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Trust is a fiduciary relationship in which one party, known as a trustor, gives another party, the trustee, the right to hold title to property or assets for the benefit of a third party, the beneficiary. Trusts are established to provide legal protection for the trustor’s assets, to make sure those assets are distributed according to the wishes of the trustor, and to save time, reduce paperwork and, in some cases, avoid or reduce inheritance or estate taxes. In finance, a trust can also be a type of closed-end fund built as a public limited company.

As per the Indian Trust Act, 1882, A trust is an obligation annexed to the ownership of property, and arising out of a confidence reposed in and accepted by the owner, or declared and accepted by him, for the benefit of another, or of another and the owner.

A trustee is entrusted with the responsibility to safeguard the interest of the beneficiary by the 'author of the trust'. 'Beneficiary' is a person for whose benefit trust confidence is reposed or declared. The 'interest' of the beneficiary or 'beneficial interest' is a right against the trustee as owner of the trust property. The subject matter of the trust is called 'trust property' or 'trust money'. Trust in simple terms means, the responsibility assigned to the trustee to safeguard the interest of the beneficiary. The interest of the beneficiary is paramount. If the trustee breached any duty assigned to him, it is breach of trust.

There are two type of Trust:

Private Trust: Private Trust is created for one or more certain number of individual. It is created for private purpose. It is governed by Indian Trust Act, 1882. It may be created by a will or a gift. Private Trust in relation to an immovable property must be created by a non - testamentary instrument signed by author or the trustee and registered. Therefore, registration of trust is necessary when it is declared in non - testamentary instrument. Where Private Trust declare by will or gift, registration will not be required in the case of immovable property or movable property as well.

Public Trust: Public Trust is established to fulfill area concern public utility and floated where it provide for property especially dealing in land and buildings; also a form of NGO, which has to be registered by Charity Commissioner Office having jurisdiction over it, making it eligible to opt for tax-exemption. In case of Public Trust, registration of trust created in relation movable and immovable property or whether created under a will or gift is not mandatory but desirable.