In India, NGO can be registered in the following ways:
A group of person can get them registered as an NGO in form of Trust, Society, Non-Profit Company under section – 25 companies.
Non-profit organizations in India
(a) exist independently of the state;
(b) are self-governed by a board of trustees or ‘managing committee’/ governing council, comprising individuals who generally serve in a fiduciary capacity;
(c) produce benefits for others, generally outside the membership of the organization; and
(d), is ‘non-profit-making’, in as much as they are prohibited from distributing a monetary residual to their own members. Separate rules and regulations are prescribed for all three categories of registering NGOs as trust, society or non-profit company.
NGO as Trust:
ngo as trust
All the states in India have their own Trust Acts prevailing in their respective states. In absence of Trusts Act general principles of the Indian Trusts Act, 1882 are applicable. A trust, in general, can be defined as the group of persons who set their own common objectives and principles and have a certain number of members who are known as trustees in the board. Public charitable trust is a possible form of not-for-profit entity in India. Typically, public charitable trusts can be established for a number of purposes, including the relief of poverty, education, medical relief, provision of facilities for recreation, and any other object of general public utility. Indian public trusts are generally irrevocable. No national law governs public charitable trusts in India, although many states (particularly Maharashtra, Gujarat, Rajasthan, and Madhya Pradesh) have Public Trusts Acts.
NGO as Society:
ngo as society
An NGO can be registered as a society under the Societies Registration Act, 1860. The main instrument of any society is the memorandum of association and rules and regulations (no stamp paper required), wherein the aims and objects and mode of management (of the society) should be enshrined. Societies are membership organizations that may be registered for charitable purposes. Societies are usually managed by a governing council or a managing committee. Societies are governed by the Societies Registration Act 1860, which has been adopted by various states. Unlike trusts, societies may be dissolved.
NGO as non-profit company:
ngo as a non-profit company
According to section 25(1)(a) and (b) of the Indian Companies Act, 1956, a section-25 company can be established ‘for promoting commerce, art, science, religion, charity or any other useful object’, provided the profits, if any, or other income is applied for promoting only the objects of the company and no dividend is paid to its members. A section 25 company is a company with limited liability that may be formed for “promoting commerce, art, science, religion, charity or any other useful object,” provided that no profits, if any, or other income derived by promoting the company’s objects may be distributed in any form to its members.
