Types of Registrations of A “Charitable & Religious Trust”
Registration of a of A “Charitable & Religious Trust” is primarily required under these two acts:
• Indian Trusts Act,1882
• Registration under Income Tax Act
Other types of registrations associated with a trust, required in certain situations, may be briefly stated as under:
(a) Registration under Public Trusts Act;
(b) Registration under the Foreign Contribution (Regulation) Act.
Procedure for Registration of Trust under the Indian Trusts Act,1882
1. Decide the following:
a) Name of the trust
b) Address of the trust
c) Objects of the trust (Charitable or Religious)
d) One settlor of the trust
e) Two trustees of the trust (minimum)
f) Property of the trust — movable or immovable property (normally a small amount of cash/cheque is given to be the initial property of the trust, in order to save on the stamp duty).
2. Prepare a Trust Deed on stamp paper of the requisite value. The rates of stamp duty varies from state to state. Kindly check the current rate of stamp duty applicable in your state.
3. Requirement for registration of Trust Deed with the Local Registrar under the Indian Trusts Act, 1882:
a) Trust Deed on stamp paper of requisite value.
b) One passport size photograph & copy of the proof of identity of the settlor.
c) One passport size photograph & copy of the proof of identity of each of the two trustees.
d) One passport size photograph & copy of the proof of identity of each of the two witnesses.
e) Signature of settlor on all the pages of the Trust Deed.
t) Witness by two persons on the Trust Deed.
4. Go to the local Registrar and submit the Trust Deed, along with one photocopy, for registration. The photocopy of the Deed should also contain the signature of settlor on all the pages. At the time of registration, the settlor and two witnesses are required to be personally present, along with their identity proof in the original.
5. The Registrar retains the photocopy and returns the original registered copy of the Trust Deed.
Registration under Public Trusts Act
It may be noted that a charitable or religious trust, whether public or private, is not required to obtain registration under the Indian Public Trusts Act .
However, in certain states like Maharashtra and Gujarat there is a Public Trusts Act, which obliges such institutions/trusts to get registered as such under the said Act.
For example, according to the Bombay Public Trusts Act, 1950, all charitable and religious institutions are to be registered as Public Trusts and will come under the supervision of the Charity Commissioner of the State.
For details, the relevant state law on trusts, if any, should be consulted.
Registration under Income-tax Act
Charitable or religious trusts and societies, claiming exemption under Section 11 and 12 of the Income-tax Act are required to obtain registration under the Act.
Private / family trusts are neither allowed such exemption nor, thus, required to seek registration under the Income-tax Act.
Registration under Foreign Contribution (Regulation) Act, 1976
Any society, trust or charitable company, carrying on educational, charitable, religious, economic, cultural or social welfare activities and desirous of receiving any foreign contribution from a foreign source, is required to obtain registration under section 6(1) of the Act.
Any such association which is not registered or which has been denied registration, can receive foreign contribution only alter obtaining prior permission from the Central Government under section 6(1 A) of the Act.