NGO/Trust/CBO/Vos Registration, differences etc....

1. Mr. Prahlada G
Faculty
Tumkur University, Tumakuru

2.  NGO may be defined as association having a
definite –
Cultural; Educational; Economical, Religious or
Social association / organization.
 NGOs ---
 are not owned by any one; and
 cannot distribute their profit/surplus as such.
Sources of revenue ---
Donations, Grant, Gift, Membership fee and interest
on investment
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3. NGO covers -
 Registered Trusts, Societies, Cooperative
Societies, Endowments, Non-profit companies,
etc., working for the Welfare, Development and
Progress of people, and in a way, supplement
similar functions of the state, and hence, called
as Non Government Organizations (NGOs).
 An NGO is a Non-Profit Organization (NPO) --
also known as
1. non-business entity,
2. not-for-profit organization,
3. non-profit institution
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4. NGO covers -
 Registered Trusts, Societies, Cooperative
Societies, Endowments, Non-profit companies,
etc., working for the Welfare, Development and
Progress of people, and in a way, supplement
similar functions of the state, and hence, called
as Non Government Organizations (NGOs).
 An NGO is a Non-Profit Organization (NPO) --
also known as
1. non-business entity,
2. not-for-profit organization,
3. non-profit institution
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5. An NGO is dedicated to –
 furthering a particular social cause or
 advocating for a shared point of view.
Surplus of the revenues -
 Used to further achieve its ultimate objective
 And not distributed to its members,
shareholders, leaders
Tax Exemption for Trusts
 NGOs do not pay income tax
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6.  Accountability (to the donors, founders, volunteers,
program recipients, and the public at large)
 Trust-worthiness (Public confidence, a key factor)
 Honesty (focus on their mission, ethical standards),
and
 Openness to every person who has invested time,
money, and faith into the organization.
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7. One may legally start the Non-Profit organization
:
 By Forming Trust (Maharashtra Public Trust Act,
1950)
 By Forming Society (Registration Act, 1860)
 By Forming Company as per Section 8 of the
Companies Act, 2013; (erstwhile section 25 of
the Companies Act, 1956)
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8. The comparison in major aspects, between –
a Trust registered under the Maharashtra Public
Trust Act, 1950,
a Society registered under the Registration Act,
1860 and
a Non- Profit company registered under section
8 of the Companies Act 2013 (erstwhile
Section 25 of Companies Act, 1956) -
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15.  The term “TRUST” has not been defined in the
Maharashtra Public Trust Act, 1950, therefore,
one has to go to the definition of Trust as given in
sec 3 of the Indian Trusts Act 1882 which is as
follows:-
 A “TRUST” is an obligation annexed to the
ownership of property, and arising out of a
confidence reposed in and accepted by the owner,
or declared and accepted by him, for the benefit
of another, or of another and the owner. 1
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16.  the person who reposes or declares the
confidence is called the “author of the trust”
 the person who accepts the confidence is
called the “trustee”
 the person for whose benefit the confidence
is accepted is called the “beneficiary”
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17.  the subject-matter of the trust is called as
“trust-property” or “trust-money”
 the “beneficial interest” or “interest” of the
beneficiary is his right against the trustee as
owner of the trust-property; and
 the instrument, if any, by which the trust is
declared is called the “instrument of trust”
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18.  A popular form of not-for-profit entity in
India established for various purposes,
including –
◦ the relief of poverty,
◦ Education,
◦ Medical relief,
◦ Provision of facilities for recreation and
◦ Any other object of general public utility.
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19. Generally the Trust’s are irrevocable
 Deregistration of Trust :
(For violation of sec. 22(3A) and 22(3B) of the
Bombay Public Trusts Act, 1950)
Section 22(3A) :
 The Deputy or Assistant Charity Commissioner
may, after such detailed and impartial inquiry
and following such procedure as may be
prescribed, de-register the trust on the
following grounds:—
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20.  (a) when its purpose is completely fulfilled;
or
 (b) when its purpose becomes unlawful; or
 (c) when the fulfillment of its purpose
becomes impossible by destruction of the
trust-property or otherwise; or
 (d) when the trust, being revocable, is
expressly revoked; or
 (e) when the trustees are found not doing
any act for fulfilling object of the trust
If a trust has made default in filing of
audit reports/change
reports for more than 5 years, it may also
be deregistered. 2
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21. Separate volume for each district; contains the sections –
 A - Hindus (including Jains, Buddhists, Sikhs, and other Hindus).
 B - Muslims
 C - Parsis
 D - Christian
 E - Others (Not from above category of specific community)
 F - Societies registered under Society Registration Act, 1860 (i.e.
 Educational Trusts and Medical Trusts etc.). 2
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22.  “[1] For the purpose of this act, a charitable purpose
includes-
 (1) relief of poverty or distress,
 (2) education,
 (3) medical relief,
 (3A) provision for facilities for recreation or other
leisure time occupation (including assistance for
such provision), if the facilities are provided in the
interests of social welfare and public benefit, and
 (4) the advancement of any other object of general
public utility, but does not include a purpose which
relates - exclusively to religious teaching or worship.”
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23.  How Trust is created - A trust is created when the
author of the trust indicates with reasonable certainty
by any words or acts :
(a) an intention on his part to create a trust
(b) the purpose of the trust
(c) the beneficiary, and
(d) trust property and (unless the trust is
declared by will or
the author of the trust is himself a trustee)
he transfers
the trust property to the trustee.
 A Public Charitable Trust has to be registered with
the office of the Charity Commissioner who has
jurisdiction of the Trust. 2
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24.  Steps 1: It is necessary to choose an appropriate
name of the Trust. While choosing the name it is
necessary to take following care :
a. The name should not suggest any kind of
patronage by the Government of India or State
Government;
b. It should not be under the restricted list of names
as per provisions of Emblems and Names Act,
1950;
c. Presently it is not allowed the name which
includes "India".
d. Generally, name should be similar with the name
of other trust. 2
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25.  Step 2 :
 Determine the Settler/Author and Trustees of
the intended trust. In most cases traditionally
there is one Settler/Author
 minimum two trustees are necessary
 there is no upper limit on the maximum
number of trustees.
 There is no Educational qualification needed
to become a trustee.
 He must not be unsound mind and should be
of the age above 18 years.
 A trustee must be a resident of India.
Foreigner, OCI Card Holder and NRIs residing
abroad more than 6 months cannot become
member of trust. 2
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26.  Step 3 :
 A. Prepare Memorandum of Association and
Rules and Regulations of Trust. This is known
as Trust Deed and is extremely essential as the
legal evidence of your Trust's existence.
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27.  An element of the Trust Deed which should be
present in it are :
◦ Name and address of the Settler/Author of the Trust
◦ Name and addresses of the other trustees
◦ Name of the Trust
◦ Minimum and maximum number of Trustees.
◦ Address of the registered office of the Trust
◦ Purpose behind formation of the Trust
◦ Objectives of the Trust
◦ Rules and Regulation of the Trust
◦ Information about the intended Bank account, which bank and
branch you shall open a bank account with
◦ Legal procedures like appointment, removal or replacement of
trustee, their rights, duties, powers, etc.
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28. Property that shall develop/divest upon the trustee(s) under the
trust for the benefit of the beneficiaries
An intention to divest the property upon the trustee(s)
Note : The intention must be expressed in clear, simple language
and with certainty.
Tenure of trustees must be specified in the deed
Board of Trustees can also have various designations for trustees
like Chairperson and Managing Trustee.
Determine these posts and the responsibilities of these in the
trust deed
Though the Trustees cannot draw any remuneration from the
trust fund but they are eligible to receive compensation for the
professional services they provide to the trust ..Determine this in
the trust deed.
Date of execution of the trust deed
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29. Audit of Trust
Details of the trust fund thus set up by the settler and the
movable/immovable property included in the Trust fund. Also
contains the information about the sources and activities through
which income shall be earned and deposited in the trust fund.
Ways and plan in which the income shall be dispersed amongst
beneficiaries or used in executing program/projects for their
welfare.
Rights, duties and limitations of the trustees
Number of meetings to be organized each year and conditions
regarding number of meetings mandatory for the Trustees to
attend
Procedures to vary after or modify any clause in the Trust Deed
Conditions under which a trustee shall cease to exist.
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30. B. The Trust Deed shall be prepared on a stamp
paper, whose value should be certain percentage of
the total value of the Trust's property. This
percentage vary from State to State.
C. To register the Trust Deed it is necessary to
comply with the following requirements:
 Trust Deed on stamp paper of requisite value
 Two pass port size photographs and self attested
copy of the proof of identity of the settler
 Two pass port size photographs and self
attested copy of the proof of identity of the each
trustee
 Signature of the settler on all the pages of the
trust deed
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31.  Proof of the registered office address of the trust
must be attached with the Trust Deed. This can be
Electric/Telephone/Water bill, etc. You might have to
submit a no objection letter by the land owner with
his identity proof.
 It is necessary to mention the property registered in
the name of the Trust and attach its proof with the
documents shall submit at the time of registration
Step 4 : Prepare all the documents that will be required
at the time of submission. The trust deed is required to
be stamped and the relevant Articles of the Maharashtra
Stamp Act as applicable to Maharashtra are Articles 55
and 61 of Schedule I, are as follows: 3
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32. Stamp Duty
Article 55 Settlement: -
A. Instrument of settlement (i)
where the settlement is made
for a religious or charitable
purpose
2% of a sum equal to the
amount settled or the market
value of the property settled.
(ii) in any other case …. Same duty as is leviable
on a conveyance under cl. (a)
(b) (c) of article 25
B. Revocation of settlement Rs 500
Article 61 Trust
A. Declaration of Trust – of, or
concerning, any property when
made by any writing not being
a Will,
(a) Where there is disposition
of property, --
(i) where the trust is made for
Religious or Charitable Purpose
2% of a sum equal to the
amount settled or the market
value of the property settled
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33. (ii) in any other case…… the same duty as per
conveyance
(b) where there is no
disposition of the
property,--
(i) where the trust is
made for a religious or
charitable purpose;
(ii) in any other case …..
Rs.500/-
Rs.500/-
B. Revocation of Trust Rs 500/-
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Trusts are irrevocable unless it is mentioned in the trust deed. This means the
trust cannot be wound up.

34.  Societies are formed by Memorandum of Association
and Rules and Regulations under the Societies
Registration Act, 1860, which is a Central Act.
 Any seven or more persons associated for any literary,
scientific or charitable purpose, or for any such
purpose, as is described in Section 20 of this Act, may
by subscribing their names to a Memorandum of
Association, and filing the same with the registrar
form themselves into a society under this Act.
 Now a days, the Charity Commissioner, Maharashtra
State, Mumbai has provided online facility for
registration of the public trusts, societies and for
filing audit statements of the registered trusts. The
website is:
http://charity.maharashtra.gov.in.
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35.  1. Name of The Society
 2. Office Address
 3. Object of the Society
 4. Members Name, Addresses, Designation, Age
and
his occupation
 5. Affirmation
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36.  1. Definition .. Name of the Society, etc.
 2. Jurisdiction – i.e. working area of the Society
 3. Financial Year - Now it is from 1st April to 31st
March
 4. Membership - minimum 7
 5. Types of Members- Life, patron, ordinary
 6. Ceasing to be a Member
 7. Managing Committee
 8. Power of the Managing Committee
 9. Meeting of the Managing Committee
 10. Requisition meeting of the Managing
Committee
 11. Quorum for the Managing Committee
 12. Minutes to be kept
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37.  13. Office Bearers and their duties
 i) President
 ii) Secretary
 iii) Treasurer
 14. Managing Committee Members
 15. General Body Meeting
 16. Extra Ordinary General Body Meeting
 17. Notice of the General Body/Extra Ordinary
General Body Meeting
 18. Business of the Annual General Meeting
 19. Quorum of the General Body Meeting
 20. Election
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38.  21. Source of Income and its application
 22. Bank Account
 23. Sub Committees
 24. Books of Accounts and Audit
 25. Provision regarding sale and purchase of
Immovable Property
 26. Provision regarding Loans & Deposit
 27. Membership register to be Kept
 28. Custody of the Documents
 29. Provision for Amendments in Rules &
Regulation
 30. Provision for change in name and object
of the society
 31. Dissolution 3
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39.  1. Application letter
 2. True copy of Memorandum of Association
 3. True copy of the Rules & Regulations
 4. Consent Letter duly signed by all the Members
of the Managing Committee
 5. Authority letter duly signed by all the Members
of the Managing Committee
 6. Affidavit/self declaration in standard format
 7. Resolution in standard format 13
 8. Address proof for registered office & NOC of
owner.
 9. Schedule I ,II and VI as per societies act
 10. Copies of photo id of managing committee.
 11. Photos of managing committee members
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Document to be
filed
Period Prescribed
Form
Procedure
Application for
registration of the
trust (Sec. 18, Rule
6)
Within 3 months
of
creation of the
Trust.
Schedule II (a) Application in the prescribed form;
(b)Instrument (Trust Deed); (c) Affidavit;
(d) Consent letter;
(e) No objection for use of
address and address proof;
(f) Notice in Newspaper;
(g) List of all the Trustees
and their identity proof
Application for
registration of the
Society under the
Societies
Registration
Act, 1860 and
Maharashtra Public
Trust Act, 1950
Within 6 months
of
creation of the
Trust
Schedule II UNDER THE SOCIETY REGISTRATION ACT, 1860:
(1) Memorandum of Association and Rules &
Regulations;
(2) Resolution of all the members.
(3) Consent Letter of members;
(4) Authority letter;
(5) NOC of the Owner of the premises to use the
same as the registered address of the captioned
Society;
(6) Affidavit;
(7) Schedule I;
(8) Schedule II;
(9) Schedule VI;
(10) List of Managing Committee members with their ID and
Address proof.

41. Application
for
registration of
a trust
created by
will (Sec. 29)
Within 1 month
of granting of
probate/within
6 months of
Testator's
death
whichever is
earlier.
Schedule II Application must be signed and affirmed
by the
applicant, and to be accompanied by a
true copy of
the Will and above procedures must be
followed.
Memorandum
of particulars
of immovable
properties
[Sec. 18(7),
Rule 6(7)]
Within 3
months of
creation of the
Trust.
Schedule II-A Memorandum to be signed and affirmed
by a
trustee
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Application for registration
of the Society under the
Societies Registration
Act, 1860 and Maharashtra
Public Trust Act, 1950
Within 6 months of
creation of the Trust
Schedule II UNDER THE MAHARASHTRA PUBLIC TRUST ACT,
1950:
(1) Schedule II;
(2) Memorandum of Association and Rules &
Regulations;
(3) Consent Letter;
(4) Authority Letter;
(5) Letter of exemption from publication;
(6) Resolution of all members;
(7) NOC of the Owner of the premises to use the
same as the registered address of the captioned
Society;
(8) Affidavit;
(9) List of Managing Committee members with their
ID and Address
proof.

42. To,
The Deputy/Assistant Charity Co
................... Region/Sub-region.
In the matter of Public Trust*
I,.....................................................................................
................................Trustee of the above named public
trust hereby apply under section 18 of the Maharashtra
Public Trust Act. 1950. for the registration of the said
public trust.
I submit the following necessary particulars:
(ai) the designation by which the public trust is or
shall be known (name of public trust).]
b(i) Name of the trustees and managers with their
addresses
(ii) Mode of succession to their trusteeship and
managership 4
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43. (iii) Objects of the trust
(iv) (a) Particulars of documents creating the trust
(attach copies).
(b) particulars other documents about the origin
or creation of the trust
(v) particulars of the scheme if any, relating to the
trust (attach copy).
(vi) movable property with estimated value of each
class of such property.
[Note- Entities would be made by broad description of
classes of such property e.g.furniture, books, etc.. rather
than of each individual article. entry regarding cash
should be made only if such cash forms part of the
capital of the trust in the case of script give particulars
of each security, stock, share and debenture including
the number of which it bears.]
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44. (vii) (a) details of immovable property showing the
village or town where situate along with c. s..
municipal or survey no., area, assessment or judi
and description of the tenure on which held (attach
certified copies of the entries in the record of right.
city survey record or municipal record relating to
the properties):-
1.
2.
3.
(b)Estimated value of each immovable property:-
1.
2.
3.
(viii) Sources of income of trust 4
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45. (ix) average gross annual income
(x) average annual expenditure
(xi) amount of average annual expenditure :-
(a)on remuneration to trustees and managers
(b)on establishment and staff
(c)on religious object
(d)on charitable objects
(e)on miscellaneous item
(xii) Particulars of encumbrances any, on trust
property
(xiii)Particulars of title deeds pertaining to trust -
property and the names of trustees in possession
thereof.
(xiv)Remarks, if any
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46. 3.Fee of Rs. ...............................................
acompanies
4. Any communication to the trustee or
manager in connection with the trust may be
sent to the following address:-
Name..................................................
Address.......................................................
Date.......................
Signature of applicant 4
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47.  A charitable institution/ association may be registered
as a non-profit company and can obtain a license
under section 8 of the Companies Act 2013. Such
company is registered without addition of word
‘Limited ‘or ‘Private Limited’ to its name Meaning of
Non-profit Making Company.
 A Non-profit making Company is a Company which:
(a) has in its objects the promotion of commerce,
art, science, sports, education, research, social
welfare, religion, charity, protection of environment
or any such other object;
(b) intends to apply its profits, if any, or other
income in promoting its objects; and
(c) intends to prohibit the payment of any
dividend to its members. 4
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48.  Essentials for Registration :
1) Digital Signatures
2) DIN
3) MOA and AOA
4) License from Central Government
 Procedure for getting License under section 8 for
new companies with charitable objects is given in
rule 19 and 20 of Companies (Incorporation)
Rules, 2014 which is as follows:
a. Obtain Digital Signatures
 It is necessary to obtain a Class II Digital
Signature Certificate from authorized DSC issuing
Company for director to sign the E- forms related
to incorporation like form Spice32 and INC12 for
obtaining license.
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49. b. Obtain Director Identification Number (DIN) [Section
153]
As per 153 of the Companies Act, 2013, every
individual intending to be appointed as director of a
company shall make an application for allotment of
DIN in form DIR.3 to the ROC along with prescribed
fees.
 c. The license may be granted to new associations as
well as to existing companies. The procedure in each
case shall be as under:
 (A) For New Associations:
a. The institution/ association should make an
application for reservation of name to the ROC in RUN
Application and follow the guidelines issued in this
regard. After reservation of name make application for
license. 4
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50. b. Application for License:
Such associations should apply to the Central
Government through ROC concerned in the Form INC-12
along with the following documents:
 (i) Memorandum and Articles of Association of the
proposed company (refer Form INC-13 for form
of Memorandum). The memorandum and articles
should be printed after having been approved.
No stamp duty is payable on the Memorandum and
Articles of Association of a company to be registered
under these provisions.
 (ii) Declarations in form INC-14 signed by:
(a) an advocate, or
(b) a Chartered Accountant whole time practicing
in India, or
is engaged in the formation of company. 5
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51. (c) a Cost Accountant whole time practicing in India, or
(d) a Company Secretary whole time practicing in India, who is engaged in the
formation of company.
(iii) Declaration signed by each of the applicants in
Form INC-15.
(iv) List of names, addresses, description and
occupation of the promoters.
(v) List of proposed Directors and Key Managerial
Personnel.
(vi) An estimate of future annual income and
expenditure of the company for next 3 years,
specifying the sources of income and objects of
expenditure.
(vii) Approval/concurrence/ NOC of the concerned
authority/sectoral regulator, department or Ministry
of Central/State Government(s). ( if required due to
nature of activity) 5
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52. c. Fee to accompany Application: The fee for filling
application is Rs. 2000, which may be paid either
electronically or in government treasury through
challan.
d. Grant of License:
The license is granted by the Registrar after the
scrutiny of the application. The Registrar may direct
the company to incorporate in its memorandum or
articles or both, such conditions of the license as
may be specified by the Registrar in this behalf.
License shall be in form INC 16.
e. Registration:
After getting license u/s 8 company has to make an
application for registration with ROC in form SPICe
(INC 32) with attachments as required. 5
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53. (b) For Companies Already Registered :
A limited company registered under the act or under any
previous company law, with objects of charitable nature,
desirous of obtaining license under section 8 of the Act,
should apply to the Central Government through
Registrar of Companies concerned, in Form INC-12.
d. Grant of License:
The license is granted by the Registrar after the scrutiny
of the application. The Registrar may direct the company
to incorporate in its memorandum or articles or both,
such conditions of the license as may be specified by the
Registrar in this behalf. License shall be in form INC 16.
e. Registration:
After getting license u/s 8 company has to make an
application for registration with ROC in form SPICe (INC
32) with attachments as required. 5
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54. 5
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Budget (Sec.
31A, Rule
16A)
At least 1
month before
commencement
of each accounting
year.
Schedule
VII-A
If annual income exceeds 􀀀 5,000/- for public
religious trusts and
􀀀 10,000/- for other trusts, then
to file budget by making adequate provisions for
carrying out the objects of the trust, and for the
maintenance and preservation of the trust property.
Accounts and
Audit (Secs.
32, 33(2),
33(4), 34,
Rules 17, 21)
Accounts to be
audited within
6 months from
close of
accounting
year.
Schedule
VIII for
Balance
Sheet and
Schedule IX
for Income
&
Expenditure
Schedule
IX-C for
Statement
of
Contribution
Trust exempted from requirements of audit is
required to file accounts in Schedules IX-A &
IX-B. It is auditors duty to prepare Balance Sheet
and Income & Expenditure A/c and forward the same
along with a copy of his report to the trustee who in
turn will forward the full set of audited accounts in
the Office of Charity Commissioner within the
fortnight of completion of audit. The trust having an
annual income of 􀀀 15,000/- or less is exempt from
audit.

55. 5
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Change (Sec.
22 and Rule
13)
Within 90
days
of the
occurrenc
e of
change
Schedule III To be signed and affirmedby a trustee.It must beensured that changes are
communicatedwithin90days and thereafterit is the responsibilityof thetrustee
to follow-upand get the order of thechanges. Changes for the appointment of
the newtrusteeswillbe filedalong with the notice ofmeeting,resolution,
attendance sheet for themeeting, invitationletter,consent letter and Affidavitas
well as for Deletionof name of trustee to be filedwith letterof resignation,
death certificate,Affidavit,No Objectionletterand other relevant documentary
evidence. Please note that the change report to befiledis to be approved by the
Superintendent andonly thereafterthe change report can be filed.

56. 5
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Change
(Section
22(1A), Rule
13(1A))
relatingto
Immovable
property
Within 90
days
of the
occurrence
of
change
Schedule
III-A
Change schedule to be signed and affirmedby a trustee along with
relevant documents of the property, how the property has come to the
trust, Name and address of previous owner, Publication in newspaper,
Copy of 7/12 of the property, Evidence Affidavitand audited accounts for
last three years.

57.  For Non-Profit Company :
Submit Audit Report with Registrar of
Companies up to 31st Oct for each year.
 Income-tax Return:
For all the Non-Profit organizations it is
necessary to submit
Income-tax return every year up to 30th
September.
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58. THANK YOU
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Mr.Prahlada G
+91 9739392011
prahlada.bhakta@gmail.com