Trusts – A Comprehensive Overview
Trusts are created by individuals to earmark a portion of their assets or property for the advantage of another person. This establishment involves a fiduciary relationship among the trustor, trustee, and beneficiary. The particulars of this relationship are delineated in the trust deed submitted during the trust registration process.
The establishment of a trust occurs when the trustor transfers a specific asset or property to the trustee for the ultimate benefit of the beneficiary. Typically, the beneficiary, who is a third party, maintains a connection to both the trustor and the trustee.
Hence, the dynamics among the involved parties play a pivotal role in defining a trust. As per the provisions of the Indian Trusts Act of 1882, a trust is characterized as a “relationship between the trustor and trustee to hold specific benefits for the beneficiary.