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CS Executive · Setting Up of Business, Industrial and Labour Laws · Non-Corporate Entities

Anita is a trustee of Kaveri Education Trust. She leaves India to reside abroad permanently. Under the Indian Trusts Act, 1882, what is the legal consequence?

A new trustee may be appointed in her place. Leaving India to reside abroad is one of the events listed in Section 73 of the Indian Trusts Act. The trust does not dissolve, and the person nominated in the trust deed has the first right to appoint.

  1. AShe automatically ceases to hold trust property
  2. BA new trustee may be appointed in her placeCorrect
  3. CThe trust stands dissolved
  4. DOnly a court can appoint a replacement, never the trust deed's nominee

Explanation

Section 73 lists leaving India for the purpose of residing abroad as an event on which a new trustee may be appointed in the trustee's place. It does not dissolve the trust or automatically divest her. The deed's nominee gets the first right to appoint, so the court-only option is wrong.

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