• Can I set up a public trust in Maharashtra by offering my agricultural land as a settlor?

I am thinking about setting up a public trust in Maharashtra based on Maharashtra Public Trust Act by contributing my agricultural land as a corpus fund of the trust. Here is my idea: I will act as a settlor without any rights in the management of the trust, my two friends (all of them are agriculturists) will become trustees and they will utilize the land, and the general public in the community will become beneficiaries. The purpose of the trust will be to promote people's welfare through charitable/social/educational/religious activities. After settig up the trust, I plan to transfer the land to the trust on practical base (7/12 ownership change, mutation entry) at an appropriate timing. Is this plan feasible?
Asked 30 days ago in Property Law
Religion: Buddhist

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9 Answers

Yes, you can create public trust.

Pradeep Bharathipura
Advocate, Bangalore
5625 Answers
339 Consultations

 

1)you can contribute agricultural land as corpus 


2) trust deed  should specify  the public, religious, or charitable objects of the trust, the details of the agricultural land being contributed, the names and addresses of the trustees, and the mode of succession.

 

3)if the trust's objective requires non-agricultural use of the land, initiate the process to get the land use converted to non-agricultural status with the local revenue authorities/District Collector.

Ajay Sethi
Advocate, Mumbai
99751 Answers
8141 Consultations

Yes, it is legally possible, but not automatic. You must follow some key conditions under Maharashtra Public Trusts Act, 1950 and Maharashtra Tenancy & Agricultural Lands Laws.


Key Points

  1. Agricultural land can be given to a public trust, but the trust itself must be treated as an “agriculturist”.

    • Since your trustees are agriculturists, this requirement is generally satisfied.

  2. You must execute a Trust Deed clearly stating:

    • You are the settlor

    • Land is being given for charitable public purpose

    • You will not retain control or benefit

  3. Register the Trust with the Charity Commissioner under Section 18 of the Maharashtra Public Trusts Act.

  4. Transfer of agricultural land to a trust requires permission under:

    • Section 36 (disposal of trust property) – handled by Charity Commissioner

    • Maharashtra Tenancy & Agricultural Lands Act – the Collector may need to approve the transfer / mutation.

  5. After approvals, apply for Mutation Entry (7/12 extract change) to record trust as owner.


Shubham Goyal
Advocate, Delhi
2052 Answers
14 Consultations

Under Section 63 of the Maharashtra Tenancy and Agricultural Lands Act, 1948:

Agricultural land cannot be transferred to a person who is not an agriculturist, or to a body that is not primarily meant for agricultural purpose, without prior permission of the Collector.

However, the proviso to Section 63(1)(c) allows exceptions, the State Government may permit transfer to a trust or institution for an educational, religious, or charitable purpose, even if the transferee is not an agriculturist.

You may:

1. Prepare draft trust deed with objects and land description.

2. Register trust under MPT Act,

3. Apply to Collector for permission under Section 63(1)(c).

4. After approval ,you may have to execute registered gift deed  and then apply for mutation in 7/12.

T Kalaiselvan
Advocate, Vellore
89953 Answers
2490 Consultations

Yes it’s feasible 

Prashant Nayak
Advocate, Mumbai
34492 Answers
248 Consultations

Dear Client,
You can establish a public charitable trust in Maharashtra and be the settlor but transferring agricultural land to a trust requires seeking prior permission from the Collector. This is because, post the trust is established as a legal entity the Trust does not necessarily qualify as an agriculturist under the Maharashtra Tenancy and Agricultural Lands Act, even though the trustees may qualify as agriculturists. Given that the trust is established, you will have to obtain approval of the gift of land to the trust, after the trust is registered with the Charity Commissioner before executing the transfer and mutation (7-12 entry). If the land is to be used for "charitable infrastructure" (school, temple, community activity) NA conversion may also be required. You can follow this process (for the agricultural land usage), but you will need to seek statutory permissions for the agricultural land transfer.
I hope this response is useful. Please let us know if you have additional questions.

Anik Miu
Advocate, Bangalore
11005 Answers
125 Consultations

Yes, your plan is feasible under the Maharashtra Public Trusts Act, 1950, but it requires careful legal and procedural compliance to ensure the trust is validly constituted and the property is effectively transferred. Here’s how it works:

You can act as the settlor and establish a public charitable trust through a trust deed specifying the name, objectives, beneficiaries (public at large), details of trustees, and trust property (in your case, agricultural land as corpus). The settlor does not have to be a trustee and can relinquish management rights.

The two friends who will act as trustees must agree to accept the responsibility of managing the trust in accordance with the trust deed and the Maharashtra Public Trusts Act, 1950. The beneficiaries being the general public is acceptable, since charitable trusts are not meant for private benefit.

However, a few key legal points must be considered:

  1. Transfer of Agricultural Land: Agricultural land can be contributed to a trust, but the trust must comply with agricultural land laws in Maharashtra. All trustees should be agriculturists; you mentioned they are, which supports feasibility. Non-agriculturists cannot hold agricultural land.

  2. Execution of Trust Deed: The trust deed must be executed on non-judicial stamp paper (usually valued as per property or corpus contribution) and must clearly declare the intention to create an irrevocable trust.

  3. Registration under the Maharashtra Public Trusts Act: The trust must be registered with the office of the Charity Commissioner having jurisdiction over the area where the property is situated. The Charity Commissioner will examine the deed, verify its purpose, and then register it with a unique PTR (Public Trust Registration) number.

  4. Mutation and Transfer (7/12 extract): Once the trust is registered and the land is legally transferred (through a transfer deed or declaration of contribution in the trust deed), the mutation entry in the 7/12 extract can be made in the name of the trust. This process ensures the land is officially recognized as belonging to the trust.

  5. Irrevocability and Control: After creating the trust and transferring the land, you cannot claim ownership or management rights unless you are named as a trustee. Your role as a settlor ends once the trust is constituted and the property is transferred.

  6. Purpose and Compliance: The trust’s stated objectives—charitable, educational, social, or religious—must fall under the definition of “charitable purpose” as per Section 9(4) of the Maharashtra Public Trusts Act. The trust must also file annual returns and accounts to the Charity Commissioner’s office.

In conclusion, yes, your plan is legally and practically feasible. You can contribute your agricultural land as corpus, act only as settlor, appoint your two friends as trustees, and have the community as beneficiaries, provided all agricultural and trust registration laws are properly complied with. It is advisable to have a lawyer draft and register the trust deed and oversee the mutation process to avoid complications later.

 

Indu Verma
Advocate, Chandigarh
169 Answers
8 Consultations

Yes, your plan is feasible. Under the Maharashtra Public Trusts Act, 1950, you can create a public trust by contributing agricultural land as corpus, appoint trustees, and designate the public as beneficiaries. However, ensure the land transfer complies with revenue laws, obtain Charity Commissioner registration, and make mutation entries after registration.

Siddharth Jain
Advocate, New Delhi
6617 Answers
102 Consultations

Your plan to set up a public charitable trust in Maharashtra and contribute your agricultural land as corpus is legally feasible, provided certain conditions and procedures are followed carefully.

There is no restriction under the Maharashtra Public Trusts Act, 1950 or the Maharashtra Tenancy and Agricultural Lands Act that prevents a settlor from donating agricultural land to a public charitable trust. A public trust is not treated as a non-agriculturist for the purpose of landholding, and since your proposed trustees are agriculturists, the trust can lawfully hold agricultural land. The trust must genuinely serve charitable purposes and not operate as a private arrangement for personal benefit.

You can act as the settlor without being involved in the management of the trust. The law permits a settlor to create a trust and leave all administrative powers to the trustees. This strengthens the character of the trust as a public charitable trust. Your intention to benefit the general public through welfare, educational, social or religious activities fully aligns with recognized charitable purposes under the MPT Act.

To establish the trust, you will need a properly drafted Trust Deed containing details of the settlor, trustees, charitable objects, powers and duties, a clear irrevocability clause, and the clause regarding the initial corpus. The application for registration is then filed with the Charity Commissioner of Maharashtra along with required documents, after which the trust receives its registration number.

You may transfer the agricultural land to the trust after it is registered. This can be done through a registered gift or settlement deed, followed by an application for mutation so the 7/12 records reflect the trust as the owner. It is permissible to create the trust with a nominal initial corpus first and transfer the land later, as you plan.

There are important compliance requirements to keep in mind. The land must be used strictly for charitable purposes and cannot be enjoyed personally by trustees or any individual. Any sale, lease or alienation of trust property requires prior permission from the Charity Commissioner under Section 36 of the MPT Act. Once you donate the land, you cannot derive any benefit from it, directly or indirectly.

Overall, your idea is workable, practical and legally allowed. It is a commonly adopted structure in Maharashtra for charitable, social and community-oriented trusts.

If you would like, I can draft the Trust Deed, the clauses for the corpus land transfer, or guide you on the application process in detail.

If you wish to contact us, you may do so on https://qrco.de/syslaw

Yuganshu Sharma
Advocate, Delhi
943 Answers
2 Consultations

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