Trusts have been described as ‘the highest and most distinctive achievement of the Equity jurisdiction’. India has never applied principle of Trust in the strict sense of the term. However, Indians have been creating Trusts, which have been enforced by the courts since a long time. The Trusts created in India are based on the wide sense of the term, which refers to ‘obligations annexed to the ownership of the property which arises out of a confidence reposed in and accepted by the owner for the benefit of another’. This principle is contained in the Indian Trusts Act, 1882. The Indian Trusts Act, 1882 codified the existing laws with the assistance of which the courts were bound to administer justice. The enactment of the Indian Trusts Act, 1882 provided a ready reference of principles for the courts to follow. This Act seeks to define the law relating to Private Trust and Trustees as stated in the Preamble. The Act provides that any person who is competent to contract may create a trust and a Trust can be created in favor of any person to whom a gift can legally be made. Trusts may also be created for charitable purposes. Regarding the eligibility of a Trustee, the Act states that every person capable of holding property may be a Trustee, but where the Trust involves the exercise of discretion, he cannot execute it unless he is competent to contract.
