Is A Trust A Legal Entity?

Under Indian law, a trust is not a separate legal entity or juristic person, but an obligation annexed to property ownership. Consequently, a trust cannot hold property, sue, be sued, or be prosecuted in its own name. Key Supreme Court decisions – such as Sankar Padam Thapa and Madasa Masih-Ul-Uloom – confirm that trustees hold legal ownership and bear personal liability for acts done on behalf of the trust. This principle applies across tax law, corporate regulations, and demat operations, where trustees act as representative assessees and titleholders rather than the trust being recognized as an independent entity.

Introduction

The trust is among the most versatile instruments known to the law, employed in India for charity, religious endowment, estate planning, employee welfare and the holding of promoter shareholdings. Trust deeds routinely describe "the Trust" as owning property, operating bank accounts and issuing cheques, and counterparties deal with it as though it were a body corporate. This convenient manner of speaking raises a persistent and consequential question: is a trust a legal entity, capable of holding rights and suffering liabilities in its own name, or is it merely a relationship between persons with respect to property? The answer determines who may sue and be sued and