Trust and society A Seminar presentation Bhadeliya Tinkal Dineshbhai Roll No. 04 M.Com Sem -2 Presented to: Dr. Daksha Pratapsinh

Overview Introduction Trust Meaning of Trust Recommendation Essentials of Trust Benefit of Trust Limitation of Trust Society Definition of Society Formation of Society Different between trust and society Conclusion

Trust and Society There are three ways to establish a non –profit organization or charitable institution in India. Either it can be registered as Trust or Society or a section 25 company. It is very often argued that which one is the best mode to operate on Indian soil. There is no distinction in the eyes of income tax Department in term of 80G certificates. We have made a detailed study on the basis of advantage, limitation, benefits and ease of process.

Trust A public charitable trust is usually floated when there is a property involved, especially in terms of immovable property like land and building. If a person wishes to set apart either property or money for a charitable purpose, so that the revenue may be devoted for the accomplishment of the charitable activity, and wants to limit control over the disposal of that income to persons whom he knows or approved, then it is best to set up a public charitable trust. But it should be kept in mind that a private trust whose beneficiaries generally are relatives or friend and not society at large, does not enjoy tax benefits .

Meaning “Trust is a general word implying the obligations towards others when some one holds cash or movable or immovable property on behalf of others. It is the fiduciary relationship between person and trustee.” “A trust is an obligation annexed to the ownership of property and arising out of ownership of property and arising out of confidence reposed in and accepted by the owner or declared and accepted by him for the benefit of another or of another and owner.”

Different states have their separate laws for formation of Trust Different states have their separate laws for formation of Trust. In absence of specific state laws. Indian Trust Act.1882 is applicable for example: A public charitable trust can be set up under the Bombay public charitable Trusts Act 1950 in Maharashtra or Gujarat . Else where in the country it can be set up under Indian trusts Act by registration of the trust deed with the registrar. should be formed only when one wishes to make an endowment of property for perpetuity and the trustee’s desire that this property be used only for specified charitable purposes with close control by the original settlers/trustees.

Recommendations A public Charitable trust should be formed only when one wishes to make an endowment of property for perpetuity and the trustee’s desire that this property be used only for specified charitable purposes with close control by the original settlers/trustees.

Essentials of trust Name of author Trust is an obligation Obligation is annexed to the property Movable-immovable property Confidence Acceptance of confidence Name of at least three prospective Name of trust Trust property Address of registered office of trust Main objective of trust /beneficiary details Instrument of trust or trust deed.

Benefits of Trust The trust deed is the heart and soul of any charitable trust and it enshrines the aims and objectives and mode of management of the trust. The management rests with the board of trustee who can remain so for life and need not stand for election changes in the composition of the board are usually by invitation and not election. This ensures that the trust is managed by those permitted by the original contributors who cannot be removed by election. Therefore danger of take over by persons not approved by the trustees or settler is less.

Limitations of Trust The main disadvantage is that the alteration of the objects laid down in the trust deed is difficult and only the settler can modify them. The charities commissioner also has more power to intervene in the affairs of a trust than in a society, and a trust cannot be dissolved easily.

Society Alternatively, one can set up a registered society under the societies registration act of 1860 or various state laws equivalent to federal societies registration act. Societies are generally established for the promotion of science, literature, or the fine arts for instruction, the diffusion of useful knowledge, the diffusion of political education, the foundation or maintenance of libraries or reading rooms for general use among the members or open to the public, or public museums and galleries of paintings and other works of art, collection of natural history, mechanical and philosophical inventions, instruments or designs, etc.

Definition of Society Prof Wright A.W. Green MacIver It is a system of relationships that exists among the individuals of the groups. A.W. Green It is the largest group in which individual have relationships. MacIver It is a web of social relationship, which is always changing.

Formation of Society Name of trust 15 person Who want to form the society Seven prospective office barer (including president, secretary, trader) Name of society Address of registered office Main object of society

Difference Between Trust and Society Basis of Difference Trust Society Statute/legislation Private trust are governed by Indian trust Act ,1882.public charitable trust do not have a national level governing law. Society Registration Act, 1860. Minimum number of members two seven Geographical area of activities All Indian (no need mention this in the trust deed) A Separate registration for All Indian level is required (8 members from different states required). Nature of control One man control, i,e.settler Democratic system. Decision are made by voting . Power struggle may ensue.

Amendments Can easily be done via a supplementary trust deed Relatively more difficult. Both memorandum of association and rules and regulations need to be changed Names Easily available A bit difficult to get the desired name Bank a/c operation Controlled by one person, settler Two persons, either president or secretary and Treasurer Office holders teture Trustees generally hold office for the whole life Member hold office for a Period of time and may stand for re-election Winding-up Trust is generally irrevocable, can not be wound-up. Can be wound up if 3/5th of the members so desire

Family members Can become trustees Registrant objects on family members becoming part of the Governing Body Governed by Board of Trustees Governing Body Main documents (1) Trust deed Memorandum of association Rules and Regulation Objectives Can be general Have to be specific

Conclusion In conclusion, the research show that we as a society are faced with an uncertain future unless we change the way that we interact with our surrounding environment. It is clear that the surveyors role in developing a sustainable society is through the promotion and identification of sustainable land uses.