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Creation of a Valid Charitable or Religious Trust

While creating a trust, the author of the trust should remember a few essential characteristics of charitable trusts. Section 6 of the Indian Trusts Act, 1882 lays down, for the purposes of creation of valid private trust, that a trust is created when the author of the trust indicates with reasonable certainty by any words or acts (i) an intention on his part to create thereby trust (ii) the purpose of the trust (iii) the beneficiary; and (iv) the trust property and transfers the trust property to the trustees. The provisions of the Indian Trusts Act, 1882 do not apply to public trusts. However, these certainties are also required to be present for the creation of a public trust as held by the Supreme Court in CIT vs. Thakur Das Bhargava (1960) 40 ITR 301 (SC) : TC 38R.759.


The Rajasthan High Court in Laxminarain Lath Trusts vs. CIT (1987) 65 CTR (Raj) 91: (1988) 170 ITR 375 (Raj) : .TC 23R.763 observed that although the provisions of the Indian Trusts Act as such are not applicable to public trusts in view of section 1 of the Indian Trusts Act, 1882, the principles underlying them, being based on general principles or rules of English law, are applied by the Courts to public trusts also. It further observed that in respect of charities, the Courts apply the doctrine of cy-pres which envisages that where a clear charitable intention is expressed, it will not be permitted to fail because the mode, if specified, cannot be executed and the law will substitute another mode cy-pres, i.e. as nearly as possible to the mode specified by the donor; the said doctrine is applied on the principle that the Court would lean in favor of charity.

What is ‘Charitable Purpose’ for Income Tax Purposes ?  [Sec. 2(15)]
Laws Applicable to Charitable Institutions/Trusts
Provisions Relating to Anonymous Donations & Gifts [ Sec. 11 5BBC ]
Formation Of A ‘Charitable & Religious Trust’
TRUST DEED of A ‘Charitable & Religious Trust’
Practical Tips on Drafting of Trust Deed of A ‘Charitable & Religious Trust’
Need for Registration of A “Charitable & Religious Trust”
Types of Registrations of A “Charitable & Religious Trust”
Procedure for Registration of Trust under the Indian Trusts Act, 1882
Registration of Trust under Sections 11 & 12 of the Income Tax Act, 1961
Cancellation of Registration of A “Charitable & Religious Trust”
Belated Filing of Application for Registration of A “Charitable & Religious Trust”
Practical Problem on Registration of a ‘Trust’ U/s. 12A
Creation of a Valid Charitable or Religious Trust
Income Tax Provisions For A “Charitable & Religious Trust”
‘Exemption’ Provisions For A “Charitable & Religious Trust”
Approval Of “Trust”  U/S 80G Of The Income Tax  Act. To Give Some Benefits To Its Donors.
Deduction To A Trust U/s 35AC
Power Of The ‘Trustees’ Of ‘Trust’
[Section 2(15)] : Exemption of Income of a Charitable & Religious Trust
[Section 11(2)] :      Accumulation or Setting Apart of the Trust Income for a Specific Purpose
[Section 11(4)] : Income from Business Undertaking of Property held under ‘Charitable Trust’ in Excess of the Income Shown in the Account
[Section 11(5)] : Forms or Modes of Money Accumulated or Set Apart of Trust Income Invested or Deposited
Trust Partly for Charitable or Religious Purpose and Partly for Other Purposes
[Section 11(1A)] : Capitai Gains Of The Trust For Charitable Purposes
[Section 12] : Income Of Religious Trusts Or Institutions From Voluntary Contributions
[Section 12AA] : Procedure For Registration Of A Trust Or Institution
[Section 13] : Income Of Charitable Or Religious Trust Does Not Qualify for Exemption u/s 11 or 12
Electoral Trusts Scheme, 2013 (Vide Not.No. SO. 309(E), dated 31.01.2013)
Functions Of Electoral Trusts - ET [Rule 17CA] [Vide Not.No. SO. 308(E), dated 31.01.20131.]
Important Points To Be Consider While Filing The Return Of A Charitable Trust Or Religious Institution:
Private Charitable Or Religious Trusts  ( Sections 161, 164 & 166 )
[Section 164(1)]: Where Shares Of The Beneficiaries Of a Private Discretionary Trust Are Indeterminate Or Unknown :
Property held under Trust Partly For Religious Purposes And Partly For Other Purposes :
ORAL TRUST [Sections 160(1)(v) and 164A ]
[Section. 167B] : Association Of Persons (AOP) And Body Of Individuals (BOI)
Tax Rates applied on Charitable or Religious Trusts
[Section-67A] :  Method Of Computing A Members Share In Income Of Association Of Persons (AOP) Or Body Of Individuals (BOI)
Provisions to Securitisation Trusts [As introduced by the Finance Act, 2013]
Definition of ‘Securitization Trusts’ as per SARFAESI Act.
Definition of ‘Securitization Trusts’ as per the SEBI Regulations
Definition of ‘Securitization Trusts’ as per the RBI Guidelines
Provisions relating to Tax on Distributed Income by Securitisation Trust
BUSINESS TRUSTS – Meaning & Provisions
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