Section 7 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 7 names the two kinds of persons who may create a trust: every person competent to contract, and, with the permission of the principal Civil Court of original jurisdiction, a minor or someone acting on a minor's behalf. In each case this is subject to any other law on how far the author may dispose of the property. If a family trust is planned for or by a minor, a legal consultation before you sign can save a defective deed.
A trust may be created (a) by every person competent to contract, and (b) with the permission of a principal Civil Court of original jurisdiction, by or on behalf of a minor. In each case the power is subject to the law for the time being in force as to the circumstances and extent in and to which the author of the trust may dispose of the trust-property. The section prints no illustrations.
The text
Section 7 reads: "A trust may be created— (a) by every person competent to contract, and (b) with the permission of a principal Civil Court of original jurisdiction, by or on behalf of a minor; but subject in each case to the law for the time being in force as to the circumstances and extent in and to which the author of the trust may dispose of the trust-property."
A footnote in the source points at the end of limb (a) to section 11 of the Indian Contract Act, 1872, which is where competence to contract is dealt with. This article does not explain that Act.
The Act deals with private trusts; public, charitable and religious trusts are governed by other laws. See private trust vs public trust.
Limb by limb
| Limb | Plain meaning |
|---|---|
| "every person competent to contract" | Anyone with legal capacity to enter a contract may create a trust |
| "with the permission of a principal Civil Court of original jurisdiction" | For a minor, the Court's permission is required |
| "by or on behalf of a minor" | The trust may be created by the minor or by someone acting for the minor, but both routes need that permission |
| "subject in each case to the law ... as to the circumstances and extent" | A separate law may limit what the author can give away |
Three observations:
- Competence is the entry ticket. The section ties capacity to being "competent to contract", so the question is capacity under the contract law referred to in the footnote. A person who is not competent to contract is not within limb (a).
- Minors are a special case. The word "permission" matters: a trust for or by a minor is not created simply by signing. The text says the permission must be of "a principal Civil Court of original jurisdiction". It does not say what the Court will look at or how the application is made; those are matters for the Court's procedure.
- The final qualifier applies to both limbs. Even a person fully competent to contract may be limited by other laws on how much of their property they can dispose of and in what circumstances. Section 7 does not list those laws. They are outside this Act.
How this fits with other sections
Section 7 is about the author. The people who may benefit or act as trustee are in section 9 and 10 respectively (see our article on who may be a beneficiary and who may be a trustee). Intention and the other creation requirements are in section 6, and form requirements are in section 5. Our existing guide on who can create a trust, competence and intention gives a practical view.
The Act's illustrations
None are printed under section 7 in our source. The Act does not give an illustration of a minor's trust, so none is invented here.
A modern example of our own
Sandeep Kulkarni, aged 45 and of sound mind, signs a trust deed to hold shares for his nephew's education. He is competent to contract, so limb (a) is satisfied. If Sandeep were in a situation where another law restricts how he can dispose of some of that property, the closing words of section 7 mean the trust is created subject to that law.
Now take Asha, aged 16, who has inherited a flat and wants to put it into a trust for her younger sister. Asha is a minor. Under limb (b), a trust "by or on behalf of a minor" needs the permission of the principal Civil Court of original jurisdiction. If Asha's guardian tries to sign for her without that permission, the section does not treat the requirements as met.
What the instrument of trust can change
Section 7 has no "subject to the instrument of trust" wording. Capacity cannot be created by a clause in the deed. A deed can, however, record how the Court's permission was obtained, and doing so helps later if the deed is questioned.
Practical points
- Settlors: confirm your capacity and think about whether any other law limits your power to dispose of the particular property.
- Guardians and parents: if the author is a minor, plan the Court application before drafting the deed. Do not assume a guardian's signature is enough.
- Trustees: ask for a copy of the permission order if the author was a minor, and keep it with the deed.
- Advisers: check section 5 for the form of the instrument as well.
Need help checking who may create your trust?
If the author of the trust is a minor, or you are unsure about capacity, our legal consultation service can review the position and the draft deed. Bring identity and age details and the property papers.
Key takeaways
- A trust may be created by every person competent to contract (s.7(a)).
- A trust by or on behalf of a minor needs permission of a principal Civil Court of original jurisdiction (s.7(b)).
- Both are subject to the law in force on the circumstances and extent in which the author may dispose of the trust-property.
- The section prints no illustrations.
- Capacity is a separate question from form (section 5) and intention (section 6).
Read next
- Section 8: subject matter of a trust
- Sections 9-10: who may be a beneficiary and who may be a trustee
- Section 6: how a trust is created
Disclaimer: Based on the text of the Indian Trusts Act, 1882 as consulted on 1 October 2026 from a scanned copy; the Act applies to private trusts, and public, charitable and religious trusts are governed by other laws. This article is general information, not legal advice; check the official text and take advice before acting.