Section 25 Company or a Non-Profit organization (NPO) is a Company founded for encourage charity, religion, science, art, commerce or any other helpful thing, provided the benefit, if any, or other income is applied for encourage only the goal of the company and no segment is delivered to its Fellow.
An NPO/NGO can be built up for encouragement of any usable thing like research activities, education, sports etc. The status Not Profit does not reparsent that the Company has not profit or income, but it factually means applying the income for ahead field upgrading of the thing and not for dividing it to the continuator. It means that the Company earn profits but promoters cant be earn out of those profits
Benefit:
- Many charter and concession under Company Law.
- concession from necessity of Minimum Paid-up capital.
- concession of seal duty for enrollment.
- Non-application of firm Auditor’s protocol Order (CARO) 2003.
- Registered copartnery firm can be a part in its personal efficiency.
- Tax deductions to the giver of the Company u/s.80G of the Income Tax Act.
Conditions:
- Benefit or Income of the Company shall be germane for the assistance of the mainobject
- Annunciation of dividend or delivery of benefit to the activator is not permited
- No member shall be nominative as a underprice officer
- No profit shall be paid to a member being a officer of the Company
Requirements:
- Minimum Two Shareholders for Private Limited Company and 7 Shareholders for Public Limited Company
- Minimum Two Directors for Private Limited Company and 3 Directors for Public Limited Company
- The shareholders and directors can be one
- DIN for all the Directors
- DSC for two of the Directors
Steps for formation of Section 25 Company or Non-Profit organization
Step No. | Steps |
---|---|
1 | DSC |
2 | DIN
DIN sanctioned DIN is a prerequisite for Deduction process |
3 | First Name Search for Application |
4 |
Application for Name Availability
|
5 | Representations before RoC on on the part of Promoters |
6 | Application to territorial director for clearance of License |
7 | Characterization before RD in case of any objections |
8 | Public Notice |
9 | Documents in need (after license issued by RD)
|
10 |
|
In case of NPO being a Public Limited Company | |
11 |
|