Blog #Trust Registration

Non-Government Organizations, NGO are those entities which work for charitable purposes without an aim for any profits for self. In India, NGOs can be registered as any of the following:

• Trust under Indian Trusts Act, 1882

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  2. Society under Societies Registration Act 1860
  3. Section 8 Company under Companies Act, 2013

An NGO can be formed as a Public Trust (charitable trust) for the benefit of the general public with a specific objective that can be related to education, health, sanitation, eradication of poverty etc.  It is different from the formation of a Private Trust where a particular group of individuals, a family or a specific class of people becomes the beneficiaries to the trust.

What are the guidelines for a Trust Registration?

•  “Any person who is competent to contract under the applicable laws or has the power to transfer the property that is transferable can create a trust.” A Trust like all the organizations is required to be registered. Trust Registration is a fairly easy process.
• Before starting the process of NGO Registration, few details are required  to be in place:
• Name for the trust
• A Registered Address for the trust
• Objects of the trust which must be for the good of the public at large.
• Two trustees of the trust
• One settler of the trust
• Property of the trust which may be movable or immovable.
• Funds that shall be accepted: donations, grants, contributions etc
• Next step is to draft a Trust Deed which shall mention the details as discussed above. Apart from those, the Trust deed shall also mention following
• Powers with the trustees.
• Bank details of the Trust
• The procedure in event of dissolution/ winding up
• May provide for the procedure of amalgamation with another NGO
• A clause for Accounts and Audits of the Trust

The Trust Deed must be printed on stamp paper of requisite value as per the State.

The Trust Deed must be accompanied by one (1) passport size photograph & a copy of identity proof of each of the trustees, settler and the witnesses.

• The Trust deed shall then be registered in accordance with the Indian Trust Act of 1882 with the local registrar of the state. Along with the Trust Deed, two (2) copies of the Trust Deed signed by the settler on all the pages have to be submitted.
  For the registration, the trustees, settler and the witnesses must be present at the Registrar office along with their identity proof in the original.
• The registrar shall scrutinize the documents, the deed for all the required details and all the documents. Upon his satisfaction, the Registrar shall enter the details in the official record, keep one copy of the trust deed for the record and return the original Trust deed to the applicants.
• The Trust Registration Process is now complete and the Public Trust can now be operated in accordance with the Trust Act. The Public Trust is now ready to be operating as a Non-Governmental Organization for charitable purposes.

Source url - http://enterslice.olanola.com/blog/43368246933/What-is-the-procedure-for-trust-registration

NGO Registration and its purpose

As we can figure out from the name itself, a Non Government Organization is established independent of any kind of government or state authorities. They work independently for the benefit of society in general. Their main objective is to contribute to society in any way including education, trade, art, culture, skill development or any other social welfare activity.

NGOs do not operate with profit earning motive, their main objective is to support the under privileged, social welfare etc.  This is the reason they are also known as non profit organizations.

Ways to Register a Non Profit Organization

In India if anyone is willing to set up a nonprofit organization, then they can do so legally in three different ways. Following are the ways to incorporate a NGO:

• Trust under Indian Trusts Act, 1882
• Society under Societies Registration Act, 1860
• Section 8 company under Companies Act, 2013

Anyone willing to establish a NGO can choose the legal status of their NGO registration from the above mentioned three choices depending upon the following factors:

• Level of operation
• Structure of organization
• Purpose of Operation etc.

All the three set-up including Trust, Society and Section 8 company are legally recognized under different Acts and have different features and benefits.

Key Features of Trust, Society and Section 8 Company

• TRUST 

A Public Trust can be registered under the Act with charitable purpose as a NGO. Such trust registration can be involved in welfare services relating to healthcare, education, upliftment of under privileged etc.

Features

• No prior name approval requirement in case of Trust
• Trust are regulated by respective state Acts. If no set State Act is there then Indian Trusts Act 1882 of center will regulate it.
• Minimum one settler and 2 trustees are required.
• No provision is available to dissolve registered trusts.
• SOCIETY

Societies are membership based organizations. Societies with Charitable objects can be incorporated with a view to promote science, arts, literature or any other kind of charitable non-profit objective.

In order to register a society, its rules and regulations must be listed out in organizations memorandum of association.

Features

• Prior name approval is not required. However the applicant must make sure that no Society is already registered with same name in concerned jurisdiction.
• Societies are regulated by Societies Registration Act 1860. Many states interpret it in different ways.
• At least 7 members are required to incorporate a society. However, if it is a national level society then 8 members will be required from different states.
• The members also have an option to dissolve the registered society.
• Section 8 Company

Anyone can incorporate a company with charitable objects under Section 8 of Companies Act, 2013. Their main object must be like any other nonprofit organization. The basic difference between a private company and a Section 8 company is that, section 8 company is not allowed to pay any dividend to its promoters and all the profits are utilized for furtherance of its main objects.

Features

• Prior name approval is mandatory; an application for the same is to be submitted through RUN service.
• They are registered and regulated by Companies Act, 2013.
• Minimum Requirement; 2 promoters and 2 directors. Promoters and Directors can be the same people.

Source url - http://enterslice.over-blog.com/2018/06/how-to-register-an-ngo.html