Financial fund of NGO
Husne Mubarak
(Querist) 08 February 2011
This query is : Resolved
Dear Experts,
We often read in the newspaper about the various NGO's filing several PILs in the High courts and Supreme Court.
Q1: since an NGO is a non-profitable organization, then how does it make such a financial fund to pay the court expenses, advocate's fees etc.?
Q2: Whether an NGO can be used as a kind of business to make money?
Q3: Or, are there some legally allowed methods to make money for particular types of NGOs?
If yes, which types of NGOs are these?
With Regards
Husne Mubarak
Ajay Bansal
(Expert) 08 February 2011
Members of NGO bears expenditures from their pockets.
M V Gupta
(Expert) 09 February 2011
All those NGOs which are registered as Societies under the Societies Registration Act and as Trusts under the Trusts Act can seek donations and contributions to meet the expenses of its activities.This answers ur questions no.1and 3. The answer to ur question no2 is No.
malipeddi jaggarao
(Expert) 10 February 2011
In India NGOs can be registered as (a) trusts under Indian Trust Act (b) Societies under Central/State Society Registration Acts and 3) Non-profit company under Sec.25 of Indian Companies Act. In all the three cases, the resdiaul incomes if any are prohibited for sharing among its members, governing bodies, but to be diverted for the benefit of others as per the aims and objects of the concerned entity. There are many methods for raising funds for pursuing the aims and objects and some of them as rightly pointed by expert Mr.Gupta are donations and contributions. If the filing of PIL is in pursuit of the aims and objects either directly or indirectly, the expenditure can be booked against the incomes of the individual entity. As far as your query No.2 is concerned, they can make profits, but not for distribution among its members/governing body. The profits are to be channelised to the beneficiaries in acccordance with the aims and objects. 3. There are no legally allowed to make money for their own benefit.
