Formation of an NGO

An NGO can either be a registered or an unregistered
body and, in case it is to be a registered body, then it
can be formed in any of the following three ways:

1)As a Trust
2)As a Society
3)As a Company u/s 25 of the Companies Act, 1956

In case the NGO is looking for external funding then it
would be a good idea to register it as it would give some
comfort to the donors - be they National or International.
Even for Income Tax purposes it would be good idea to
create an instrument and register the same. Similarly
for FC (R) Act. It should be noted that all NGOs
with an Income in excess of Rs 50,000 are required to
get their accounts audited as per the conditions stipulated
by the Tax Department while granting exemption.

As regards collections, once one has an entity one
can open an Bank account and take donations by
cheque. In case one intends not to register then one can
be treated as an Association of Persons (AOP) by the
Bank and it can open a Bank account in the AOP’s
name.