Draft Detailed Project Report
Rohtak
Rohtak
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Technology Centre Systems Program – <strong>Draft</strong> DPR for New TC at Rohtak<br />
Governance structure<br />
Selection of the Governance Model for the new TCs<br />
All the existing 18 TCs have been set up under the Societies Registration Act, 1860. The management<br />
of affairs mainly rest with the Governing Council constituted by MoMSME, Government of India with<br />
the Additional Secretary and Development Commissioner of Ministry of Micro, Small and Medium<br />
scale Enterprises (DC-MSME) acting as the President of the Society and Chairman of the Governing<br />
Council (GC).<br />
This arrangement has proved effective as most TCs have supported local MSMEs well and have<br />
performed financially. Each TC has a separate society and has very decentralised authority and<br />
governance structure. DC, MSME being chairman and other two members Director –Tool Room and<br />
representative of IF-wing of MoMSME are common members in all 18 GCs.<br />
During the study and preparation phase of this DPR, we analysed different governance models for<br />
the new TCs. Under Indian law, there are three legal forms that exist for non-profit organisations.<br />
Mainly two forms are relevant for the purpose of the TCSP Program.<br />
► Society as per society Registration Act, 1860<br />
► Section 25 companies as per Companies Act, 1956<br />
The two forms mentioned above have distinguishing features as per their respective acts.<br />
Table 21: Comparison of Society Registration Act and Companies Act<br />
Features Registered Society Not-for-profit Company u/s 25<br />
Setting up and running<br />
cost<br />
Nominal<br />
Comparatively more than the<br />
society & trust<br />
Formation Simple Takes 2-3 months, required to<br />
comply with provisions of<br />
Companies Act<br />
Jurisdiction Registrar of society Registrar of companies<br />
Meetings<br />
Governance<br />
Annual Meeting As per Law.<br />
Governing Body meeting as per<br />
the rules of Society.<br />
Vests with governing body as per<br />
the rules framed by them. Law<br />
specifies no rules & regulation<br />
Quite Extensive as per the<br />
provision of Company Law<br />
Vests with Board of directors &<br />
management committee.<br />
Specific provisions for quorum,<br />
adoption, ratification and<br />
compliance<br />
Membership transfer Impossible Free or control as per desire<br />
Statutory Regulations Limited Exhaustive<br />
Transparency<br />
Transparent<br />
(As society act is not so<br />
exhaustive requiring statutory<br />
Fully Transparent<br />
(The Companies Law is quite<br />
exhaustive requires specific
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