NGO Registration in Patna Bihar-Society Registration in Patna Bihar-Trust Registration in Patna Bihar
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NGO, Society, Trust & Section 25 Company  registration  in India

 

NGO Registration in Patna Bihar

 

In India, nonprofit / public charitable organizations can be registered as trusts, societies, or a private limited nonprofit company, under section-25 companies. Non-profit organizations in India

 

 

(i) exist separately of the state; (ii) Are self-governed by a board of trustees or 'managing committee'/ governing council, comprising individuals who generally serve in a fiduciary capacity; (iii) Produce benefits for others, usually outside the membership of the organization; and (iv) are 'non-profit-making', in as much as they are prohibited from distributing a monetary residual to their own members.

 

Section 2(15) of the Income Tax Act which is applicable uniformly throughout the Republic of India defines 'charitable purpose' to include 'relief of the poor, education, medical relief and the advancement of any other object of general public utility'. A purpose that relates completely to worship is not considered as charitable. Therefore, in ascertaining whether a purpose is private or public, one has to see if the class to be benefited, or from which the beneficiaries are to be selected, constitute a substantial body of the public.

 

Whether a trust, section-25 company or society, the Income Tax Act gives all categories equal treatment, in terms of exempting their income and granting 80G certificates, whereby donors to non-profit organizations may claim a repayment against donations made.

 

 

1. NGO/Society Formation:

 

There is two type of Society and NGO's in India - State label and All India label. Before registering the NGO or Society you should know about the difference between both of them

 

STATE LABEL:

 

To register the Society or NGO at State Label. You will have to provide the ID proof of Seven Member's (DL | Copy of Passport | Voter ID). You will have to provide Two Members (President - Treasurer or Secretary - Treasurer) form Delhi and another Five Member's can be from any states. Two set of MOA of NGO or Society.

 

ALL INDIA LABEL:

 

To register the Society or NGO at all India Label. You will have to provide the ID proof of Nine Member's (DL | Copy of Passport | Voter ID). You will have to provide Two Members (President - Treasurer or Secretary - Treasurer) form Delhi and another Seven Member's from Seven different states. Two set of MOA of NGO or Society.

 

2. Projects Preparation Services For NGO:

 

INTRODUCTION :-

Numerous NGOs are tending to the interlinked issues of neediness, underdevelopment, and natural debasement. Specifically, non-government organizations(NGOs) are dynamic and differing aggregations of conglomerations  working at neighborhood, national and worldwide levels. Their exercises envelop  alleviation and philanthropic support log evacuees and removed persons,  monetary and provincial improvement programs, common assets and preservation  ventures, open health intercessions, and numerous different regions. How Non-Government Organizations screen the social, monetary and ecological effect of  their undertakings is the subject of this article. NGOs can prepare  NGO project and file in government ministries, corporate or link with foreign donor for grant.
We enclose for your information,  an informative leaflet about our organization. In case you are interested please send the following documents for preparation of innovative NGO projectb proposals for grant-in-aid.

 

• Registration Certificate and memorandum of Association and Rules and Regulation of Society/Trust Deed of Trust.

• Balance Sheet of last three Years.
• Annual Report of last three Years

• Pan Card of the Ngo

• Bank Account Details

• 12a and 80g Registration Certificate under Income Tax nAct 1961

 

3. Funding for NGOs:

Non-Government Organizations might be interested in the Bilateral Development and awareness projects. These initiatives provide funding possibilities for Slovakia NGOs, business enterprises  and state organizations that are seeking to implement Slovakia  development projects. Proposed law on the National Fund to support these social welfare organizations in Development Projects:

                    Funding agencies provide support  and funding to non-profits, grass-root level NGOs, organizations; but the  agencies provide funds and support according to their own guidelines, terms and  parameters. The listing of donor and other related agencies, persons, organizations  provided here is only for information purpose. We are not affiliated with any  agency, we do not endorse or recommend any agency or organization for any  purpose. This information has been provided for contact purpose only, assuming  that the enlisted agencies support or help volunteers, social welfare  conglomerations and groups for their social cause or entrepreneurship.

 

4. Project Proposal Writing

We provide best consultancy in Ngo Project proposal writing. A project proposal depicts an arrangement for a required movement. An undertaking proposal may be utilized to acquire an elected allow or to persuade a directorate to store another activity. Project proposals consist of several sections, perhaps including an  executive summary, a description of the problem or goal, a history or  background of existing conditions, a research review, and so on.

 

We prepare project reports in the following sectors:-

 

• Projects under 35ac, 35 1(ii), 35 1(iii)
• Dental College
• Medical College
• Research Centre
• Ayurvedic College
• Homeopathic and Biochemistry college
• Polytechnic Colleges
• Engineering Colleges
• Physical Education Colleges
• Law College
• Special schemes of Indian and state government like SWADHAR, GRAMEEN ROJGAR YOJNA etc.

 

5. Types of NGO Projects :-

A Non Government Organization can approach the following  departments for project funding:-

 

Government Agency:

 

If the NGO completes 3 years, then it becomes eligible for bigger amount of  funding and can approach the government ministries for grants. There is a separate  ministry for Non government organization grant focused on a particular  objective and scheme. Even if the NGO is not three years old, it can apply for  small budgetary grant for short term projects like environmental awareness,  camps organizing for health improvement in rural areas.

 

Foreign Funding Agency:

 

Foreign Funding is applicable when the NGO gets registered under FCRA. The social welfare organization has to be 3 years old for permanent registration under FCRA. In case if the Non-Government Organization is even one year old and any foreign donor is willing to donate any amount to that  Foundation, then that NGO can apply for FCRA prior permission. The foreign  donation is usually for those donations who are particularly working for a  specific cause like women empowerment, eradication of child illiteracy,  HIV/AIDS awareness in villages and under developed areas.

 

Corporate Social Responsibility:

 

CSR stands for corporate social responsibility. Nowadays, the Indian Government  has made a rule of CBDT limit. All corporate organizations who are having an  annual turnover in Crores, they are supposed to donate 2% of their profits to  social welfare organizations i.e. NGOs. The CSR prefer those NGOs who are  registered under section 12A and 80G of Income Tax Act 1961. This helps the  corporate organizations in getting 50% tax rebate from donated amount.

Our firm provides a wide gamut of services in the  sectors of project report preparation for NGOs after thorough and deep understanding of the mission of non-government organizations. Ngo Consultancy was shaped to help conglomerations in administration limit building and in reinforcing productivity. We have extensive variety of experts backed by proper office framework and exhaustive database of backing documentation with a  determination of best administration devices and key articles for them. We work professionally and give quality administration to our customers at the  described schedule.

 

 

Notes :-

 

NGO/Society Registration services are currently available in our head office Patna only.

 

Please Use Resources  - List of Documents Required Tab to know about documents required for registration at current date.

 

Society Registration in India

 

Non-Profit Organization can be set up in the style & form of Society under the Societies Registration Act, 1860. Every society registered under this Act may take legal action or be sued in the name of President, Chairman, or Principal Secretary, or trustees, as shall be determined by the rules and regulations of the society and, in default of such determination, in the name of such person as shall be appointed by the governing body for the occasion:- Provided that it shall be competent for any person having a claim, or demand against the society, to sue the President or Chairman, or Principal Secretary or the trustees thereof, if on application the governing body some other officer or person be not nominated to be the defendant.

 

Society Registration Procedure

 

According to section 20 of the Societies Registration Act, 1860, the following societies can be registered under the Act:- Charitable societies, military orphan funds or societies established at the several presidencies of India, societies established for the promotion of science, literature, or the fine arts, for instruction, the diffusion of useful knowledge, the diffusion of political education, the foundation or maintenance of libraries or reading rooms for general use among the members or open to the public, or public museums and galleries of paintings and other works of art, collection of natural history, mechanical and philosophical inventions, instruments or designs.

 

Legislation: - The Societies Registration Act, 1860, Societies are registered under which is a federal act. In certain states, which have a charity commissioner, the society must not only be registered under the Societies Registration Act, but also, additionally, under the Bombay Public Trusts Act.

 

Main Instrument: - The major instrument of any society is the memorandum of association and rules and regulations (no stamp paper required), wherein the aims and objects and mode of management (of the society) should be enshrined.

 

Trustees: - A Society needs a minimum of seven managing committee members; there is no upper limit to the number managing committee members. The Board of Management is in the form of a governing body or council or a managing or executive committee.

 

Application for Registration: Registration can be done either at the state level (i.e., in the office of the Registrar of Societies) or at the district level (in the office of the District Magistrate or the local office of the Registrar of Societies).

 

Documents Required

These information & documents are required to be furnished for registration of a society:

 

1. Name of Society
2.

Name, Father’s name, Address of seven members

3.

6 passport size photos of all 7 members

4. Id & Address Proof of 3 members
5. Address proof of registered address of Society given by Anchala Dhikari (Circle Officer)
6. Front & Side Photos of Office Building

 

Registration Procedure:

 

The procedure varies from state to state. However usually the application should be submitted together with: (a) memorandum of association and rules and regulations; (b) consent letters of all the members of the managing committee; (c) authority letter duly signed by all the members of the managing committee; (d) an affidavit sworn by the president or secretary of the society on non-judicial stamp paper of Rs.20-/, together with a court fee stamp; and (e) a declaration by the members of the managing committee that the funds of the society will be used only for the purpose of furthering the aims and objects of the society.

 

Note:

 

1.

NGO/Society Registration services are currently available in our head office Patna only.

2.

Please Use Resources - List of Documents Required Tab to know about documents required for registration at current date.

 

Co-operative society registration in India

 

What is ‘Cooperation’?

According to economic historian, Charles Guide "Cooperation is self-help and each for all (mutual-aid)". Self-help means the pride of supplying one's own needs by one's own resources, of being one's own merchant banker, money lender and employer. "Each for all", means to seek liberation, not only for oneself but for and through others”. The International Cooperative Alliance (ICA), at its Manchester Congress held in September, 1995 adopted a Statement on Cooperative Identity. The Statement included the definition of Cooperatives, a list of "Cooperative Values and a set of "Cooperative Principles”. According to ICA, "a cooperative is an autonomous association of persons united voluntarily to meet their common, economic, social and cultural/needs and aspirations through a jointly owned and democratically -controlled enterprise".

What are the principles of cooperation?

Cooperative Principles are guidelines by which cooperatives put their values into practice.

The Cooperative principles are:


(1) Voluntary and open membership
(2) Democratic member Control
(3) Member economic participation
(4) Autonomy and Independence
(5) Education, Training and Information
(6) Cooperation among Cooperatives
(7) Concern for community

What are the origins of cooperative movement in India?

During the British Rule in India, Nicholson a British Officer in India suggested `Find Raiffersen in India', i.e. introduce Raiffersen model of German agricultural credit Cooperatives in India. As a follow-up of that recommendation, the first Cooperative Society Act of 1904 was enacted to enable formation of "agricultural credit cooperatives" in villages in India under Government sponsorship. With the enactment of 1904 Act, Cooperatives were to get a direct legal identity as every agricultural Cooperative was to be registered under that Act only. The 1904 Cooperative Societies Act, was repealed by 1912 Cooperative Societies Act which provided for formation of Cooperative societies other than credit. Under 1919 Administrative Reforms, Cooperatives was made a provincial subject making each province responsible for Cooperative development.


In 1942, the Government of India enacted the Multi-Unit Cooperative Societies Act, 1942 with an object to cover societies whose operations are extended to more than one state. Armed with an experience of 42 years in the working of Multi Unit Cooperative Societies and the Multi-Unit Cooperative Societies Act, 1942, the Central Government enacted a comprehensive Act known as Multi State Cooperative Societies Act, 1984, repealing the Act of 1942.


Based on the recommendation of the Mirdha Committee and the "Model Cooperative Societies Act", this Government of India enacted the Multi State Cooperative Societies Act, 2002 which provided for democratic and autonomous working of the Cooperatives. The Multi State Cooperative Societies Act, 2002 came into force with effect from August 19, 2002.

 

Which are the institutions working for the development of cooperative movement in India?

National Cooperative Union of India (NCUI) and National Cooperative Development Corporation (NCDC) are the important agencies working for promotion of cooperative movement in India.

Who can become members of a cooperative society in India?

Persons who may become members of a Cooperative society at State level (as per the State Act)


(a) an individual competent to Contract, attained majority and is of sound mind and belongs to a class of persons if any for whom the society is formed as per its bye-laws;


(b) a society registered or deemed to be registered under the Cooperative Societies Act;


(c) the Government;


No individual shall be eligible for admission as a member of a federal society
Persons who may become members of a Multi-State Cooperative Society: (As per Multi-State /cooperative Societies Act, 2002).


(a) an individual, competent to contract under section 11 of the Indian contract Act, 1972.
(b) any multi-state Cooperative society or any Cooperative society.
(c) the Central Government
(d) a State Government
(e) National Cooperative Development Corporation (NCDC)
(f) any other Corporation armed or controlled by the Government.


No individual person shall be eligible for admission as a member of a national Cooperative society or a federal Cooperative.

 

Registration Procedures:

 

Registration Procedure of Cooperative society under a State Act:

Steps involved for forming a Cooperative Society under a state act:

(i) Prescribed application duly filled in shall be made to the Registrar of Cooperative societies;
(ii) the application shall be accompanied by four copies of the proposed Bye-laws of the society;
(iii) Where all the applicants are individuals, the number of applicants shall not be less than ten;
iv) the application shall be signed by every one of such applicants if the applicants are individuals;
v) if the applicant is a society, by a member duly authorized by such society;


Registration procedure of Multi-State Cooperative Society:

 

To form a Multi-State Cooperative society:

(i) An application for registration of a Multi-State Cooperative society shall be made in the prescribed form;


(ii) the application shall be signed by;


(a) In the case of a multi-state Cooperative society of which all the members are individuals, by at least fifty persons from each of the states concerned.


(b) In case the members are Cooperative Societies, by duly authorized representatives on behalf of at least five such societies as are not registered in the same state;


(c) In case the members are other Multi-State Cooperative Societies and other Cooperative Societies, by duly authorized representatives of each of such societies;


(d) If the members are cooperative societies or multi-state Cooperative societies and individuals, by at least (i) fifty persons, being individuals from each of the two states or more and; (ii) one Cooperative society each from two states or more or one Multi-state Cooperative society.


(e) The application shall be accompanied by four copies of the proposed Bye-laws.


(f) (i) Name of the proposed multi-state cooperative society;
(ii) Head Quarters and address to be registered;
(iii) Area of operation;
(iv) Main objectives
(v) a certificate from the Bank
(vi) Stating credit balance there in favour of the proposed Multi-State Cooperative Society.

 

Note:

 

1.

Co-operative Society Registration services are currently available in our head  office Patna only.

 

2.

List of Documents Required Tab to know about documents required for registration at current date.

 

Trust registration in India

 

Definition of Trust


Creation of a trust, particularly relating to an immoveable property is also a specie of transfer of property. Trust is defined in section 3 of the Trust Act, 1882 as " 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. In simple words it is a transfer of property by the owner to another for the benefit of a third person alongwith or without himself or a declaration by the owner, to hold the property not for himself and another.


Requirements of a Trust

 

A trust is not a contract of agency to hold the property, as in that case there would be no transfer of the property. In trust there is a transfer from the owner to the trustee subject to certain terms and conditions. Bailment is also a kind of trust, but in bailment also there is no transfer of any interest in the property, but only a transfer of possession without ownership. Thereof, a trust is essentially a transfer of property by one to the other to be held by the other for the benefit of some person or for carrying out some object. It is no also a sale because a sale cannot be conditional and in sale there is consideration which is absent in a trust. The purpose of a trust must be lawful, that is,

 

1. It should not be forbidden by law.
2.

It should not be of such nature that, if permitted it could defeat the provisions of any law.

3.

It should not be fraudulent.

4. It should not involve or imply injury to the person or property of another or
5. It should not be such as would be regarded by a court as immoral or opposed to the public policy.

Where a trust is created for two purposes one of which is lawful and the other is not and the two purposes cannot be separated, the whole trust is void.

 

Creation of Trust


A trust of immoveable property can be created by two ways. One by a non-testamentary document and another by a testamentary document such as a will. In other words, a trust regarding a immoveable property cannot be created orally but it must be by a document duly registered. A trust of a moveable property can be created either by a document or delivering the property to the trustee with necessary oral directions. If the directions are given in writing it would amount to a trust by a non-testamentary document which may or may not be registered.
A person who creates a trust is called the settlor, the person to whom the the property is transferred on trust is called a trustee and the person for whose benefit the property is transferred is called the beneficiary or "cestuique trust" .


Deed of Trust

 

A trust relating relating to an immoveable property is required to be created by a document and such document must state and contain five essential things with reasonable certainty namely :

 

1. the intention on the part of the author of the trust or settlor to create a trust.
2.

the purpose of the trust.

3.

the beneficiary.

4. the trust property, and
5. transfer of the property to the trustee.

 

Declaration of Trust


A trust can also be created by the author himself declaring that he would hold the property, not as owner, but as a trustee for the benefit of some person or persons including himself and in that case the transfer of property is not necessary as one need not transfer his property but in such a case the declaration of trust is by the owner and he alone should be the trustee. Such a declaration would, however, require registration under the Registration Act.


Testamentary Trust

 

A trust can also be created by a testamentary document that is by Will and the same conditions as mentioned in Section 6 of the Trust Act are required to be fulfilled. such a Will also does not require registration

 

A trust is also created :

 

1. by application of employed trust or
2.

as a constructive trust or

3.

as derivative trust.

4. But they are created by fiction by of law and cannot be subject matter of conveyancing

 

Who can Create a Trust

A Trust can be created by any person competent to contract or even by a manner with the authority of a competent court and respect of any property which is transferable and over which the author of the trust has dispossessing power.


Private & Public Trust:


A Trust may be Private and Public.
When the purpose of the trust is to benefit an individual or a group of individuals or his or their descendants for any legal person and who is capable of holding property, it is a private trust.


When the purpose of the trust is to the benefit the public or any section of the public, it is public trust.


Who can be a Trustee?


A trustee can be any person that is, an individual or a corporate body or a corporate sole, capable of holding property and competent to contract. and he must accept the trust.

 

 

A Trust can be created by any of the following methods:

 

    • By Trust Deed
    • By Will
    • By Transfer of Property

 

 

By Trust Deed

A trust declared inter vivos or by the acts of the parties is to be supported and evidenced by a non testamentary instrument in writing and signed by the author of the trust and the trustee (i.e trust deed). There is no prescribed form of a trust Deed. Any words which indicate the intention of the author that the property of which he is the legal owner, shall beneficially be another’s is sufficient. A trust in relation to an immoveable property must be supported by a trust deed, unless it is declared by a will, and must be registered.

A trust declared by a non testamentary instrument comes into effect from the date specified in the instrument or the date of its execution, where the date is not specified.

 

Necessity of Trust Deed

A trust can be created orally but in such cases it is necessary to prove that there was either an express declaration as to the trust or that there is evidence of language or expressions used by or facts and conduct of the owner of the property to indicate with reasonable certainty that trust was created. In order to remove ambiguity and disputes, it is always advisable to create a trust by a written trust deed.

 

Registration of Trust Deed

As Trust deed is non mandatory requirement, the registration so is not statutorily required but it is always desired. A registered trust deed has the following advantage:

        • A registered trust deed is an official document enforceable by law.
        • A registered deed effectuates transmutation of possession. The registration of trust deed , in the absence of an intention to the contrary, is enough to convey the title to the trust property to the trustee even if the trust deed is not delivered to the trustee.
        • A conveyance of the trust property to the trustee, under a registered deed is generally, not open to challenge, except where there is no intention to act upon the deed.

 

 

By Will

A person may declare his intention to create a trust in respect of his property or any part thereof by way of a will. A will according to the Indian Succession Act must be in writing and signed thereof by all testators in presence of two witnesses. A trust declared under will , shall came into existence.

 

 

By Transfer of Ownership

A trust in relation to moveable property can be formed also by mere of ownership of the property or the trustee with a direction that the property be held under trust for the benefit of the beneficiary. The ownership of a moveable property can be transferred by physical act of handing over the possession of the property.

In case where the author himself is the trustee, transfer of possession is neither necessary nor possible and mere declaration of the author that he holds the property under trust would be sufficient to constitute a trust.

 

 

 

Registration Procedure

 

 

Trust Registration Procedure in India

 

The Commissioner/Registrar, on receipt of an application for registration of trust shall within the expiry of six months from the end of the month in which application was received for registration shall move along with in the under listed manner :

 

The Commissioner may call upon for necessary documents in order to satisfy himself about the genuineness of activities of the trust and can also make necessary inquiries.

 

After being satisfied about the nature, objects and the genuineness of the trust or institution he may –

 

i. Pass an order in writing registering the trust or institution.


ii. Pass an order in writing refusing registration of trust or institution, if he is  not so satisfied by the documents submitted to him by the trust.


iii. Give the applicant a reasonable opportunity of being heard in case (ii).


iv. Sent a copy of such order to the applicant.
If after granting registration subsequently the commissioner is satisfied that the activities of such trust or institution are not genuine or are not being carried out non-parallel in relation to its objects, then he may pass an order in writing, cancelling the registration of trust or institution, after giving such trust or institution a justifiable opportunity of being heard

 

Procedure of Trust in India under 12AA – NEW TRUST

 

STAGE 1

Preparing Trust Deed:
1. Give the objective
2. Give details of trustees: Name, Father’s Name, Age, and Residential Address.
3. Give name of the proposed trust
4. Pay the necessary Drafting Fee including Stamp paper

 

STAGE 2
Registration u/s 12AA:
1. Obtain the trust deed copy.
2. Register the trust deed at the local registrar office.
3. Prepare Round seal, Address seal, Flat seal.
4. Prepare Letter Head.
5. Take 4 Photocopies (Xerox) of the Trust Deed.
6. Obtain Signature of the Managing Trustee in the Last Sheet of the Trust Deed Photocopy.
7. Pay the necessary Fee for obtaining Registration Certificate
8. Sign form 10A

 

STAGE 3
1. Take Four to Five Photographs of Trust Activities.
2. Bring the photographs, intimation letter from Income-Tax department, Letter Head and Flat Seal.

 

STAGE 4

Obtain 12A Certificate.

 

Documents & Information Required for registration of Trust:

These information & documents are required for registration of trust:

 

1. Id proof of at least three persons
2.

Address proof of at least three persons

3.

Name & Activities of proposed trust

4. Address proof of Registered address of proposed trust
5. 2 passport size photos of atleast three persons.

 

Note:

 

1.

Trust Registration services are currently available in our head office Patna only.

2.

Please Use Resources - List of Documents Required Tab tab to know about documents required for registration at current date.

 

12A registration

 

How to apply for 12A Registration of NGO - Income Tax Act 1961

 

When NGO organization gets registered with Income Tax department, to claim tax exemption for their income, it gets the 12A certification.

 

From the Date of establishment of a nonprofit ngo organization like trust, society or nonprofit company, it should apply for registration with Income tax department to get 12A certificate. If delayed in applying for registration then the nonprofit ngo organization should submit Audit Reports for the past three years or as may be available.

 

To get registered with Income tax department, Nonprofit NGO has to fill a form name FORM 10A and it have to produce to the Commissioner of Income Tax, Income Tax Department office where your NGO organization is location. If your NGO established in metropolitan cities like Delhi, Calcutta, Mumbai and Chennai, then you have to produce the FORM 10A to the Director of Income Tax (Exemption), Income tax department office. Before submitting FORM 10a, please make sure that you have received PAN CARD for your nonprofit ngo organization.

 

When you produce the form 10A to the above Income tax department, you have also required enclosing the proofs and copies of the following. (You can download the 10A form here to get 12A certification which is editable)

 

Original basic documents of organization, which evidencing the creation of the NGO should be enclosed, like Trust deed / Bye laws / Rules and Regulations / Memorandum and Articles of Association as per the shape of the nonprofit ngo organization.

 

Two copies of the Accounts of Three previous years should be enclosed. Where the NGO was not in existence in any of three prior years, copies of the accounts of for minimum years may also be submitted. 

After you have produced the above FORM 10A either through registered post with acknowledgement due or directly in the Income Tax office, The department will overlook your application for fitness towards registration. It may also monitor your organization directly in person to know the genuinity of your ngo organization.

 

The Income tax officers have the rights to grant or to refuse registration to your application. If the Income tax office gets satisfied with your proper documents and with the genuinity of your organization, then you will be certified. Even a 12a certified ngo organization, shall be rejected or cancel the grant by the Income tax department, if it feels your organization is not fit as per law at any time.

 

Note:

 

1.

This service is currently available in our head office Patna only.

2.

Please Use Resources - List of Documents Required Tab tab to know more about documents required for registration at current date.

 

80G registration

 

What Is section 80-G of Income Tax Act. ?


If an organization has obtained certification under section 80-G of Income Tax Act then donors of that NGO can claim exemption from Income Tax. This is not one time registration.  This needs to get renewed after validity period.

 

What is the validity period of the registration under section 80G of Income Tax Act?


80G registration: 1 to 3 years validity

 

What application forms are being used for applying for registration under section 80G of Income Tax Act?

 

80G registration: Form 10G (For New Application and Renewal both)

 

What are the conditions on Section 80G?

There are few conditions to be fulfilled under the section 80G:

 

1.

The NGO should not have any income which are not exempted, such as business income. lf, the NGO has business income then it should maintain separate books of accounts and should not divert donations received for the purpose of such business.

2.

The bylaws or objectives of the NGOs should not contain any provision for spending the income or assets of the NGO for purposes other than charitable.

3. The NGO is not working for the benefit of particular religious community or caste.
4. The NGO maintains regular accounts of its receipts & expenditures.
5. The NGO is properly registered under the Societies Registration Act 1860 or under any law corresponding to that act or is registered under section 25 of the Companies Act 1956.

 

What is Tax Exemption limit on donations?

There is a limit on how much money can be exempted from the Income Tax.

 

If the amount of deduction to a charitable organisation or trust is more than 10% of the Gross Total Income computed under the Act (as reduced by income on which income-tax is not payable under any provision of this Act and by any amount in respect of which the assessee is entitled to a deduction under any other provision of this Chapter), then the amount in excess of 10% of Gross Total Income shall not qualify for deduction under section 80G.

 

The persons or organisation who donate under section 80G gets a deduction of 50% from their taxable income. Here at times a confusion creeps in, that the tax advantage under section 80G is 50%, but actually it is not so. 50% of the donation made is allowed to be deducted from the taxable income and consequently tax is calculated.

 

The ultimate benefit will depend on the tax rates applicable to the assessee. Let us take an illustration. Mr. X an individual and M/s. Y Pvt. Ltd., a Company both give donation of Rs.1,00,000/- to a NGO called Adarsh. The total income for the year 2003-2004 of both Mr. X and Ms. Y Pvt. Ltd. is Rs. 2,00,000/-. Now assuming that the rates are 30% for the individuals and 40% for the Companies without any minimum exemption limit.

 

Where to apply for registration under section 12A and 80G of Income Tax Act?

 

Application for registration under section 12A and 8OG can be applied to the Commissioner of Income-tax (Exemption) having jurisdiction over the institution.

 

Can both the applicatlons under section 12A and 80G of Income Tax Act be applied together?

 

Yes ! Both applications can be applied together or it can also be applied separately also. If some organization is willing to apply both applications separately, then application for registration u/s 12A will be applied first. Getting 12A registration is must for applying application for registration u/s 80G of Income Tax Act.

 

Generally what is the timeline for getting registration under section 12A and 80G of Income Tax Act?

 

If application for registration under section 12A and 80G will be applied through NGO Factory, it should take 3 to 4 months.

 

What is the procedure for getting registration under section 12A and 80G of Income Tax Act?

 

Step-1: Dully filled-in application will be submitted to the exemption section of the lncome Tax Department.


Step-2: NGO will receive notice for clarifications from Income Tax Department in 2-3 months after applying.


Step-3:
Reply of notice will be submitted by the consultant along with all relevant desired documents to the Income Tax Departments.


Step-4: Consultant will personally visit the Income Tax Departments to follow-up the case on behalf of the applicant organization.


Step-5: Exemption Certificates will be issued.

 

Documents reguired for registration u/s 80G:

 

1.Dully filled in Form - 10A for registration u/s 12A registration;
2.Dully filled in Form - 10G for registration u/s 80G registration;
3.Registration Certificate and MOA /Trust Deed (two copies - self attested by NGO head);
4.NOC from Landlord (where registered office is situated);
5.Copy of PAN card of NGO;
6.Electricity Bill / House tax Receipt /Water Bill (photocopy);
7.Evidence of welfare activities carried out & Progress Report since inception or last 3 years;
8.Books of Accounts, Balance Sheet & ITR (if any), since inception or last 3years;
9.List of donors along with their address and PAN;
10.List of governing body I board of trustees members with their contact details;
11.Original RC and MOA /Trust Deed for verification;
12.Authority letter in favor of NGO Factory;

13.Any other document I affidavit / undertaking I information asked by the Income Tax department

 

Note:

 

1.

This service is currently available in our head office Patna only.

2.

Please Use Resources - List of Documents Required Tab tab to know more about documents required for registration at current date.

 

35 AC registration

 

INTRODUCTION


As we already know that an NGO can avail income tax exemption by getting itself registered and complying with certain other formalities, but such registration doesn't provide any benefit to the persons making donations. The Income Tax Act has certain provisions which offer tax benefits to the "donors". All NGOs should avail the advantage of these provisions to attract potential donors. Section 35AC is one of such sections.


REGISTRATION UNDER SECTION 35AC

The Central Government approves certain NGOs and notifies them as eligible for project or schemes for the purposes of section 35AC. If an NGO succeeds in getting such an approval for its projects then it stands a very good chance of mobilising funds from the corporate and the business sector. Business houses making contribution to such approved projects are allowed the benefits of deducting such contribution as expenditure.

NATIONAL COMMITTEE
 
The Central Government has constituted a National Committee to identify projects and schemes to be notified under section 35AC, such committee normally consists of eminent persons. All NGOs are entitled to apply to the National Committee to get its projects or schemes approved.

WHERE THE APPLICATION IS TO BE MADE
 
The application for approval by the National Committee should be made to the Secretary, National Committee for Promotion of Social & Economic Welfare, Dept. of Revenue, Govt. of India, North Block, New Delhi - 110001.

THE APPLICATION AND ITS ENCLOSURE
 
i) The application is to be made in 2 Sets, written either in Hindi or English.
ii) Details such as name, address and status of applicant, the district/ ward circle where assessed/PAN number.
iii) Audited Balance Sheet, Profit& Loss Account or Income& Expenditure Account for the latest year and two preceding years.
iv) How is it constituted i.e. whether as a trust, society, etc supported by relevant documents like trust deed, rules & regulation, memorandum of association etc. and registration certificate, if any.
v) Name & Addresses of the persons managing the affairs of the association or institution, including those who left the organisation but were managing the affairs of the association or institution during the 3 years preceding the date of application.
vi) If the association or institution is notified under section 10(23)(C) or is approved for the purposes of section 80G, the particulars of such approval granted.
vii) Brief particulars of the activities of the association or institution during 3 years preceding the date of application or since inception if the association or institution is less than 3 years old.
viii) Such other information as the association or institution may like to place before the National Committee.

ADDITIONAL INFORMATION REGARDING THE PROJECT/SCHEME TO BE SUBMITTED
 
(i) Title of project or scheme;
(ii) Date of commencement;
(iii) Duration and the likely date of completion;
(iv) Estimated cost of the project ;
(v) Category or class of persons who are likely to be benefited from the project or scheme;
(vi) Affirmation that no benefit from the project or scheme other than remuneration or honorarium, will accrue to persons managing the affairs of the NGO ;
(vii) Such other particulars as the applicant may place before the National Committee.

 

CERTIFICATE TO BE ISSUED TO THE DONOR

All approved NGOs are required to issue a certificate to the donor for all contributions & receipts under section 35AC. The certificate is to be issued in Form 58A.


This certificate will enable the donor to claim exemption from its taxable income. Further, the NGOs should also send an Annual Report to the National Committee indicating the progress of the work relating to the project/scheme and the following information in respect of each contributor:

i)   Name of the contributors & their addresses.
ii)  PAN.
iii) Amount of contributions.
iv) The project/scheme for which the contribution is made.
v)  Total amount of contribution received during the year.
vi) Total cost of the project approved by the National Committee.

Such Annual Report should reach the National Committee by 30th June, following the financial year in which the amount is received.

DEDUCTION OF CONTRIBUTION UNDER SECTION 80GGA
 
Section 35AC is available to assessees who have income from the head ‘business' or ‘profession'. Therefore, for the assessees who do do not have income from business or profession, section 80GGA provides for deduction on donations made to eligible projects under section 35AC. Section 80GGA, is a broader section and deductions are also available for contributions made for scientific research under section 35CCA & 35CCB, which have been withdrawn. 100 per cent deduction is available under section 80GGA, subject to the available gross total income under section 80A. Therefore, unlike section 35AC, deduction under section 80GGA cannot be carried forward in the form of losses to next year .

OVERALL SUMMARY

To sum up the discussions:


i) Under section 35AC, organisations having income from business or profession can get 100 per cent deduction. Charitable Organisations can get registered themselves u/s. 5AC by applying to the National Committee under rule 11F to 11-O, if they are carrying on any business.
ii) The Central Government has specified various types of projects of national needs for which Charitable Organisations can make donations.
iii) Business houses making donations for the purpose of section 35AC, should be careful that the donee organisation continues to enjoy approval u/s. 35AC. As the approval under section 35(AC) is not permanent in nature.
iv) To get approval u/s. 35AC two sets of application have to be made alongwith specified enclosures to secretary of National Committee, New Delhi.
v) The National Committee may recommend or reject the project but when the approval is recommended then it is for a period of maximum 3 years and it could be further extended if the National Committee is satisfied with the performance during the period.
vi) A certificate has to be issued to the donor in Form 58A. This certificate will enable the donor to claim exemptions.
vii) The National Committee may withdraw the approval if the project is not carried out in accordance with the approved conditions. To withdraw a project National Committee should provide an opportunity of being heard to the aggrieved organisation.
viii) Section 35AC provides deduction from income from business and profession. Similar deduction is also available u/s. 80GGA, for assesses having income from other heads.

 

Note:

 

1.

This service is currently available in our head office Patna only.

2.

Please Use Resources - List of Documents Required Tab tab to know more about documents required for registration at current date.

 

35AC Registration in India

 

Income Tax : Deduction U/s 35 AC

 

Purpose


NGO can register itself u/s 35AC from the Central Government of India. Potential donors get 100% exemption for the amount donated towards 35AC. All NGOs should avail the advantage of this provision to attract potential donors.

 

How it is important for NGOs?

 

Contributions made to a project/scheme notified as an eligible project or scheme for the purpose of section 35AC of the Income Tax Act, would entitle the donor to a 100% deduction of the amount of such contribution. Unlike the certificate granted u/s 80G, the certificate u/s 35AC is not given to any organization as a whole, but only to an eligible and approved projects. If general donation is made to a large multi-purpose trust, the donor would not be entitled to the 100% deduction unless he specifies that the amount has been given towards the project or scheme notified as an eligible project or scheme for the purpose of section 35AC of the Income Tax Act. Eligible projects and the schemes for exemption u/s 35AC include one or more of the following:

 

1. Construction and maintenance of drinking water projects in rural areas and in urban slums, including installation of pump-sets, digging of wells, tube-wells and lying of pipes for supply of drinking water

 

2. Construction of dwelling units for the economically weaker sections

 

3. Construction of school buildings, preliminary for children belonging to the economically weaker sections of the society

 

4. Establishment and running of non-conventional and renewable source of energy systems

 

5. Construction and maintenance of bridges, public highways and other roads

 

6. Pollution control projects

 

7. Promotion of sports

 

8. A weighted deduction of 125% is also allowed for contributions to organizations approved under section 35(1)(ii) (a scientific research institute or a university, college or other institution) specifically for "scientific research," and for contributions made under section 35(1)(iii) specifically for "research in social science or statistical research." If an NGO succeeds in getting such an approval for its projects then it stands a very good chance of mobilizing funds from the corporate and the business sector. Business houses making contribution to such approved projects are allowed to show an amount of donation as expenditure in their regular books of accounts. Role of National CommitteeThe Central Government has constituted a National Committee to identify projects and schemes to be notified under section 35AC, such committee normally consists of eminent persons. All NGOs are entitled to apply to the National Committee to get its projects or schemes approved.

 

How to apply for 35AC
The application for approval by the National Committee should be made to the Secretary,


National Committee for Promotion of Social & Economic Welfare,
Dept. of Revenue,
Govt. of India,
North Block,
New Delhi – 110001.

 

The Application has to be submitted along with following documents:

 

A. The application is to be made in 2 Sets, written either in Hindi or English.

B. Name, address and status of applicant NGO, the district/ ward circle where assessed / PAN number.

C. Audited Balance Sheet, Profit& Loss Account or Income& Expenditure Account for last three years.

D. Give details about its constitution such as whether it is registered as a trust, society, etc supported by relevant documents like trust deed, rules & regulation, memorandum of association etc. and registration certificate, if any.

E. Name & Addresses of signatories of NGO, including those who left the organization but were managing the affairs of the organization during last 3 years of date of application.

F. If the organization is notified under section 10(23) (C) or is approved for the purposes of section 80G, give particulars of such approvals granted.

G. Brief particulars of activities of the NGO during last 3 years of date of application.

H. Such other information as the organization may like to present to National Committee.

 

I. Additional Information Regarding the Project/Scheme to Be Submitted:


(i) Title of project or scheme;
(ii) Date of commencement;
(iii) Duration and the likely date of completion;
(iv) Estimated cost of the project ;
(v) Category or class of persons who are likely to be benefited from the project or scheme;
(vi) Affirmation that no benefit from the project or scheme other than remuneration or honorarium, will accrue to persons managing the affairs of the NGO ;
(viii) Such other particulars as the applicant may place before the National Committee.3. Certificate should be issued to the Donor:

 

All approved NGOs need to issue a certificate to the donor for all contributions & receipts under section 35AC. The certificate is to be issued in Form 58A (given below).4. This certificate required for the donor to claim exemption from its taxable income. Further, the NGOs should also send an Annual Report to the National Committee indicating the progress of the work relating to the project/scheme and the following information in respect of each contributor:

 

i) Name of the contributors & their addresses.
ii) PAN.
iii) Amount of contributions.
iv) The project/scheme for which the contribution is made.
v) Total amount of contribution received during the year.
vi) Total cost of the project approved by the National Committee.

 

Such Annual Report should reach the National Committee by 30th June, after finishing the financial year in which the amount is received. Click Here for Form 58A.

 

Note:

 

1.

This service is currently available in our head office Patna only.

2.

Please Use Resources - List of Documents Required Tab tab to know more about documents required for registration at current date.

 

 

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