Non-profit organisations - how many of them really function?

April 24th, 2008 - 12:00 pm ICT by admin  

By Madhusree Chatterjee
New Delhi, April 24 (IANS) Fake non-profit charitable or social organisations that continue to proliferate often dodge the law as poor monitoring allows them to get away with “irregularities”, says a study on the state of NGOs in Delhi. It found that 84 percent of them in the city were non-operational! Lee Club Francis, a Delhi-based non-profit organisation, was registered as a charitable society in 1973. Seven young enterprising students apparently started it to promote French culture in India, but a police investigation 38 years later found that the organisation does not exist.

Delhi Police initiated criminal proceedings against the club after a complaint was lodged at the Defence Colony police post in the capital.

However, the office of the Registrar of Societies in New Delhi said it was not in a position to act against the club because there was no legal provision in the Society Registration Act, 1860, to crosscheck the existence of a charitable organisation post-registration.

In a letter to the owner of a prime property in the capital’s posh Defence Colony, the Registrar of Societies said: “There is no such provision in the Societies Registration Act to verify the existence of members, residence and signatures etc. of the society members and we have to rely on the documents filed by the society at the time of registration”.

The probe-cum-study “Ground Realities of Charitable Societies Being Registered in Delhi” conducted by the city-based Forum of Charitable Societies in 2008, found that 84 percent of the societies were non-operational.

Forum of Charitable Societies is a regulatory body for charitable organisations.

It also noted that 73 percent of the registered societies in Delhi did not file their returns with the Registrar of Societies, thus violating the Societies Registration Act, and 40 percent were functioning without the mandatory minimum of seven members.

According to the study, Delhi is the only state in India where the registrar of societies cannot take any action against errant charitable organisations.

“The Registrar of Societies in New Delhi is not empowered to act against any societies in case of disputes because Section 13 of the Registration of Societies Act says only a civil court can solve disputes in a registered society. The act, which is 148 years old, has never been amended,” Balwant Singh, Registrar of Societies in Delhi, told IANS.

Lee Club was accused of “forcibly occupying” the premises of a prime property in Defence Colony by furnishing false papers. The property owner, who lodged a police complaint, alleged that the club members had locked the premises for nearly two years and were staying elsewhere.

Papers cite that the club rented out two spaces - one in Nizamuddin West and the other in Defence Colony. But the police report filed in court as evidence said no such society exists at the addresses listed by the respondents. However, the report acknowledges that the “society named Lee Club Francis was registered by the registrar of societies on July 5, 1973″.

The club, according to documents in possession of IANS, boasts of members like Delhi-based author-publisher Urvashi Butalia and senior Indian Administrative Service officer Shamsher Sheriff, who are listed as students in 1973.

Butalia and Sheriff, however, have denied any association with the Lee Club Francis, said A. Puri, owner of the property.

The study further revealed that 30 percent of registered societies were battling internal disputes, 64 percent were starved for funds, 80 percent did not maintain records or hold meetings and 85 percent were involved in profitable or illegal activity.

According to a rough estimate by registrar Singh, there are 61,000 registered societies in New Delhi and nearly 2,500 societies on an average are registered annually.

Alarmed by the rise in cases of money laundering by non-profit groups, the Council for Advancement of People’s Action and Rural Technology blacklisted 769 non-profit organisations countrywide in 2007 because it found that the benefits were not reaching the right people.

(Madhusree Chatterjee can be contacted at

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