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Step-by-Step Tutorial on Mandatory Legal Compliance for Private Limited Companies under Companies Act, 2013

Operating a Private Limited Company in India involves adhering to numerous mandatory compliances as mandated by the Companies Act, 2013. These set the legal framework within which companies must operate and report various aspects of their business. Here’s a step-by-step guide to ensure your company meets all mandatory legal compliances:

Step 1: Convene the Initial Board of Directors Meeting

  • Hold the first meeting of the Board of Directors within 30 days of company incorporation.
  • Schedule at least four board meetings throughout the financial year, maintaining a maximum gap of 120 days between two meetings.

Step 2: Issue Share Certificates

  • Issue Share Certificates to the subscribers of the memorandum within 60 days of incorporation.
  • Keep a record of the share certificates issued for transparency and statutory compliance.

Step 3: Appoint Statutory Auditors

  • Appoint a practicing Chartered Accountant as the company auditor.
  • This appointment should be made by the Board of Directors within 30 days of incorporation, or by the members in an Extraordinary General Meeting within 90 days.
  • Re-appoint or ratify the appointment in each subsequent Annual General Meeting.

Step 4: Document Board and General Meetings Minutes

  • Record the minutes of all Board of Directors and General meetings.
  • Ensure this is completed within 30 days following the conclusion of each meeting.

Step 5: Disclose Directors’ Interests

  • Each director must disclose any interest in other business entities at their first board meeting as director and subsequently at the first board meeting in each financial year.
  • Submit their disclosures in FORM MBP-1.

Step 6: Approval and Signing of Financial Statements

  • Approve financial statements in a board meeting.
  • Sign them on behalf of the Board by the chairperson or two directors, and by the CFO and Company Secretary if appointed.
  • Submit these for auditing.

Step 7: Prepare Board of Directors’ Report

  • Attached to the general meeting financial statements, include a report detailing the state of the company and its compliance with financial and corporate standards.

Step 8: File Financial Statements

  • File the company’s Financial Statements with the Registrar of Companies within 30 days of the Annual General Meeting using E-FORM AOC-4.
  • Ensure the form is digitally signed by at least one director and certified by a professional if required.

Step 9: File Annual Returns

  • File the company’s Annual Return with the Registrar of Companies within 60 days of the Annual General Meeting using E-FORM MGT-7.
  • Have the form digitally signed by at least one director and certified by a Company Secretary in practice if necessary.

Step 10: Maintain Statutory Registers

  • Keep up-to-date statutory registers including:
    • FORM MGT-1: Register of Members
    • FORM MGT-2: Register of Debenture Holders
    • FORM MGT-3: Foreign Register of Members and other security holders
    • FORM SH-2: Register of Renewed and Duplicate Share Certificates
    • FORM SH-3: Register of Sweat Equity Shares
    • FORM SH-6: Register of Employee Stock Options
    • FORM SH-10: Register of Shares or Securities Bought Back
    • FORM CH-7: Register of Charges

Ensure you regularly review compliance regulations as they may be subject to changes. Non-compliance could result in penalties, so maintaining diligence in these areas is crucial for the ongoing operation of your Private Limited Company. Lastly, always confirm with legal advisers or professional consultants to ensure full compliance according to the latest amendments in the law.

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What is the procedure for Nidhi Company Registration

Nidhi Company is registered as Public Limited Company in India, Nidhi Company is Finance Company that deals with its members – Accept deposit from its members and provide loans to its members.

For Registration of Nidhi Company Following information and documents are required :

  1. Minimum 7 Members are required
  2. Minimum 3 Director are required , Please note that Director should also be member of Nidhi Company
  3. Minimum Paid up Capital and Authorized Share Capital at the time of Registration should be Rs. 5 Lakh
  4. Mobile No and Email id of Members and Directors
  5. PAN Card Copy of all the Members and Directors
  6. Aadhar Card Copy of all the Members and Directors
  7. Bank Statement copy with Address and not older than 2 months
  8. Photo – Passport Size
  9. Duly Signed Digital Signature Form
  10. Video for Digital Signature (20 Sec) of all the Members
  11. Office Address
  12. Office Address Electricity Bill, Rent Agreement, if rented and NOC from Owner

Procedure for Registration of Nidhi Company –

  1. Signing of Incorporation Documents – Form DIR-2, INC-9 , Declaration for Compliance of Nidhi Rules , 2014
  2. Now Application is required to be submitted to CRC online with Incorporation forms along with required fee
  3. CRC review the application and if found any issue , sent it for re submission. Other Company gets Incorporated
  4. Resubmit the Application
  5. Approval of Application
  6. Certificate of Registration/PAN/TAN is issued to Company
  7. Filing of Form INC 22 for Office address , if you have given Communication address while Incorporation of Company than you are required to file Form INC22 for Office address within 30 days of Registration of Company
  1. Opening of Bank Account of Nidhi Company :
  2. Once the Company is Incorporated, you are required to open a Bank Account of Company with Bank of your Choice and Deposit the subscription amount to Bank .
  3. Filing of Form INC 20A for Business Commencement
  4. Filing of Form ADT-1 for Auditor Appointment of the Company

If you have any queries related to Registration of Nidhi Company Please Place your request at Place your Request – Get Fastlegal Support

For More details :

Nidhi Company Registration and Nidhi Rules 2014 Requirements – Academy by Fastlegal

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Tax on Cryptocurrency as Virtual Digital Assets

In the Union Budget for FY 22-23, the government of India announced provisions related to Taxation of Cryptocurrency as Virtual Digital Assets, earlier to this there was no provisions for taxation of Cryptocurrency and as General practice, most the Taxpayers are declaring their income either as Trading business or if brought as an investment perspective than as Capital Assets, Short Term or Long Term Capital Gain provisions are been followed by many Industry Experts. In this article, we will discuss provisions related to the Taxation of Crypto as Digital Virtual Digital Assets.

Meaning of Virtual Digital Assets

“Virtual Digital Asset” Means––

(A) Any Information Or Code Or Number Or Token (Not Being Indian Currency Or Foreign Currency), Generated Through Cryptographic Means Or Otherwise, By Whatever Name Called, Providing A Digital Representation Of Value Exchanged With Or Without Consideration, With The Promise Or Representation Of Having Inherent Value, Or Functions As A Store Of Value Or A Unit Of Account Including Its Use In Any Financial Transaction Or Investment, But Not Limited To Investment Scheme; And Can Be Transferred, Stored Or Traded Electronically;

 (B) A Non-Fungible Token Or Any Other Token Of Similar Nature, By Whatever Name Called;

(C) Any Other Digital Asset, As The Central Government May, By Notification In The Official Gazette Specify: Provided That The Central Government May, By Notification In The Official Gazette, Exclude Any Digital Asset From The Definition Of Virtual Digital Asset Subject To Such Conditions As May Be Specified Therein

Digital Virtual Assets

Tax on Crypto as Virtual Digital Assets

For Taxation of Virtual Digital Assets new Section 115BBH has been inserted in Income Tax Act

Where the total income of an assessee includes any income from the transfer of any virtual digital
asset, the income-tax payable shall be the aggregate of

(a) the amount of income-tax calculated on the income from transfer of such virtual digital asset at the rate of thirty per cent and

(b) the amount of income-tax with which the assessee would have been chargeable had the total income of the assessee been reduced by the income referred to in clause (a).

From the above, it is clear that the minimum tax rate shall be thirty percent on any income received from Transfer of Virtual Digital Assets if your rate of tax is below thirty percent or if your rate of tax is more than thirty percent than the higher rate of tax applicable will be the rate of Tax on transfer of Virtual Digital Assets.

Deduction allowed while Calculating Income of Virtual Digital Asset

While calculating income from Virtual Digital Assets deduction in respect to Cost of Acquisition will be allowed and no other deduction will be allowed. Also, Set-off of any loss will not be allowed while calculating income from Virtual Digital Assets.

TDS on payment on Transfer of Virtual Digital Assets

A New Section 194S has been inserted in Income-tax Act for Provisions related to TDS on Virtual Digital Assets

Any person responsible for paying to a resident any sum by way of consideration for transfer of a virtual digital asset shall, at the time of credit of such sum to the account of the resident or at the time of payment of such sum by any mode, whichever is earlier, deduct an amount equal to one percent. of such sum as income-tax thereon

Further, if there is an exchange of one Virtual Digital Assets for another than the person responsible for paying such consideration shall, before releasing the consideration, ensure that tax has been paid in respect of such consideration for the transfer of virtual digital assets.

Non Applicability of TDS on specified person

TDS on Crypto is not applicable if the value or aggregate value of such consideration does not exceed fifty thousand rupees and ten thousand rupees for other than specified persons during the financial year.

“specified person” means a person,–– (a) being an individual or a Hindu undivided family, whose total sales, gross receipts or turnover from the business carried on by him or profession exercised by him does not exceed one crore rupees in case of business or fifty lakh rupees in case of the profession, during the financial year immediately preceding the financial year in which such virtual digital asset is transferred; (b) being an individual or a Hindu undivided family, not having any income under the head “Profits and gains of business or profession”

TDS provisions will be applicable from 01st July 2022.

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How to Appoint or Add New Director in Private Limited Company

Foreign Subsidiary Company

In Private Limited Company Directors plays main role in its functioning, Directors takes day to day decisions for business operations, Directors are key person in whom Shareholders of company trusts for their money invested, here in this article we will discuss about how a company can have new Director on its Board legally in India :

Obtain Consent of Proposed Director: 

Proposed Director Should give his consent to act as Director in the Company as per Form DIR-2 , this is very important document and company must obtain form DIR-2 form before proposing him Director of the Company. 

Digital Signature of Proposed Director :

If proposed Director does not have Digital Signature , he must obtain Digital Signature from Certifying Authority in India.

Obtain Director Identification Number (DIN): 

If the proposed Director does not have DIN , he should let the company know that he does not have ,and than the Company in which he is about to be appointed as Director is required to pass Board Resolution for proposing him to be Appointed as Director of the Company , the company should apply for DIN no of the proposed person. The Resolution is required to be attached with Form DIR 3.  ( This is new requirement for obtaining DIN , as new person cannot just apply for DIN if he is not to be appointed as Director in any Company. DIN is only allotted once for lifetime of Director.  

The Company should obtain all KYC documents along with necessary educational Qualification documents required as per terms of job, it is important to note that there is no minimum education qualification required to hold position of Director in the Company in India 


Issue of Notice of General Meeting: 

The Director in the Company are appointed in the General Meeting , the Company should issue notice to all the Shareholders of the Company for holding Extra Ordinary General Meeting of the Company, Please note that Notice of General Meeting should be issued in accordance with provisions of Companies Act, 2013 and rules made there under and Secretarial Standards issued by Institute of Company Secretaries of India (ICSI).


Hold Extra Ordinary General Meeting of the Company : 

Once the Notice of EGM is issued to the shareholders , now on the meeting date and time , hold the meeting and Pass the Necessary Resolution for Appointment of Director as Company. 

Issue Letter of Appointment 

Now issue letter of appointment to the Director of the Company mentioning terms and conditions of appointment and salary to be payable to the Director.

File form DIR-12 to ROC

Once all the above steps are completed the Company should file Form DIR-12 to ROC within 30 days form the date of appointment of Director , It is always advisable to File the Form DIR-12 within next day of appointment, so as to avoid late filing and Additional Fee.


Making Necessary entries in Register of Directors 

Company should make necessary entries in the Register of Director and Key Managerial Personals

File Necessary Amendment Application to GST, Tax Authorities  Other regulators 

The Company is required to make necessary application for Changes in Directors details in GSTN and Other Certificates, wherever applicable. 

Book On Company Law Procedures

Need for Director Appointment Services? Email us at mail@fastlegal.in or Place your request here 

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CSR Activities which may be Included by Companies in their Corporate Social Responsibility Policy

Companies that are required to spent CSR funds, can only undertake CSR activities as mentioned in Schedule VII of the Companies Act 2013, Companies Can Undertake the CSR Activities through Non-Profit Organisation’s Registered with Ministry of Corporate Affairs having CSR Registration Number

CSR ACTIVITIES

List of CSR Activities:

  1. Eradicating hunger, poverty, and malnutrition, promoting health care including preventive health care and sanitation including contribution to the swach Bharat Kosh set-up by the Central Government for the promotion of sanitation and making available safe drinking water;
  2. Promotion of education including special education and employment enhancing vocation skills especially among children, women, elderly, and the differently-abled and livelihood enhancement projects;
  3. Promoting gender equality, empowering women, setting up homes and hostels for women and orphans; setting up old age homes, daycare centers and such other facilities for senior citizens and measures for reducing inequalities faced by socially and economically backward groups;
  4. Ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agroforestry, conservation of natural resources and maintaining the quality of soil, air, and water[4] including contribution to clean Ganga Fund set-up by Central Government for rejuvenation of river Ganga;
  5. Protection of national heritage, art, and culture including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promotion and development of traditional arts and handicrafts;
  6. Measures for the benefit of armed forces veterans, war widows and their dependents Central Armed Police Forces (CAPF) and Central Para Military Forces (CPMF) veterans, and their dependents including widows [5] ;
  7. Training to promote rural sports, nationally recognized sports, Paralympic sports, and Olympic sports;
  8. Contribution to the Prime Minister’s National Relief Fund or Prime Minister’s Citizen Assitance and Relief in Emergency situations Fund (PM CARES Fund) or any other fund set up by the Central Government for socio-economic development and relief and welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities, and women;
  9. Contribution to incubators funded by Central Government or State Government or any agency or Public Sector Undertaking of Central Government or State Government, and contributions to public-funded Universities, Indian Institute of Technology (IITs), National Laboratories and Autonomous Bodies (established under the auspices of Indian Council of Agricultural Research (ICAR), Indian Council of Medical Research (ICMR), Council of Scientific and Industrial Research (CSIR), Department of Atomic Energy (DAE), Defence Research and Development Organisation (DRDO), Department of Biotechnology, Department of Science and Technology (DST), Ministry of Electronics and Information Technology) engaged in conducting research in science, technology, engineering and medicine aimed at promoting Sustainable Development Goals (SDGs);”
  10. Rural development projects.
  11. Slum area development
  12. Disaster management, including relief, rehabilitation, and reconstruction activities. Explanation.- For the purposes of this item, the term ‘slum area’ shall mean any area declared as such by the Central Government or any State Government or any other competent authority under any law for the time being in force.

Book on CSR:

CSR Activities which may be Included by Companies in their Corporate Social Responsibility Policy 1
Check Book On CSR

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Main requirements for Trademark Registration

In this article we will discuss the main requirements for trademark registration in India, Trademark Registration is very important part of brand building and creating intellectual assets for any business, Trademark registration process is now fully online procedure and can be done online by applicant himself or through his attorney or agent Authorized by him.

Main requirements for Trademark Registration

Following are the main requirements of filing of Trademark Application :

Public Search of Trademark (Main requirements for Trademark Registration)

Public search of trademark enables applicant to know the existing mark that are identical or similar to any previously used mark , this helps us to know that we should opt for particular trademark or not , Public search of Trademark can be done online via public search of Trademark link.

Public search of trademark is required to be done carefully, unproperly public search of trademark may lead you in serious trouble and your trademark process may takes years to complete or you may have to leave the mark in vain.

Date of Use of Trademark (Main requirements for Trademark Registration)

Date of Use of Trademark is also most important thing we must take seriously , Date of use makes lot of sense in Trademark registration and help you stand out from others with prior user tag, Applicant of Trademark must ensure that he should have proper evidence for establishment of date of use , Evidence may be any sales bill, Spending on Advertisement etc.

In the trademark registration process applicant must submit affidavit that he is using the mark from the particular date.

Goods and Services Description in Trademark Registration

Goods and Services Description in Trademark is another important thing we must consider seriously, goods and services description helps you to get trademark for the particular product and services, in Trademark there are Forty five (45) classes in total for different goods and services description, we need to carefully decide that in which class our trademark is falling and we should apply accordingly.

Status of Proprietor of trademark in Trademark Registration Application

The Fee Structure of Trademark is based on the legal structure of business of Proprietor , for Single Firm, MSME and Startups fee for Trademark Application of Rs. 4500 and other Rs. 9000 per class, so the applicant of mark is MSME or startup, he should accordingly.

Law of Trademark in India

Laws of Trademark in India

Trademark Laws

Fastlegal provides Trademark Application and Registration Services , for any help submit your request in below form

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Electrical Contractor Licence In Rajasthan

Electrical Contractor Licence is mandatorily required to obtain before applying for any Tender in Rajasthan for Contractor work. Every person who is planning to apply for tender of Electrical government works must obtain the Electrical contractor’s license with PWD And Electrical Inspector.

Minimum Requirements for applying for Electrical Contractor Licence :

A contractor must have a Firm Registered, a Firm can be a proprietorship firm, company, partnership, or LLP ( you can choose any type of business entity) ( For Firm Registration with Fastlegal call 9782280098 or email: mail@fastlegal.in )

Obtain GST Registration for Electrical Contractor Licence :

Your Firm must have GST Registration ( for GST Registration call 9782280098 or email: mail@fastlegal.in) 

Classes of Electrical Works Contractors

  • E- xyI
  • E- xyII
  • E- xyIII
  • E-xyVI
Contractor Class AIndividual or legal entity either partnership or proprietorship firm or private or public limited company having at least 3 years of experience as “B” or “C” class contractor. he shall have successfully executed a minimum of 10 numbers of HT installation (Across India) OR Individual or the owner of the firm or all partner(s) of the firm who is /are Engineers(s) having 5 years of experience in electrical operation and maintenance field (Across India) OR Individual or a firm who ( or which) is already having a license issued by the competent authority of any other state and having experience of at least three years in electrical works of above 33 KV Voltage level with successful execution 10 numbers of HT installation (Across India)
Contractor Class BAny individual or legal entity or legal entity either partnership or proprietorship firm or private or public limited firm or company or contractor having a license issued by the competent authority of any other state.
Contractor Class CFor the person (s) who is /are unemployed engineer holding degree or diploma in electrical engineering or is class “A” supervisor (Applicable for domicile or Rajasthan only)
Contractor Class DFor the person(s) holding a certificate or permit for supervisor or wireman issued by the office of the Chief/senior electrical inspector (HOD)
Electrical Contractor Licence

Electrical Sub Class Of Contractors for Electrical Contractor Licence:

  • EWSD-I
  • AC-I
  • LE-I
  • FF-I
  • ER-I
WiremanCandidates who have passed two years ITI or National Apprenticeship Certificate recognized by the Government. OR Candidate having a permit to work as Wireman issued by the competent authority of other states.
Supervisor Class A(For any voltage level)Candidates who have B.E. or B.Tech in Electrical Engineering Or Candidates who have valid experience as B Class supervisors for at least five years.
Supervisor Class B(Voltage up to 33 kV and below)Candidates who have a diploma in Electrical Engineering OR (a) candidate who has a wireman permit issued by Electrical Inspectorate of Rajasthan; and (b) at least ten years of valid practical electrical works experience in the State of Rajasthan as electrician/ wireman certified by electrical contractor of Class A/ B/ C or by the head of the office/ section in charge of any State/ Central Government/ Board/ Corporation/ private sector establishment/ installations OR Supervisor having a certificate of competency and permit to work as supervisor issued by the competent authority of other states.
Supervisor Mines(A) A Degree holder in Electrical Engineering with one year practical experience in mining installation after obtaining a degree (B) A Diploma holder in Electrical Engineering with two years practical experience in mining installation after obtaining the diploma (B) A Valid wireman permit holder with a minimum working experience of 15 years out of which 5-year practical experience.
Charted Safety Electrical Engineer(A) The applicant should have a degree in Bachelor of Engineering or Bachelor of Technology in Electrical Engineering (B) At least five years or experience operation and maintenance of the electrical installation

Information and Documents required for Electrical Contractor Licence

  • Contractors basic details
  • Business name
  • BRN No. (If Available)
  • Firm And Bank Details
  • Solvency Certificate (Issued by Bank, Local Tehsil, ADM )
  • Infrastructure Details
  • Work Experience
  • Machine Details
  • Employee Detail
  • Litigation Details (Court Cases If Any)
  • Relative Details ( Details Of Relative Who Works In Same Department )
  • Scanned Copies of Documents Required:
    • Self Photo(Scanned Passport Size)
    • Self Signature
    • Contractor’s PAN Card
    • Contractor’s Aadhaar Card
    • Address Verification of Firm/Company’s by police station/post/Councilor/Sarpanch (Verification must be attested)
    • Scanned copy of GST Registration
  • Affidavit of a close relative of Proprietor/All partners/Directors.
  • Two Certificates of work completed satisfactorily in last 3 years with work order and documents of T.D.S. deduction (26 A.S.) (amount in lacs).
  • List of machinery, plant, and documents of ownership and list of working staff on the stamp of Rs. 50 / – (rent nomination of machinery on the stamp of Rs. 500 /with Ownership documents).
  • Attested report(3B report) of latest GST return.
  • Affidavit regarding Sales Tax on the stamp of Rs. 50/- and undertaking released by C.A.
  • Bank Confidential Report

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List of important Legal Documents

In this article, we will discuss important Legal documents every company or startup should follow in practice, The document which clearly mentions the detailed terms and conditions, roles, and responsibilities has become a necessity for every business. Most businesses to scale up require alliances or business associates or require alternate resources or new technology, therefore to enter into a legal contract or obligation document which is the one that is clear enough to be easily understood by a person of ordinary prudence and at the same time detailed enough so that it cannot be wilfully misinterpreted is required and this documents than forms part of an integral part when the terms of the contract are beached by any party for commercial litigations purposes.

List of some important Legal Documents which every Startup Company or Business is Required :

  1. Business Associate Agreement
  2. Partnership Agreement
  3. Franchisee and Trademark Assignment Agreement
  4. Board Resolutions
  5. Business Takeover Agreement
  6. Work Space Sharing Agreement
  7. NON Disclosure Agreement
  8. Leave and Licence Agreement
  9. Software Licence Agreement
  10. Website Terms and Conditions, Privacy Policy and Disclaimer
  11. Refund Policy
  12. Social Media Policy
  13. Appointment Letter for Managerial Personals

 

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Top Fundraising Platforms for NGO’s in India

In this article, we will discuss top Fundraising Platforms for NGO’s through which NGO’s can get donations by running different campaigns, India being the most populous country and the gap between rich and poor is so high and people are in need of help to sustain their life, upgrading the skills of poor and so much.

There are many people who want to help others and are helping to serve the community to live better lives, helping the people with the help of other peoples makes things bigger and many needy get benefited, for which other people donate funds to non-profit organizations. Making contributions to many such non Profit organizations are eligible for Income Tax Exemptions as well.

In Today’s digital world, the world is open to everyone through the internet and Non-Profit Organisation’s to benefit from this by collecting funds in the form of donations by running campaigns on Online Crowdfunding platforms.

Here we will discuss about the top Fund raising platforms on which NGO’s can raise funds to achive there objectives :

Milaap (https://milaap.org/)

Fundraising Platforms for NGO's

Milaap is an online crowdfunding platform that enables anyone across India to raise funds for healthcare, education, sports, disaster relief, and other personal causes, with great ease. Founded in 2010 by a team of young and passionate entrepreneurs, Milaap has pioneered the development of person-to-person giving in India.

What started as a platform to fund rural projects and micro-entrepreneurs, is today widely utilized by Indians to raise funds from friends, family and a wider social network for medical needs, loved ones and charity. Milaap is soon becoming the go-to platform for funding cancer treatment, transplants and other critical emergencies.

Impactguru (https://www.impactguru.com/)

Top Fundraising Platforms for NGO's in India 3

Impactguru is another great platform that provides complete crowdfunding solutions to empower individuals, NGOs and social enterprises to raise funds for medical emergencies, personal needs, creative projects or any social cause – be it big or small. We aim to bring together generosity with need to maximise people’s potential to do good.

Ketto ( https://www.ketto.org/)

Top Fundraising Platforms for NGO's in India 4

Ketto is another great Platform for Non Profit Origination to start campaigns for Free, on ketto you can raise funds for different causes like :

Fueladream (https://www.fueladream.com/)

Top Fundraising Platforms for NGO's in India 5

Fueladream is crowdfunding platform that is committed to radically changing the lives of 2.2 Bn people in India and Africa . We operate in the donation and rewards space and are building a marketplace for Ideas & Causes that will dramatically alter how we fund what is important to all of us.

Read Our Article

How to Register your NGO in India