Before establishing a NGO, the most important question is in what form will it be registered.
NGO can be categorized based on many factors like orientation, level of operation (state-level, national level) and structure. From the legal point of view, NGO can be registered in the following three forms:
1. Trust
2. Society
3. Section 8 Company
NGO as TRUST
Trust can be of two types Private and Public. Public Trusts can be registered with charitable purpose for this (NGO) purpose. Public trust registration can be formed for providing services relating to health, education, upliftment of under privileged etc.
Features
1. No prior name approval is required.
2. They are governed by different respective state Acts. In absence of any such Act, the trust is regulated by Indian Trusts Act 1882.
3. Minimum 2 trustees should be present for trust registration.
4. Generally, they are irrevocable in nature.
NGO as SOCIETY
NGO registration as a society is similar in character to a public trust. But otherwise they are very different. They are membership based organizations. Charitable societies can be formed with objectives like promotion of science, arts, literature etc. or any other charitable non-profit purpose.
A registration application includes the society's memorandum of association and rules and regulations.
Features
1. No prior name approval is required., but no other Society should be registered with the Registrar of Societies of that particular jurisdiction.
2. They are governed by Societies Registration Act 1860. Different states have different interpretation of the said ACT.
3. Minimum 7 members are required to form a society. If the proposed society is a national level society, then 8 members are required from different states.
4. A society can be dissolved, which is not possible in case of a Trust.
NGO as Section 8 Company
Companies formed under Section 8 of Companies Act, 2013 have charitable, non-profit objectives. They are formed with an objective to promote commerce, art, research, health, education, sports, social welfare etc. Any profits of Section 8 company are used for furtherance of its main objects. And no dividends are paid to the promoters.
Features
1. Prior name approval is required to be filed through RUN. Or direct spice can be filed for registration with a unique name.
2. They are governed by Companies Act, 2013.
3. Minimum 2 promoters and 2 directors are required to form a Section 8 Company. Promoters and Directors can be the same people.
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