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Formation of the NGO as Trust

Groups of individuals can also deliver goods to society by forming public charitable trusts. The concept of the trust is generally involving endowment of some property for public utility under certain norms. However, of late, the practice of establishing family or public charitable trusts by sparing certain cash amount for charitable, welfare or religious purposes have also come into vogue. As compared to registered societies, the set up of the trust is not open having a tendency to keep its membership limited and form byelaws suiting to the needs of the trustees (not necessarily on democratic lines); there is also minimum interference of the authorities in its functioning.

Indian Trust Act, 1882 governs private or family trusts although various states have also enacted their own trust acts, for example The Punjab Trust Act; Bombay Public Trust Act, 1950; Madhya Pradesh Public Trust Act, 1951; Rajasthan Public Trust Act, 1959; etc. Therefore, before registration of an NGO as trust the provisions of applicable trust act should be studied by the promoters to suit their needs. Normally the trusts are created by dedicating some property to a charitable purpose, however, some cash fund may also be spared by the trust or trustees for charitable purpose while creating a trust.

The main instrument of declaring a trust is the Trust Deed, which should be made on non-judicial stamp papers pf, prescribed fee and signed by the trustee or trustees for submission to the Registrar concerned. In case of trust the registrar or sub-registrar having authority to register properties has the authority to register the Trust Deed. Therefore, Trust Deed of the proposed Trust may be registered with Tehsildar, or registrar properties and endowment at the district collectorate. In metropolitan cities separate offices of registrar of properties and endowments do function.

The Trust Deed should contain name(s) of the author(s), settler(s) of the trust; the name(s) of the trustee(s); the name(s) if any, of the beneficiary/ies or whether it shall be public at large; name of the trust; address of the trust; objects of the trust; procedure of appointment, removal or replacement of a trustee, their rights, duties and powers, etc; the mode and method of determination of the trust etc.     

The trust Deed in duplicate should be submitted for registration along with proof of addresses of the author(s)/settler(s)/trustee(s) of the trust. The author(s)/settler(s) or all the trustees should sign on all the pages of the Trust Deed before the registrar. If required passport size photos of each of the signatory should also be pasted on the Trust Deed. The registrar is likely to verify credentials of the applicants and check the proof of address, photographs, proof of the registered office, etc.

After completion of the formality a nominal fee will be charged by the registrar (excluding the stamp duty) and after making due marks and signature of the registrar the original copy of the trust Deed will be handed over to the authorised person. For any subsequent amendments in the name and objectives of the registered trust, registration of supplementary deed with the registrar concerned would be required.

 

 

 

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Al-Qura'n Kareem

Hadith Mohammed SAW


 

 

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