Chapter: 2.1 Registration of Public Trusts of the Trust Act

Registration of Public Trusts:
A public trust can be registered as a society under the Societies Registration act. Any seven persons can join together to form a society with memorandum of association and a constitution.

A person called "settler" contributes the initial fund known as trust fund and can appoint original trustees. He can also create a Public Trust. Execution of a non-testamentary document called trust deed is necessary.

Both the above are to be registered within three months of formation.

The Sec. 18 of the Bombay Public Trust Act provides elaborately regarding registration of a public trust.

There is a prescribed format available at the Charity Commissioner's office as per which information has to be provided. A court Fee stamp of Rs. 2 must be affixed to the application. The application has to be signed and solemnly affirmed by the trustees. One of the trustees can be authorized to sign the application and follow up the proceedings. The information required to be given is as follows: -                                                 
(1) The name of the Trust
(2) The names and addresses of the trustees.
(3) The mode of succession to the office of the trustees.(Will the trustees be nominated or elected; and if elected after what period)
(4) The approximate value of movable & immovable property.
(5) Address of the trust.
(6) Gross average annual income of the trust property (based on an average of proceeding three years).
(7) Average annual expenditure.
(8) The objects of the trust.

As regards immovable property, details of location and proof of ownership have to be furnished. The copy of the trust deed has also to accompany the application for registration. In the case of a society to be registered under the Societies Registration Act, the following documents are to be submitted.

(a) The Memorandum of Association
(b) A copy of the rules and regulations (The Constitution)

After the above relevant documents with an application for registration are submitted, the Deputy / Assistant Charity Commissioner will scan and check the documents to ascertain:

•    Whether really a trust exists.
•    What are the objectives of the trust and whether they are charitable?
•    Who are the trustees?
•    What is the source of income for the trust?

After the Deputy / Assistant Charity Commissioner is satisfied about these queries, he passes the order for registering the society / trust and the registration certificate is issued.                                               

In the case of a society, the certificate of a registration of a society is issued first and the certificate of registration as a trust is issued later. Thus a body originally registered as a society gets two registration certificates and two numbers i.e. as a society and as a trust.

All the details submitted by the trustees vide the application for registration is then entered into a register at the Charity Commissioner's office. Any person can get a certified copy of the entries by making a simple application. The register is known as schedule I register.

Change Report

The trustees are under a legal obligation to report to the Charity Commissioner regarding any changes that take place in the entries recorded in schedule I. Thus, if there is a change in

(a) The Trustees.
(b) The trust property / office of the Trust.
(c)The object of the trust.
(d) The rules and regulations.

The trustees must report the change in 90 days to the Deputy / Assistance Charity Commissioner. If any of the trustees make a default in such report it amounts to an offense as per the Sec. 66 of the Bombay Public Trust Act, and the trustees can be penalised.

(a) Change in the trustees:

Any of the trustees may die, resign, disclaim or leave the country for permanently settling abroad.
The composition of the trustee board may change due to periodical elections as per rules and regulations.

(b) The trust property:

The trust may acquire new property or may dispose off / alienate the trust property.

(c) The trust may change its objects by either adding or deleting any of its objects.
(d) There may be changes in the rules and regulations.

In the eventuality of any of the above changes, the trustees are legally bound to report the changes to the Charity Commissioner. Such change reports the changes to the charity Commissioner. Such change report should specify:
•    The nature of the change
•    The reasons of the change
•    Any other remarks

It is also necessary for the trustees to submit necessary and relevant documents in support of the reported changes. If new trustees are to take over from the old trustees, then consent letters from both incoming and outgoing trustees are necessarily to be furnished. If the deletion of the trustees is due to the death of a.trustee, the death certificate should accompany the change report.

If the change is regarding immovable property all particulars regarding the property are to be submitted.                                        
After the change report is received, the Assistant / Deputy Charity Commissioner has to be satisfied about the authenticity and correctness of the change and then amend the entries in Schedule I Register.
The Assistant / Deputy Charity Commissioner has to use his legal discretion. He has to see that reported change is legal.