Trust Deed | Registration of Trust

You can trust us to draw up your trust deed. The team at legal conclave will be more than happy to make sure your trust deed is in order so that someone who wishes to create a trust for the beneficiaries can do so with the least possible legal headache. You want to create a trust deed but the legal protocols sometimes take longer so it puts people off from taking this step. Legal conclave gives you the chance to let us draw up your trust deed and create a trust for worthy beneficiaries.




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What is Trust Deed?

A deed in a legal sense means a legal document executed between parties. Deed is mode to transfer the property from one person to another. A trust deed is one of those; a trust deed indicates a nexus wherein there is the ‘Author/creator/settler’ of the trust deed, a person who is appointed as a trustee, to whom the property is transferred, and the person who is a ‘beneficiary’ who gains the interests . The foundation on which the trustee is appointed, itself qualifies as TRUST. The main idea behind a person transferring or disposing his certain property or assets itself is to protect and preserve it or either to extend benefits to the beneficiary. The term beneficiary for the purposes of a trust deed includes, minors, as they themselves cannot protect their interests and even private trust can be set up to invoke the viabilities of beneficiaries for an entire family. The law that governs trusts and trusts deed is Indian Trusts Act, 1882.

It is essential to note that, the author of the deed must be a major and totally sane and sound. Similarly, the trustee also must be a person above the age of 18 years, along with it must be of sound mind and not an insolvent. The trustee may, at his discretion under reasonable realm reject his trusteeship. The object of the trust shall always be legal, shall not be opposed to public policy. The total crux is that the trustee shall be trustworthy, because it is him to whom the property stands transferred, per se.

Essentials of creating a valid trust deed

A trust deed should include:

  • A valid name for the Trust
  • A valid address for the Trust
  • Name of the Author
  • Name of Trustee/s
  • Nature of the property being movable or immovable
  • The purpose of the Trust deed should be legal and not against any law time being in force.

Various types of trusts

  • Simple Trust – Simple trusts are those where the trustee does not have much activity involves; he merely bears the tag of trustee.
  • Private trust: Private trusts are those when the author creates it for a number of individuals as its beneficiary, example- family.
  • Special Trust: Special trusts are those, wherein the trustee actively plays role in the management process, to execute the deed repeatedly.
  • Public Trust: Public trusts are those, which are mostly charitable in nature and aimed at society as a whole as a beneficiary.
  • Express Trust: Express trusts are those, which expressly decide and create the fate of the deed.
  • Implied Trust: Implied trusts are those, which operates on the assumption and intent as to the fact for which the trust was created.
Procedure to make a valid trust deed

Trust deed is also a legal instrument, which is created by the settler or the author of such deed, who has an intention to transfer the property to the trustee to manage it and to take care of it for the beneficial interests of the Beneficiary. A trust deed could be made for, charitable purposes, will, protection of the property etc.

  • A draft of the Trust deed must be created with bearing in mind all the loops, it must bear the title as TRUST DEED. It should be clear and precise and shall constitute all the intentions of the Author.
  • There should be at least two Trustees for its creation and execution.
  • Such draft of trust deed must be printed on a Stamp paper of prescribed value.
  • Such deed must bear the signature of the Author along with that of the two Trustees‘s signatures.
  • The trust deed must also be signed and attested by Two Witnesses.
  • The trust deed in the end has to be registered in the Sub-Registrar office paying appropriate registration charges.

A trust of immoveable property can be created by two ways either by Non-testamentary document or by Testamentary document, such as will. A trust deed regarding an immovable property must be registered and cannot be made orally, whereas a trust deed for a movable property may be made by a document or by delivery of that movable property. The whole and sole difference between trust and will is that the trust deed can be achieved, performed, and executed even while the author is alive, whereas the Will only comes into effect when the author is dead. A trust deed must not be fraudulent and when a part of the trust becomes unlawful and may not severe and it may render the legal document or any such document/ deed to that regards, void. A minor after attaining majority, may reject the beneficial interests and such property then goes to the Government.