Summary of Societies
Registration Act 1860
Societies are governed by the Societies Registration Act 1860, which
is an all-India Act. Many states, however, have variants on the Act.
Societies are similar in character to trusts, although there a few
essential differences.
While only two individuals are required to form a trust, a minimum
of seven individuals are required to form a society.
The applicants must register the society with the state Registrar
of Societies having jurisdiction in order to be eligible to apply
for tax-exempt status.
A registration application includes the society's memorandum of
association and rules and regulations. In general, Indian citizens
serve as members of the managing committee or governing council
of societies, although there is no prohibition in the Societies
Registration Act against non-natural legal persons or foreigners
serving in this capacity.
According to section 20 of the Act, the types of societies that
may be registered under the Act include, but are not limited to,
the following : Charitable societies; Societies established for
the promotion of science, literature, or the fine arts, for education;
and Public art museums and galleries, and certain other types of
museums.
The governance of societies also differs from that of trusts; societies
are usually managed by a governing council or managing committee,
whereas trusts are governed by their trustees. Individuals or institutions
or both may be members of a society.
The general body of members delegates the management of day-to-day
affairs to the managing committee, which is usually elected by the
membership. Members of the general body of the society have voting
rights and can demand the submission of accounts and the annual
report of the society for inspection.
Members of the managing committee may hold office for such period
of time as may be specified under the bylaws of the society. Societies,
unlike trusts, must file annually, with the Register of Societies,
a list of the names, addresses and occupations of their managing
committee members.
Furthermore, in a society, all property is held in the name of
the society, whereas all of the property of a trust legally vests
in the trustees. Unlike trusts, societies may be dissolved. Dissolution
must be approved by at least three-fifths of the society's members.
Upon dissolution, and after settlement of all debts and liabilities,
the funds and property of the society may not be distributed among
the members of the society. Rather, the remaining funds and property
must be given or transferred to some other society, preferably one
with similar objects as the dissolved entity.
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