NGO Setup in India

Non Governmental Organization (NGO), voluntary group of individuals or organizations, usually not affiliated with any government, that is formed to provide services or to advocate a public policy. Although some NGOs are for-profit corporations, the vast majority are nonprofit organizations.

NGO can be registered in 3 different structures

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

The simplest approach would be to establish a Section 8 company.

What could be the aim or objective of a Section 8 Company or NGO?

The Section 8 company is exclusively established to advance non-profit causes like trade, commerce, arts, charity, education, religion, environmental protection, social welfare, sports, research, and more. Any profits or incomes generated by the NGO must be utilized for the NGO's stated objectives and cannot be distributed as dividends.

What documents are necessary for the registration of a section 8 Company/NGO?

• Pan, Aadhar, and any utility bill of the prospective directors and shareholders must be provided.
• Rental agreement and electricity bill of the intended registered address are also required.

What are the essential prerequisites for establishing a Section 8 Company?

To incorporate a Section 8 company as a private limited company, it is necessary to have at least two directors. In the case of a private limited company, the maximum number of members allowed is 200. However, there is no obligation for a Section 8 company to have a minimum paid-up capital.

How can one go about registering a Section 8 company?

Here are the steps involved:

1. Obtain digital signatures from all directors.
2. Apply for Director Identification Number (DIN).
3. Apply for Name Approval.
4. Prepare Memorandum of Association (MOA), Articles of Association (AOA), and declaration in INC 13, INC 15.
5. Obtain a certificate from a Chartered Accountant.
6. Apply for the NGO license.
7. Once the license is approved, the final step is to file INC 7 and obtain the registration certificate.