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PROJECT.
Topic:
Explain section 61 to 69 of the Indian Trust act, 1882.

Student’s Name: Mehul Rojh

Enrolment No: 19FLICDDNO2101

Batch Name: BA-LLB

Year: 3rd YEAR
Section: B

Submitted by: Mehul Rojh

Submitted to: Miss Priya Chanana.

Faculty Associate, ILS

ICFAI University, Dehradun.

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ACKNOWLEDGEMENT.

Primarily I would like to thank our Faculty Miss. PRIYA CHANANA MA’AM,
I.C.F.A.I LAW SCHOOL, whose Valuable guidance has been the ones that helped
me patch this project and make it full Proof success. His suggestion and
instructions has guided towards the completion of the project. Next, I would like to
thank my colleague’s for lending me a helping hand during the shaping up of the
project; subsequently I would like to thank my university for allowing me to avail
the computer lab and internet facilities without which this project would have been
in a distant realm.

I extend my heartfelt thanks to my family and friends for their moral support and
encouragement. I also take this opportunity to thank all those people who
contribute in their own small ways but fail to get a mention.

Mehul Rojh

19FLICDDN02101
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INDEX

1. INTRODUCTION
2. ACKNOWLEDGEMENT
3. INDEX
4. TRUST
5. MEANING
6. DEFENITION
7. TYPES OF TRUST
8. SECTION 61 TO 69
9. CONCLUSION
10. BIBLIOGRAPHY
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TRUST:
Meaning:

A trust is an acceptance of an obligation by a person in against of some property or funds to use

it or hold it for the benefit for the person whom the trust is created. The Indian Trust act is
related to Private Trust and Trustees. The Indian Trusts Act is an Act related to private trusts and
trustees in India. The act defines what exactly will be called a Trust, and who exactly can be a
trustee legally and also provides a definition for them. The Indian Trusts Amendment Bill of
2015 enabled the government to scrutinize the trusts’ investment at will, but at the same time
also removed some restrictions on monetary assets investment, etc. The act also defines and
states how the author of the trust can assign his assets to be controlled by the trust, and how he
can appoint trustees and beneficiaries.

1. The person who declares the confidence is called the author of the trust.

2. The person who accepts the confidence is called trustee.

3. The subject matter of the trust is called trust property or trust monetary.

4. The written document through which trust is created is called instrument of trust.

5. The person whose benefit the confidence is accepted is called beneficiary.

Definition:

As per the Indian Trust act,1882, trust means - an obligation annexed to the ownership of
property, & arising out of a confidence reposed in & accepted by the owner for the benefit of
another or for another and owner.

Creation of Trust:
The elements of valid trust are presented in section-6. The act defines how the author could
create the trust, assign trustees and give them his monetary assets to be controlled by the trust. It
may be express or implied. It includes-
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1. Intention of the author to create the trust.

2. Purpose of the trust.
3. The monetary asset is assigned for the benefit of the trustee.
4. Gives control or transfer the trust property to the trustee which includes intention of the
author.
5. Trustee can claim expenses & salary from the benefits from the trust of his work.

The requirement of the trust law is that the author should indicate by words or conduct with the
reasonable intention to create a trust. In simple terms we can define, Trust as a belief upon some
person to do certain acts.

Trust can be categorized into two types:

1. Public or Charitable Trust

2. Private Trust. ( it is made certain individual)

The Private can be categorized in three different types:

1. Express Trust.
It is in a written form. The trust is created by way of an instrument with all the facts and
conditions specified. There is an agreement for the creation of Trust.
2. Implied Trust :
It is based on the Presumption. There are things which are not expressed then it can be
said to be implied.
3. Constructive Trust.
It is by way of Operation of law. When by the operation of law certain property is given
or has been given then it is also provided with some Rights and Liabilities.

The Indian Trust Act, 1882 was enforced on 1st March 1882. It consists of IX chapter and 96
Sections. Under this Sec 61 to 69 talks about – Of the Rights and Liabilities of the Beneficiary.
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The Beneficiary has certain rights and liabilities and these Rights and Liabilities are enshrined in
these section. The Beneficiary is the person on whose favour the Trust has been created.

SECTION – 611

Right to compel to any act of duty — the beneficiary has a right that his trustee shall be
compelled to perform any particular act of his duty as such, and restrained from committing any
contemplated or probable breach of trust.

This section raises a right in the favor of the beneficiary and a duty to be followed by the trustee.
When a trust has been created then the trustee has to act accordingly, he is bound to do that act
and he is even compelled to do such act.

Illustration:

A, a trustee has been asked to sale certain land and pay the amount equally to B and C. now A
made the sale which was improper so B can put an injunction to the sale by A and he can do so
on behalf of C also.

SECTION – 622

Wrongful purchase by trustee — where a trustee has wrongfully bought trust-property, the
beneficiary has a right to have the property declared subject to the trust or retransferred by the
trustee, if it remains in his hands unsold, or, if it has been bought from him by any person with
notice of the trust, by such person. But in such case the beneficiary must repay the purchase -
money paid by the trustee, with interest, and such other expenses (if any) as he has properly
incurred in the preservation of the property; and the trustee or purchaser must (a) account for the
net profits of the property, (b) be charged with an occupation-rent, if he has been in actual
possession of the property, and (c) allow the beneficiary to deduct a proportionate part of the

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purchase -money if the property has been deteriorated by the acts or omissions of the trustee or
purchaser.

Nothing in this section— (a) impairs the rights of lessees and others who, before the institution
of a suit to have the property declared subject to the trust or retransferred, have contracted in
good faith with the trustee or purchaser; or (b) entitles the beneficiary to have the property
declared subject to the trust or retransferred where he, being competent to contract, has himself,
without coercion or undue influence having been brought to bear on him, ratified the sale to the
trustee with full knowledge of the facts of the case and of his rights as against the trustee.

In this section when the trustee has wrongfully brought trust property by inducing or fraudulently
then in such case trustee is liable and the beneficiary has the right to declare such property to
trust or retransfer it to as trust property. But the beneficiary must repay the money which has
been provided to him by the trustee.

Example-

A, a trustee by wrongful means sold the trust property to a relative B, with the intention to latter
transfer the property to himself. Here the beneficiary has the right to claim the Trust property.

SECTION – 633

Following trust-property— into the hands of third persons;—

Where trust-property comes into the hands of a third person inconsistently with the trust, the
beneficiary may require him to admit formally, or may institute a suit for a declaration, that the
property is comprised in the trust.

Into that into which it has been converted.—

Where the trustee has disposed of trust-property and the money or other property which he has
received therefore can be traced in his hands, or the hands of his legal representative or legatee,

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the beneficiary has, in respect thereof, rights as nearly as may be the same as his rights in respect
of the original trust-property.

In this section 63, where trust property has been transferred to third person wrongfully, then the
beneficiary has the right to make the trustee admit formally or institute a suit for the declaration
that the trust has been compromised.

There is a proviso attached to the section is that when the property which has been sold by the
trustee or misappropriated by the trustee then such property should be reimbursed by the trustee
or his legal representative.

Example-

(a) A, a trustee for B of Rs. 10,000, wrongfully invests the Rs. 10,000 in the purchase of certain
land. B is entitled to the land.

(b) A, a trustee, wrongfully purchases land in his own name, partly with his own money, partly
with money subject to a trust for B. B is entitled to a charge on the land for the amount of the
trust-money so misemployed.

SECTION – 644

Saving of rights of certain transferees.—

Nothing in section 63 entitles the beneficiary to any right in respect of property in the hands of—

(a) A transferee in good faith for consideration without having notice of the trust, either when
the purchase-money was paid, or when the conveyance was executed, or

(b) A transferee for consideration from such a transferee.

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A judgment-creditor of the trustee attaching and purchasing trust-property is not a transferee for
consideration within the meaning of this section.

In this section, it is the saving clause of Trustee where trustee has transferred the trust property
for the benefit of beneficiary.

SECTION – 65

Acquisition by-trustee of trust-property wrongfully converted.—

Where a trustee wrongfully sells or otherwise transfers trust-property and afterwards himself
becomes the owner of the property, the property again becomes subject to the trust,
notwithstanding any want of notice on the part of intervening transferees in good faith for
consideration.

In this section it is provided that when the trustee wrongfully sells the trust property and then
become the owner of such property, then such property again become subject to the trust without
any want of notice on the part of intervening transferee in good faith.

Example-

A, a trustee sells the Trust property, wrongfully without letting it know to the beneficiary with
the intent to convert such trust property into his private property, then the beneficiary may direct
the trustee to return the property to the trust.

SECTION – 66

Right in case of blended property.—

Where the trustee wrongfully mingles the trust-property with his own, the beneficiary is entitled
to a charge on the whole fund for the amount due to him.

In this section, if the trustee mixes the Trust- property with the property of himself, then the
beneficiary will have the charge upon such extent of the property where the debt stands.
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Example- A, a trustee buys several property and mixes it with the trust-property, then the
beneficiary is entitled to such extent as his beneficial interest are not fulfilled.

SECTION – 67

Wrongful employment by partner-trustee of trust-property for partnership purposes —

If a partner, being a trustee, wrongfully employs trust-property in the business or on the account
of 20 the partnership, no other partner is liable therefore in his personal capacity to the
beneficiaries, unless he had notice of the breach of trust. The partners having such notice are
jointly and severally liable for the breach of trust.

This section is a saving clause as well as a liability clause. It is the saving clause for a Partner in
the partnership firm. This section defines that when the Trustee deploys Trust-property in the
Partnership firm and if the partners are unaware of the fact that the other partner invested the
trust property in the Partnership Firm.

The Trustee is liable to pay the amount which has been generated from the Trust Property.

Example –

A and B are partners. A dies, having bequeathed all his property to B in trust for Z, and
appointed B his sole executor. B, instead of winding up the affairs of the partnership, retains all
the assets in the business. Z may compel him, as partner, to account for so much of the profits as
are derived from A’s share of the capital. B is also answerable to Z for the improper employment
of A’s assets.

SECTION – 68

Liability of beneficiary joining in breach of trust. —

Where one of several beneficiaries—

(a) joins in committing breach of trust, or

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(b) Knowingly obtains any advantage there from, without the consent of the other beneficiaries,
or

(c) becomes aware of a breach of trust committed or intended to be committed, and either
actually conceals it, or does not within a reasonable time take proper steps to protect the interests
of the other beneficiaries, or

(d) Has deceived the trustee and thereby induced him to commit a breach of trust,

the other beneficiaries are entitled to have all his beneficial interest impounded as against him
and all who claim under him (otherwise than as transferees for consideration without notice of
the breach) until the loss caused by the breach has been compensated.

When property has been transferred or bequeathed for the benefit of a married woman, so that
she shall not have power to deprive herself of her beneficial interest, nothing in this section
applies to such property during her marriage.

This section mentions about the liability of the Beneficiary where the beneficiary has been a part
of the breach of Trust. This section mentions that

a. If one of the beneficiary,

b. Knowingly has obtained undue advantage, without the consent of the other beneficiary.
c. And if one of the beneficiary knows about the breach of trust and still conceals it, and
without reasonable step do not protect the interest of the beneficiaries.

Then such Beneficiary shall be liable to pay the losses and all his beneficial interest transfer to
other beneficiaries.

Example –

A, a Trustee and B, one of the several Beneficiary committed the breach of Trust without letting
know the other beneficiary.

Then B shall be liable to compensate the loss and all his beneficial interest shall transfer to the
other beneficiaries.

SECTION – 69

Rights and liabilities of beneficiary’s transferee.—

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Every person to whom a beneficiary transfers his interest has the rights, and is subject to the
liabilities, of the beneficiary in respect of such interest at the date of the transfer.

In this section it is mentioned that when the beneficiary transfer his beneficial interest then his
Rights and liabilities also transfer to such person from the date of transfer.

Example –

A, is the beneficiary and he transfer his beneficial interest in the favour of B, then all the Rights
and Liabilities of such beneficiary transfer to B.

BIBLIOGRAPHY:
Books:-

1. THE INDIAN TRUSTS ACT, 1882

2. SPECIFIC RELIEF ACT (with equity and trusts)- Dr. ASHOK K. JAIN

Website:-

 
1. https://indiankanoon.org/doc/470004/
2. http://bdlaws.minlaw.gov.bd/act-47/chapter-details-156.html