Non Profit Company
Generally companies are promoted with an object of making profit by carrying commercial transactions. But a company can be registered with charitable motive with the object not to make any profit also.
The registration of such company is subject to the provisions of Section 8 of the Companies Act. 2013. So, these companies generally called as Section 8 Company. These companies must be formed with an object to promote of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object.
The name of a Company registered under Section 8 of the Act, the name shall include the words foundation, Forum, Association, Federation, Chambers, Confederation, council, Electoral trust etc.
A Section 8 Company shall not pay any dividend to its members but apply its surplus of receipts over payments for promotion of its objects. These companies need not use the words Limited or Private Limited after the name.
The registration process of a Section 8 company is slightly different from a regular limited company. A license for registration must be obtained from the Ministry of Corporate Affairs for registration as a Section 8 Company.
These companies are generally registered as Guarantee Company with limited liability with or without capital. This company can be private or public in nature depends on the number of persons involved in it.