A Society is an organization which is registered as a Non-Profit Organization (NPO). NPO/company has its objective of promotion of arts, commerce, charity, education, protection of environment, science, social welfare, sports, research, religion and intends to apply its profits, if any, or other income in promoting its objects. It functions exactly like a limited company including all the rights and obligations that come with such a company. However, it differs from a company in one very crucial aspect, i.e. it cannot use the words “Section 8” or “Limited” in its name.
Societies in India is governed by the Societies Registration Act 1860 as well as State Act notified for different states.
A Society can be formed by at least seven individuals or Institutions with a common object of like ‘any literary, scientific, or charitable purpose’ as per the Societies Registration Act 1860. A Memorandum of Association is required to be submitted to Registrar of Societies by the members, willing to form a Society. Registration is required to legalize the Society and to obtain income tax exemption.
A Memorandum of Association requires to contain the following: the name of the society to be registered; the object of the society, i.e the basic purpose to form the Society; the names, addresses, and occupations of the governing body members. The governing body members are elected or selected as per Rules framed by the Society and are responsible for management of all the affairs of the Society. Framed rules and regulations of the society, certified by at least three members, is required to be submitted, along with the Memorandum of Association to the Registrar of Societies, under whose jurisdiction the Society falls into. Any Indian can be a member of a Society and there is no bar to include a Foreigner in a Society.
Let us discuss the types of a Societies which can obtain registration under the Act mentioned. It can be formed for any charitable purpose; Societies for utilization of military orphan funds or societies established at the several erstwhile presidencies of India is also there; it may be formed to promote science, literature, or fine arts; for knowledge dissemination on various subjects including Politics; a Society can be established for maintenance of libraries or reading-rooms for use among the members or for public; Society for museums and galleries of paintings and other works of art is possible, collections of natural history, mechanical and philosophical inventions, instruments, or designs are also eligible under the Societies Registration Act 1860.
The income of the Company must be used to promote only charitable objects and cannot pay any dividend to the members of the company. The central government provides an incorporation certificate to all such companies and also informs them about some restrictions and conditions. In case they don’t fulfil them, the central government may also order them to wind up the company. In case fraud objectives of the Company are proved, legal action will be taken against all officers of the Company.Section 8 Company Registration can be done through LegalRaasta in Delhi NCR, Mumbai, Bengaluru, Chennai and other Indian cities.