Indian NGOs
Encyclopedia
Indian Non-governmental organization
s (NGOs) can be set up under various Indian laws, and the different legal entities under which civil society organizations can register themselves are:
and Rajasthan
have independent state level public trust acts. States like West Bengal
, Jharkhand
and Bihar
, do not have any act to register a public trust.
A trust can be registered in one state, but the same has the scope to operate in any number of states. In the state of Maharashtra
and Gujarat , all organizations that are registered as 'Society' are by default also registered as Public Trust.
or NGOs.
objectives, but exempting them from the operation of some cumbersome requirements (which are essentially for regulation of business bodies but are difficult for compliance by non-profit companies), are the noteworthy features that are provided under the companies act, 1956.
According to section 25(1):
"Where it is proved to the satisfaction of the Central Government that an association is about to be formed as a limited company for promoting commerce, art, science, religion, charity or any other useful objectives, intends to apply its profits, if any, or other income in promoting its objectives, and to prohibit the payment of any dividend to its members, the Central Government may, by license, l direct that the association may be registered as a company with limited liability, without addition to its name of the word "Limited" or the words "Private Limited"
, cooperative societies are regarded as instruments to mobilize and aggregate community effort to eliminate layers of middlemen in any product
or service supply chain
hence resulting in greater benefit sharing for the grassroot farmer
, worker or artisans.
The Cooperative Credit Societies Act, 1904 enabled formation of cooperatives for supplying to farmers cheap credit and protect them from exploitation
in the hands of the moneylenders. The cooperative act 1912 expanded the sphere of cooperation and provided for supervision by central organization.
of 1984, facilitates the incorporation
of cooperative societies whose objects and functions spread over to several states. The act provides for formation of both primary (with both individual and institutional members) and federal cooperatives (with only institutional memberships). Any application for the registration of a multi-state cooperative society , of which all the members are individuals , should be signed by at least fifty persons from each of the states concerned. In case of a society of which members are cooperative societies, it should be signed by duly authorized representative of at least five such societies registered in different states
or business
, and includes any federation
of two or more Trade Unions.
Non-governmental organization
A non-governmental organization is a legally constituted organization created by natural or legal persons that operates independently from any government. The term originated from the United Nations , and is normally used to refer to organizations that do not form part of the government and are...
s (NGOs) can be set up under various Indian laws, and the different legal entities under which civil society organizations can register themselves are:
Registered Societies
Societies Registration Act, 1860 is a central act for registering not-for-profit organizations. Almost all the states in India have adopted (with modifications, if any) the central Act for creating state level authorities for registering various types of not-for-profit entities.. According to the act any seven persons who subscribe to the Memorandum of Association (MOA) can register a society. The memorandum should include names of the society, its objectives, its names, addresses and occupations of the members subscribing to it as well as the first governing body to be constituted on registration.Public Trust
Public trust can be created for public charitable purposes. There is no All India Level Act for setting up public charitable trusts. Some of the states in India has enacted the Public Charitable Trust Act, while most states in India does not have a trust act. An NGO can be created only under a public trust act.Madhya PradeshMadhya Pradesh
Madhya Pradesh , often called the Heart of India, is a state in central India. Its capital is Bhopal and Indore is the largest city....
and Rajasthan
Rajasthan
Rājasthān the land of Rajasthanis, , is the largest state of the Republic of India by area. It is located in the northwest of India. It encompasses most of the area of the large, inhospitable Great Indian Desert , which has an edge paralleling the Sutlej-Indus river valley along its border with...
have independent state level public trust acts. States like West Bengal
West Bengal
West Bengal is a state in the eastern region of India and is the nation's fourth-most populous. It is also the seventh-most populous sub-national entity in the world, with over 91 million inhabitants. A major agricultural producer, West Bengal is the sixth-largest contributor to India's GDP...
, Jharkhand
Jharkhand
Jharkhand is a state in eastern India. It was carved out of the southern part of Bihar on 15 November 2000. Jharkhand shares its border with the states of Bihar to the north, Uttar Pradesh and Chhattisgarh to the west, Orissa to the south, and West Bengal to the east...
and Bihar
Bihar
Bihar is a state in eastern India. It is the 12th largest state in terms of geographical size at and 3rd largest by population. Almost 58% of Biharis are below the age of 25, which is the highest proportion in India....
, do not have any act to register a public trust.
A trust can be registered in one state, but the same has the scope to operate in any number of states. In the state of Maharashtra
Maharashtra
Maharashtra is a state located in India. It is the second most populous after Uttar Pradesh and third largest state by area in India...
and Gujarat , all organizations that are registered as 'Society' are by default also registered as Public Trust.
Private Trust
A private trust , created under and governed by the Indian Trusts Act of 1882, aims at managing assigned trust properties for private or religious purpose. A private trust does not enjoy the privileges and tax benefits that are available for public trustsCharitable trust
A charitable trust is an irrevocable trust established for charitable purposes, and is a more specific term than "charitable organization".-United States:...
or NGOs.
Non Profit Companies (Section 25)
Conferring of corporate personality to associations that promote cultural and charitableCharity (practice)
The practice of charity means the voluntary giving of help to those in need who are not related to the giver.- Etymology :The word "charity" entered the English language through the Old French word "charité" which was derived from the Latin "caritas".Originally in Latin the word caritas meant...
objectives, but exempting them from the operation of some cumbersome requirements (which are essentially for regulation of business bodies but are difficult for compliance by non-profit companies), are the noteworthy features that are provided under the companies act, 1956.
According to section 25(1):
"Where it is proved to the satisfaction of the Central Government that an association is about to be formed as a limited company for promoting commerce, art, science, religion, charity or any other useful objectives, intends to apply its profits, if any, or other income in promoting its objectives, and to prohibit the payment of any dividend to its members, the Central Government may, by license, l direct that the association may be registered as a company with limited liability, without addition to its name of the word "Limited" or the words "Private Limited"
Comparison between a trust, a society and a section 25 company
| Public Trust | Society | Section 25 Company | |
|---|---|---|---|
| Statute/Legislation | Public Trust Act like Bombay Public Trust Act, 1950 | Societies Registration Act of 1860 | Companies Act of 1956 |
| Jurisdiction of the Act | Concerned state where registered | Concerned state where registered | Concerned state where registered |
| Authority | Charity Commissioner | Registrar of Societies | Registrar of Companies |
| Registration | As Trust | As Society (and by default also as Trust in Maharashtra and Gujarat) | As Section 25 Company |
| Main Document | Trust deed | Memorandum of Association and Rules & Regulations | Memorandum and Articles of Association. |
| Stamp Duty | Trust deed to be executed a non-judicial stamp paper of prescribed value | No stamp paper required for Memorandum of Association and Rules & Regulations | No stamp paper required for Memorandum and Articles of Association |
| Number of persons needed to register | Minimum two trustees; no upper limit | Minimum seven, no upper limit | Minimum three, no upper limit |
| Board of Management | Trustees | Governing body or council/managing or executive committee | Board of Directors/Managing Committee |
| Mode of succession on board of management | Usually by appointment | Usually election by members of the general body | Usually election by members of the general body |
Co-operative Societies
In IndiaIndia
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...
, cooperative societies are regarded as instruments to mobilize and aggregate community effort to eliminate layers of middlemen in any product
Product (business)
In general, the product is defined as a "thing produced by labor or effort" or the "result of an act or a process", and stems from the verb produce, from the Latin prōdūce ' lead or bring forth'. Since 1575, the word "product" has referred to anything produced...
or service supply chain
Supply chain
A supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to...
hence resulting in greater benefit sharing for the grassroot farmer
Farmer
A farmer is a person engaged in agriculture, who raises living organisms for food or raw materials, generally including livestock husbandry and growing crops, such as produce and grain...
, worker or artisans.
The Cooperative Credit Societies Act, 1904 enabled formation of cooperatives for supplying to farmers cheap credit and protect them from exploitation
Exploitation
This article discusses the term exploitation in the meaning of using something in an unjust or cruel manner.- As unjust benefit :In political economy, economics, and sociology, exploitation involves a persistent social relationship in which certain persons are being mistreated or unfairly used for...
in the hands of the moneylenders. The cooperative act 1912 expanded the sphere of cooperation and provided for supervision by central organization.
Multi-State Co-operative Societies (MACTS)
The Multi-state Co-operative Societies Act, 2002 which substitutes the earlier statuteStatute
A statute is a formal written enactment of a legislative authority that governs a state, city, or county. Typically, statutes command or prohibit something, or declare policy. The word is often used to distinguish law made by legislative bodies from case law, decided by courts, and regulations...
of 1984, facilitates the incorporation
Incorporation (business)
Incorporation is the forming of a new corporation . The corporation may be a business, a non-profit organisation, sports club, or a government of a new city or town...
of cooperative societies whose objects and functions spread over to several states. The act provides for formation of both primary (with both individual and institutional members) and federal cooperatives (with only institutional memberships). Any application for the registration of a multi-state cooperative society , of which all the members are individuals , should be signed by at least fifty persons from each of the states concerned. In case of a society of which members are cooperative societies, it should be signed by duly authorized representative of at least five such societies registered in different states
Trade Unions
Trade union means any combination , whether temporary or permanent, formed primarily for the purpose of regulating the relations between workmen and employers or between workmen and workmen or between employers and employers, or for imposing restrictive conditions on the conduct of any tradeTrade
Trade is the transfer of ownership of goods and services from one person or entity to another. Trade is sometimes loosely called commerce or financial transaction or barter. A network that allows trade is called a market. The original form of trade was barter, the direct exchange of goods and...
or business
Business
A business is an organization engaged in the trade of goods, services, or both to consumers. Businesses are predominant in capitalist economies, where most of them are privately owned and administered to earn profit to increase the wealth of their owners. Businesses may also be not-for-profit...
, and includes any federation
Federation
A federation , also known as a federal state, is a type of sovereign state characterized by a union of partially self-governing states or regions united by a central government...
of two or more Trade Unions.