The details of the most common forms in which NGOs may be constituted and registered are as follows:
i.) Trust:
trust in an ngo
As a public charitable trust. A public trust, whether relating to movable or immovable property, may be created by mere delivery of possession with a direction that the property is to be held under trust. However, a written instrument of trust signed by the author and registered is always desirable. The public charitable trust is usually floated when there is property involved, especially in terms of land and building. 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.
ii.) Society:
society in an ngo
Section 20 of the Societies Registration Act lays down that charitable societies and societies established for the promotion of science, literature or the fine arts may be registered under that Act. A society registered under the said Act is a legal entity apart from its members and under Section 6 of the said Act, it can sue or be sued in the name of its President, Chairman, Secretary or members of the governing body of Trustees. In Secretary of State India v. Radha Swami Satsangh it was held by the Bombay High Court that the registration of a charity under the Societies Registration Act, 1860 was a prima facie evidence of valid dedication of property for charitable purposes. According to section 20 of the Societies Registration Act 1860, the following societies can be registered under the Act: ‘charitable societies, military orphan funds or societies established at the several presidencies of India, societies established for the promotion of science, literature, or the fine arts, for instruction, the diffusion of useful knowledge, the diffusion of political education, the foundation or maintenance of libraries or reading rooms for general use among the members or open to the public, or public museums and galleries of paintings and other works of art, collection of natural history, mechanical and philosophical inventions, instruments or designs.’
iii.) Company:
company registration act
An association may be registered under Section 25 of the Companies Act, 1956 if the Central Government is satisfied that it is about to be formed as a limited company for promoting commerce, art, science, religion, charity or any other useful object and it intends to apply its profits, if any, or other income in promoting its members. In such cases, the Central Government may by license direct that the association may be registered as a company with limited liability without the addition to its name of the word “Limited” or the words “Private Limited”. 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 by ngo registration that no profits, if any, or other income derived by promoting the company’s objects may be distributed in any form to its members.
