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Answer please

srinivass (CA Final) (2466 Points)

19 December 2011

How to Incorporate an Society.................

Please tell me which is better one Society or Trust

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Sourav Banerjee MA,MSW (Shabda Bramha) (8842 Points)
Replied 20 December 2011

Dear Srinivass, You can find your answer at

https://www.ngosindia.com/resources/ngo_registration.php

The following excerpt in tabular form, copied from the above link, is given here for your ready reference.

Comparision among Trust, Society and Non profit Company

	Trust	Society	Section-25 Comapny
Statute/Legislation	Relevant State Trust Act or Bombay Public Trusts Act, 1950	Societies Registration Act, 1860	Indian Companies Act, 1956
Jurisdiction	Deputy Registrar/Charity commissioner	Registrar of societies (charity commissioner in Maharashtra).	Registrar of companies
Registration	As trust	As Society In Maharashtra, both as a society and as a trust	As a company u/s 25 of the Indian Companies Act.
Registration Document	Trust deed	Memorandum of association and rules and regulations	Memorandum and articles of association. and regulations
Stamp Duty	Trust deed to be executed on non-judicial stamp paper, vary from state to state	No stamp paper required for memorandum of association and rules and regulations.	No stamp paper required for memorandum and articles of association.
Members Required	Minimum – two trustees. No upper limit.	Minimum – seven managing committee members. No upper limit.	Minimum three trustees. No upper limit.
Board of Management	Trustees / Board of Trustees	Governing body or council/managing or executive committee	Board of directors/ Managing committee
Mode of Succession on Board of Management	Appointment or Election	Appointment or Election by members of the general body	Election by members of the general body

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Sanket (!..Live to Give..!) (16427 Points)
Replied 20 December 2011

Society: A society can be defined as an association of persons united together by mutual consent to deliberate, determine and act jointly for the same common purpose. Minimum seven persons, eligible to enter into a contract, can form society. When an NGO is constituted as a society, it is required to be registered under the Societies Registration Act, 1860.

The primary advantages of forming a society are that it gives a corporate appearance to the organization, and provides greater flexibility as it is easier to amend the memorandum and bye laws of the society than in the case of trust, terms of which are strictly manifested in the trust deed. However, formation of a society needs more procedural formalities than in the case of a trust.

A Society for its inception requires:-

I. Memorandum of Association, and
II. Rules and Regulations

For the purpose of registration, the following documents are required to be filed with the registrar of Societies:

a) Covering letter requesting for registration, stating in the body of the letter various documents annexed to it. The letter is to be signed by all the subscribers to the memorandum or by a person duly authorized by all of them to sign on their behalf.
b) Memorandum of Association, in duplicate neatly typed and pages serially numbered.
c) Rules and Regulations/Bye-Laws, in duplicate, certified by at least three members of the governing body.
d) An affidavit of the president/Secretary of the society, on a non-judicial stamp paper of prescribed value, stating the relationship between the subscribers, duly attested by an oath commissioner, notary public or 1st class magistrate.
e) Documentary proof such as house tax receipt, rent receipt in respect of premises shown as registered office of the society or no objection certificate from the landlord of the premises.
f) An authority duly signed by all members of the managing committee.
g) A declaration by the members of the managing committee that the funds of the society shall be used only for the purpose of furthering the aims and objects of the society.

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Sanket (!..Live to Give..!) (16427 Points)
Replied 20 December 2011

Trust: "Trust" is defined 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.

A Trust may be created by any language sufficient to know the intention and no technical words are necessary. A trust deed, generally, incorporates the following:

i. The name(s) of the author(s)/settlor(s) of the trust;
ii. The name(s) of the trustee(s);
iii. The name(s) if any, of the beneficiary/ies or whether it shall be the public at large;
iv. The name by which the trust shall be known;
v. The name where its principal and/or other offices shall be situated;
vi. The property that shall devolve upon the trustee(s) under the trust for the benefit of the beneficiary/ies;
vii. An intention to divest the trust property upon the trustee(s);
viii. The objects of the trust;
ix. The procedure for appointment, removal or replacement of a trustee, their rights, duties and powers etc;
x. The rights and duties of the beneficiary/ies;
xi. The mode and method of determination of the trust

A charitable trust is not required to obtain registration under the Indian Registration Act.