A Section 8 Company is a special type of non-profit organization registered under the Companies Act, 2013, with the objective of promoting charitable causes such as education, art, science, religion, environment, and social welfare. It enjoys all the benefits of a corporate structure like limited liability, a separate legal identity, and improved credibility—without the burden of distributing profits to its members.
In India, NGOs can be registered in three different forms based on their operational goals and scale—Trust, Society, and Section 8 Company. While all three structures are aimed at promoting non-profit activities, they differ in terms of governance, legal framework, and benefits. A Section 8 Company is generally considered the most structured and credible form, especially for organizations looking for grants or FCRA approval.
Comparison Between Trust, Society & Section 8 Company
|
Feature |
Trust |
Society |
Section 8 Company |
|
Governing Law |
Indian Trusts Act, 1882 (or State-specific Acts) |
Societies Registration Act, 1860 (or State-specific) |
Companies Act, 2013 |
|
Regulatory Body |
Charity Commissioner / Sub-Registrar |
Registrar of Societies |
Registrar of Companies (MCA) |
|
Minimum Members Required |
2 Trustees |
7 Members |
2 Directors (at least one resident of India) |
|
Legal Status |
Not a separate legal entity |
Not a separate legal entity |
Separate legal entity |
|
Ease of Formation |
Relatively simple |
Moderate |
Requires stricter compliance |
|
Transparency & Credibility |
Moderate |
Moderate |
High (Audits, filings with MCA) |
|
Foreign Funding (FCRA) |
Allowed but less preferred |
Allowed |
Preferred structure for foreign donations & CSR grants |
|
Annual Compliance |
Low |
Medium |
High (Regular filings and audit requirements) |
At StartupMancer, we help NGOs, social startups, and philanthropists register their Section 8 Company with complete legal support—ensuring compliance with MCA, income tax, and other regulatory bodies, so you can focus on creating social impact.
Minimum 2 Directors (At Least One Must Be a Resident of India):
To register a Section 8 Company, you need at least two directors, and one of them must be an Indian resident. This ensures local presence and administrative accountability in compliance with Indian laws.
Registered Office Address in India:
The organization must have a valid physical address in India to be registered as its official office. This address will be used for all government and legal correspondence.
Charitable Objective Aligned with Section 8 Norms:
The company must be formed with non-profit objectives such as the promotion of arts, education, science, sports, social welfare, environment protection, or other charitable purposes. The profits, if any, must be used solely for promoting these objectives, and not distributed as dividends.
Digital Signatures (DSC) of All Directors:
All proposed directors must obtain Digital Signature Certificates (DSC). These are used to sign electronic documents submitted during the registration process, ensuring authenticity and data security.
DIN if the Director Is Already Involved in Another Company:
If any of the directors are already associated with another company, they must provide their Director Identification Number (DIN). This number helps the Ministry of Corporate Affairs (MCA) keep track of directors across all companies.
Name Reservation (SPICe+ Part A): Reserve a unique name with the suffix “Foundation,” “Association,” or “Society” (no Pvt Ltd or Ltd used).
Get DSC (Digital Signature Certificate): Required for directors to digitally sign forms.
Draft MOA & AOA: Define the mission, vision, rules, and structure of your non-profit.
Apply for Section 8 License (Form INC-12): Submit objectives, financial projections, and supporting documents to obtain approval from the Regional Director.
Filing of Incorporation (SPICe+ Form): After license approval, file incorporation forms with MCA to obtain COI, PAN & TAN.
Note: Timeline for Section 8 Registration is 10–20 working days, depending on license approval and document accuracy.
For Directors & Shareholders:
PAN card (mandatory)
Aadhaar card / Passport / Voter ID / Driving License
Passport-size photo
Latest Bank statement or utility bill (not older than 1 month) or utility bill on the name of director/ shareholder (for address proof)
Email & Contact number of all directors/Shareholders
For Registered Office:
Electricity bill or utility bill (not older than 1 month)
Rent agreement (if rented)
NOC from property owner
Minimum 2 Directors (At Least One Must Be a Resident of India):
To register a Section 8 Company, you need at least two directors, and one of them must be an Indian resident. This ensures local presence and administrative accountability in compliance with Indian laws.
Registered Office Address in India:
The organization must have a valid physical address in India to be registered as its official office. This address will be used for all government and legal correspondence.
Charitable Objective Aligned with Section 8 Norms:
The company must be formed with non-profit objectives such as the promotion of arts, education, science, sports, social welfare, environment protection, or other charitable purposes. The profits, if any, must be used solely for promoting these objectives, and not distributed as dividends.
Digital Signatures (DSC) of All Directors:
All proposed directors must obtain Digital Signature Certificates (DSC). These are used to sign electronic documents submitted during the registration process, ensuring authenticity and data security.
DIN if the Director Is Already Involved in Another Company:
If any of the directors are already associated with another company, they must provide their Director Identification Number (DIN). This number helps the Ministry of Corporate Affairs (MCA) keep track of directors across all companies.
A Section 8 Company is the most structured and legally recognized way to operate a non-profit organization in India. Whether you're aiming to drive social change, serve a community, or raise CSR and donor funds—this model gives you the platform to grow with transparency and trust.
At StartupMancer, we specialize in Section 8 Company registrations with end-to-end support—from drafting documents to getting MCA approval. Let us help you bring your mission to life with a strong legal foundation.