Trust property transfer to another trust
Querist :
Anonymous
(Querist) 23 October 2024
This query is : Resolved
AN IGNORANT PERSON HAS CREATED A NINE MEMBERS PUBLIC TRUST WITH ABOUT 30 OBJECTIVES ,AND WITH AUTOCRATIC POWERS AS ITS PRESIDENT , AND POWERS VESTED WITH HIM LIKE IN A PRIVATE TRUST . WITH PUBLIC DONATIONS THIS TRUST HAS PURCHASED A VACANT SITE WORTH RS ONE CRORE . SEVEN OF THE TRUSTEES SUSPECT THE ABOVE PRESIDENT AS UNTRUSTWORTHY . IN CASE OF AMENDMENT ALL THE CLAUSES HAVE TO BE REPLACED. HENCE THEY WANT TO CREATE A NEW TRUST WITH FIVE SIMILAR OBJECTS AND GET THIS PROPERTY TRANSFERRED TO THE NEW TRUST . THE OLD TRUST PRESIDENT HAS ALSO REALISED HIS MISTAKE AND IS AGREEING TO THE TRANSFER OF THE PROPERTY TO THE NEW TRUST . WHAT IS THE PROCEDURE TO BE ADOPTED IN THIS CASE .
WHAT IS THE MINIMUM AND MAXIMUM NUMBER OF TRUSTEES IN A TRUST ? IS IT BETTER TO BE RUN BY A MANAGING TRUSTEE OR BY A TEAM OF OFFICE BEARERS ? IF WITH JUST FIVE TRUSTEES HOW TO CONDUCT AN ELECTION ?
T. Kalaiselvan, Advocate
(Expert) 23 October 2024
public trust can be dissolved and its assets transferred to a new trust in a few ways:
Revocation: The trust is explicitly revoked, and the assets and liabilities are transferred to a similar charitable trust. The trust can then be dissolved after seeking permission from the charity commissioner or income tax authority.
Trust purpose is fulfilled: The trust can be dissolved if its purpose is completely fulfilled.
Trust purpose becomes unlawful: The trust can be dissolved if its purpose becomes unlawful.
Trust purpose becomes impossible: The trust can be dissolved if it becomes impossible to fulfill its purpose, for example, if the trust property is destroyed.
Once a trust is dissolved, the responsibilities of the trustees end and the trust property is distributed according to the trust's terms or legal requirements.
minimum of two trustees are required to form a public trust in India:
Trust deed
The trust deed is the main instrument of a public charitable trust. It should specify the minimum and maximum number of trustees, as well as the trust's aims, objects, and management structure.
Trustees
The trustees collectively govern the trust and are known as the Board of Trustees. There is no limit to the maximum number of trustees, but the trust must determine the maximum number it can have.
Registration
The trust must be registered with the respective state authority. The Registrar of Trusts is the primary regulatory authority for trust registration.
Querist :
Anonymous
(Querist) 23 October 2024
CAN THE PROPERTY OF THE EXISTING TRUST BE TRANSFERRED TO THE NEW TRUST BY A REGD. DEED, OR TO BE DONE AFTER THE DISSOLUTION ?
WHICH IS BETTER THE OFFICE BEARERS OR A MANANGING TRUSTEE ?
P. Venu
(Expert) 24 October 2024
You have posted more of opinions than facts. Please confine the query, if at all any, to facts highlighting the real issue, if any.
kavksatyanarayana
(Expert) 24 October 2024
Before the dissolution of the Trust, the trustees with a majority, as noted in the deed, shall approve dissolving the trust and transferring its assets to another trust having similar aims and objects. Similarly, the new trust members/trustees shall approve in the meeting handing over the assets of another trust with the permission of the Income Tax Commissioner for both trusts.
Querist :
Anonymous
(Querist) 25 October 2024
MY PROFOUND THANKS TO YOU MR. SATYANARAYANA ,
I UNDERSTAND THAT AFTER THE FORMATION OF THE NEW TRUST THEY MUST PASS A RESOLUTION TO ACQUIRING THE PROPERTY FROM THE OTHER TRUST . IS IT TO BE WORDED AS JUST A TRANSFER ? OR AS ACQUISITION BECAUSE OF DISSOUTION OF THE OLD TRUST.
IN A SEVEN MEMBER TRUST , IS IT BETTER TO HAVE A MANAGING TRUSTEE OR TO HAVE A TEAM OF OFFICE BEARERS . IN CASE OF THE LATTER HOW TO CONDUCT THE ELECTION ?
kavksatyanarayana
(Expert) 25 October 2024
It is a transfer from one trust to another. The managing trustees or office bearers are the same. As noted in the dee, the trustees shall approve the resolution with a majority.
