MEANING OF TRUST
Non- Governmental Organisations come under not-for-profit organisations and form a significant part of these kinds of organisations. NGOs are known for devoting or giving their funds for public welfare. It is significant to know that Trusts, Societies and Sec. 8 Companies are the three common forms of not-for-profit organisations. An individual is free to choose among these three as per his/her areas of interest. When it comes to NGOs as tr0usts, they are noticeably the oldest form of charitable organisations. The trusts can be private or public. Private Trusts involve a very small group or set of known individuals and are established with the purpose to benefit the family members. These trusts are governed and directed by Indian Trusts Act, 1882. The best part about the trusts is that they are very easy to form and run. In a trust, the donors donate the money in accordance with the objectives mentioned in the trust deed of the company.
NGO as Trust: Features or Characteristics
- Indian Trusts Act, 1882 administers the private trusts whereas public trusts are directed by the common law except in Maharashtra and Gujarat where public trusts are governed by Bombay Public Trusts Act, 1950.
- There is no upper limit for the trustees but minimum two trustees are always required for the purpose of registration.
- In order to form a public trust, trust deed is the main document that is required.
- Execution of trust deed in the trusts is done with a non-judicial stamp paper of prescribed value.
Trust Acts and Trust Deed
It is to be noted that different states in India follow different Trusts Acts in force. However, in the absence of a Trusts Act in any state or territory, general principles of the Indian Trusts Act 1882 are followed or applied. In public charitable trusts, the main instrument is the trust deed and it is important that aims and objectives of the trust should be clearly specified in the trust deed. Trust deed refers to the formal document which defines or outlines the terms of a trust agreement. The trust deed should tell about the procedure to be followed for the management of the trust along with the procedure of appointing or removing the members. Both the settlor and trustee should sign the trust deed in the existence of two witnesses.
REQUIREMENT FOR REGISTRATION OF TRUST DEED
1. Stamp Duty @3% on the Amount of Contribution. The Stamp Paper shall be in the name of Trust.
2. Demand Draft of Rs. 1,100 from bank account of Trustees
3. NOC on affidavit of Rs. 10 from the owner for the use of premises and any address Proof like utility Bill.
4. 2 Photographs of each of the Trustees & Settler / beneficiary
5. Aadhar Card of beneficiary.
6. If only receipt of Addhar Card is Available than any other proof of identity along with that receipt.
7. Settler / beneficiary shall be Physically Present.
8. Two Witnesses with their Identity Proof.(who shall bring in original also)
9. Signed Address Proof & Identity Proof of Trustees.
10. Principal office of Trust shall not be in unauthorized colony. This shall be ascertained prior to Drafting of Trust Deed by Providing Khasra No. and Village No. in advance so that it may be ascertained first.
11. Khasra No. of the Property shall also be written in Trust Deed.