SOCIETY/TRUST/NGO- A COMPARISON
INTRODUCTION
(BIRD’S – EYE VIEW)
TRUST
♦ First & Oldest Form Of Not-For-Profit-Organisation
♦ Regulated As Per Indian Trust Act, 1882
♦ Formed With Minimum 2 Individuals , No Statutory Requirement For Annual Return/ Documents Filling
♦ Difficult To Wind Up As Trust Are Generally Irrevocable But Can Be Wound Up According To The Trust Deed
SOCIETY
♦ Comparatively To Be In Modern Form
♦ Governed By The Societies Registration Act, 1860 or Its Versions In Force In Different States
♦ Require 7 Individuals From 1 State/ And 8 Individuals In Case Of Different States Come Together For A Common Resolution In A General Body
♦ Unlike Trusts, A Society Has A More Democratic Set Up With Membership And An Elected Body To Manage The Society
♦ Generally Works Best For Individuals With State-Level Objectives Who Are Interested In Focusing On Their Formalities
COMPARATIVE ANALYSIS
|
TRUST |
SOCIETY |
| ♦ Trust is governed by the Indian Trust Act, 1882
♦ One Man Control i.e., settlor / founder trustee / board of trustees ♦ At least 2 trustees are required to register a public charitable trust In general. Indian citizens serve as trustees, although there is no prohibition against non-natural legal persons or foreigners serving in this capacity ♦ Applicable to whole of over India no matter from which state trust deed belongs ♦ There are no requirement for any annual compliances |
♦ Societies are governed by the Societies Registration Act 1860. Many states, however, have variants on the Act
♦ Decisions are made by voting power ♦ Minimum Seven members are required for formation of state level society and 8 members in case different states members are involved ♦ In case society is formed within particular state with 7 or more members then within that particulars state it is applicable, for all over India with different state 8 or more members has to be present ♦ Societies must file annually, list of names, occupations and address of the managing committee members |
CONCLUSION- WHAT’S BETTER
♦ It is clear that all the organizations i.e. Trusts or society are meant to provide social benefit, relief to poor’s and providing social welfare to society at large, they cannot do any other work apart from providing social benefits and what is prescribed in the main documents, the surplus from their business cannot be applied in any other object, i.e. Non-profit organization.
♦ There is no evident particular situation under which one can choose what to form, like in case of providing social benefit to one individual/family or to society at large wherein it can be properly managed, the trustee to hold office for his or her lifetime without the need for an election.
♦ In case if person wants more organized, structural way managed through elected bodies to provide social benefits to public at large then formation of societies is the ideal choice
♦ If one desires to provide social welfare as a legal structure of a company, to gain reliability and credibility then form trusts as it is an approved establishment by the central government, with no requirement of higher, more benefits of government subsidies, foreign contribution, more transparency.
Hence, it is evident from the above discussion that there is no specific criteria that one must follow to decide which Not- for- profit organization is better, every organization is best at their parts.
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