Sections 80-83 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.
Chapter IX of the Act deals with "certain obligations in the nature of trusts". Section 80 introduces the Chapter, sections 81 and 82 are repealed, and section 83 says that where a trust cannot be carried out, or is carried out without using up the trust property, the trustee must hold the property or what is left for the author of the trust or his legal representative, unless a direction says otherwise. The Act deals with private trusts; public, charitable and religious trusts are governed by other laws (see private vs public trust). If you are working out where unused trust property goes, our legal dispute resolution team can look at the deed and the facts.
Section 80 says an obligation in the nature of a trust is created in the cases the following sections list. Sections 81 and 82 are repealed. Under section 83, where a trust is incapable of being executed, or is completely executed without exhausting the trust property, the trustee, in the absence of a direction to the contrary, must hold the property, or the unexhausted part, for the benefit of the author of the trust or his legal representative. Lawyers often call this result a resulting trust.
Section 80: the opening clause of Chapter IX
Section 80 is a single sentence: "An obligation in the nature of a trust is created in the following cases." Its heading is "Where obligation in nature of trust is created". It does not state a rule of its own; it introduces the cases set out in sections 81 onward. In these cases there is no express trust, but the person who holds the property is made to hold it for another, "in the nature of a trust". The later sections of Chapter IX, from 83 to 93 and the saving in section 96, set out those cases and the effect in section 95; see sections 95-96.
Sections 81 and 82: repealed
Section 81 (headed "Where it does not appear that transferor intended to dispose of beneficial interest") and section 82 (headed "Transfer to one for consideration paid by another") are repealed. The scanned text shows both as "" and the footnotes say they were repealed by the Benami Transactions (Prohibition) Act, 1988 (45 of 1988), section 7, with effect from 19 May 1988. The footnotes reproduce the old wording, but it is not current law and this article does not rely on or teach it. This article does not cover the current law on benami transactions; take specialist advice on that subject.
Section 83: trust incapable of execution, or not exhausting the property
Section 83 reads: "Where a trust is incapable of being executed, or where the trust is completely executed without exhausting the trust-property, the trustee, in the absence of a direction to the contrary, must hold the trust property, or so much thereof as is unexhausted, for the benefit of the author of the trust or his legal representative."
| Words | Meaning |
|---|---|
| "incapable of being executed" | The trust cannot be carried out at all |
| "completely executed without exhausting the trust-property" | The trust has been carried out but property is left over |
| "in the absence of a direction to the contrary" | The deed or other direction can send the property elsewhere |
| "must hold ... for the benefit of the author of the trust or his legal representative" | The property reverts, in effect, to the settlor or his representative |
| "so much thereof as is unexhausted" | Only the unused part goes back |
The section does not tell the trustee how to transfer the property or when. The text is silent on any time limit or procedure.
Section 83 is separate from section 77, which lists when a trust is extinguished; section 83 says where unused property goes. See section 77.
The Act's own illustrations
The Act gives four illustrations under section 83. In plain words:
- Illustration (a). A conveys land to B "upon trust" and no trust is declared; or "upon trust to be thereafter declared" and no declaration is ever made; or upon trusts too vague to be executed; or upon trusts that become incapable of taking effect; or "in trust for C" and C renounces his interest. In each case B holds the land for the benefit of A.
- Illustration (b). A transfers Rs 10,000 in the four per cent (as printed in the scan) to B, in trust to pay the interest each year to C for her life. A dies. Then C dies. B holds the fund for the benefit of A's legal representative.
- Illustration (c). A conveys land to B in trust to sell it and apply half the proceeds to certain charitable purposes and the other half to maintain the worship of an idol. B sells the land, but the charitable purposes wholly fail and the worship does not use up the second half. B holds the first half and the unapplied part of the second half for the benefit of A or his legal representative.
- Illustration (d). A bequeaths Rs 10,000 to B to be laid out in buying land to be conveyed for purposes that wholly or partly fail. B holds, for the benefit of A's legal representative, the undisposed-of interest in the money or the land if purchased.
No illustrations are printed under sections 80 to 82 in the scan.
A modern example of our own
Ishita Bose transfers Rs 12 lakh to her friend Tarun "upon trust to pay for the medical education of a named child, Rohan, until he qualifies as a doctor". The deed says nothing about surplus.
- If Rohan dies in his first year and the purpose cannot be carried out, the trust is incapable of execution. Section 83 says Tarun must hold the money for Ishita or her legal representative, unless the deed has a direction to the contrary.
- If Rohan qualifies and Rs 3 lakh is left over, the trust has been completely executed without exhausting the property. Tarun holds the Rs 3 lakh for Ishita or her legal representative, which is the result in the Act's illustration (b) after the life interest ends.
- If the deed had said that any surplus is to go to a named charity, that is a "direction to the contrary" and the deed would prevail.
What the instrument of trust can change
Section 83 applies "in the absence of a direction to the contrary", so the deed can say who gets surplus or unexecuted property: a named person, a charity, another beneficiary. A settlor should therefore always write a gift-over or residuary clause. A deed that says nothing leaves the property to come back to the author or his legal representative under section 83.
Practical points
- Settlors: write a clause on what happens if the trust fails or the property is not all used.
- Trustees: when a trust ends with something left over, do not distribute it to beneficiaries on impulse; read the deed first and section 83.
- Legal representatives of a deceased settlor: ask the trustee for the accounts, because the property may be returning to the estate.
- Remember that these obligations come from the Act, not from the deed's own words.
Need help with unused or failed trust property?
If a trust cannot be carried out, or there is property left over after it has been, the deed and the accounts decide what applies. Our legal dispute resolution team can read them and advise on whether section 83 applies and who is entitled.
Key takeaways
- Section 80 introduces the obligations in the nature of trusts and refers to the cases that follow.
- Sections 81 and 82 are repealed by the Benami Transactions (Prohibition) Act, 1988; their old wording is not current law.
- Section 83: where a trust is incapable of execution or leaves property unexhausted, the trustee holds it for the author or his legal representative, unless there is a direction to the contrary.
- The Act's four illustrations include a trust with no declared terms, a life interest that ends, a failed charitable purpose and a bequest that partly fails.
- The Act deals with private trusts only.
Read next
- Sections 84-85: transfer or bequest for illegal purpose
- Section 77: how a trust is extinguished
- Sections 95-96: obligator's duties, liabilities and saving of bona fide purchasers
- Extinguishment of trust: how trusts end
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.