purposes only and is based on the latest guidelines and regulations. While we strive to ensure the accuracy and completeness of the information, it may not reflect the most current legal or regulatory changes. Taxpayers are advised to consult with a qualified tax professional or you may contact to our tax advisor team through call +91-9871990888 or info@semantictaxgen.in.