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Trust


Appointment of a new trustee

A new trustee can be appointed by

  1. a person nominated for that purpose by the instrument of trust or

  2. author of trust or

  3. surviving or continuing trustees or the trustee for the time being

  4.  legal representatives of the last surviving and continuing trustee or

  5. with the consent of the court, the retiring trustees (if they all retire simultaneously) or the last retiring trustee

  6. by the court if it is impracticable to appoint a new trustee by the aforesaid persons.

A new trustee can be appointed if

  1. any person appointed as trustee disclaims

  2. any trustee dies

  3. any trustee is absent from India for a continuous period of 6 months or leaves India for the purpose of residing abroad

  4. any trustee is declared an insolvent

  5. any trustee desires to be discharged from the trust or refuses to act as trustee or accepts an inconsistent trust

  6. if any trustee, in the opinion of a court becomes unfit or personally incapable to act as a trustee

Extinction and revocation of trusts

A trust gets extinguished under four circumstances:(1) when its purpose is completely fulfilled (2) when its purpose becomes unlawful (3) when the fulfillment of its purpose becomes impossible by destruction of the trust property or otherwise (4) when the trust being revocable is expressly revoked.

Revocation of a private trust

The trust created by will can be revoked at the pleasure of the testator that is, author of the trust who has by his will envisaged the trust. A trust created otherwise can be revoked only in following 3 circumstances:

  1. by the consent of all the beneficiaries if they are of the age of majority and of sound mind and are as well not disqualified by any law

  2. by exercising power of revocation if it is expressly reserved for the author of the trust

  3. at the pleasure of the author of the trust if the trust is for the payment of the debts of the author of the trust and it has not been communicated to the creditors. But no trust can be revoked by the author of the trust so as to defeat or prejudice the acts duly done by the trustees in the execution of trust.

Public, charitable and religious trusts:

  • As regards the public trusts, there is no Central Act applicable in all the States. But various states such as Bihar, Madras, Madhya Pradesh, Orissa, etc, have enacted their own acts prescribing conditions and procedure for the administration of public trusts. These Acts are more or less similar in nature though there may be certain variations.

  • For instance, the Bombay Public Trusts Act, 1950 provides machinery of charity commissioners to regulate the administration of public religious and charitable trusts. It makes registration of all the public religious and charitable trusts including the religious trusts created under Hindu Muslim and Christian personal laws mandatory and prescribes certain norms for the maintenance and audit of budget, and accounts of such trusts and further empowers the charity commissioners to inspect and supervise the property belonging to a public trust and as well the proceedings of the trustees and books of accounts of such a trust.

  • That apart, the act also creates certain restrictions on the investment of public trust money and as well alienation of immovable property of such a trust.



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