Overview
A non-governmental organization (NGO) is a non-profit entity that operates independently of government involvement. Its primary aim is to address various social and charitable issues within society. NGOs are required to reinvest any profits made during a financial year back into the organization to further their objectives. NGOs can be active in diverse fields such as commerce, arts, science, sports, education, research, social welfare, religion, charity, and environmental protection. Registering an NGO enables individuals to pursue their goals of contributing to societal improvement and development.
Before discussing the NGO registration process, it is important to understand what an NGO is, how it works in Assam, and what are the criteria involved for registration.
NGOs can be classified into three types: Section 8 companies, societies, or trusts. The registration process for each type is governed by different laws:
The Indian Trusts Act, of 1882, for trust registration.
The Societies Registration Act, of 1860, for society registration.
Companies Act, 2013, Section 8 for company registration.
Benefits of NGO Registration in Assam
Registering an NGO offers several advantages, including:
Tax Exemption: NGOs registered in Assam under the Companies Act 2013 can claim tax benefits, allowing them to save a significant amount of money. These savings can be redirected towards more impactful activities.
Asset Acquisition: A registered NGO can acquire assets and incur liabilities in its own name. Unregistered NGOs cannot claim these benefits and it is illegal for them to hold any property in their name.
No Minimum Share Capital Requirement: Registered NGOs are not required to have a minimum share capital, making it easier to receive donations and charity funds without the need to continually raise capital.
Transfer of Ownership: There are no restrictions on the transfer of ownership of an NGO registered under the Companies Act of 2013. Similarly, the Income Tax Act of 1961 does not limit the transfer of interest claims.
Legal Status: A registered NGO gains legal status, enabling it to accept funds in its name. This legal recognition also facilitates interactions with the government and potential donors.
Recognition: A registered NGO projects a sense of security, ethics, and adherence to legal norms, which can attract volunteers and contributors.
Bank Account: To ensure smooth operations, NGOs need a bank account. However, a bank account in the organization’s name can only be obtained if the NGO is registered as a trust, Section 8 company, or society.
Types of NGO Registration in Assam
Various Categories for NGO Registration in Assam
NGO Registration in Assam (as a Trust): To register an NGO as a trust, an individual must establish a public trust with a specified charitable purpose. The trust’s author creates a deed outlining the property to be used for the trust’s activities and appoints trustees responsible for managing the property. The beneficiaries must be the general public, not specific individuals.
NGO Registration in Assam (as a Section 8 Company): Under the Companies Act of 2013, entities aiming to promote arts, facilitate commerce, establish religious and charitable institutions, and protect the environment can be registered as non-profit organizations under Section 8. These organizations must reinvest any profits back into the NGO’s mission and cannot distribute profits to members like regular companies.
NGO Registration in Assam (as a Society): NGOs can also be registered under the Society Registration Act of 1860. According to this Act, seven or more individuals can form a society to pursue objectives related to scientific, literary, or charitable purposes. These societies must avoid using words that suggest any affiliation with the state government, central government, or local authorities. Self-help groups focused on profit-making do not qualify under this category.
What are the Eligibility Criteria to Start an NGO in Assam?
Private Limited Company (PLC): A minimum of two directors is required to incorporate an NGO as a Private Limited Company. The maximum number of members allowed is 200.
Public Limited Company: At least three directors are necessary to incorporate an NGO as a Public Limited Company. There is no limit on the number of members for a Public Limited Company.
Why is NGO Registration Required in Assam
Expanded Resources: Registration broadens the scope for both financial and human resources, attracting more volunteers to support the NGO.
Ethical Reinforcement: A registered NGO upholds the ethical, social, and legal norms of society.
Limited Liability Protection: Members of a registered NGO enjoy limited liability protection, with their roles and responsibilities restricted to their capital or fund contributions.
Special Legal Standing and Tax Exemptions: NGO registration grants the organization special legal status and tax exemptions. Contributors, donors, and lenders can claim tax deductions for their contributions. NGOs in Assam benefit from income tax rebates under Sections 12A and 80G, with 80G-certified NGOs attracting more donors.
No Minimum Share Capital Requirement: Registered NGOs can operate independently without needing a minimum share capital. They can also receive direct funding through donations.
Name Protection: Once registered, the NGO’s name is protected nationwide, preventing others from using the same or a similar name, thus safeguarding the organization’s identity and image.
Documents for NGO Registration in Assam
Memorandum of Association (MOA)
Articles of Association (AOA)
Company Name for Approval
Aadhar Card
Voter ID
Copy of Passport
Driving License/Identity Proof of All Directors
Office Address Proof (e.g., water bill, electricity bill, or tax receipt)
Process of NGO Registration in Assam
Choose the Name and Type of NGO: Decide on the name and the type of NGO you wish to register.
Obtain DSC and DIN-3: The applicant must obtain a Digital Signature Certificate (DSC). After acquiring the DSC, apply for DIN-3 from the Registrar of Companies (ROC).
Draft the AOA and MOA: Prepare the Articles of Association (AOA) and Memorandum of Association (MOA).
Register with the Appropriate Authority: Submit the registration application to the relevant authority.
Obtain a PAN Card: The NGO must obtain a Permanent Account Number (PAN) card after registration.
Apply for Tax Exemptions: Finally, apply for tax exemptions under Sections 12A and 80G of the Income Tax Act.
Conclusion
Registering an NGO in Assam provides numerous benefits, including expanded resources, limited liability protection, tax exemptions, and legal recognition. The process involves selecting an appropriate name and type, obtaining necessary certifications like DSC and DIN-3, drafting essential documents such as the MOA and AOA, and completing the registration with the relevant authority. Post-registration, obtaining a PAN card and applying for tax exemptions under Sections 12A and 80G are crucial steps. These measures ensure that the NGO can operate effectively, attract more volunteers and donors, and make a meaningful impact on society. By following these steps, individuals and organizations can successfully establish an NGO in Assam, contributing to social and charitable causes.
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