A surprising number of flats, plots, shops and godowns in Mumbai stand on land that once belonged to a public charitable trust. Often the trustees sold, exchanged or leased it long ago without the Charity Commissioner’s sanction. The problem surfaces decades later, when the buyer or a later purchaser tries to sell, redevelop or take a loan, and a lawyer’s title search flags the missing sanction. This guide explains the law and the one statutory route that can cure it.
The basic rule: previous sanction is required
Under Section 36(1) of the Maharashtra Public Trusts Act, 1950, notwithstanding anything in the trust deed:
- no sale, exchange or gift of immovable property of a public trust, and
- no lease exceeding ten years for agricultural land, or three years for non-agricultural land or a building,
is valid without the previous sanction of the Charity Commissioner. No lease longer than 30 years can be sanctioned at all (Section 36(1A)). A transaction made without sanction is therefore open to challenge, which makes the title doubtful for everyone who later buys from the original purchaser. See what Section 36 permission is.
The cure: ex-post-facto sanction under Section 36(5)
Section 36(5) allows the Charity Commissioner, in exceptional and extraordinary situations where the absence of previous sanction causes hardship to the trust, to a large body of persons, or to a bona fide purchaser for value, to grant ex-post-facto sanction to a transfer of trust property made by the trustees before the commencement of the Maharashtra Public Trusts (Second Amendment) Act, 2017.
The Charity Commissioner must be satisfied of all of the following:
| # | Condition |
|---|---|
| (a) | There was an emergent situation that warranted the transfer |
| (b) | There was a compelling necessity for the transfer |
| (c) | The transfer was necessary in the interest of the trust |
| (d) | The consideration was not less than the prevailing market value at the time, certified by an expert |
| (e) | The trustees made reasonable efforts to secure the best price |
| (f) | The trustees acted bona fide throughout and derived no benefit, monetary or otherwise |
| (g) | The transfer was made by a registered instrument, where registration was legally required |
Only the Charity Commissioner appointed under Section 3, not a Joint, Deputy or Assistant Charity Commissioner, can grant this sanction.
Who this helps, and who it does not
- Helps: genuine purchasers, housing societies and occupants of buildings built on trust land sold before 2017 at a fair price, where the trustees simply failed to obtain sanction.
- Does not help: transfers made after the 2017 amendment came into force; sham or undervalued sales; transfers where trustees took personal benefit; unregistered transfers that required registration.
- For transactions now, there is no shortcut: previous sanction must be obtained before the deal.
Higher penalties since 2025
The Maharashtra Public Trusts (Amendment) Act, 2025, effective from 1 September 2025, raised the punishment under Section 66A for alienating or attempting to alienate trust property without previous sanction to imprisonment of either description up to one year, or a fine up to Rs 50,000, or both. The same Act introduced a 120-day limit for revision applications to the Charity Commissioner under Section 70A against orders of the Deputy or Assistant Charity Commissioner.
What a buyer or society should do
- Find out the facts: obtain the trust’s register entry (PTR extract), the original sale or lease deed, and any orders of the Charity Commissioner. See getting an extract of the public trust register.
- Check the date: was the transfer before the 2017 amendment? If not, Section 36(5) will not apply.
- Gather proof of each condition: the reason for the sale at the time, contemporaneous valuation or an expert’s retrospective valuation, payment records, and the registered deed.
- Approach the trustees: the application is best supported by the trust itself. Where the trust no longer functions, take advice on how to proceed.
- Apply to the Charity Commissioner with a full record. Expect scrutiny of the price and the trustees’ conduct.
What trustees should do today
- Never sign an agreement for sale, development agreement or long lease without first obtaining sanction under Section 36. See redevelopment of a trust-owned building.
- If an old unsanctioned transfer exists, deal with it openly rather than leave it to surface in a dispute.
- Report any change in trust property under Section 22 once a sanctioned transaction is complete.
Frequently asked questions
Is a sale of trust property without sanction void?
Section 36 says it is not valid without previous sanction. In practice this leaves the title open to challenge until the defect is cured.
Our building was built on trust land sold in the 1990s. Can our society apply?
Section 36(5) is designed for such cases, including hardship to a large body of persons, provided all the conditions are met.
Can the Deputy Charity Commissioner in Mumbai grant ex-post-facto sanction?
No. The section limits this power to the Charity Commissioner appointed under Section 3.
See also: Section 36 sanction and leasing trust property.
Consultations are by appointment. To fix a time, telephone +91 99301 50560 or send a message on WhatsApp.
This guide describes general law as understood in October 2026. It is not legal advice; title questions turn on documents and dates, so take advice on the specific property.