All about type of business organization registrations to start your business in India

1. Dr Raju Indukoori
Business Organizations

2. Content
Business
• Business Types
• Business Size
• Business Ownership
• Business Organization
Business Organizations
For Profit Organizations
• Individual Firms
• Private Companies
• Public Companies / Joint Stock Companies
Not for profit organizations
• Government Organizations (GOs)
• Non Governmental Organizations (NGOs)
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3. Business
• Commercial activity for excess of income over
expenses.
• Process of making profits.
• Set of commercial activities coordinated to make
profits over a period of time.
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4. Direct Business
A. Primary Sector: Natural sources
1. Agriculture
2. Mining
3. Forestry
B. Secondary Sector: Manufacture
1. Finished goods
2. Semi finished goods
3. Assembly units
C. Tertiary Sector: Services
1. Direct Services
2. Intermediate Services
Indirect Business
A. Trading
1.Domestic : Buy–Sell
2.Foreign : Export–Import
B. E-Commerce
1.Aggregator: Demand-Supply
2.Business to Business(B to B)
3.Business to Customer(B to C)
C. Investments
1.Holding Companies
2.Venture Capital
3.Private Equity
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Business Types

5. Business Size
1. Local : Business limited to a town or city.
2. Regional : Branded in a state/s or region or zone
3. National : Presence across the nation (PAN).
4. International : Exports/Imports, foreign sales.
5. Multinational : Presence in all potential countries.
6. Global : Presence across the continents.
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6. Business Ownership
1. Public Sector : Owned and controlled by Government
2. Private Sector : Owned & controlled by private people
3. Joint Sector : Combination of Private & Public Sector
4. Societies : Owned by cooperative societies
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7. Business Organization
• An organization which has commercial activities to
make profit are know as Business entities / companies /
corporations.
• Some organizations doesn’t have commercial motives
like Development banks, government owned telecom,
railway and defense services. But they are part of
commercial activities generating money leading to
profits or losses.
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8. A. Individual Firm
1. Sole Proprietary (SP)
2. Private Partnership (PS)
B. Private Company
1. One Person Company (OPC)
2. Limited Liability Partnership (LLP)
3. Private Limited Company (Pvt Ltd)
C. Public Company/Joint Stock
Company
1. Public Limited (Pub Ltd) Company
2. Listed Company (LC)
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Types of Business Organizations
A. Government organizations
1. Indian Government
2. State Government
3. Local Governments
B. Non Governmental
Organizations (NGOs)
1. Trusts
2. Societies
3. Cooperatives
For Profit Organizations Not for Profit Organizations

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A. Individual Firms

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• These are the business firms owned by individuals.
• There is no difference between the owner of the firm and business.
• Tax is part of the individuals’ income attracting personal income tax
rates and slabs.
• Types of Individual Firms
1. Sole Proprietary (SP)
2. Partnership (PS)
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A. Individual Firms

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• It is the oldest form of doing business lead by an individual with sole
responsibility and Liability.
• Most business forms in the world are in Sole Proprietary form.
• Most of the popular global brands like Coca Cola started as Sole
Proprietary..
• A sole proprietary may have trade name or brand name.
• One person can be a proprietor for more than one firms.
• Though it is not required to register, sole proprietorship firm
registration with MSME.GOV.IN is required to do banking, online
transactions, funding, future growth.
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1.SOLE PROPRIETARY

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It is also known as
• Sole Trader
• Individual entrepreneurship
• Proprietorship
• Privately held
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Sole Proprietary

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Disadvantages
• Limited life
• Unlimited liability
• Difficult to raise capital to support growth
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Advantages
• Ease of formation as it doesn’t require registration
• Subject to few regulations at the personal level.
• No corporate income taxes
• Simple to operate and maintain
Sole Proprietary

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• It is an extension of Sole proprietary.
• Liabilities are on the name of more than one person.
• Taxes are applicable as per the personal income tax slabs and rates
of each partner.
• This is suitable for medium scale business.
• A partnership has almost the same advantages and disadvantages
as a sole proprietorship. The added advantages are that
1) Risk is distributed among more than one person.
2) Relatively more scope for new capital.
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2.PARTNERSHIP

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• Acts: Indian Partnership Act,1932, Companies Act 2013.
• Members: Minimum 2 members and maximum is 100.
• Conversion: into LLP, PLC and other company forms.
• Share transfer: Partners can transfer their share after the consent of
all the partners.
• Share Assign: Without consent of all the partners, one of the
partners can assign share to a person to receive all financial benefits.
• Closure: If the firm has only 2 partners, it comes to a closure if one of
them is deceased or retires or becomes insolvent.
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Partnership Nature

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1. Unregistered
2. Registered with Registrar of Firms (ROF)
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Partnership Types

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It contains minute details of the firm as follows
1.Firms details: Name, address, Contact number.
2.Partners: Name, address, Contact number.
3.Capital: Contribution or stake of each partner.
4.Profits: Distribution ratio to each partner.
5.Tenure: Duration to do business if applied.
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Partnership Deed

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• Create partnership instrument through partnership Deed or
agreement on a stamp paper of a value with signature of all
partners.
• Stamp duty has to be paid as per government norms.
• The value of the stamp paper and stamp duty which varies from
state to state.
• The agreement on the stamp paper has to be notarized.
• Though Indian Partnership Act, 1932 doesn’t mandate for
registration of the agreement, it suggested to be registered with
Registrar of Firms (ROF).
• Take PAN for the firm.
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Partnership Process

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• ‘Cargill’ is a classic example of non limited company form of
business organizations.
• William W Cargill Owned ‘CARGILL’ as sole proprietary initially.
• It was transformed to a partnership business with his family
members as partners.
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Partnership Example

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B. Private Companies

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• It is a company still owned and controlled by few private
individuals
• A private company is a separate from its owners
• Mostly owners acts as managers.
• It is a legal entity registered with Registrar of Companies
(ROC) bounded by Indian Companies Acts and Ministry
of Corporate Affairs (MCA).
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Private Company

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Private Company
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Advantages
1. Unlimited life
2. Limited liability
3. Ease of raising capital
4. Attract big clients
5. Raise loans from corporate
banking
Disadvantages
1. Double taxation i.e corporate tax
and personal income tax.
2. Cost of set-up and report filing
3. Lack of professional management.
4. No separation of ownership and
management
Pros and Cons of Private Companies

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1. One Person Company (OPC)
2. Limited Liability Partnership (LLP)
3. Private Limited (Pvt Ltd) Company
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Types of private companies

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• A new concept introduced in India through Companies Act 2013.
• Formed only by an Indian Resident and citizen.
• It is the form of business organization where a person is the only
member, director and shareholder with one share.
• One can form only one OPC.
• Nominee is mandatory.
• A member of an OPC can be nominee of another OPC.
• It has perpetual succession.
• OPC owns its assets, member doesn’t have insurable rights on
OPC’s assets.
• OPC is a great relief for many small Entrepreneurs.
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1. ONE PERSON COMPANY (OPC)

25. 1. Paid up Capital: Minimum 1 Lakh and upto Rs 50 Lakh
2. RUN (Reserve Unique Name): on MCA portal. 2 names can be reserved
with one resubmission for approval. OPC should appear in brackets.
3. PAN (Permanent Account Number) : Permanent Account Number for the
person incorporating. Form 49A will be generated.
4. TAN: Tax deduction and collection Account Number for tax collection from
others. Form 49B will be generated.
5. DIN (Director Identification Number): for the Director.
6. DSC (Digital Signature Certificate): for the proposed director is produced
on submission of Address Proof, Aadhaar, PAN, Photo, Email and Phone
Number.
7. Mandatory Display of OPC in the name of the company in brackets:
Example : Indian Garments (OPC)
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OPC Requirements

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1.Form INC 32:: Submitted through Simplified process for Incorporating
Company Electronically (SPICe) with Run (Name can be reserved
through SPICe if RUN is not done), DIN, PAN and TAN
2.MOA (Memorandum of Association): Form INC 33 for eMoA with
nominee mentioned. Nominee can be changed with intimation to ROC.
3.AOA (Articles of Association) : Form INC 34 for eEAoA
4.MCA (Ministry of Corporate Affairs): Upload all the forms with DSC
on MCA portal.
5.ROC (Registrar of Companies): Issue Incorporation Certification
upon verification.
6.Start Business
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OPC Incorporation Process

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• Time Period: An OPC can convert into a private or public ltd
company only after two years from the date of incorporation.
• Regulation: The Conversion process should be done as per the
rules and regulations laid down by the Companies Act, 2013 under
Section 18, and Rule 7(4) of the Companies (Incorporation) Rules,
2014.
• Nominee Role in Conversion
– The company shall be having one member and shall appoint one nominee to act as
member in case of death or incapacity of the member at the time of conversion into
OPC.
– Where a natural person, being member in OPC becomes a member in another OPC
by virtue of his being a nominee in that OPC, then such person shall meet the
eligibility criteria of being a member in only one OPC within a period of one hundred
and eighty days, i.e., he/she shall withdraw his membership from either of the OPCs
within one hundred and eighty days.
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OPC Conversion

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1) Voluntary Conversion: Decision by the owner / member / director.
Form INC-6 shall be filed within 30 days
2) Mandatory Conversion: : Form INC-6 shall be filed within 30 days
– If the paid up capital is more than Rs 50 Lakhs. Form INC-6 shall
be filed within six months.
– Average annual turnover three consecutive years is more than
two Rs 2 cr.
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OPC Conversion Types

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1. Branded business: Company mentioned with name.
2. Complete Control : Easy to make decisions.
3. Disintegrated business property: Different from personal owners property
4. Enhanced efficiency : with personal interest.
5. Independent Existence : Person is his / her own boss.
6. Legal Status.
7. Limited Liability: unlike sole proprietary with unlimited liability.
8. Nominee: He / She is the successor.
9. Profits to one person.
10.Quick Decision Making
11.Tax Savings: Arise as person income and business income get separated.
Salary, lease or rentals paid, interest paid to the member can be shown as
expenses.
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OPC Merits

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1. Limited capital : for expansion purposes when compared to private or
public limited.
2. Share: Cannot be divided.
3. One man show: Becomes difficult at times to handle and make decisions.
4. Tax rate: High tax rate (30%) compared to sole proprietary (Personal
income tax rates and slabs).
5. ESOPs (Employee Stock Option): Cannot be issued
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OPC Demerits

31. Sole Proprietary
1. One person starts.
2. Business and owner are single entity.
3. Unlimited Liability.
4. Personal Income Tax.
5. No successor.
6. Personal framework.
7. Zero cost to start.
8. No Dividend distribution tax (DDT).
9. No compliance.
10. No limit on paid up capital.
11. No limit on annual turnover.
OPC
1. One person starts.
2. Business and owners are separate entities.
3. Limited Liability.
4. Private companies tax.
5. Has a successor.
6. Corporate framework.
7. Rs 15,000 to start.
8. Dividend distribution tax (DDT).
9. Low compliance.
10.Convert to private ltd if paid up capital is
more than Rs 50L.
11.Convert to private ltd if average annual
turnover for 3 years is more than Rs Cr.
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Sole Proprietary Vs OPC

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Some of the successful OPCs
Name Place Business
Broom Bikes Jaipur Auto Parts Sales
Fashtoon Apparel Jaipur Apparel Manufacturing
Snehsanskriti New Delhi Textile Manufacturing
Wimoku Ernakulam Software
Wowwash Hyderabad Research

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• It was introduced in 2008.
• it was the most preferred business organisation.
• It is similar to Limited Liability Corporations (LLC) across the world.
• It is a mix of limited liability firm and partnership firm.
• Similar to a limited liability firm, it provides the benefits of limited
liability of a company like low compliance cost.
– It is similar to a partnership firm as it allows its members the flexibility of
organising their internal management on the basis of a mutually arrived
agreement.
– It is an alternative owing to flexibility in its structure and operation, it would be
useful for small and medium enterprises, in general, and for the enterprises in
services sector, in particular.
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2.Limited Liability Partnership(LLP)

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• The LLP is a body corporate and a legal entity separate from its partners.
• Governed by the provisions of the Limited Liability Partnership Act 2008
• It should have at least two partners and two individuals as designated
partners, of whom at least one shall be resident in India.
• Any two or more persons, associated for carrying on a lawful business with
a view to profit, may by subscribing their names to an incorporation
document and filing the same with the Registrar, form a Limited Liability
Partnership.
• There are no shares and directors in LLP.
• The duties and obligations of Designated Partners shall be as provided in
the law.
• The LLP will have perpetual succession.
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Nature of LLP

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• The Indian Partnership Act, 1932 shall not be applicable to Limited Liability
Partnerships.
• The mutual rights and duties of partners of an LLP shall be governed by an
agreement between partners or between the LLP and the partners subject
to the Act.
• The act provides flexibility to devise the agreement as per their choice.
• The LLP will be liable to the full extent of its assets, with the liability of the
partners being limited to their agreed contribution in the LLP which may be
of tangible or intangible nature or both.
• No partner would be liable on account of the independent or un-authorized
actions of other partners or their misconduct.
• The liabilities of the LLP and partners who are found to have acted with
intent to defraud creditors or for any fraudulent purpose shall be unlimited
for all or any of the debts or other liabilities of the LLP.
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Limited Liability Partnership Act2008

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• The LLP shall be under an obligation to maintain annual accounts reflecting
true and fair view of its state of affairs.
• A statement of accounts and solvency shall be filed by every LLP with the
Registrar every year.
• The accounts of LLPs shall also be audited, subject to any class of LLPs
being exempted from this requirement by the Central Government.
• The Central Government has powers to investigate the affairs of an LLP, if
required, by appointment of competent Inspector for the purpose.
• The compromise or arrangement including merger and amalgamation of
LLPs shall be in accordance with the provisions of the LLP Act 2008.
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Contd..

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Conversion:
• A company (Private Ltd or Public Ltd) is allowed to be converted into LLP.
• An LLP cannot be converted into a company.
Winding Up:
• It may be either voluntary or by the Tribunal to be established under the Companies
Act, 1956.
• Till the Tribunal is established, the power in this regard has been given to the High
Court.
Government Influence
• The LLP Act 2008 confers powers on the Central Government to apply provisions of
the Companies Act, 1956 as appropriate, by notification with such changes or
modifications as deemed necessary.
• However, such notifications shall be laid in draft before each House of Parliament for a
total period of 30 days and shall be subject to any modification as may be approved by
both Houses.
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Organizational Changes

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1. More suitable for Startups
2. Low compliance compared to private ltd and public ltd firms.
3. It is easy raise capital compared to sole proprietary and
partnership.
4. DDT is not applicable.
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LLP Benefits

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1. ESOPs cannot be offered.
2. Higher tax rates (30%) compared to Public ltd (22%) and Sole Proprietary
(Tax slabs).
3. High cost of late filing of documents is very high. As a fine of INR 100 per
day till the time the offence of late filing continues.
4. Director designation cannot be used. Partner or Managing Partner should
be used.
5. No shares and no shares transferability. Even the share is transferred, the
ownership and nature of LLP doesn’t change.
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LLP Demerits

40. Partnership
1. Business and owners are integrated
2. Unlimited Liability
3. Personal Income Tax
4. Personal framework
5. Zero cost to start
6. No DDT
7. No compliance
LLP
1. Business and owners are separate
2. Limited Liability
3. Private companies tax
4. Corporate framework
5. Rs 10,000 to start
6. No DDT
7. Low compliance
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Partnership Vs LLP

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• It is a form of company with limited liability and multiple owners
suitable for services and growth industry.
• It stands between individual owned and public limited companies.
• Minimum capital required is Rs 1 Lakh.
• It has perpetual life.
• FDI is the added advantage in PLC.
• It can be converted into public limited company.
• Share of the owners can be transferred.
• Private company’s tax rate is applicable (different from corporate
tax).
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3.Private Limited Company (PLC)

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• Periodic compliance through books and accounts is
mandatory.
• It is mandatory to do audit if the annual turnover crosses
Rs 1 Cr.
• Annual General Meeting (AGM).
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Mandatory Provisions

43. Parameter Partnership Firm Company
Life Limited Unlimited
Liability Unlimited Limited
Profit flow To the pockets To the pockets / Reinvested
Taxation Taxation on individual profit. Double taxation
Equity liquidity Low High
Funding Low High
Governance Low High
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Partnership Firm Vs Company

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C. Public Ltd / Joint Stock Companies

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• It is the form of company where the shares of the company are
owned by the public jointly in proportion.
• It is also known as joint stock company
• Share holders are the owners of these companies.
• Like private companies, these are also independent entities different
from owners.
• Unlike a private company, public limited company has clear
separation of ownership and management.
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C. Public Limited Company

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Company/ Corporation
• It is a legal entity registered with Registrar of Companies
(ROC) bounded by Indian Companies Act 1956
• It is separate from its owners and managers
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Advantages
1. Unlimited life
2. Easy transfer of ownership
3. Limited liability
4. Ease of raising capital
Disadvantages
1. Double taxation
2. Cost of set-up and report filing
3. Agency problem

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1) Unlisted Company
2) Listed Company
3) Multi National Company (MNC)
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Types of Public Limited Companies

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• It is a voluntary association of members which is incorporated and,
therefore has a separate legal existence and the liability of whose
members is limited.
• Separate legal existence apart from its members who compose it.
As a company is an independent legal person, its existence is not
affected by the death, retirement or insolvency of any of its
shareholders.
• It has Minimum of seven and upper limit.
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1. Unlisted Company

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• The company collects its capital by the sale of its shares and those
who buy the shares are called the members. The amount so
collected is called the share capital.
• The shares of a company are freely transferable and that too without
the prior consent of other shareholders or without subsequent notice
to the company.
• The liability of a member of a company is limited to the face value of
the shares he owns. Once he has paid the whole of the face value,
he has no obligation to contribute anything to pay off the creditors of
the company.
• The shareholders of a company do not have the right to participate
in the day-to-day management of the business of a company. This
ensures separation of ownership from management.
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Share Holders

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• Forming a public limited company: Its formation, working and its winding
up, in fact, all its activities are strictly governed by laws, rules and
regulations.
• The Indian Companies Act, 1956 : Contains the provisions regarding the
legal formalities for setting up of a public limited company.
• Registrars of Companies (ROC) : Appointed under the Companies Act
covering the various States and Union Territories are vested with the
primary duty of registering companies floated in the respective states and
the Union Territories.
• BOD: The power of decision making in a company is vested in the Board of
Directors (BOD), and all policy decisions are taken at the Board level by the
majority rule. This ensures a unity of direction in management.
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Regulation and Governance

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1. Continuity of existence.
2. Efficient management: Professional and qualified
persons.
3. Raise more capital.
4. Limited liability.
5. Unity of direction.
6. Able to attract big clients.
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Advantages

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1. Scope for directors for personal profit.
2. Scope for promotional frauds.
3. Subjected to strict regulations.
4. Undemocratic control.
5. Agency problem.
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Disadvantages

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• Listed in stock exchanges which give trading facilities
for the companies shares. They included
1. National Exchanges : NSE and BSE
2. Regional Exchanges : HSE, NDSE, BgSE, CSE
• Listing gives
• better brand value
• Attracting more customers
• Takes the attention of big nvestors
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Listed Companies

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• The company has business spread in foreign countries
with customised focus
• The company shares are listed in Indian stock
exchanges as well as Foreign stock exchanges where
the company is operating.
• Multinational business was started by Europeans with
Dutch East India and British India followed by French,
Portuguese with their Asian invasion including India.
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Multi National Company (MNC)

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Indian MNCs
• Software : Infosys, TCS, Wipro, HCL
• Automobile : Tata motors, M&M, Hero
• Pharma : Dr Reddy’s
• Banking : ICICI, HDFC
• Telecom : Airtel
• Steel : Tata Steel, Mittal Steel,
Foreign MNCs
• American : Apple, Microsoft, Google, Face Book, Ford
• European : Volvo, Bata, Lafarge, Legrand, Volkswagen
• Asian : Honda, Sony, Samsung
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Types of MNCs

56. Types of Business Firms
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Description
Individual
1. SP
Individual
2. PS
Private
3.OPC
Private
4.LLP
Private
5. PLC
Joint Stock
6.Pub ltd
Joint Stock
7. Listed
Members (Min–Max) 1 - 1 2 - 100 1 – 1 2 2 – 200 7 - Unlimited 7 - Unlimited
Directors NA No director 1 - 15 No director 2 - 15 3 3
Liability Unlimited Unlimited Limited Limited Limited Limited Limited
Management Owner Partners Owner Partners BOD BOD BOD
Tax
Personal
Income Tax
Personal
Income Tax
Private Companies
Tax (30%)
Private Companies
Tax (30%)
Private Companies
Tax (30%)
Corporate Tax (22%) Corporate Tax (22%)
Registrar NA / MSME ROF ROC ROF ROC ROC ROC
Transferability NA Anyone Nominee Anyone Anyone Anyone
Share transfer
Permission
NA Partners NA
LLP
Agreement
BOD NA NA
Registration Optional Optional ROC Mandatory Mandatory Mandatory
Capital in Rs Lakh NA NA
1 (Min)-
50(Max)
NA Minimum 1 Minimum 5 Minimum 5
Conversion Optional Can’t
Mandatory if >
Rs 50 Lakh
Can Can Can Can
Firm’s Life Owner’s Life Owners’ Life Owner’s Life Perpetual Perpetual Perpetual
Suitability
Micro and
Small
Startup /
Medium/
Services
Micro and
Small
Startup/
Medium/
Services
Services /
Growth /
Manufacturing /
Capital Intensive/
Offshore business
Manufacturing /
Capital Intensive/
Offshore business
Board Meetings in a
calendar year
NA NA
0. (2meetings
if directors >1)
NA 4 4 4
Law/Authority NA
Indian Partnership
Act 1932
The Companies Act
2013, MCA
LLPAct2008, MCA
The Companies Act
2013, MCA
The Companies Act
2013,
The Companies Act 2013,
SEBI
FDI Allowed Yes Yes No Yes Yes Yes Yes
Books & Accounts NA NA Mandatory Mandatory Mandatory Mandatory Mandatory
Audit NA NA Turnover > Rs1Cr Turnover >Rs1Cr Turnover > Rs1Cr Mandatory Mandatory
AGM NA NA NA NA Mandatory Mandatory Mandatory

57. Dr Raju Indukoori
A. Government organizations (Gos)
1. Government of India
2. State Governments
3. Local Governments
B. Non Governmental Organizations (NGOs)
1. Trusts
2. Societies
3. Cooperatives
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Not for Profit Organizations

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• Owned Governments.
• They are managed and controlled by respective
ministries or departments.
• They are more of public services.
• They are initially public needs and later become value
added services.
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A. Government Organizations

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1. Government of India
• Indian Railways
• Sea Ports: Major Ports and Minor Ports
• Airports
• Space: ISRO
2. State Governments
• State road transport services
• Power generation and distributions services
3. Local Governments
• Public Utility services
• Amusement and entertainment services
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Government Business

60. • Non Government Organization (NGO).
• Primary objective is social service.
• Can operate businesses initially.
• Some profit is acceptable even legally.
• If the NGOs start making excessive profits out of their
services, it is only then that other people may start
questioning. They can be classified as
1. Trusts
2. Societies
3. Cooperatives
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C. NGOs

61. • Akshaya Patra
• HelpAge India
• CRY
• E Vidyaloka, Bangalore
• Give India
• Pathway India
• Sapne NGO
• Tulir
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Popular NGOs

62. Trust is transfer of property by one person (settlor) to another (trustee)
who manages that property for the benefit of someone else
(beneficiary). The settlor must legally transfer ownership of the assets
to the trustee of the trust -
Settlor: The individual / entity who creates a trust. Also known as
Trust or or Grantor.
Trustee: The owner who is under an obligation to use his ownership
for the benefit of another
Beneficiary: The owner who enjoys the benefit of the Trust property.
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1. Trusts

63. • Private Trust : Indian Trusts Act,1882 . Settlor creates a Trust
primarily for benefit of one or more particular individuals as its
Beneficiary.
• Public Trust: Beneficiaries are the general public or a class as a
whole. It has some charitable end as its Beneficiary. -
– Religious Endowment Act, 1863
– Charitable and Religious Trust Act, 1920
– Charitable Endowments Act, 1890
• Business Trust: Finance Act 2014.
– Real Estate Investment Trusts (REITs)
– Infrastructure Investment Trusts (InvITs)
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Types of Trust

64. • Simple Trust – Trustee is just a passive depository of the Trust
property. There are no active duties expected from Trustee and no
directions are given to him.
• Special Trust – Trustee is active and acts as an agent to execute
the Grantor’s wishes. This Trust is operative.
• Express Trust – Here, the Settlor creates a Trust over his assets
either in present or upon his death. It can be either by way of a will
or Trust deed.
• Implied Trust – It is created where some legal requirements for an
Express Trust are not met, but intention on behalf of the parties is to
create a Trust that is presumed to exist.
• Others: Depending on the type of object(s).
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Types of Trust

65. • Trust gained more importance in India as they participate
in investments.
• The are regulated be SEBI
• Some of them are
– Mutual Fund Trusts
– Venture Capital Trusts
– Foreign Portfolio Investors (FPI)
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Business Trusts

66. • The Societies Registration Act, 1860 is a legislation in India which
allows the registration of entities.
• Society is formed by Memorandum of Association
• It is formed by 7 persons or more
• Society should have
– Name
– Governng body
– Addresses and Occupation of the membersa
• Societies are more involved in t
– Education
– Health
– Employment.
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2. Society

67. • Societies are more involved in the following
– Education
– Health
– Employment
• Approved Educational institutions are tax free and
without approval are taxed @ 30%.
• Other business under societies attract different tax slabs
and rates or GST as and when prescribed by the
government.
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Society Business

68. • Formed by people of common interest for a
common purpose usually in a village or tribe.
• The purpose include agriculture, diary, trade,
food processing, grocery, funding, banking, etc.
• It has joint ownership with the society members.
• Democratic leadership.
• It is perpetual like a company
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3. Cooperative Society

69. 1. Voluntary and open membership
2. Democratic member control, with each member
having one vote.
3. Economic participation by members
4. Autonomy and independence
5. Education, training and information
6. Cooperation among cooperatives
7. Concern for community
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Principles

70. Dr Raju Indukoori 70
Popular Cooperatives
Name Place Product
Indian Farmers Fertilisers Cooperative
(IFFCO)
New Delhi Fertilizers
Amul Anand Milk Producers
Adarsh Co-Operative Bank Sirohi Banking
Indian Coffee House Jabalpur Restaurant Chain
Horticultural Producers’ Cooperative
Marketing and Processing Society
Bengaluru Farm Produces
KRIBHCO NOIDA Fertilizers

71. Thanks for patient reading
Happy Business Days