If you are looking to start a School in India, the first and foremost thing is to form a TRUST, SOCIETY or a SECTION 8 Company. The most important element which one should remember is the entity thus formed has to be Not-For-Profit and Non- Proprietary in nature.
What is Not – For – Profit?
- The profits, if any, or other income and property of the company, whensoever derived, shall be applied, solely for the promotion of the objective of the Society / Trust / Sec 8
- No portion of the profits, other income or property aforesaid shall be paid or transferred, directly or indirectly, by way of dividend, bonus or otherwise by way of profit, to persons who, at any time are, or have been, members of the company or to any one or more of them or to any persons claiming through any one or more of them.
- No remuneration or other benefit in money or money’s worth shall be given by the company to any of its members, whether officers or members of the company or not, except payment of out-of-pocket expenses, reasonable and proper interest on money lent, or reasonable and proper rent on premises let to the company.
- Nothing in this clause shall prevent the payment by the company in good faith of prudent remuneration to any of its officers or servants (not being members) or to any other person (not being member), in return for any services actually rendered to the society/Trust/ Sec 8 company;.
- Nothing in clauses (iii) and (iv) shall prevent the payment by the company in good faith of prudent remuneration to any of its members in return for any services (not being services of a kind which are required to be rendered by a member), actually rendered to the society/Trust/ Sec 8 company;
That the school is run as a community service and not as a business and that commercialization does not take place in the school in any shape whatsoever.
That no part of income from the institution shall be diverted to any individual in the Trust/Society/Company registered under section 25 of the companies act, 1956 School Management Committee or to any other person. The savings, if any, after meeting the recurring and non-recurring expenditure and contributions to developmental, depreciation and contingency funds may be further utilized for promoting the school
Not for Profit means the members of the managing committee of the society in No Way can withdraw PROFIT coming out of the business of the society or the trust for their personal gain. Money should be channelized within the ambit of society and its functional areas. Society’s profit should be used only for the development and betterment of the objectives and aims of the society/Trust/ Sec 8.
What is Non- Proprietary?
The Society / Trust / Section 8 company running the School should not be related to each other via blood line. It means your siblings and parents or children. The majority of the members of Society / Trust / Section 8 should be unrelated to each other.
What is the difference between Trust / Society & Section 8 Company? Which one is better?
What is the procedure for constitution & registration of Trust /Society or a section 8 Compnay?
Starting a TRUST
- TRUST DEED: Trusts are registered using a document called TRUST DEED. This document contains all the information about the Trust and is printed/written/typed on plain A4 size papers.
- Attach a Rs. 100 Non-Judicial stamp paper (which you can get from a notary). All the Trustees and witnesses will have to give thumb impressions and signatures on these papers. All in all, you will need help of a notary to prepare the papers.
- You may also need a No-Objection Certificate (NOC) from the owner of the property where the registered office of the trust is to be situated. If you’re the owner of the property, then you don’t need to worry about NOC
- Following elements must be mentioned in the Trust Deed document:
- Name and address of the Settler (Settler is the person who is setting up trust)
- Name(s) and address(es) of the other trustees
- Name of the trust
- Minimum and maximum number of trustees your trust can have
- Address of the registered office of the trust
- Objectives of the trust
- Rules and Regulations of the trust
- For registering a trust you need minimum two trustees (i.e. one settler and another person). You can decide the maximum number of trustees and this number must be mentioned in the trust deed. All the trustees together are called Board of Trustees. This board collectively governs the trust.
- Unlike societies, in case of trusts all or some of the trustees can be related persons (i.e. they may belong to the same family)
- All the trusts are allowed to work on all India level
- Trusts are irrevocable –unless it is mentioned in the trust deed. This means that the trust cannot be wound up
- Trustees are usually life-long members or their tenure is specified in the deed. Electoral process is not involved in the appointment of trustees.
- Board of Trustees can also have various designations for trustees. Common designations are Chairperson and Managing Trustee.
Starting a Section 8 Company in India
A person or an association of persons shall make an application in Form No. INC-12 along with the fee as provided in the Companies
The Memorandum of association of the proposed company shall be in Form No. INC-13
Form INC-13 shall be accompanied by the following documents
- Memorandum of association and articles of association
- The confirmation by an advocate, a charted accountant or a company secretary that the memorandum and articles of association follow all the provisions of section 8;
- An approximate declaration of the annual income and expenditure of the Company for next three years mentioning the source of income and modes of expenditure.
- The declaration by each of the persons making the application in Form No. INC-15.
- The company must issue a notice within one week of sending the application and a copy of the application must be sent to the registrar and this notice shall also be published-
At least once in the vernacular newspaper of the district in which the registered office of the Company is situated and also in an English newspaper circulating in the district.
Starting a SOCIETY
- Create MOA (Memorandum of Association) and BYE LAWS: Any seven persons who subscribe to a Memorandum of Association (MOA) can register a society.
- The Memorandum should include the names of the society
- Objectives & Aims of the Society
- Names, addresses and occupations of those members subscribing to it
- The details of the first governing body to be constituted on registration.
- BYE LAWS : The MOA should be accompanied by the BYE LAWS Rules and Regulations- this should include
- Procedure for enrolling and removing various categories of members
- Procedure of forming the governing body
- Conduct of meetings, election and removal of office bearers
- Procedure for conducting annual general body meetings, etc.
- Membership: The membership of the society may be kept open (or by invitation) to anybody who subscribes to its aims and objectives, for which a fee may be charged.
- Engage with Registrar of Society: Submit the relevant official documents for registration of the Trust / Society to the Assistant / Deputy Charities Commissioner of the area / district, where the office of the Trust / Society is located.
Office of Registrars across India
|Uttar Pradesh||Registrar of Cooperative Societies , |
Govt. of Uttar Pradesh, 14 Vidhan Sabha Marg
3rd Floor, Vikasdeep, Lucknow, Uttar Pradesh 226001
|Chhattisgarh||Registrar of Cooperative Societies , |
Govt. of Chhattisgarh, Block - 3, 2nd and 3rd Floor,
Indrawati Bhawan, New Raipur
Tel : 0771 2511921
|Madhya Pradesh||Registrar Firms & Societies|
Department of Commerce & Industries
Government of Madhya Pradesh
D-Wing, First Floor, Vindhyachal Bhawan,
|Punjab||Directorate of Industries, Ponch House, Lahore (Next to Chuburji)|
Phone : 0092-42-99211520-21
Fax : 0092-42-99211522
|Bihar||Completely Online||1) https://biharregd.gov.in/Society/Home.aspx
|Rajasthan||Registrar of Cooperative Societies , |
Govt. of Rajasthan, Nehru Sahakar Bhawan,
Bhawani Singh Road, Jaipur 302 001
|Jharkhand||Ground Floor, Engineer's Hostel - I, Near Golchakkar, Dhurwa, Ranchi, Jharkhand.||http://www.jharkhand.gov.in/office-of-registrar-cooperative|
|West Bengal||Department of Cooperation,|
Government of West Bengal
New Secretariat Building(4th Floor),
|Maharashtra||Commissioner for Cooperation |
Registrar of Cooperative Societies
2nd Floor, New Central Building,
Ambedkar Wellesly Rd,
Pune, Maharashtra 411001
Tel.: 020 2612 2846
|Tamil Nadu||No.100, Santhome High Road, Chennai 600 028.||http://www.tnreginet.net/english/society.asp|
|Kerala||Inspector General, |
Departmernt of Registration,
Kerala - 695035
contact 0471-2472118, 2472110
|Andhra Pradesh||Office of the Commissioner & Inspector General of Registration and Stamps,|
5-59, R.K.Spring Valley Apartments,
Edupugallu, Kankipadu Mandal,
A.P, Vijayawada - 521151
|Telengana||D-Block, 4th Floor, Telangana Secretariat, Hyderabad-500022.|
Office : 040-29801057
|Karnataka||Registrar of Cooperative Societies in Karnataka, Address: 1, Ali Asker Rd, Bengaluru, Karnataka 560052||1) http://sahakara.kar.gov.in/ContactUs.html
|Himachal Pradesh||Block No.25, SDA Complex, Kasumpti, Shimla, Himachal Pradesh 171009||https://coophp.nic.in/|
|Uttarakhand||Registrar of Cooperative Societies, |
Govt. of Uttarakhand, Uttaranchal Secretariat,
4-B, Subhas Road, Dehradun 248001
Tel : 2713534
|Haryana||Bays No. 27-30, Sector-2, |
Phone No. : 0172-2585023, 2583438
|Gujarat||Registrar of Cooperative Societies , |
Govt. of Gujarat, Block No 10, 1st Floor, Old Sachivalaya
Gandhinagar 382 010
Tel : 079-23253868, 079-23253862 ,
FAX: 079-23253877, 079-23253876
|Manipur||Government of Manipur|
4th floor, Western Block
|Assam||Registrar of Cooperative Societies , |
Govt. of Assam, Lakhtokia, Guwahati 781 001
Tel : 0361-2545334 ,
|Meghalaya||Registrar of Cooperative Societies|
New Administrative Building
Lower Lachumiere, Shillong-793001
East Khasi Hills District, Meghalaya
Phone Number : 0364 - 2225212
|Tripura||O/O the R.C.S. Govt of Tripura. 1st Floor & 2nd Floor||http://tripura.nic.in/coop/|
|Nagaland||Registrar of Co-operative Societies|
A.G. Office Road
|Sikkim||Government of Sikkim|
Annexe 1, Top Floor, Kazi Road
Gangtok , Sikkim-737101
|Odisha||Near State Bank Of India, Kharvel Nagar, Bhubaneswar, Odisha 751001||http://rcsorissa.nic.in|
THE OFFICE OF THE REGISTRAR OF
4 & 5 FLOOR, EDC COMPLEX,
PATTO, PANAJI – GOA
Tel:No: +91 - 832- 2437165/2437175/2437134
Email : email@example.com
Is it mandatory to form a Trust/Society/Section 8 Company?
Yes it is Mandatory to have Trust/Society/Section 8 Company in India.
Who can be members, Trustees, directors of Society / Trust / Section – 8 company? Can the members of the same family become members of the Trust? Can the Blood Relations form a Trust, Society etc?
The husband, wife, son, daughter singly or jointly can be the members of the Trust provided that they do not vest control of the Trust. In other words, if the husband as well as the wife (2trustees), are the members of the Trust, then the Trust should have another 3 to 4 trustees who are not members of the same family, to prevent the husband-wife team vesting the control of the trust. Thus the total membership of the Trust in this case will have to be enlarged to 5 or 6 Trustees, out of which 3 to 4 Trustees should not be from the same family. Likewise, in case a trust is constituted with husband, wife and son / daughter (three trustees), then the Trust will have to have another 4 to 5 trustees, who are not the members of the same family.
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