Immovable property belonging to a public trust generally cannot be sold, exchanged, gifted or leased beyond the periods specified without the prior sanction of the Charity Commissioner under Section 36 of the Maharashtra Public Trusts Act, 1950.
What the application sets out
The property concerned, the proposed transaction, the consideration, and the reason the transaction is said to be in the interest, benefit or protection of the trust. Valuation and public notice ordinarily follow, and the sanction, when granted, may carry conditions on price and on how the proceeds are to be held or invested.
Why sanction cannot be skipped
A transaction entered into without this sanction is void. Where a trust has already dealt with property without sanction, what can be done about it depends entirely on the facts, and should be discussed before any further step is taken.
Documents generally required
- Title documents for the property
- Trustee resolution proposing the transaction
- Valuation, where available
- Details of the proposed transferee or transaction
See also change reports and trust registration.
What the office examines
An application under Section 36 is decided in the interest of the trust, not in the interest of the parties to the transaction. In practice the questions are:
| Question | What answers it |
|---|---|
| Why is the transaction necessary or beneficial? | A board resolution setting out the reasoning, and evidence of the trust’s position |
| Is the consideration or rent fair? | A valuation by a competent valuer |
| Was the property properly marketed? | Evidence of how offers were invited and compared |
| What happens to the proceeds? | A stated application to the trust’s objects reads very differently from plugging a running deficit |
| Is any trustee interested in the transaction? | Disclosure, made openly and early rather than discovered |
| Is the trust’s own file in order? | Current register entries and filed accounts |
That last row decides the timetable more often than the merits do. A trust with unfiled accounts or years of unreported trustee changes will meet those questions before the transaction is considered at all, so putting the file straight is usually the fastest route to a sanction. See change reports and the compliance calendar.
Common questions
When does a trust need Section 36 sanction?
For any sale, exchange or gift of immovable property of a public trust, and for a lease exceeding ten years of agricultural land or three years of non-agricultural land or a building. The sanction must be obtained before the trust commits itself — the section requires previous sanction.
Can a lease of trust property exceed thirty years?
No. The Charity Commissioner is not to sanction any lease for a period exceeding thirty years. Arrangements structured to run longer, including chains of short renewals that add up to a long occupation, are judged on substance rather than on the label on the document.
What happens if property was sold without sanction?
The transaction’s validity is in serious question, and unwinding the position is slow and expensive for both sides. The 2017 amendment added a narrow route allowing sanction after the event in exceptional and extraordinary situations, subject to stringent conditions and confined to transfers after a date in October 2017. It is a remedy, not a plan.
Does a leave and licence agreement need sanction?
If it concerns a building or non-agricultural land and runs beyond three years, yes. This catches a great many Mumbai trusts that let shops, halls or offices on five-year arrangements without realising the provision applies.
How long does a Section 36 application take?
It depends heavily on how complete the application is and on the state of the trust’s compliance record. An application supported by a proper valuation, clear reasoning and a current file moves considerably faster than one that prompts questions about unfiled accounts before the transaction is reached.
Who applies — the trust or the buyer?
The trust applies, because it is the trust’s power to deal with its property that is in question. A buyer or lessee should make their agreement expressly conditional on sanction being granted, and should satisfy themselves about the trust’s status before paying anything.
This page describes general procedure and does not constitute legal advice. What applies to a particular matter depends on its own facts.
Why previous sanction under Section 36 matters
Section 36 of the Maharashtra Public Trusts Act, 1950 requires a public trust to obtain the previous sanction of the Charity Commissioner before selling, exchanging or gifting any immovable property that belongs to the trust. A transaction carried out without this sanction, where one is required, is void.
When sanction is required
- Sale, exchange or gift of any immovable trust property, regardless of value
- A lease of agricultural trust land for a period exceeding 10 years
- A lease of non-agricultural trust land or a building for a period exceeding 3 years
Process
- Filing an application (commonly referred to as a Section 36 application) before the relevant Charity Commissioner’s office, describing the property, the proposed transaction, and the reasons for it.
- Filing supporting documents — valuation report, trustees’ resolution, draft sale or lease deed, and title documents of the property.
- Public notice and inquiry, including consideration of objections from interested parties.
- Order of the Charity Commissioner granting or refusing sanction, sometimes subject to conditions such as a minimum sale price or utilisation of proceeds for trust purposes.
Assistance with this matter
If you are dealing with a Charity Commissioner proceeding and would like assistance in preparing or filing your matter, you may contact this office through the Contact page to discuss the specifics of your trust or society.
Related guides
- Trust Property Sold Without Sanction: Ex-Post-Facto Sanction Under Section 36(5)
- Redevelopment of a Trust-Owned Building: Tenants and Section 36
- What Is Section 36 Permission Before the Charity Commissioner?
- Leasing Trust Property: When Section 36 Sanction Is Needed
Consultations are by appointment. To fix a time, telephone +91 99301 50560 or send a message on WhatsApp.
This page describes general procedure and is published for information only, in keeping with Rule 36 of the Bar Council of India Rules. It is not legal advice and does not solicit work. What applies to a particular matter depends on its own facts.