TaxTMI 
TaxTMI 
2018 (10) TMI 787
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....ormed vide Trust deed dated 8th March 2013, by a Settler, Shri Satish Kumar in favour of five trustees. The main objects of the Trust as given in the deed are as under: - Main objects of the Trust are: In furtherance, but not in limitation, of the foregoing charitable and educational purposes, the Trust shall: (1) be dedicated to promoting and improving emergency medicine and care on a global basis through advocacy, training, and education of physicians and allied health care personnel internationally; (2) alone or in cooperation with other foundations, institutions, associations and other organizations, conduct any and all activities and do any and all acts and things which may be necessary, useful, suitable or proper in connection with or for the furtherance, accomplishment or attainment of such charitable and educational purposes as are lawful for a Trust formed under the Indian laws; (3) to solicit, collect, accept, hold, invest, reinvest and administer any gifts, grants, bequests, devises, benefits of trusts and property of any sort, without limitation as to value or amount, for such Charitable Purposes, and make grants and contribu....
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....lish Training Centres and allied educational institutions. (16) Raise funds through donations and contributions to support all the above activities, and setting up appropriate management structure, including subsidiary units as necessary. (17) Create assets and transport facilities to accommodate any of the above activities. 3. The Trust was stated to be established for the benefit of humanity at large and class of people mentioned above without discrimination of caste, religion, creed or sex. Looking to its objects which was charitable in nature, trust has applied for registration u/s.12AA before the ld. CIT(E) vide application dated 26.03.2015 and also application for exemption u/s.80G. 4. Ld. CIT (E) on the perusal of the Trust deed noted that there were five initial trustees, and all were Non-Resident Indian, i.e., who have taken the citizenship of the foreign country. According to ld. CIT (E) in terms of Explanation-1 to Section 60 and Section 73 of the "The Indian Trust Act" a non-resident cannot be a trustee of an Indian resident trust unless he is domiciled in India. Based on this reasoning, he has rejected the assessee's application for grant of reg....
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....e cannot be held to be a valid Trust under the Indian Trust Act, 1882. 5. Before us, ld. counsel for the assessee submitted that the constitution of the trustees was substituted before filing of 'Form-10A' seeking registration u/s.12A, wherein one, Mr. Milakh Raj Arora who was ordinary resident of India was residing in Ludhiana, Punjab on permanent basis and has replaced by one of the non-Indian trustees. The list of the trustees was also enclosed along with copy of 'Form 10A' filed before the ld. CIT (E) duly signed by Mr. Milakh Raj Arora. Thus, he submitted that Explanation-1 to Section 60 of the Indian Trust Act does not apply in the present case, as one of the trustees is ordinary resident and Indian citizen. He further submitted that Section 12AA requires that ld. CIT(E) has to satisfy himself about the objects which should be in the nature of 'charitable purposes' and also about the genuineness of the activities of the Trust. There is no adverse finding or opinion of the ld. CIT(E) on the objects, therefore, registration cannot be cancelled. In support, he strongly relied upon the decision of ITAT Jaipur Bench in the case of Sidha Sthan Shri Kapleshwar Mahadev Sanyas Ashr....
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....ee may within a reasonable period, disclaim it, and such disclaimer shall prevent the trust property from vesting in him. A disclaimer by one or two more co-trustees vests the trust-property in the other or others and makes him or them sole trustee or trustees from the date of the creation of the trust. Illustrations (a) A bequeaths certain property to B and C, his executors, as trustees for D.B. and C Prove A's will. This is in itself an acceptance of the trust, and B and C hold the property in trust for D. (b) A transfers certain property to B in trust to sell it and to pay out of the proceeds A's debts. B accepts the trust and sells the property. So far as regards B, a trust of the proceeds is created for A's creditors. (c) A bequeaths a lakh of rupees to B upon certain trusts and appoints him his executors. B serves the lakh from the general assets and appropriates it to the specific purpose. This is an acceptance of the trust." 8.1 The aforesaid section clearly provides that every person capable of holding property may be a trustee, but where trust involves the exercise of discretion, he (trustee) cannot execute it unless he is competent ....
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.... with his consent and by the order of the Court, be appointed under this section, in any case in which only one trustee is to be appointed and such trustee is to be the sole trustee. The provisions of this section relative to a trustee who is dead include the case of a person nominated trustee in a will, but dying before the testator, and those relative to a continuing trustee include a refusing or retiring trustee if willing to act in the execution of the power." Section 73 thus, deals with the appointment of a new trustee on death, or is absent from India for the period of more than 6 months or domiciled outside India, etc. This section merely provides that a new trustee may be unfit to be appointed in case the said person is domiciled abroad for a period of six months continuously; or leaves India for the purpose of residing abroad, etc. In such a case, it is considered that there is a personal incapacity to act in a Trust by such person. This inter-alia means that he is considered to be unfit for the office of the trustee and the said section presume that vacancy has occurred and the provision authorizes the appointment of a new trustee in his/her place. This provis....