Trust: The public charitable trust is a possible form of nonprofit entity in

India. Typically, public charitable trusts can be established for a number of

purposes, including the relief of poverty, education, medical relief, provision
of facilities for recreation, and any other object of general public utility.
Indian public trusts are generally irrevocable.
No national law (except the broad principles of the India Trusts Act 1882,
which governs private trusts) governs public charitable trusts in India,
although many states (particularly like Maharashtra, Gujarat, Rajasthan, and
Madhya Pradesh) have Public Trusts Acts. Public charitable trusts, as
distinguished from private trusts, are designed to benefit members of an
uncertain and fluctuating class. In determining whether a trust is public or
private, the key question is whether the class to be benefited constitutes a
substantial segment of the public. There is no central law governing public
charitable trusts, although most states have "Public Trusts Acts."
Typically, a public charitable trust must register with the office of the Charity
Commissioner having jurisdiction over the trust (generally the Charity
Commissioner of the state in which the trustees register the trust) in order to
be eligible to apply for tax-exemption.
In general, trusts may register for one or more of the following purposes:
Relief of poverty or distress / Education / Medical relief / Provision for
facilities for recreation or other leisure -time occupation (including assistance
for such provision), if the facilities are provided in the interest of social
welfare and public benefit.
At least two trustees are required to register a public charitable trust. In
general, Indian citizens serve as trustees, although there is no prohibition
against non-natural legal persons or foreigners serving in this capacity. Legal
title of the property of a public charitable trust vests in the trustees. Trustees
of a public charitable trust may not, however, in any way use trust property
or their position for their own interest or private advantage. Trustees may
not enter into agreements in which they may have a personal interest that
conflicts or may possibly conflict with the interests of the beneficiaries of the
trust (whose interests the trustees are bound to protect). Trustees may not
delegate any of their duties, functions or powers to a co-trustee or any other
person, except that trustees may delegate ministerial acts. In essence,
trustees may not delegate authority with respect to duties requiring the
exercise of discretion.
Trustees of religious or charitable trusts are charged with discharging their
duties with the degree of care that an ordinarily prudent person would
exercise with respect to his personal property. This is a slight variant on the
duty of care applicable in many U.S. jurisdictions, which requires directors
and officers to act with the degree of diligence, care and skill that ordinarily
prudent persons would exercise under similar circumstances in like positions
(as opposed to in the management of their personal affairs).
Public charitable trusts are highly regulated. For instance, in many states,
the Charity Commissioner must approve purchases or sales of immovable
property by a trust or taking a loan in advance. Indian public charitable
trusts are generally irrevocable. If a trust becomes inactive due to the
negligence of its trustees, the Charity Commissioner may take steps to
revive the trust. Furthermore, if it becomes too difficult to carry out the
objects of a trust, the doctrine of cypres, meaning "as near as possible," may
be applied to change the objects of the trust.

How to register a public charitable trust?

1. Trust registration is created with a document named Trust deed. ( Trust
Deed which may be shaped to registered with a stamp duty paper in the
Registrar office as per the Registration Act.) Model Trust deeds for Charitable
Trust and several other types of trust are Formation and Management of NGOs: Non
Governmental Organisations available here, which you can buy online
2. Trust is created by the Founder (author or settler) with the trust of
Trustees (who are the body of Trust)
3. Trust shall be created under irrevocable nature.
4. Trust deed : This another book which can help to form trust deed Formation
and Management of NGOs (Non Governmental Organisations) which consists of objects
of the trust, Operation of Trust, Trustee information, Trustee powers, rights,
duties and liabilities. But better choose the first NGO book above which may
be more comfortable
5. There are some procedures in creation of a trust deed. Charted
accountants (Auditors) and Lawyers (Attorney) shall help you for creation of
Trust deed. After creation of Trust deed, That organization TRUST shall be
registered with the Registrar or Sub-registrar office as per the laws relevant
to the specific states.
6. After the registration of trust, you shall get the copy of the registration
from the Registrar and you shall apply for PAN card, and you have to apply
for proper Income tax registration with Income tax department ( Here the 12
A plays the role). You shall buy the Income Tax for NGOs book here.
7. After you have properly got the Income tax certificate for the Trust (12A),
you can also apply for tax exemption certificates like 80g, 35ac and so many
other forms of income tax exemption as per the objects of your trust and as
per the applicable rules. You shall buy Tax related books in below Links
8. A trust shall be a public charitable trust or Private trust. Public charitable
trust is able to raise funds from public to serve the social causes of the
nation.
9. A trust must be registered whether with movable or immovable properties.
10. Trust should be registered with a "Registered office address of the trust"
with proper landmarks.
11. A Trust shall be registered by the founder only with the minimum of 2
members.
So in this way you can understand how to form a trust. If you like to know
more details about the Indian laws and regulations of Trust, you shall buy
the book in any nearby law book stall in your city or town, which is named "
Formation & Management of a Trust along with Tax Planning 1996-97 ",
which is a Practical Handbook for Private, Charitable & Religious Trust which
was published by A NABHI PUBLICATION. The another recent NGO book will
also be most useful to know more about trust, which is published by
Universal Law Publishing Co. Pvt. Ltd, which has the book name as "
Formation and Management of NGOs " written by Anita Abraham, Advocate.
In all law book shops these above two books are available.
TRUST Registration Explained once more:
Trust are formed under a Trust deed and registered with Registrar office and
Income Tax Authority. In general a Trust deed will be created (Trust bye-law
or instrument of trust) with the objects of Trust.
Trust deeds are created and declared either by will or inter-vivos by
agreement and as testamentary instrument or a non testamentary
instrument. Some type of trust may be created even verbally. However, it's
advisable to have written trust deed. The basic need of a trust deed is must
to be in writing and registered with the Registrar of the Trust ( In local
Registrar office or as per the law related to Trust), which is the only prima
facie evidence for the existence of trust It also simplifies devolution of trust
property. The written trust and trust deed is the essential for registration
towards conveyance of Immovable property. It helps to claim income tax
exemption as per Income tax act. It is useful to control, regulate and
manage the works and operations of the trust. It spells several procedures
for appointment and removal of the trustees, and their powers, rights and
duties. That is, a Trust is created in written by a will which is related to
movable or immovable property, whether it may be a public or private trust,
duly registered with Registrar of local office and Income tax department.