An NGO can be started under three Acts: Indian Trust Act, Indian Societies Act & Companies Act
We will inform you of all the documents required and complete the paperwork
We will register your NGO
An NGO or non-governmental organisation is a not-for-profit entity that typically does work for the welfare work for poorer sections of society or toward a particular cause. Their focus may be environmental, on human or animal rights, improving health and welfare of children, development work or even raising awareness about a particular cause or activity, such as art. That said, many NGOs may also be fronts for political or religious interests. Being not-for-profit, these entities cannot pay out any profits as dividends to members; instead, any profit must be reinvested toward the cause. NGOs raise money from donors, who may or may not receive tax breaks on their donations. In India, an NGO can be set up as a trust, section-8 company or a society.
A trust is meant for the welfare of the public. A trust can have varied interests, such as education, animal welfare, religious or even recreational, but is typically set up only when property is involved (schools or hospitals, for example). Most Indian states have their own act related to trusts, while the others are governed by the Indian Trust Act, 1882. To set up a trust, you need to draft a trust deed and then have it registered.
A society is an organization registered under the Indian Society Act, 1860. It has a proper governing community and managing council that runs and carry out its principles. The setting up and running of a society is similar to a housing society. Just like a Section 8 Company, a society also needs Memorandum and Articles of Association; it will also have byelaws that can be amended by the managing council.
A Section-8 company has limited liability and is often formed to promote commerce, recreational art or religion. The main prerequisite of Section 8 organisations is that the profits that are earned by these organizations cannot be divided among the members and could be only used to promote and strengthen the work. A Section-8 company is to be set up just like a private limited company.
Trusts are managed by the trustees, while the society’s functioning is managed by a committee or the managing council. A Section-8 company, on the other hand, has a board of directors. A trust must have at least two trustees, while a society requires seven (in case of a state-level society) and eight (in case of a national level society) committee members. A section-8 company requires two members for a private limited company and seven members to register it as a public limited company.
A trust is governed by the Registrar of Trusts. Therefore, the Trust Deed needs only to be registered with it. A society is governed by the Registrar of Societies. Section 8 companies are overseen by the Registrar of Companies as well as the commissioner of the relevant state where they are set up; such a company, therefore, needs to be subjected to an audit each year.
While private limited companies can be set up in around two weeks, trusts, societies and section-8 companies attract substantial scrutiny from the bodies that govern them. Therefore, they take longer to be set up. Governing bodies need to be convinced that the entity has a genuine interest in the cause. It takes up to 20 days to register a trust, up to 45 days to register a society and up to 75 days to register a Section-8 company.
After understanding your requirement, we will recommend the type of NGO that would suit you best. This will depend on the amount of money you wish to spend initially, the number of days you're willing to wait for the institution to be set up and the various features of a section-8 company, trust and society.
On making the choice, we will inform you of the documents you require for setting up each of these institutions. Once you provide them, we will begin drafting the procedure. This may involved the draftng of the trust deed (in case of a trust) or the registration of directors with the MCA (in case of a section-8 company).
As mentioned earlier, Registrars are very careful about which entities they approve. Therefore, it takes much time for a trust, society or section-8 company to be approved. We will, however, keep you up-to-date every step of the way.
Just tell us a little bit about your business and you'll have the registered trust deed in 20 working days (subject to government approval). It's that simple. In addition to yours, we'll be handling around 400 requests this month.
We make your interaction with government as smooth as is possible by doing all the paperwork for you. We will also give you absolute clarity on the process to set realistic expectations.
Our team of experienced business advisors are a phone call away, should you have any queries about the process. But we'll try to ensure that your doubts are cleared before they even arise.