NGO (Non-Government Organisation) is an organization that works for non-profit/ charitable purposes. NGOs can be registered in India under any of the following manners:
- Trust under Indian Trusts Act, 1882
- Society under Societies Registration Act 1860
- Section 8 Company under Companies Act, 2013
In this article, we will explain how to register as NGO in the form of Section 8 Company, under Companies Act, 2013.
1. Purpose of NGO – Section 8 Company
The main purpose of establishing the company as Section 8 company is to promote non-profit objectives such as trade, commerce, arts, charity, education, religion, environment protection, social welfare, sports, research etc. The profits/ income of the company if any is also applied towards promoting the objectives of the company and are not distributed as a dividend to the shareholders.
Minimum two directors are required if the section 8 company is incorporated as a private limited company and three directors in case of public limited company. The maximum number of members can be 200 in case of private limited company and for a public limited company, there is no such limit.
Also, there is no requirement of minimum paid-up capital in case of section 8 company.
2. Pre-Requisites to the Registration Process
- Obtain DSC (Digital Signature): Digital signatures are required as the forms for registration process are filed online and should be digitally signed. DSC should be obtained for the proposed directors of the company. Digital signature certificates are issued by government recognized certifying agencies. The list of such certified agencies can be accessed here. The cost of obtaining DSC varies depending upon the certifying agency. You must obtain either Class 2 or Class 3 category of DSC. Under Class 2 category, the identity of a person is verified against a pre-verified database whereas, under class 3 category, the person needs to present himself before registering authority to prove his/her identity.
- Apply for Director Identification Number (DIN): You have to apply for the DIN of the proposed directors of the company. The application for allotment of DIN has to be made in Form DIR-3. You have to attach the scanned copy of necessary documents such as a self-attested copy of PAN, Identity and Address proof of directors along with the form and submit it online on the MCA Portal. The form must be attested by a practicing professional who can be a chartered accountant, a company secretary or a cost accountant.
3. Number of Forms Required for Registration
|Name of the form||Purpose of the Form|
|INC 1||Name Approval|
|INC 12||Issue of Licence as section 8 company|
|INC 13||Memorandum of Association|
|INC 7||Incorporation of company|
|INC 22||Registered office of company|
|DIR 12||Appointment of Directors|
4. Purpose of the Forms
Form INC – 1
Form 1 is filed for the reservation of name of the proposed company. But before quoting the name in the form, it is recommended that you must access the free name search facility of existing companies available on the MCA portal. The system will provide a list of closely resembling names of the existing companies based on the search criteria filled up. This will help you to avoid choosing the similar name already existing. You can make up to 6 choices in the order of your preference in the Form INC 1.
Form INC-12 is filed for the grant of a license to operate as section 8 company. Along with this form, you are required to attach a draft copy of Memorandum of association and Articles of Association. There is a prescribed format for Memorandum of Association of section 8 company in Form INC 13. The subscription pages of MOA and AOA shall be signed by each subscriber along with name, address, description, and occupation in the presence of at least one witness.
Form INC 12 is filed with the following attachments :
- INC-13 for Memorandum of Association
- Draft Articles of Association
- INC-15 for the declaration by each subscriber to MOA that the draft memorandum and articles of association have been drawn up in conformity with the provisions of section 8
- Estimated statement of Income & Expenditure for the next three years
- List of proposed Promoters and Directors of the Company
The following forms are required to be filed after the issuance of the license to the company:
Form INC 7
INC 7 is the application for the incorporation of the company. The following documents must be attached along with Form INC 7:
- Memorandum and articles of the company duly signed by all the subscribers
- An affidavit from each of the subscribers and first directors in Form INC 9 that they are not guilty of any offense or misfeasance
- Declaration in Form INC 8 that all the requirements of the Companies Act have been complied with
- Address of correspondence till the registered office is fixed
- Address and Identity proofs of all the subscribers to MOA and first directors of the company
Form INC 22
Form INC 22 is filed for providing the notice for the situation of company’s registered office. It can be filed along with Form INC 7 or within 30 days from the incorporation of the company.
Form DIR 12
Form DIR 12 is filed for the appointment of the directors of the company. It must be filed within 30 days from the date of the appointment of the directors.
5. Certificate of Incorporation
If the registrar is satisfied with the details mentioned in the form along with supporting documents, then he will issue the certificate of incorporation to the company and will allot a unique company identification number called as CIN.