Some more info on Trusts
Registration of Trust
Q 1How to form a `Trust'? a) A trust can be formed as per Section 4 of Indian Trust Act 1982 for a lawful purpose;
b) A trust should have a document written and signed by trustees or a sole trustee;
c) A trust can be formed through a will also;
There is no definite form to create a trust. Objectives of the trustee should be clear and unambiguous;
Q 2What are the purposes for which a trust can be formed? Trust cannot be formed for the following purposes under Sec.4 of the Act:
a) Unlawful purposes;
b) Against provisions of Indian Trusts Act 1932 rules made there under;
c) If there are provisions for cheating etc. in the trust;
d) If the trust is intended to cause loss or damage to one's property
Q 3Who can form a trust? The following can form a trust under Sec.7 of the Indian Trusts Act 1882:
a) A person capable of making contract can form a trust;
b) Trust can be formed on behalf of minor with permission of Civil Court.
Q 4What is the stamp duty to be paid for a trust deed? Under Article 54(a) of schedule of the Karnataka Stamp Act 1957, stamp duty is to be paid as bond (Article 12) on the value shown or value of movable or immovable property involved subject to maximum of Rs.500.
Q 5What is the fee for registration of trust deed? As per Article III of table of fees under Karnataka Registration Rules 1965, fee shall be paid at 2 percent on the total of value shown by the trustee or value of movable or immovable property shown in the trust deed, subject to maximum of Rs.500. The document is construed as trust under the provisions of Karnataka Stamp Act, 1957.
Q 6Can a trust be cancelled? A trust can be cancelled on the following grounds as per Sec. 78 of The Indian Trust Act 1882:
a) Trust can be cancelled at the will of the trustees;
b) Trust can be cancelled if there is provision for cancellation in the deed.
c) If author of a trust creates trust for the purpose of repayment of his debt and if this is nor informed to the creditor author can cancel the trust.
Q 7Can the defects in the trust be cured by amendment? Yes, amendment can be made a rectification or supplementary deed.
Pls note : Stamp duty may vary from State to State
Download a model trust deed at :