Requirement for Starting an NGO in India

What is the registration process and Documentation Requirement for Starting an NGO in India?

For a registering nongovernmental organization or non-profit organizations in India, these are the three legal formats:

• Trusts
• Societies
• Section 8 Companies.

There is no central legislation in Indian trusts; Indian institutions are regulated by various legal and institutional structures, with Section 8 companies in the country being standardized in legislation – Company Act, 2013. It is this strong Act that governs a section 8 company’s creation, administration, and transparency. Meaning, it is better regulated and controlled than trusts and corporations and is worldwide recognized.

A not-for-profit company or organization with Section 8 company registration is an enterprise that;

• Is aiming at promoting commerce, art, technology, sport, education, research, social welfare, religion, charity, environmental protection or any other object of this nature;
• Seeks to use its profits to promote its products, if any, and;
• It aims to prevent its members from paying any dividend.

Procedure for Incorporation of Section 8 Company under Companies Act, 2013

Filing of Information in SPICe+ WEB Application

The new integrated web form offers the following services:

– Part A:

Name Reservation (New Companies only)

The proposed name of a section 8 company must include the words Foundation, Forum, Association, Federation, Chambers, Confederation, Council, Electoral Trust, etc.

– Part B:

• Company Incorporation
• Application for DIN
• PAN Application
• TAN Application

The SPICe+ application form can be applied in two ways:

• Part A may be submitted for a name reservation separately, and the name Part B can be submitted for at the time of reservation. (The approved name is valid for 20 days from the approval date)
• Part A and part B can be applied together (Without name reservation).

Document to be attached in SPICE+ Part-B:

Document Requirement

Part B

Directors Address and ID proof Memorandum of Association* Articles of Association* DIR-2 for all the Directors Declaration by professional like CA/ CS/ ICWA in Form INC-14; Declaration by each of the persons making the application in Form INC-15; An estimate of the future annual income and expenditure of the company for next three years, specifying the sources of the income and the objects of the expenditure; Proof of office address Copy of utility bills

* Section 8 companies are mandatorily required to file MOA and AOA as pdf attachments

Next step is to prepare AGILE PRO.

AGILE (Application for Goods and Services Identification Number, Employee’s State Insurance Agency Registration of Workers) plus Registration of Provident Fund Association. Previous AGILE Form (INC – 35) is now replaced by the web form AGILE – PRO.

• GSTIN Application
• EPFO Registration
• ESIC Registration
• Opening of Bank Account for the Company
• Profession Tax Registration (only for Maharashtra)

Documents, as mentioned in the above table, need to be attached while filing this form.

AGILE PRO

Proof of principal place of business Proof of appointment of Authorised Signatory for GSTIN (Either of the documents– Letter of Authorisation/Copy of A resolution passed by BOD/ Managing Committee and Acceptance Letter) Proof of identity of Authorised Signatory for the opening of a bank account Proof of address of Authorised Signatory for the opening of a bank account Specimen Signature of Authorised Signatory for EPFO

Filing of INC-9

INC-9 is auto-generated by MCA after completing all the above steps. You need to download the form and affix the same with DSC of the directors & Shareholders, including Professional certifying the details in the form.

Once the DSC is affixed, upload the form on MCA and make payment for the respective amount.

Once the web form is completed, download the same and affix the digital signature in downloaded form.

Upload the same in the MCA portal by paying the applicable nominal fees. On the same SRN will be generated for tracking purposes.

MCA will review and check all the documents and approve the same by issuing a Certificate of Incorporation.

Advantages of Registering Section 8 Company:

• Stamp duty exemption.
• Tax deductions characterize the company’s contributors. Income tax Act 80G. 80G.
• Section 8 Companies, with or without share capital, may be formed where they are formed without capital, utilizing donations, subscriptions of members and the general public, the funds necessary for carrying out business are provided.
• Section 8 businesses are not obligated at the end of their titles to add suffix Limited or Private Limited.
• In contrast to some other non-contracting organizations, including trust and community, a Section 8 corporation has more legitimacy.

Conclusion

If it is a trust, corporation, or an undertaking under section 8, all such organizations may file for an exemption from revenue and donations under the 1961 Income Tax Act. Therefore, the option of registration in Section 12A and Section 80 G of the Income Tax Act of 1961 is available after registration as a trust, corporation, or section 8 business.