1. A COMPARATIVE PERSPECTIVE TO REGISTER MY CHARITABLE ENTITY
Description Society Public Trust Section 25 Company
Relatively simple procedure; Simple procedure; Complex procedures;
Ease of Formation
8-12 weeks to setup 6-8 weeks to setup 12-24 weeks to setup
Min # of subscribers Seven Two Two
Control over the entity Low High Varies
Statutory Regulation Very limited Nominal Exhaustive but mature
The Societies Registration Act,
Act of Registration Indian Trusts Act, 1882* The Companies Act, 1956
1860.
Authority with whom to be Registrar of Societies of the Registrar of Company of the
Assistant Charity Commissioner
registered concerned state** concerned state
Separate application not required. Prior Approval required as per the
Approval of Name Name is generally granted if Not Required guidelines. May take two or more
available weeks
Memorandum of Association &
Charter By Laws and Rules & Regulations Trust Deed
Article of Association
Can operate throughout India even
if registered in one particular State.
Area of operation Can operate throughout India Can operate throughout India
No separate registration is required
for operating in another state
Rule of unequal voting power
Voting Rights Equal Not Applicable
based on share holding exists
Controlled by general body or
Admission of new members Controlled by governing board Not Applicable
board through issue of capital
Can be transferred. Restrictions
Transfer of Membership Non transferrable Non transferrable
on transfer can also be placed.
Removal of Members Possible without consent Not Applicable Not possible without consent
Board meetings must be held
General & Board meetings are No provision in the act. regularly, normally once a
General & Board Meetings required to be held as prescribed in Adequate rules can be framed in quarter. One annual general
the by laws of the society the trust deed meeting. Proper detailed minutes
to be maintained
Permitted as per general body Provision should exist in trust Permitted as per general body
Payment to Functionaries
approval deed approval
To be complied as per To be complied as per
Labour and other relevant laws To be complied as per applicability
applicability applicability
One-time setup cost (approx.) 2-3 months & Rs. 50,000 1-2 months & Rs. 50, 000 4-7 months & Rs. 1,00,000
Ongoing annual compliance cost
(only min statutory compliance – 2-3 months & Rs. 30, 000 2-3 months & Rs. 30, 000 2-3 months & Rs. 30, 000
approx.)
*Few states have enacted Public Charitable Trust Acts. Particularly Maharashtra, Gujarat, Rajasthan, and Madhya Pradesh have Public Trusts Acts. The provisions of Indian
Trust Act, 1882 have been applied to Public Trusts. Where there is no specific Trust Act, trusts are registered under Registration of Documents Act
**In case of Maharashtra and Gujarat, under the provisions of Bombay Public Charitable Trust Act, 1950, societies with charitable purpose have to be registered with charity
commissioner.
Note: The above legal structures are governed by Income Tax Act, 1961 for the purposes of income, taxation & exemption.
The information provided in this document is not exhaustive and therefore members are requested to independently verify and validate the information prior to reliance or further
use.
Key Decision Criteria