Formation of
Charitable Trust
- Introduction
A public charitable or religious institution can be formed either as a Trust or as a Society or as a Company registered u/s 25 of the Companies Act.
It generally takes the form of a trust when it is formed
primarily by one or more persons.
To form a Society at least seven persons are required.
Institutions engaged in promotion of art, culture, commerce etc. are often
registered as non-profit companies.
These forms are enumerated as under :
- Charitable Trust settled by a settlor by a Trust Deed or under a Will.
- Charitable or religious institution / association can be formed as a society.
- Charitable
institution can be formed by registering as a company u/s. 25 of the
Companies Act, 1956, as non profit company (without addition to their
name, the word "Limited" or "Private Limited").
- Who can form a
Charitable or Religious Trust
As per section 7 of the Indian Trusts Act, a trust can be formed –
a.
by
every person competent to contract, and
b.
by
or on behalf of a minor, with the permission of a principal civil court of
original jurisdiction.
but subject in each case to the law for the time being in
force as to the circumstances and extent in and to which the Author of the
Trust may dispose of the Trust property.
A person competent to contract is defined in section 11 of
the Indian Contract Act as a person who is of the age of majority according to
the law to which he is subject and who is of sound mind and is not disqualified
from contracting by any law to which he is subject. Thus, generally speaking,
any person competent to contract and competent to deal with property can form a
trust.
Besides individuals, a body of individuals or an artificial
person such as an association of persons, an institution, a limited company, a
Hindu undivided family through it's karta, can also form a trust.
It may, however, be noted that the Indian Trusts Act does
not apply to public trusts which can be formed by any person under general law.
Under the Hindu Law, any Hindu can create a Hindu endowment and under the
Muslim law, any Muslim can create a public wakf. Public Trusts are essentially
of charitable or religious nature, and can be constituted by any person.
Capacity to create a Trust
As a general rule, any person, who has power of disposition over a property, has capacity to create a trust of such property. According to section 7 of the Transfer of Property Act, 1882, a person who is competent to contract and entitled to transfer the property or authorized to dispose of transferable property not his own, either wholly or in part and either absolutely or conditionally, has 'power of disposition of property'.
As a general rule, any person, who has power of disposition over a property, has capacity to create a trust of such property. According to section 7 of the Transfer of Property Act, 1882, a person who is competent to contract and entitled to transfer the property or authorized to dispose of transferable property not his own, either wholly or in part and either absolutely or conditionally, has 'power of disposition of property'.
Thus, two basic things are required for being capable of forming
a trust –
.
power
of disposition over property; and
a.
competence
to contract.
Who can be a Trustee
Every person capable of holding property can become a trustee. However, where the trust involves the exercise of discretion, he can accept or act as a trustee only if he is competent to contract. No one is bound to accept trusteeship. Any number of persons may be appointed as trustees. However, no trust is defeated for want of a trustee. Where there is no trustee in existence, an official trustee may be appointed by the court and the trust can be administered. An executor of a Will may become a trustee by his dealing with the assets under the provisions of the Will. When an executor is functus officio to any of the assets and yet retains them, he becomes a trustee in respect of those assets.
Every person capable of holding property can become a trustee. However, where the trust involves the exercise of discretion, he can accept or act as a trustee only if he is competent to contract. No one is bound to accept trusteeship. Any number of persons may be appointed as trustees. However, no trust is defeated for want of a trustee. Where there is no trustee in existence, an official trustee may be appointed by the court and the trust can be administered. An executor of a Will may become a trustee by his dealing with the assets under the provisions of the Will. When an executor is functus officio to any of the assets and yet retains them, he becomes a trustee in respect of those assets.
Who can be a Beneficiary
In a private trust the beneficiaries are one or more ascertainable individuals. In a public trust the beneficiaries are a body of uncertain or fluctuating individuals and may consist of a class of the public or the whole public. Generally, a private trust is not a permanent one. But a public trust is of a permanent nature. If properties are dedicated to temples and mosques or gifts are made to religious or charitable institutions they create a trust.
In a private trust the beneficiaries are one or more ascertainable individuals. In a public trust the beneficiaries are a body of uncertain or fluctuating individuals and may consist of a class of the public or the whole public. Generally, a private trust is not a permanent one. But a public trust is of a permanent nature. If properties are dedicated to temples and mosques or gifts are made to religious or charitable institutions they create a trust.
Subject matter of Trust
Any property capable of being transferred can be a subject matter of a trust.
Any property capable of being transferred can be a subject matter of a trust.
Section 8 of the Indian Trust Act, however, provides that
mere beneficial interest under a subsisting trust cannot be made the subject
matter of another trust.
In the case of J.K. Trust vs. CIT (1957) 32 ITR 535
(S.C.), the Supreme Court had held that the word " property"
under the Trusts Act is of the widest import and a business undertaking will
undoubtedly be a property so that a running business can be made a subject
matter of trust. This view has been followed in the case of in CIT vs. P.
Krishna Warriar (1964) 53 ITR 176 (SC).
Business may be a taboo for charitable institution from the
point of view of exemption for income tax purposes. From time to time, the law
has undergone a change as to what business is permitted and under what
circumstances. The present law permits only such business which is incidental
to attainment of the objects of the trust or the institution, subject to the condition
that separate account books are maintained for such business as prescribed
under sub-section 4A of section 11 of I.T. Act.
Requisites of a Trust
0.
The
existence of the author/settlor of the trust or someone at whose instance the
trust comes into existence.
1.
Clear
intention of the author/settlor to create a trust.
2.
Purpose
of the Trust.
3.
The
Trust property
4.
Beneficiaries
of the Trust.
5.
There
must be divesting of the ownership by the author / settlor of the trust in
favour of the beneficiary or the trustee.
Unless all these requisites are fulfilled a trust cannot be
said to have come into existence.
Essentials of a valid Charitable or Religious Trust
There are four essential elements of a valid charitable or
religious trust –
.
Charitable or Religious Object : The object or
purpose of the trust must be a valid religious or charitable purpose according
to law ;
i.
Capacity to create Trust : The founder or
settlor should be capable of creating a trust and dedicating his property to
that trust;
ii.
Certainty of Object and Dedication thereto : The settlor should
indicate precisely the object of the trust and the property in respect of which
it is made. The property should be dedicated to the trust and the owner must
divest himself of the ownership of that property.
iii.
Concurrence with the law : The trust or its
objects must not be opposed to the provisions of any law for the time being in
force.
Instrument of trust – i.e., trust deed
The instrument by which the trust is declared is called instrument of Trust, and is generally known as Trust Deed.
The instrument by which the trust is declared is called instrument of Trust, and is generally known as Trust Deed.
It is well settled that no formal document is necessary to
create a Trust as held in Radha Soami Satsung vs. CIT- (1992) 193 ITR 321
(SC). But for many practical purposes a written instrument becomes
necessary under following cases –
0.
When
the trust is created by a will irrespective of whether the trust is public or
private or it relates to movable or immovable property. This is because as per
Indian Succession Act, a will has to be in writing
1.
When
the trust is created in relation to an immovable property of the value of
Rs.100 and upwards, in case of a private trust. In case of public trusts, a
written trust deed is not mandatory, even in respect of immovable property, but
is optional.
2.
Where
the trust/association is being formed as a society or company, the instrument
of trust; i.e., the memorandum of association, and Rules and Regulations has to
be in writing.
A written trust-deed is always desirable, even if not
required statutorily, due to following benefits :
c.
a
written trust deed is a prima facie evidence of existence of a trust ;
d.
it
facilitates devolution of trust property to the trust;
e.
it
clearly specifies the trust-objectives which enables one to ascertain whether
the trust is charitable or otherwise;
f.
it
is essential for registration of conveyance of immovable property in name of
the Trust;
g.
it
is essential for obtaining registration under the Income-tax Act and claiming
exemption from tax;
h.
it
helps to control, regulate and manage the working and operations of the trust;
i.
it
lays down the procedure for appointment and removal of the trustee(s),
his/their powers, rights and duties; and
j.
it
prescribes the course of action to be followed under any eventuality including
dissolution of the trust.
Types of Instrument of Trust
0.
Trust
deed, where a trust is declared intervivos; i.e., by settling property under
Trust.
1.
A
will, where a trust is declared under a will;
2.
A
memorandum of association along with rules and regulations, when the
association/institution is being formed as a society under the Societies
Registration Act, 1860.
3.
A
memorandum and articles of association where the association /institution is
desired to be formed as a Company.
Trust Deed-Clauses
A person drafting the deed of a public charitable trust has to bear in mind several enactments, particularly the Indian Trusts Act, any local enactment relating to trusts, like the Bombay Public Trusts Act for the State of Maharashtra and the Income tax Act. Such a person has also to keep in mind the relevant judicial pronouncements dealing with the scope of "charitable purpose" and accordingly decide whether a particular purpose is charitable or not. An instrument of Trust
or association/institution created or established should contain inter alia the following clauses:
A person drafting the deed of a public charitable trust has to bear in mind several enactments, particularly the Indian Trusts Act, any local enactment relating to trusts, like the Bombay Public Trusts Act for the State of Maharashtra and the Income tax Act. Such a person has also to keep in mind the relevant judicial pronouncements dealing with the scope of "charitable purpose" and accordingly decide whether a particular purpose is charitable or not. An instrument of Trust
or association/institution created or established should contain inter alia the following clauses:
0.
Nothing
contained in this deed shall be deemed to authorise the trustees to do any act
which may in any way be construed as statutory modifications thereof and all
activities of the trust shall be carried out with a view to benefit the public
at large, without any profit motive and in accordance with the provisions of
the Income-tax Act, 1961 or any statutory modification thereof.
1.
The
trust is hereby expressly declared to be a public charitable trust and all the
provisions of this deed are to be construed accordingly.
The Trust Deed, generally contains the following clauses :
2.
Preamble
3.
Trust
name by which Trust shall be known
4.
Place
were its office shall be situated
5.
Author
or settlor of the trust
6.
Names
of the Trustees
7.
Beneficiaries
8.
The
property settled, for Trust – In case of immovable property, it should contain
full description of the property sufficient to identify it
9.
An
express intention to direct the trust property from the trustees
10.
The
objects of the Trust
11.
Minimum
and maximum number of Trustees
12.
The
procedure for appointment, removal, replacement of trustees
13.
Trustees
rights, duties and powers
14.
Administration
of trust
15.
Provision
for maintenance of accounts, auditing etc.
16.
Clause
enabling, spending and utilization of the Trust funds or corpus.
17.
Bank
Account operations
18.
Borrowing
money on security for the purpose of the Trust
19.
Investment
of the Trust funds and dealing with Trust properties
20.
Alienation
of immovable property of the Trust
21.
Amalgamation
clause
22.
Dissolution
of Trust
23.
Irrevocable
nature of the trust.
Registration of Charitable Trust
0.
Registration of Public Trust (Sec. 18 of Bombay Public Trust
Act)
1.
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It
shall be the duty of the trustee of a public trust to which this Act has been
applied to make an application for the registration of the public trust.
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2.
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Such
application shall be made to the Deputy or Assistant Charity Commissioner of
the region or sub-region within the limits of which the trust has an office
for the administration of the trust or the trust property or substantial
portion of the trust property is situated, as the case may be.
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3.
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Such
application shall be in writing, shall be in such form and accompanied by
such fee as may be prescribed.
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4.
|
The
application shall be made within 3 months of creation of the Public Trust.
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5.
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The
application shall inter alia contain the full detail as prescribed in the
form of Schedule II – (under Rule-6).
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6.
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Every
application made under sub-section (1) shall be signed and verified in the prescribed
manner by the trustee or his agent specially authorized by him in this
behalf. It shall be accompanied by a copy of an instrument of trust, if such
instrument has been executed and is in existence.
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6A.
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Where
on receipt of such application, it is noticed that the application is
incomplete in respect of any particulars, or does not disclose full
particulars of the public trust, the Deputy or Assistant Charity Commissioner
may return the application to the trustee, and direct the trustee to complete
the application in all respects or disclose therein the full particulars of
the trust, and resubmit it within the period specified in such direction; and
it shall be the duty of the trustee to comply with the direction.
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7.
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It
shall also be the duty of the trustee of the public trust to send memorandum
in the prescribed form containing the particulars, including the name and
description of the public trust, relating to the immovable property of such
public trust, to the Sub-Registrar of the sub-district appointed under the
Indian Registration Act, 1908, in which such immoveable property is situated
for the purpose of filing in Book No.I under section 89 of that Act.
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1.
Such
memorandum shall be sent within three months from the date of creation of the
public trust and shall be signed and verified in the prescribed manner by the
trustee or his agent specially authorized by him in this behalf.
2.
When
the Registering Officer is satisfied that the provisions of the Act as
applicable to the document presented for registration have been complied with,
he shall endorse thereon a certificate containing the word
"registered", together with the number and page of the book in which
the document has been copied. Such certificate shall be signed, sealed and dated
by the Registering Officer, and shall then be the conclusive evidence that the
Trust has been duly registered. A registered trust deed shall become operative
(retrospectively) from the date of its execution.
3.
Procedure for registration
The following documents are required to be filed for registration of a Charitable Trust.
The following documents are required to be filed for registration of a Charitable Trust.
1.
Covering
Letter
2.
Application
Form in Form –Schedule II under rule 6 duly notarised
3.
Court
fee stamp of Rs. 2/- to be affixed on application form
4.
Certified
copy of the Trust Deed
5.
Consent
letter of Trustees. (Blank Form enclosed)
The office of the Charity Commissioner maintains a register
containing all details of the Trust; viz., Reg.No., name and address of the
Trust, names of all the Trustees (Past & Present), mode of succession of
Trusteeship objects of the Trust, particulars of documents creating a Trust,
description of movable and immovable properties, particulars of encumbrances on
trust property etc. This register is known as P.T.Register. A certified copy of
the P.T. Registrar in Schedule-I (vide Rule 5) can be obtained by applying in
simple application with Rs.10/- Court fee stamp by paying prescribed fees for
the same. It is advisable for all the trusts to have a certified copy of P.T.
Register entry.
Registration under the Societies Registration Act
Society as a form of charitable institution will be suitable, where a large number of contributors making regular contributions would require some kind of indirect controls by the office bearers. The best examples are professional organizations.
Society as a form of charitable institution will be suitable, where a large number of contributors making regular contributions would require some kind of indirect controls by the office bearers. The best examples are professional organizations.
The Charity Commissioner is also an authority to register
such organizations as a society. When a trust is constituted as a society, it
is required to be registered under the Societies Registration Act, 1860.
After the Memorandum and Rules and Regulations of the
Society have been drafted, signed and witnessed in the prescribed manner, the
members should obtain the registration of the society. For the purpose of
registration as society, following documents are required to be filed :
.
Letter
requesting for registration stating in the body of the letter various documents
annexed to it. The letter is to be signed by all the subscribers to the
Memorandum or by a person duly authorised by all of them to sign on their
behalf.
a.
Memorandum
of Association, in duplicate, neatly typed and pages serially numbered.
b.
Rules
and Regulations in duplicate.
c.
Where
there is a reference to any particular existing places of worship like temple,
mosque, church, etc., sufficient documentary proof establishing legal competence
and control of applicant society over such places should be filed.
d.
An
affidavit of the President or Secretary of the society, on a non-judicial stamp
paper of prescribed value, stating the relationship between the subscribers,
duly attested by an Oath Commissioner, Notary Public or First Class Magistrate.
e.
Documentary
proof of address such as House Tax receipt, rent receipt in respect of premises
shown as Registered Office of the society or no objection certificate from the
landlord of the premises.
If the Registrar is satisfied with the documents filed, he
then requires the applicant society to deposit the registration fee. Normally,
registration fee is Rs. 50, payable in cash or by demand draft. After the
registration formalities have been completed and the Registrar is satisfied
that the provisions of the Act have been complied with, he issues a certificate
of Registration. Certified copies of the Rules and Regulations and Memorandum
can be obtained by making simple application.
An entity registered under the Societies Act also gets
registration under the local Public Trusts Act; i.e., Bombay Public Trusts Act
by making an application simultaneously as mentioned above in case of trust
deed. This is so because the definition of a Public Trust in Bombay Public
Trusts Act includes a " Society " which is registered under the
Societies Registration Act.
Registration under Companies Act
A charitable institution/association can be registered as a non-profit company and obtain a licence u/s 25 of the Companies Act. For obtaining a licence, the association has to first apply for availability of name to the Registrar of Companies of the State in which it wants to get itself registered. The application should be made in Form 1-A and the guidelines issued in this regard should be followed. As soon as the letter of approval of name is received from the Registrar, proceed for incorporation, as follows :
A charitable institution/association can be registered as a non-profit company and obtain a licence u/s 25 of the Companies Act. For obtaining a licence, the association has to first apply for availability of name to the Registrar of Companies of the State in which it wants to get itself registered. The application should be made in Form 1-A and the guidelines issued in this regard should be followed. As soon as the letter of approval of name is received from the Registrar, proceed for incorporation, as follows :
The institution/associations should apply to Regional
Director, Registrar of Companies of the region by a letter along with following
documents.
.
Three
typewritten copies of draft Memorandum and Articles of Association of the
proposed company. No stamp duty is payable.
i.
List
of names, addresses, description and occupation of the promoters in triplicate.
ii.
List
of companies, associations and other institutions in which promoters are
directors or hold responsible positions, with description of positions held.
iii.
List
of members of the proposed board of Directors.
iv.
Declaration
in the prescribed form by an Advocate, Attorney, Pleader, Chartered Accountant
or a whole time practising Company Secretary, on a non-judicial stamp paper of
appropriate value.
v.
Copies
of accounts, balance sheet and reports on working of association for last two
financial years ( for one year only if the association has functioned for less
than two years), in triplicate.
vi.
Statement
of assets and liabilities.
vii.
Sources
of income and estimate of annual income and expenditure.
viii.
A
note on work already done and proposed to be done by the association.
ix.
Grounds
in brief for making application u/s. 25.
x.
Declaration
signed by each of the applicant.
xi.
Certified
copy of notice published in newspaper .
xii.
A
draft or paid treasury challan for requisite fees for registration.
A copy of the application with all enclosures and
accompanying papers should be sent to the Registrar of Companies of the State
where the association proposes to situate its Registered Office.
After the draft Memorandum and Articles have been approved
by the Regional Director, the association should apply to the Registrar of
Companies, for its registration as a company, in Form No.1 along with printed
copies of Memorandum and Articles and other documents necessary for
registration along with a registration fee of Rs. 500/-. The Registrar then issues
a certificate of incorporation.
Registration under Income-tax Act
0.
Charitable
or religious trusts, societies and companies claiming exemption under sections
11 and 12 of the Income-tax Act are required to obtain registration under the
Act. Private/family trusts are neither allowed such exemption nor required to
seek registration under the Income-tax Act. The detailed procedure is as under
:
1.
Registration
of Trust under Income-tax Act procedure for registration u/s. 12AA of I.T. Act.
1.
Application
for registration in Form No.10A in duplicate.
2.
List
of Name and Address of the Trustees
3.
Copy
of Registration Certificate with Charity Commissioner or copy of application to
him.
4.
Certified
True Copy of the Trust Deed.
5.
PAN
No. or Copy of application of the Trust.
6.
PAN
of the trustees.
2.
Procedure for registration (Sec 12AA)
The Commissioner, on receipt of an application for registration of a trust or institution made under clause (a) of section 12A, shall –
The Commissioner, on receipt of an application for registration of a trust or institution made under clause (a) of section 12A, shall –
a.
call
for such documents or information from the trust or institution as he thinks
necessary in order to satisfy himself about the genuineness of activities of
the trust or institution and may also make such inquiries as he may deem
necessary in this behalf; and
b.
after
satisfying himself about the objects of the trust or institution and the
genuineness of its activities he –
i.
shall
pass an order in writing registering the trust or institution;
ii.
shall,
if he is not so satisfied, pass an order in writing refusing to register the
trust or institution,
and a copy of such order shall be sent to the applicant.
3.
Provided
that no order under sub-clause (ii) shall be passed unless the applicant has
been given a reasonable opportunity of being heard.
Registration under Foreign Contribution (Regulation) Act,
1976 (FCRA)
0.
Any
Charitable Trust, Society, Company, desirous of receiving any foreign
contribution from a foreign source, is required to obtain registration under
section 6(1) of FCRA Any such association which is not registered or which has
been denied registration, can receive foreign contribution only after obtaining
prior permission from home ministry of the Central Government under section
6(1A) of the Act.
In order to obtain registration under the Foreign
Contribution (Regulation) Act, (FCRA), the applicant association should
preferably be incorporated as a legal entity, that is, as a Charitable Trust,
Society, or a Company (u/s. 25) and should have been working for a period of at
least three years. The association must not have received any foreign contribution
earlier without prior permission of the Government.
1.
Application
for obtaining permission to accept foreign contribution or hospitality
0.
Every
individual, association, organization or other person, who is required by or
under this Act to obtain the prior permission of the Central Government to
accept any foreign contribution, or foreign hospitality, shall before the
acceptance of any such contribution or hospitality, make an application for
such permission to the Central Government in such form and in such manner as
may prescribed.
1.
If
an application referred to in sub-section (1) is not disposed of within ninety
days from the date of receipt of such application, the permission prayed for in
such application shall, on the expiry of the said period of ninety days, be
deemed to have been granted by the Central Government :
PROVIDED that, where in relation to an application, the
Central Government has informed the applicant the special difficulties by
reason of which his application cannot be disposed of within the said period of
ninety days, such application shall not, until the expiry of a further period
of thirty days, be deemed to have been granted by the Central Government.
An application for obtaining prior permission of the Central
Government to –
a)
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receive
foreign contribution under sub-section (1) of section 5, or clause (a) of
sub-section (2) of that section, shall be made in Form FC-1;
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aa)
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receive
foreign contribution under proviso to sub-section (1) of section 6, or under
sub-section (1A) of that section or clause (b) of section 10, shall be made
in Form FC-1A.
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b)
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accept
foreign hospitality under section 9 or clause (d) of section 10, shall be
made in Form FC-2.
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2.
Application for registration
An application for registration of an association referred to in sub-section (1) of section 6 for acceptance of foreign contribution shall be made in Form FC-8.
An application for registration of an association referred to in sub-section (1) of section 6 for acceptance of foreign contribution shall be made in Form FC-8.
Transfer of Movable Property to Trust
A trust in relation to movable property, can be formed also by mere transfer of ownership of the property to the trustee, with a direction that the property be held under trust for the benefit of the beneficiaries. The ownership of a movable property can be transferred by physical act of handing over the possession of the property. The transfer of any symbol of ownership will be deemed sufficient, such as the key of the godown where the property is stored, or the deposit certificate of a Bank wherein the securities are lodged.
A trust in relation to movable property, can be formed also by mere transfer of ownership of the property to the trustee, with a direction that the property be held under trust for the benefit of the beneficiaries. The ownership of a movable property can be transferred by physical act of handing over the possession of the property. The transfer of any symbol of ownership will be deemed sufficient, such as the key of the godown where the property is stored, or the deposit certificate of a Bank wherein the securities are lodged.
Where the author himself is the trustee, transfer of
possession is neither necessary nor possible; and a mere declaration of the
author that he holds the property under trust would be sufficient to constitute
a trust.
Transfer of Immovable Property to Trust
An immovable property can be transfered to the Trust, either by way of settling the property through a Will or Deed or by way of donating the same to the existing Trust. In all the cases the instrument should be in writing and it should contain complete description of the property so as to clearly identify the property. The title of property should be clear to be transferable to the Trust. It should be free from mortgage and litigation. The instrument by which the immovable property is desired to be introduced to Trust is required to be registered, then only the property can be conveyed in favour of the Trust.
An immovable property can be transfered to the Trust, either by way of settling the property through a Will or Deed or by way of donating the same to the existing Trust. In all the cases the instrument should be in writing and it should contain complete description of the property so as to clearly identify the property. The title of property should be clear to be transferable to the Trust. It should be free from mortgage and litigation. The instrument by which the immovable property is desired to be introduced to Trust is required to be registered, then only the property can be conveyed in favour of the Trust.
An intimation in the form of change report is required to be
sent to the Charity Commissioner so as to record an entry in the P.T.Register.
The entry in this record is conclusive evidence that the particular immovable
property belongs to the Trust. This record contains description and location of
the property and the area of the property. This entry in the P.T. Register is
necessary for the reason that if in future the said property is desired to be
alienated (sold) by the Trust, such an entry is a prerequisite.
A model Trust deed and various forms for registration are
enclosed herewith for ready reference.
MODEL TRUST DEED OF A PUBLIC CHARITABLE
TRUST
THIS
DEED OF TRUST executed on this _______________________ day of __________________
year 20____, _______________________ BETWEEN
__________________________________________ (Party of the first part)
hereinafter called " SETTLOR OF THE TRUST"
________________________________________________________
________________________________________ AND _____________________________________ .
________________________________________ AND _____________________________________ .
1.
SHRI.
S/O. SHRI
, of ____________ &
2.
SHRI.
S/O. SHRI.
, of ____________ &
3.
SMT.
W/O SHRI.
, of ____________
(Hereinafter
called " The Trustees" which expression shall unless repugnant to the
context or meaning thereof be deemed to include the survivors or survivor of them
and the trustees or trustee for the time being of these presents and their
heirs, executors and administrators of the last surviving trustee, their or his
assignees) of the other part;
WHEREAS
the party hereto of the first part is possessed of the sum of Rs. ___________/-
(Rs. __________ Only) as his absolute property and he is desirous of creating a
Religious/ Charitable/Educational Trust for the benefit of the humanity at
large.
AND
WHEREAS each of the parties hereto of the "Other Part" has
individually and jointly has agreed to act as Trustees of the Trust, proposed
by the party of the first part.
AND
WHEREAS nothing contained in this deed shall be deemed to authorize the
trustees to do any act which may in any way be construed statutory
modifications thereof and all activities of the trust shall be carried out with
a view to benefit the public at large, without any profit motive and in
accordance with the provisions of the Income-tax Act, 1961 or any statutory
modification thereof.
AND
WHEREAS the trust is hereby expressly declared to be a public charitable trust
and all the provisions of this deed are to be constituted accordingly.
NOW
THIS INDENTURE WITNESSTH AS FOLLOWS :
- SETTLEMENT
The party of the first part, the settlor, does hereby settle the sum of Rs._______ /- (Rs. __________ only) in Trust, with the name and for the objects hereinafter stated, by delivering the said amount in cash which the party of the other part, the Tustees, have accepted the receipt of which they do hereby acknowledge, to hold the same in and to the Trustees with the powers and obligations as provided hereinafter.
- NAME
The name of the Trust shall be "____________________________".
- PLACE
The principal office of the Trust shall be situated at ______________________ or such other place as the Trustees may from time to time decide. The Trust may also carry on its work at any other place or places, as decided by the Trustees.
- OBJECTS
- Educational – to run, maintain or assist any educational or other institution for coaching, guidance, conselling or vocational training or to grant individual scholarships for poor, deserving and needy students for elementary and higher education.
- Medical – to run, maintain or assist any medical institution, nursing home or clinics or to grant assistance to needy and indigent persons for meeting the cost of medical treatment.
- Relief of the poor – to give financial or other assistance in kind by way of distribution of books, notebooks, cloths, uniforms, or meals for the poor and indigent and to the persons suffer due to natural calamities.
- Other objects of general public utility –
- to acquire property for the sole use for public good by making it available for public purposes as for example, housing a library clinic, crèche and/or as a community ball to be available for public use as training classes, seminars, discourses and other public functions for benefit of the community in general.
- to undertake any other activity incidental to the above activities but which are not inconsistent with the above objects.
PROVIDED the Trust may assist/donate the other TRUST to
carry out the various objects mentioned in the objects clause in such manner
and to the extent the Trustees may decide upon from time to time.
- FUNDS
The Trustees may accept donations, grants, subscriptions, aids or contributions from any person, Government, Local authorities or any other charitable institutions, in cash or in kind including immovable property without any incumbrance, but the Trustees shall not accept any receipt with any condition or terms inconsistent with the objects of the Trusts. While applying such receipts to the objects, the Trustees shall respect the directions, if any, by the granter. Any receipt with specific direction to treat the same as part of the corpus of the Trust or separate fund shall be funded accordingly.
- INVESTMENTS
i.
All
monies, which shall not immediately required for current needs shall be
invested by the Trustees in eligible securities and investments, or in banks.
Such investments shall be in the name of Trust or Trustees.
ii.
That
the trustees shall invest the trust fund, carry on any business with the trust
fund and/or enter into partnership on behalf of the trust, as they may deem
fit.
iii.
That
the trustees shall manage the trust fund and investments thereof as a prudent
man would do the same. They shall recover all outstandings and meet all
recurring and other expenses incurred in the upkeep or management thereof.
iv.
That
the trustees shall receive and hold the income of the trust on behalf and for
the benefit of the beneficiaries under the trust.
POWER OF TRUSTEES
That the trustees shall have the following powers :
That the trustees shall have the following powers :
.
to
manage all the assets and/or properties of the trust including the conduct of
business;
i.
to
appoint employees and to settle the terms of their service, remuneration and
termination;
ii.
to
look into the management of the trust;
iii.
to
invest the funds of the trust, in bank or in the purchase of company shares or
securities or other movable and movable and immovable properties;
iv.
to
sell, alter, vary, transpose or otherwise dispose or alienate the trust
properties or any investment representing the same for consideration and to
reinvest the same;
v.
to
pledge or mortgage the trust properties for raising loans;
vi.
to
open the bank accounts in the name and on behalf of the trust and to operate
the same;
vii.
To
enter into a partnership on behalf of the trust with any other party or
parties;
viii.
To
pay all charges, impositions and other outgoings payable in respect of the
trust properties and also to pay all cost of the incidental to the
administration and management of the trust properties;
ix.
To
file suit on behalf of the trust and to refer to arbitration all actions
proceedings and disputes touching the trust properties and to compromise and
compound the suits filed;
x.
To
accept any gift, donation or contribution in cash or in kind from anyone for
the objects of the trust;
xi.
To
seek legal opinion of lawyers and/or Chartered Accountants as and when
required;
xii.
To
nominate their representatives for any of the aforesaid purposes.
The
number of the trustees shall not be less than two but not more than five.
In
case of any difference between the trustees, the opinion of the minority shall
prevail.
prevail.
Every
trustee will be at liberty to nominate or appoint attorneys or agents and to
delegate all or any of the duties and powers vested in him to such attorney or
agent, and to remove such attorney or agent and reappoint other or others in
his place.
No
trustee shall be responsible or liable for any loss or any act of omission or
commission by his constituted attorney or agent or employees or other trustees
unless occasioned by his wilful neglect or default.
Any
of the trustees may retire on giving one month’s notice in writing to the other
trustee(s).
If
any trustee dies or retires or becomes incapable or unfit to act, the
continuing or surviving trustee or trustees shall appoint a successor in the
place of such trustee.
If
at any time the number of the trustees is less than two, the existing trustee
shall appoint one or more trustees.
Upon
the appointment of a new trustee the trust properties shall vest in the new
trustee jointly with the continuing or surviving trustees, with the duties and
power of the trustees set out hereinabove in this deed.
If
the trust is determined by efflux of time, the corpus of the trust shall be
divided amongst the beneficiaries in the shares as fixed by the trusees.
BANKING ACCOUNT
All income, subscription and pecuniary donations for the general purposes of the Trust and the income, investments and all other moneys from time to time forming part of the general revenue of the Trust shall on the same being received be paid into a banking account with any scheduled bank for the purpose of the Trust. The bank accounts shall be operated by the Managing Trustee along with any one of the remaining Trustees.
All income, subscription and pecuniary donations for the general purposes of the Trust and the income, investments and all other moneys from time to time forming part of the general revenue of the Trust shall on the same being received be paid into a banking account with any scheduled bank for the purpose of the Trust. The bank accounts shall be operated by the Managing Trustee along with any one of the remaining Trustees.
ACCOUNTS AND AUDIT
.
The
Trustee shall keep proper books of account of all the assets, liabilities and
income and expenditure of the Trust and shall prepare an Income and Expenditure
Account and Balance Sheet for every year as on the last day of March.
i.
The
accounts of every year shall be audited by a Chartered Accountant or a firm of
Chartered Accountants who shall be appointed for that purpose by the Trustees
and the audited accounts shall be placed at a meeting of the Trustees, which
shall be held before the end of the succeeding year.
IRREVOCABLE
This Trust is irrevocable.
This Trust is irrevocable.
AMALGAMATION
The trustees may amalgamate the trust with another Charitable Trust or Institution having similar objects with prior permission of the Charity Commissioner/Court/any other law as may be applicable for the time being.
The trustees may amalgamate the trust with another Charitable Trust or Institution having similar objects with prior permission of the Charity Commissioner/Court/any other law as may be applicable for the time being.
WINDING UP
In the event of dissolution or winding up of the Trust the assets remaining as on the date of dissolution shall under no circumstances be distributed amongst the Trustees but the same shall be transferred to some other similar Trust/Organisation whose objects are similar to those of this Trust with the permission of the Charity Commissioner / Court / any other law as may be applicable for the time being.
In the event of dissolution or winding up of the Trust the assets remaining as on the date of dissolution shall under no circumstances be distributed amongst the Trustees but the same shall be transferred to some other similar Trust/Organisation whose objects are similar to those of this Trust with the permission of the Charity Commissioner / Court / any other law as may be applicable for the time being.
The
Trustees shall be indemnified against all losses and liabilities incurred by
them in the execution of the Trust and shall have a lien over the funds and
properties of the Trust for such indemnity.
IN
WITNESS WHEREOF, The Parties hereunto have signed and delivered the presents on
the day and year first hereinabove written.
SETTLOR
WITNESS
:
1. TRUSTEE ____________
1.
2. TRUSTEE ____________
2.
3. TRUSTEE ____________
Form of Application for Registration of
a Public Trust
Schedule II (Vide Rule 6)
Schedule II (Vide Rule 6)
|
To
The Deputy/Assistant Charity Commissioner, ............................................................................ Region/Sub-Region In the matter of Public Trust* .............................................................. ....................................................................................................... |
I
............................................. trustee of the above named public
trust, hereby apply under section 18 of the Bombay Public Trust Act, 1950 for
the Registration of the said public trust.
2.
|
I
submit the following necessary particulars:–
|
|
|||||
|
(ai)
|
The
designation by which the public trust is or shall be known.
(Name of the Public Trust) |
|
||||
|
(i)
|
Names
of the trustees and managers with their addresses
|
|
||||
|
(ii)
|
Mode
of succession to the trusteeship and managership
|
|
||||
|
(iii)
|
Objects
of the trust :
|
|
||||
|
(iv)
|
(a)
|
Particulars
of documents creating the trust
(attach copies) |
|
|||
|
|
(b)
|
Particulars
other than documents about the origin or
creation of the trust. |
|
|||
|
(v)
|
Particulars
of the scheme, if any, relating to the trust
(attach copy). |
|
||||
|
(vi)
|
Movable
property with estimated value of each class
of such property. |
|
||||
|
|
(Note:–
Entries should be made by board description
of classes of such property, e.g., furniture, books, etc., rather than of each individual article. Entry regarding cash should be made only if such cash forms part of the capital of the trust. In the case of scripts give particulars of each security, stock, share and debenture including the number which it bears). |
|
||||
|
(vii)
|
(a)
|
Details
of immovable properties showing the
village or town where situate, along with C. S., Municipal or Survey No., area, assessment or Judi and description of the tenure on which held (attach certified copies of the entries in the Record of Rights, city survey record or municipal record relating to the properties). |
1.
2. 3. |
|||
|
|
(b)
|
Estimated
value of each immovable property:–
|
1.
2. 3. |
|||
|
(viii)
|
Sources
of income of the trust.
|
|
||||
|
(ix)
|
Average
gross annual income:–
|
1.
|
From
Movable:–
|
|||
|
|
|
2.
|
From
Immovable:–
|
|||
|
(x)
|
Average
annual expenditure
|
|
||||
|
(xi)
|
Amount
of average annual expenditure:–
|
|
||||
|
|
(a)
|
on
remuneration to trustees and
manager ..
|
|
|||
|
|
(b)
|
on
establishment and
staff
..
|
|
|||
|
|
(c)
|
on
religious
objects
..
|
|
|||
|
|
(d)
|
on
charitable objects
..
|
|
|||
|
|
(e)
|
on
miscellaneous
items
..
|
|
|||
|
|
(xii)
Particulars of encumbrances, if any on trust Property –
|
|
||||
|
(xiii)
|
Particulars
of title deeds pertaining to trust
property and the names of trustees in possession thereof – |
|
||||
|
(xiv)
|
Remarks,
if any –
|
|
||||
3.
|
Fees
of Rs............................../-
(...............................................) accompanies
|
||||||
4.
|
Any
communication to the trustee or manager in connection with the trust, may be
sent to the following address :–
|
||||||
|
Name
.......................................................
|
||||||
|
Address
....................................................
|
||||||
|
...............................................................
|
||||||
|
|
I,
the above named ............................................. inhabitant
residing at ......................................... do solemnly affirm and
say that what is stated in the above application is true to the best of my
information and belief.
Solemnly
affirmed at .................................. ]
|
|
aforesaid
this ................... day of .............. ]
|
Signature
................................
|
200...
]
|
|
Before me.
|
|
* Give full name and address of the trust.
* If the Wakf or Trust is registered under the old Acts, no fees under 3 are payable.
* If the Wakf or Trust is registered under the old Acts, no fees under 3 are payable.
CONSENT LETTER
To
Deputy
Charity Commissioner/Assistant Charity Commissioner
.............................. Region
.............................. Region
Sir,
Shri
..............................................................................................................................................
(Name of Applicant)
For Charitable Institution/Association/Trust ........................................................................... have applied for registration under B.P.T. Act, 1950, on .................................... The information provided in the application are true, we have not to say anything more than that. We state that a separate notice for the details of the said application is no more necessary. We have no objection for the issue of Registration Certificate in the name of applicant. Please note that.
(Name of Applicant)
For Charitable Institution/Association/Trust ........................................................................... have applied for registration under B.P.T. Act, 1950, on .................................... The information provided in the application are true, we have not to say anything more than that. We state that a separate notice for the details of the said application is no more necessary. We have no objection for the issue of Registration Certificate in the name of applicant. Please note that.
|
Name
of other trustees
(including the applicant) |
Signature |
1.
|
....................
|
.................
|
2.
|
....................
|
....................
|
3.
|
....................
|
....................
|
4.
|
....................
|
....................
|
5.
|
....................
|
....................
|
6.
|
....................
|
....................
|
7.
|
....................
|
....................
|
I
know all the above said signatories.
|
||
|
|
(Applicant
Sign.)
|
|
|
|
|
|
Date
:
|
Descriptive Clauses Zulfiqar; Thanks for Sharing it! Very Comprhensive Clauses for Private trust deed agreement!
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