The Societies Registration Act

Based on the English Literary and Scientific Institutions Act, 1854, the Societies Registration Act was enacted in India in 1860. This law was implemented partly to provide legal standing to various organisations and partly to allow the colonial government to keep a check on them. However, the Act provided complete freedom to the Societies/organisations that chose to register with the government.

The Societies Registration Act, 1860 allows the formation of a Society for any literary, scientific, or charitable purpose. The legal measures include: State’s power of enquiry and investigation; cancellation of registration and consequent dissolution of Societies; supersession of the Governing Body; appointment of administrator; dissolution; and deletion of defunct organisations. State legislations on this subject vary widely.

A Trust is a special type of organisation that arises from a will. The will maker transfers the ownership of a property to be used for a particular purpose. If the purpose is to benefit particular individuals, it becomes a Private Trust and if it concerns some purpose of the common public or the community at large, it is called a Public Trust.

Religious Endowments

Religious Endowments and Waqfs are variants of Trusts which are formed for specific religious purposes. Unlike Public Trusts, they may not necessarily originate from formal registration. Religious endowments arise from the dedication of property for religious purposes. The corresponding action among the Muslim community leads to the creation of Waqfs.

Waqfs in India

Under Muslim rule in India, the concept of Waqf was more widely comprehended as aligned with the spirit of charity endorsed by the Quran. Waqf implies the endowment of property, moveable or immovable, tangible or intangible to God by a Muslim, under the premise that the transfer will benefit the needy.

Non-Profit Companies (Section 25 of the Companies Act, 1956)

Section 25 of the Companies Act, 1956 provides for a mechanism through which an Association can be registered as a Company with a limited liability, if such association is formed for promoting commerce, art, science, religion or any other useful object and intends to apply its profits/income in promoting its objects.