A charitable trust, as the name proposes is the one that works exclusively to elevate people from poverty, incorporate women empowerment in the society, eliminate illiteracy, promote public health and well-being, advance religious practices, and other beneficent purposes. Kind-hearted and humanitarian objectives are not necessarily charitable besides if it is explicitly for the welfare of masses or groups of individuals.

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  • A charitable trust, in contrast to a private foundation, has interminable existence and are spared from laws against perpetuity
  • These are partially or totally excluded from taxes
  • If the motive behind a charitable trust gets impossible to execute, at that point under the legal doctrine of cy près (French for as near as), the court or trustee acting by the majority can pick another motive. This ought to be as close as the first original motive behind the trust


  1. PUBLIC TRUST: This is an express trust which profits the public. The Charitable and Religious Trust Act, 1920, the Religious Endowments Act, 1863, the Charitable Endowments Act, 1890, the Bombay Public Trust Act, 1950 are some acts that control the public trusts.
  2. PRIVATE TRUST: In a private trust, the beneficiaries are narrow and separated into different categories. Like the workers of an organization. Private trusts are governed by the Indian Trusts Act, 1882.


  • An Author-who makes the trust from his/her property 
  • Trustee-the individual liable for trust property 
  • Beneficiary- the one who is profiting by this property
  • Trust Property-the property utilized for the benefits
  • An objective- clear intention for developing of the trust


You could build trust with no composed documentation as there is no requirement for a trust deed. However, it is desirable in some cases, and in a few, it is needed to form a written document. 

Like, in the event of a private trust relating to a fixed property (building), the trust deed is a necessity. However, on account of public trust for immovable property, the deed is desirable.


  • To discharge the author’s sentiments by the means that guarantee public welfare.
  • For claiming tax exemption benefits
  • A trust could guarantee legitimate administration and safeguarding of property 
  • To manage the issues of the provident fund, superannuation fund or gratuity fund, or some other fund comprised to assist the employees. 
  • For the welfare of relatives/family members, who are dependent on the settler of the trust.

Conditions to form a private charitable trust

The most significant condition is for the author to present written/verbal affirmation or by demonstrating the goal for the development of trust (if there is any). In the event that the trust deed is verbal, at that point, the author should simply imply the goal to make the trust. Formal words are not required. Yet, in such a case the author should.

  • Intend to build a trust authoritative in law on himself or to the individual to whom the property is given 
  • Intend to bind a definitive property for the trust
  • Have the aim to profit an individual or a group of people with a certain goal in mind

Conditions to form public trust

The guidelines to build private trust varies from that of the public trust. It is on the grounds that public trust is governed by general law and private trust is administered by the Indian Trusts Act, 1882. Public trust can be made either as a general public or under section 8 of the organization. It appears as a trust when the individuals included are less, normally 1 or 2.

Stepwise procedure for charitable trust

  • Structure a trust document stating the type of trust you want. 
  • Submit the document it to a legal firm or a bank 
  • This record should to likewise specify the name of the settlor, the beneficiaries, the trustees, and the list of the considerable assets trusts would hold.
  • You can then apply for the Permanent Account Number of the trust to open a bank account of its own.
  • You can enroll this trust if there is a transfer of fix/immovable property to this trust.

  As indicated by segment 6 of the Indian Trusts Act, 1882, a trust is made when the author  demonstrates the following by either word or by an act

  • The goal behind the trust 
  • The reason behind the trust 
  • Beneficiaries
  • Trust property 
  • If the author transfers the trust property to the trustee

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