(A Brief Introduction)
1.Definition of Trust. Trust is defined in Section 3 of the Trust
Act, 1882 as an obligation annexed to the ownership of property and arising out
of a confidence reposed in and accepted by the owner, or declared and accepted by
him, for the benefit of another or of another and the owner. In simple words, it
is a transfer of property by the owner to anther for the benefit of a third person
along with or without himself or a declaration by the owner, to hold the property
not for himself but for another or for himself and another.
2.Creation of Trust. A person who creates a trust is called the
Author of the Trust or Settler, the person to whom the property is transferred on
trust is called a Trustee and the person for whose benefits the property is transferred
is called the beneficiary.
3.Deed of Trust. A trust relating to an immovable property
is required to be created by a document and such document must state and contain
five essential things with reasonable certainty namely;
(a) The intention on the part of the author of the trust to create a trust,
(b) The purpose of the trust,
(c) The beneficiary,
(d) The trust property and
(e) The transfer of the property to the trustee.
There cannot be trust without property.
4.Who can create a trust.Any person competent to contract can create
5.Who can be trustee. A trustee can be any person that is, an individual
or a corporate body or corporate sole, capable of holding property and competent
6.Duties liabilities of trustees. The Indian Trust Act, 1882 lays
down the duties, liabilities and powers of a trustee in general. Section 11 to 30
of the Act, prescribes the duties and liabilities.
Format of Trust deed
Note: This is only a draft format and not a format prescribed under any law.
This format can be used with modifications suiting to your requirements wherever
it is necessary. In case of doubt regarding payment of Stamp duty and Registration
fee etc. contact the concerned Sub-Registrar / District Registrar.
Levy of Stamp duty on Trust deed entirely depends on the intention and the
wordings used in the Trust deed. A Trust deed either can be stamped as a settlement
as defined in Section 2 (q) of the Karnataka Stamp Act, 1957, read with Article
48 or as per Article 54 of the Schedule to the Karnataka Stamp Act, 1957 as the
case may be.
Click here for Section 2 (q) of the Karnataka
Stamp Act, 1957.
here for Article 48 and
54 of the Schedule to the Karnataka Stamp Act, 1957
[You can download this Trust deed format]