Complete Guide to Trust Registration in India

In India, a Trust is a legal arrangement where one person known as a settlor or trustor, transfers property or assets to another person, the trustee, to manage for the benefit of a third party - the beneficiary. All the rights, duties and benefits are spelled out in a trust deed which is used while registering the trust.

In most common instances, trusts are created when the settlor / trustor transfers or allocates a specific asset or property to the trustee for the ultimate benefit of a beneficiary. The relation between the parties involved is essential in defining trust.

Trusts are vital business structures created for noble intentions to support the development of sciences, literature, education, healthcare and other worthy causes.

They serve purposes like alleviating scarcity, offering education to those in need, and providing medical assistance and providing medical assistance.

Trust registration is a legal process of officially recognizing a trust under the Trust Act of 1882. This step ensures that the trust is legally acknowledged and can operate within the framework of the law, ensuring its activities are valid and compliant.

The trust registration process involves three main parties:

• Trustor: This is a person who creates a Trust. They are typically the owner of the assets or property being transferred into the trust for a specific purpose.
• Trustee: This person is an individual or an organization responsible for managing and administering the trust. The trust’s properties / assets are held by the Trustee and the decisions about the usage / distribution of such properties / assets are made by the Trustee.
• Beneficiary: This person is the ultimate beneficiary of the trust and are entitled to receive the assets or properties held in the trust according to the terms set out in the trust.

This guide provides a detailed overview of trust registration, including the process, types of trusts, fees, and the necessary documents required for trust registration across various states like Delhi, Maharashtra, Tamil Nadu, and West Bengal.

Types of Trusts in India

Trusts are recognised in India and based on the kind of operations they conduct they are widely categorized into the following types:

• Private Trust: A private trust is created for the benefit of specific individuals, like family members or close associates.

• Public Trust: A public trust is created for the benefit of the public at large, usually for charitable, religious, or educational objectives.

• Charitable Trust: This type of trust is specifically formed for charitable activities, such as providing relief to the poor, promoting education, or advancing religion.

• Religious Trust: A religious trust is typically formed to manage the affairs of a religious institution, such as a mandir (temple) or a mosque.

Trust Registration Process

The process of registering a trust involves several steps, which vary slightly depending on the state in which the trust is being established. The general process for registering a trust in India is as follows:

• Drafting the Trust Deed: The first process in establishing a trust is the drafting of a trust deed, legal document that outlines the following details:

1. The name of the trust

2. Objects of the trust (i.e., its purpose—whether charitable, religious, educational, etc.)

3. The trustees (names of the individuals or body of persons managing the trust)

4. Details of the beneficiaries

5. The address of the trust

6. Any powers or restrictions on the trustees

7. The person who is creating the trust or the individual for whom the trust is being established. 

• Selecting Trustees: At least two trustees are required to incorporate a trust in India. The trustees will be responsible for managing the assets of the trust and carrying out its activities as per the trust deed.

• Registration of the Trust Deed: Once the trust deed is drafted, it must be registered at the local sub-registrar office under the Indian Trusts Act, 1882. The deed must be signed by the settlor and the trustees in the presence of two witnesses. The documents that need to be submitted when registering the trust deed typically includes the following:

1. Original copy of the trust deed

2. PAN card of the trustees

3. Address proof of the trustees (eg. Aadhar, Voter ID, Passport)

4. Identity proof of the trustees (eg. Passport, Aadhar)

5. Photographs of the trustees

6. Proof of trust address (e.g., utility bill, rental agreement)

• Submission of Documents to the Sub-Registrar: Once the trust deed is ready, the necessary documents must be submitted at the sub-registrar office. The trust will be registered after the deed is signed and stamped. A trust registration certificate will be  issued as a proof of registration. 

Trust Registration Certificate

Once the trust deed is registered, the authorities will issue a Trust Registration Certificate. This certificate is proof that the trust has been formally created and recognized by the government. It includes the name of the trust, its registration number, and other important details.

Downloading the Trust Registration Certificate: In some states, you can download the trust registration certificate online by visiting the respective state government’s portal.Alternatively, you can request for the certificate at the local registrar’s office.

Documents Required for Trust Registration

The following documents are typically required for trust registration:

• Trust Deed (Drafted and signed)
• PAN Card of the settlor and trustees
• Address proof of trustees (such as Aadhaar, voter ID, passport)
• Photographs of the trustees
• Identity proof of trustees (such as passport, Aadhaar)
• Proof of the trust address (utility bill, rent agreement)
• Original receipt issued by any Energy Department or other authorized station in case of NOC taken from the property owner
• Income Proof (optional for certain trusts)

Trust Registration Fees

The fees for trust registration in India has mainly the following components: 

• Stamp duty: For a trust deed, stamp duty fee ranges from State to State. It can range from ₹100 to ₹2,000 or more based on the value of the assets or the nature of the trust.

• Registration fees: The registration fee at the local sub-registrar office is typically between ₹100 and ₹500, depending on the state and the nature of the trust.

• Legal fees: If you hire a lawyer or professional to draft the trust deed or assist in the registration process, legal fees may also apply.

Trust Registration Act

The Indian Trusts Act, 1882 governs the registration and administration of trusts in India. This Act lays down guidelines for the creation of trusts, the duties of trustees, and the legal obligations of all parties involved. Additionally, for charitable or religious trusts, the Charitable and Religious Trusts Act (which varies by state) may also be applicable.

How to Check Trust Registration Number

To check the trust registration number, you can either:

• Visit the office of a local sub-registrar where the trust is registered.

• Check online: Some states provide the facility to verify the trust registration number through their official portals.

If the trust registration number is not immediately available, you can always request the information from the registrar office by submitting a formal application.

Trust Registration in Various States

• Trust Registration in Delhi: Trust registration in Delhi is governed  by Delhi Public Trust Act. You can register a trust online or through physical submission of documents at the Registrar's office. The process involves submitting the trust deed, documents of trustees, and the relevant fees.

• Trust Registration in Maharashtra: Maharashtra has its own set of rules under the Bombay Public Trust Act, 1950. A charitable trust must be registered with the Charity Commissioner’s office in Maharashtra. The registration can be done offline at the Commissioner’s office or online.

• Trust Registration in Tamil Nadu: The registration of a trust in Tamil Nadu follows the Indian Trusts Act, 1882 and is managed by the respective sub-registrar offices. If it is a charitable trust then registration at the Charity Commissioner is also required.

• Trust Registration in Uttar Pradesh (UP): In UP, the Trust Registration follows the Indian Trusts Act, 1882, and is handled by the local sub-registrar office. The registration procedure is similar to other states, involving submission of documents, deed drafting, and payment of fees.

• Trust Registration in West Bengal: Trust registration in the West Bengal region is governed by the West Bengal Public Trusts Act, 1964. The Public Charitable Trusts office within the state undertakes the registration of charitable and religious trusts.

Conclusion

Trust registration is a vital step in formalizing the operations of a trust in India, whether it's for charitable purposes, private family matters, or religious activities. By following the necessary steps as outlined herein  and preparing the necessary documents, you can ensure that your trust is legally recognized and it complies with the relevant laws, and enjoys the benefits that come with it.

If you're considering establishing a charitable trust or a mandir trust it's important to consult with a legal professional to ensure the process runs smoothly and meets all legal requirements.

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