Trust Registration is done in India by the Trust Act, 1882. The Trust Act, 1882 defines a Trust as “an obligation annexed to the ownership of property and arising out of a confidence reposed in and accepted by the owner, or declared and accepted by him, for the benefit of another or of another and the owner. In simple words it is a transfer of property by the owner to another for the benefit of a third person along with or without himself or a declaration by the owner, to hold the property not for himself and another.” In India, majority of the Trusts are registered as public charitable trust a form of not-for-profit entity. Public Charitable Trusts can be established for a number of purposes, including the social service, education, healthcare, provision of facilities for recreation, and any other object of general public welfare. In this article, we look at the process for Trust Registration in India:
A Trust can be created by any person in India who is competent to contract, having in his/her power any property with is transferable. The person creating the Trust is called the Settlor and the person to whom the property is transferred on trust is called a Trustee. The person for whose benefit the property is transferred is called the beneficiary.
If the property to be transferred to the Trust is immovable, then the Trust must created by the execution of a Trust Deed that is duly registered. In case the Trust is created by the transfer of a movable property, then the Trust can be created by the property owner himself orally or in writing declaring that he would hold the property, not as owner, but as a Trustee for the benefit of some other person(s).