Governance of Non-profit Organisations in India - Noshir H. Dadrawala

Author: Noshir H. Dadrawala
Design: Satisfice Designs
Sponsored by: Forbes Marshall
Copyright: Noshir H. Dadrawala, Centre for Advancement of Philanthropy 2024
Edition: October 2024

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior permission of the author/publisher.

About the Author

Noshir H. Dadrawala is Chief Executive of the Centre for Advancement of Philanthropy (CAP), through which he has been offering compliance-related advisory to non-profits and corporate social initiatives. His career spans over forty years in the non-profit sector, working with a diverse range of organisations, from large established national and global organisations, to corporate and family grant-makers, to non-profit start-ups. Drawing upon more than four decades of hands-on experience and practical insights, Noshir's main role at CAP involves simplifying the confusing and complex maze of ever-changing regulatory laws. Noshir's expertise within the sector is widely recognised, as is his deep understanding of compliance-related issues with various regulatory authorities. He has authored several resource books and publications and is now also an active blogger. Noshir serves on the boards of many non-profits and is a trustee of the Forbes Foundation.

Dedication to Late Darius M. Forbes (1926-2023)

When Darius M. Forbes passed away in the early hours of Friday, 11th August 2023, it felt like the end of an era to me. He was one of my mentors and instrumental in helping me carve out a successful and fulfilling career in the philanthropic sector. Darius Forbes was among stalwarts like H.T. Parekh (Founder of HDFC Ltd.), Rusi M. Lala (Director of Sir Dorabji Tata Trust) and R. R. Chari (Commissioner of Income tax) who had founded the Centre for Advancement of Philanthropy (CAP) with which I have been involved now for close to four decades.

Darius founded Forbes Marshall which specialises in products and services for steam efficiency, process optimisation, and control and monitoring for industry. From a modest, Mumbai based trading company, today it is a multi-faceted, corporate group, manufacturing advanced engineering products and providing comprehensive services for industries in India and globally. Besides serving customers and making pioneering contributions to Indian industry, Forbes Marshall has always been committed to the well-being of the community beyond their factory-gate. Their community service programmes are guided by a desire to be an economic, intellectual, and social asset to the nation and the community in which the company operates. Corporate Social Responsibility (CSR) has become mandatory under the Indian Companies Act only since the year 2014. However, Darius Forbes not only talked about CSR but practiced it, long before corporate India had even heard of this term.

Mr. Forbes believed that Industry should function in close partnership with society and give back to society what it takes from it for its development and growth. While Industry provides employment opportunities and thus brings socio-economic progress, it also displaces people and the onus is on Industry to provide proper infra-structural facilities. Over seventy five years ago when the company purchased about ten acres of land from various farmers in Pune for their factory, Mr. Forbes realised that the farmers would be cash rich for only a short period of time. What would become of them after the money was over? And, so, the company decided to create employment opportunities for them through vocational training, especially for their children.

Since the factory was situated outside the city limits, the first need that was recognised for the members who commuted long distances was proper transport. The next requirement was electricity, water supply and sewage facilities, not just for the factory but the entire village of Kasarwadi. Gradually, the village with a then population of eight hundred, began to transform into a township. Mr. Forbes considered all this as his company's social obligation. The company was giving back to society what it gained from society. To him it was a process of harmonious living with the local community.

An accident, which Mr. Forbes witnessed while driving on a rainy day to the factory, moved him to create a medical facility in the company's spacious complex at Kasarwadi. The Shehernaz Medicare Centre (named after Mr. Forbes' departed sister-in-law) has grown from a one-physician clinic to a fully equipped hospital with full-time doctors, a modern operation theatre, X-ray machines, dental care facilities and a laboratory for clinical analysis. This hospital was set up in 1966, at a time when there was no medical facility available for miles along the Bombay - Pune highway. He strongly believed that by caring for all stakeholders and especially the local community, a company earns respect, confidence, goodwill, and loyalty of the local community.

Over the years, community development programmes have been implemented and enhanced to improve the quality of life of people living in the neighbouring area and well beyond. Mr. Forbes was a man far ahead of his times. He was an astute industrialist. But above all else he was a very thoughtful human being who genuinely cared about those who worked with him. I have been very fortunate to not only have known him but to have been mentored by him. His greatest gift to me was the gift of sound professional values. He taught me that success and happiness is a by-product of work that you do with a sense of purpose!

 

Preface

Darius M. Forbes was born on 2nd October, 1926, in Bombay and grew up in Madras. He spent much of his life building strong businesses and institutions, and later, teaching others how to do the same. He believed in the power of individuals to achieve great things, regardless of their background or upbringing. He lived a life of service above self; done quietly and without much fuss, just because it was the right thing to do.

Darius was immensely proud of Forbes Marshall not just as a business, but more so because of each member. For him, the business and social work were not separate buckets but blended naturally together in his daily life. Hence, Forbes Marshall has always believed in the philosophy of contributing and giving back to the community in which it operates. When our first factory was originally set up in Pune in 1958, Darius felt it was insufficient to merely purchase land from the farmers who were the original owners of the land; it was necessary to actively and positively contribute to the community.

Over the last 75 years, we have strived to build resilience in our communities through initiatives focused on improved healthcare, education, women's empowerment and livelihood programmes. We ensure the sustainability of our social interventions through an emphasis on innovation, collaboration, advocacy and research; we encourage pilots and new ideas within programmes, engaging with multi-stakeholders, fellowships for individuals and knowledge creation for change. While the range and scope of our programmes have changed over the years, our dedication to enabling positive change in society in communities around us, remains constant.

One of Forbes Marshall's focus areas is capacity building and enabling resilience in the social sector. We support organisations to build basic capacities in areas such as programme design, leveraging technology and AI, communication, finances, organisational development etc. Among the challenges that non-profits face is access to knowledge and navigating the maze of rules and laws they face.

Noshir H. Dadrawala, Chief Executive, Centre for Advancement of Philanthropy, has been associated with Darius and Forbes Marshall for many years. He has advised us from time to time, conducted several programmes for non-profits and our members and helped us set up the Forbes Foundation.

This 2nd October is Darius' 98th birth anniversary. To commemorate his life of purpose and achievement, we encouraged Noshir to write a book that would be a useful and practical resource for the social sector, especially for non-profits. This book stems from the collaboration between CAP and Forbes Marshall. The book will be available in an e-version for ease of access, and we hope it will be a guide for non-profits, NGOs and the corporate sector.

- The Forbes Family

 

Author's Note

To commemorate the memory of Late Darius M. Forbes in a meaningful manner, his family requested me to work on a resource book which would be of value, relevance and guidance to the philanthropic sector. I was not only thrilled to take up this task but felt most honoured and privileged. An all-encompassing resource book of this nature was long overdue and much required. Keeping in mind lay readers, special effort has been made to keep the style simple and devoid of legal jargon.

Laws governing non-profit organisations (NPOs) in India are complex and multi-layered. At times there is also a dichotomy between state and central laws. NPOs have reporting obligations with multiple regulatory authorities. ¹Trusts and societies in Western India are regulated by the Office of the Charity Commissioner. Non-profit companies are regulated by the Registrar of Companies. Income Tax authorities regulate all three types of entities on their tax exemption status. The Ministry of Home Affairs regulates the flow of funds from foreign sources under Foreign Contribution Regulation Act 2010. Apart from these three key regulatory authorities, certain NPOs must also register under the Shops and Establishments Act, regulated by the local municipal authority. Some NPOs having supply of goods (made by beneficiaries) or services are also required to register under GST. NPOs are not exempt under labour laws either. What is applicable and to whom and when is what this book has attempted to address.

One of the key issues in non-profit governance in India is the lack of uniformity and standardisation. Since 'charity' is a state and not a central subject in India, some states have excessive regulations while others have virtually none. For example, in the states of Maharashtra and Gujarat, the Charity Commissioner requires regular 'change reports' to be filed, regulates investment of funds as well as prior permission for buying and selling immovable property. On the other hand, the National Capital Delhi and several other states do not have a Charity Commissioner. It is no surprise that some non-profits attempt to seek registration in New Delhi or other territories where one may legally bypass at least one regulatory authority.

Every registered NPO must also file annual returns with the relevant regulatory authority, e.g., the Charity Commissioner, Registrar of Societies, or Registrar of Companies. Annual returns must also be filed with the Income Tax authorities and, if the NPO is registered under the FCRA, with the Ministry of Home Affairs.

To navigate through this complex and often confusing maze of laws and compliance, every stakeholder within the philanthropic sector should have at least some working knowledge to optimally govern the NPO. The object with which this book has been curated is just that - to help governing board members and staff to have a better understanding of governance related issues and ensure compliance. In our view, compliance is the key to credibility of every NPO. We hope readers will find this work interesting and informative. We will try to keep this work updated periodically.

Once again, I am grateful to the Forbes family for inspiring me to work on this book and supporting its publication for the benefit of the non-profit sector in India.

-Noshir H. Dadrawala

"If government provides the head of society and business the hands, then independent voluntary action provides its heart. But hearts cannot be taken for granted. Strengthening the big heart of societies means making one's own contribution of time, talent, treasure and proclaiming aloud the underlying values of philanthropy." - J.D. Livingston Booth

Chapter I The Spirit of Philanthropy

People often use the terms 'philanthropy' and 'charity' interchangeably and think the two are synonymous. Social scientists, however, consider this to be incorrect and rightly so. Charity (which mostly involves alms-giving) generally addresses the symptoms, while philanthropy (Greek philanthropos meaning love of human beings) tends to strike at the root of various issues facing society. They say, if you give fish to a poor person, you have done charity. You teach this person to fish and that's philanthropy. You give clothing to a poor man and you have done charity. You teach this person the skills to stitch clothing and that's philanthropy.

A generally-accepted comprehensive definition of philanthropy does not exist, and many leading scholars in the field doubt that one can be developed. Some scholars feel some vagueness is inevitable and even desirable. Contemporary philanthropy has come to be recognised as being broadly concerned with improving the quality of life for all members of society by promoting their welfare, happiness and culture. It usually focuses on interests and concerns of all income classes, such as protecting the environment, preventing diseases, improving education and recreational facilities, enhancing the arts, preserving historic landmarks, etc. Charity on the other hand, has come to mean serving mainly, if not only, the poor.

According to Paul Ylvisaker, "Philanthropy takes a more impersonal and dispassionate approach to bettering the human condition by institutionalising 'giving,' focusing beyond the immediate condition of people on root causes of human problems and systemic reform, recognising a responsibility to the public interest and helping to effect societal change."

Dr. Robert L. Payton, former president of the Exxon Foundation and ex-U.S. ambassador to the Cameroons, defines philanthropy to include, "voluntary giving, voluntary service and voluntary association, primarily for the benefit of others." Dr. Payton calls philanthropy, the "prudent sister" of charity.

 

Ancient and Varied Traditions

Ideas of philanthropy have varied with the customs of people, with changing needs and with the development of the human mind and desire to make life happier for others. One of the oldest records of 'giving' is in 'The Book of the Dead', the chief monument of religious literature of Egypt, which goes back to about 4,000 B.C. It says, "I have given bread to the hungry man and water to him that was athirst and apparel to the naked man and a ferry boat to him that had no boat. I have made propitiatory offerings and given cakes to the Gods."

The Greek and the early Roman concept of philanthropy was radically different; it consisted in doing kindly acts 'towards people', not towards the poor. It was not alms-giving, it had little or no connection with poverty, and it was seldom motivated by pity. One of its earliest expressions is in Homer's lines: "and generally was he loved, for courteously he welcomed to his house besides the way all comers". The Greek ethic of general kindliness was "do not overlook an un-hired body; kindle a fire; give a share of water; tell the way; advise truthfully."

In India, feeding the cow, the dog and the Brahmin was practically a routine in the daily life of a Hindu householder. There is a chapter devoted to charity in the Rig Veda, and charity is divided into three classes - Satvik, Rajasi and Tamasi; centuries later, in 1180 A.D., Rabbi Moses Ben Marmon said that there were eight degrees in giving charity, one higher than the other. Lowest on the scale was charity given meagerly and by a person as if forced; somewhat higher was charity contributed adequately but only after it was asked for; even better was aid given in such a manner that neither the giver nor the person assisted knew the identity of the other, and the highest of all was assistance that enabled a person to achieve self-support by helping him to find work or to open a business.

Under the Islamic faith, charity forms one of the basic obligations. Zakat is a compulsory poor-tax which a Muslim must pay not only on the surplus of the year, but also on the value of his total movable assets. The other forms of charities known is Islam are the khairat and sadga. In the early centuries, zakat was highly organised through the institutions of baitulmal or the treasury. Every Muslim was required to send his zakat to the baitulmal with such instructions as he desired for the disbursement of the fund.

The concept of philanthropy and universal love for man is sprinkled all over the 'New Testament' and it is little wonder that even in a country like America generally branded as 'materialistic' the practice of setting aside private funds for public use has thrived and continues to grow from strength to strength. In fact, apart from being the largest in the world, the American foundations are today known to bestow wealth to the entire world. Apparently, Americans take the theological reference, "for God loves a cheerful giver", (II Corinthians 9:6-7) quite seriously. Corinthians 13:1-13 goes a step further: "If I should speak with the tongues of men and of angels, but do not have charity, I have become as sounding brass or a tinkling cymbal. And if I have prophecy and know all mysteries and all knowledge, and if I have all faith so as to remove mountains, yet do not have charity, I am nothing."

Among the Jews, Zedakah implies the fullest obligation that people owe to one another. Zedakah calls for more than mere alms-giving, because in its exercise, there must be kindness, tenderness, not to shame the poor or put him to disgrace. Sacred unto the Lord is the human dignity and personality of the recipient of charity, and they must not be hurt or lowered. Moreover, of greater merit than giving to the poor is to help him to become self-supporting.

If the name 'Parsi' is synonymous with 'charity', it is, once again, thanks to the emphasis of this ethos in their religious scriptures. The Zoroastrian religion is not a religion in the sense in which the term is commonly understood. It is rather a scientific and rational explanation of existence, of reality as a whole, of man's place in it, his duties while in this life, and the high destiny which he can achieve by establishing his conduct in accordance with the Eternal and Immutable Law of Nature which Zarathushtra called the Law of Asha.

Five things, according to the Pahlavi Dinkard, were considered worthy of merit: a) truthfulness b) charity c) skill d) endeavour and e) giving encouragement to others in good deeds. In the Handarz literature, Aturpat Mahraspand, the high priest at the court of the Sasanian king, Shapur II, speaks of three kinds of charity:

Aturpat adds that charity is good when one expects nothing from the receiver in return and entertains no such expectation. Good charity, according to him, is never done for publicity, show or personal gain. Thousands of years have passed since Prophet Zarathushtra walked this planet, but his small yet dedicated band of followers remember to the last breath, his timeless message, "Happiness comes to him who seeks happiness for others." (Yasna 43.1).

 

Altruism among other life forms

Altruism is recognised in some way or the other by individuals of all cultures, and it is generally regarded as a trait favourable to the coherence and continuity of social groups and society in general. Brian O'Connel, in 'America's Voluntary Spirit', makes a fascinating observation, "....altruistic behaviour is an invention of nature herself..... the earliest philanthropic activity occurred many millions of years before Homo sapiens appeared, and that nature must value such behaviour since she has seen fit to continue it over vast periods of time."

To support his theory, he writes, "An article in a scientific journal on 'The Evolution of Altruism' reported that some seventy million years ago, as is known from fossil records of miocene times, there existed organised societies of termites and ants. Within such insect societies - bees, wasps, ants, and others - there were then, and still are, groups whose activities can in some broad sense be labeled as altruistic, with members of these groups performing specialised functions for the good of the larger society, often at individual sacrifice.

"More recently, a biologist, studying the chain of life in the sea, found 'support for a community theory of evolution according to which short-term advantages to individual species are sacrificed for long-term benefits for an entire living community.'

"Many people would be surprised to learn the extent to which animals help their own kind. Even the popular view of wild animals of Africa as ferocious beasts, 'red in tooth and claw', is at least partially mistaken. Throughout the animal world, there is much behaviour which is peaceful, cooperative and even altruistic."

Richard J. Butler and David C. Wilson, in 'Managing Voluntary and Non-Profit Organisations', have said, "Altruism is a fundamental part of human rationality and altruistic behaviour is the foundation stone of very many charities in Britain and elsewhere in the world. Without unselfish regard for others, there would be no place for charitable organisations in our society. A society that is based solely on self-centered considerations cannot function. There must be some concern for others' needs if there is to be any continuing collaboration of the type that makes for social coherence and continuity."

 

Chapter II Beyond Alms-Giving

Katy Butler, in 'Robin Hood was Right', notes, "There are only three things to be done with surplus money: spend it, invest it or give it away. Each person must decide what combination of the three makes the most sense, personally and morally."

Andrew Carnegie, a one-time penniless bobbin boy, gave away $350 million to various philanthropic causes. Perhaps his most enduring contribution to civilisation was the setting up of some 3,000 libraries in the United States of America and abroad.

Carnegie in 'The Gospel of Wealth', summed up the duty of 'the man of wealth' as follows: "To set an example of modest, unostentatious living, shunning display or extravagance; to provide moderately for the legitimate wants of those dependent upon him; and, after doing so, to consider all surplus revenues which come to him simply as trust funds, which he is called upon to administer, and strictly bound as a matter of duty to administer in the manner which, in his judgement, is best calculated to produce the most beneficial results for the community - the man of wealth thus becoming a mere trustee and agent for his poor brethren, bringing to their service his superior wisdom, experience, and ability to administer, doing for them better than they would or could do for themselves."

Carnegie had identified seven "best uses to which a millionaire can devote the surplus of which he should regard himself as only the trustee":

Carnegie also had a word of caution for what he called 'indiscriminate charity'. He believed, "It were better for mankind that the millions of the rich were thrown into the sea than so spent as to encourage the slothful, the drunken, the unworthy. Of every thousand dollars spent in so-called charity today, it is probable that nine hundred and fifty dollars is unwisely spent - so spent, indeed, as to produce the very evils which it hopes to mitigate or cure."

Carnegie then provides an analogy of a well-known writer of philosophic books who had given a quarter of a dollar to a man who approached him, although he had every reason to suspect that it would be spent improperly. Carnegie felt, "The quarter dollar given that night will probably work more injury than all the money will do good which its thoughtless donor will ever be able to give in true charity. He only gratified his own feelings, saved himself from annoyance - and this was probably one of the most selfish and very worst actions of his life."

In bestowing charity, the main consideration should be to help those who will help themselves; to provide part of the means by which those who desire to improve may do so; to give those who desire to rise the means by which they may rise; to assist only to the extent that is required, rarely or never to do all. Carnegie firmly believed, "Neither the individual nor the race is improved by almsgiving....for in alms giving, more injury is probably done by rewarding vice than by relieving virtue."

Modern and forward-looking as Carnegie's philosophy on 'giving' may seem, it has its roots in the Greek tradition of broad gifts for the populace as a whole. The Athenian citizen, Herodes Atticus, provided water supply to the city of Troas, a theatre to Corinth, a stadium to Delphi, aqueducts for Canusium in Italy and baths for Thermopylae. Many, if not most, of the other benefactions of that period were similar to those of Atticus. Indeed, they were all acts of philanthropy (for the public at large) and not charity (for individual needy people).

Bertrand Russell had observed a complete absence of benevolence in the Greek philosopher Aristotle. The sufferings of mankind, in so far as Aristotle was aware of them, did not move him emotionally. In fact, he held them, intellectually, to be an evil.

 

Not by wealth alone

Philanthropy, however, is not about giving of one's wealth alone. It includes giving of one's time, experience, expertise and labour. John D. Rockefeller, another leading philanthropist and contemporary of Carnegie, believed, "The most generous people in the world are the very poor, who assume each other's burdens in the crises which come so often to the hard-pressed. The mother in the tenement falls ill and the neighbour in the next room assumes her burdens. The father loses his work, and neighbours supply food to his children from their scanty store. How often one hears of cases where the orphans are taken over and brought up by the poor friend whose benefaction means great additional hardship! This sort of genuine service makes the most princely gift from superabundance look insignificant indeed..... It is only the spirit of giving that counts, and the very poor give without any self-consciousness."

R.M. Lala, in a paper titled "Not by Funds Alone", contributed for the International Conference on Corporate Philanthropy (1991), provided an interesting anecdote. "As a trust officer," he wrote, "I received a handwritten appeal from a young man in Pune who said he was the son of a farmer who had an annual income of Rs 5,000/-. He was studying agriculture at the University. He applied too late to get a government scholarship and was in grave difficulties. I requested a young man from the Symbiosis College of Management, Pune, to visit and find out whether the case was genuine and whether he deserved our scholarship."

Lala then quotes from the letter of the management student, Bharat Avalani, "Presently he is having a very difficult time and it is very difficult for him to also pay his mess bill which comes to around Rs 250/- per month. He says sometimes he has only one meal a day. Also I must mention that he is quite thin and looks a little undernourished.....I personally feel that he is very deserving and sincere.... I shared this with some of my close friends and we had the thought that we should also do something to ease his burden. We also realise now how fortunate and privileged we are. So far I've managed to collect Rs 300/- from friends who have contributed willingly and voluntarily after hearing about Rajesh. Another friend who has a family business of his own, offered to pay his mess bill next month."

Concludes Lala, "The philanthropy of the students reached Rajesh before I could, as Director of the Sir Dorab Tata Trust, sign the scholarship letter." Adds Lala, "And the conclusion I have come to is that men are more important than funds - men dedicated to serving their fellowmen in a country of India's size, diversity and problems, the way to uplift the nation is to light the spark in a million hearts and let them find their momentum. Funds are needed to assist them. But if you start with creating large organisations and expect them to do the job, you are beginning at the wrong end. We need men who will plan the strategy, have the dedication and also give of themselves."

Head over heart

The patron saint of American philanthropy is not Dorothea Dix or any other saintly person but rather Benjamin Franklin, the man with a business sense and an eye on his community. For Franklin, doing good was not a private act between a bountiful giver and a grateful receiver, it was a prudent social act. A wise act of philanthropy would, sooner or later, benefit the giver, along with all other members of the community.

While living in Philadelphia, Franklin developed philanthropic enterprises which included projects for establishing a city police, for the paving and the better cleaning and lighting of city streets, for a circulating library, for the American Philosophical Society for Useful Knowledge, for an Academy for the Education of Youth (origin of the University of Pennsylvania), for a debating society and for a volunteer fire department. Few, if any, of Franklin's enterprises were primarily for the immediate relief of distress or misfortune. If an activity was required and was not yet performed by the Government, he thought it perfectly reasonable that individuals club together to do the job, not only to fill the gap, but also to prod or shame the Government into doing their part.

Julius Rosenwald considered the concept of 'benevolent giver and grateful receiver' and the axiom that the 'poor are always with you', as 'sob-stuff' philanthropy. Rosenwald was not hard-hearted, but merely tough-minded. He said, "I do not like the 'sob-stuff' philanthropy. What I want to do is to try to cure the things that seem to be wrong. I do not underestimate the value of helping the underdog. That, however, is not my chief concern but rather the operation of cause and effect. I try to do the thing that will aid groups and masses rather than individuals."

Ideas on philanthropy have varied with the customs of people, with changing needs and with the development of the human mind and man's desire to make life happier for others. India, today, has come a long way from the concept of feeding the cow, the dog and the Brahmin. While Mahatma Gandhi believed, "All wealth is a social trust and every individual a trustee entitled to its proper utilisation for the common good", Jamsetji N. Tata (1839-1904) felt, "What advances a nation or a community is not so much to prop up its weakest and most helpless members but to lift up the best and the most gifted so as to make them of the greatest service to the country." States R.M. Lala, in 'The Heartbeat of a Trust', "Jamsetji was a man sensitive to the suffering of his people but realised that 'patchwork philanthropy' as he called it - giving some food here and clothes there - would not go far."

India being a land of many cultures and ethnic groups, there is a natural and healthy diversity in the philosophy and approach to philanthropy. Some strike at the root, while others address only the external manifestations. Mother Teresa felt, "Poverty is man-made and not by God." She believed, "Those who are consecrated (to the work of God), poverty is a joy and a freedom. If you talk of cruelty, you are judging others and meanwhile someone who needs help may die in the next two hours. If you judge people, you have no time to love them." Mother Teresa was not concerned about how poverty or suffering can or should be removed. She only knew that poverty and suffering exist and, therefore, it is our duty to be of service.

In this diversity of approach, however, there is but one common factor - philanthropy or the love for human beings.

Chapter III Institutionalised Philanthropy

The earliest form of institutionalised philanthropy dates to 150 B.C. Roman law broadened the legal heir concept by declaring philanthropic organisations to be both 'sentient reasonable beings' and 'immutable undying persons.' The reign of the 'five good emperors' (beginning 96 A.D.) gave a further fillip to these concepts. Nerva accorded the cities the right to accept and administer bequest of funds, Trajan extended this privilege to towns and Hadrian to villages, and Marcus Aurelius permitted even private groups to receive bequests.

In India, the first institutionalised efforts in social development and welfare were initiated by Christian missionaries in the early nineteenth century. Apparently, the objective was to propagate Christianity, but their contribution to the establishment of schools, colleges, dispensaries and orphanages cannot be underrated. Later in the same century, the English established a number of organisations for the promotion of professions, arts, culture and research, notable among these being the Bombay branch of the Royal Asiatic Society and the Bombay Natural History Society.

The advent of Mahatma Gandhi on the Indian socio-political scene gave a fresh impetus to the voluntary movement in the country. He believed that voluntary action was the only path to India's development. His vision of development included all facets of life- social, economic, cultural, political and spiritual. His conceptual framework of rural development was constructing self-supporting, self-governing and self-reliant village communities where everyone's needs were satisfied, and everyone lived in harmony, co-operation and peace. To achieve this goal, Gandhiji introduced a constructive programme to achieve egalitarianism in Indian society by introducing basic education and sanitation, and by eradicating untouchability.

Origin of trusts

In England, trusts came into existence as a creation of the Court of Chancery. They were an outcome of the feudal 'uses' invented by medieval lawyers in England, in order to overcome the hardship of the Common Law rules preventing the land from being 'devised' (i.e., left by will) and the hardships of the feudal burdens imposed by the feudal lords of the manor on freehold tenants under the feudal system of the Middle Ages (500 A.D. to 1500 A.D.).

Trusts, in the sense in which that term is used and known in English law, was not known to Hindu law. However, in the wider sense of the term, it was quite analogous. There are instances in the Hindu law of the Karta of the Joint Hindu Family managing on behalf of a minor or absent members, or cases of setting apart of property which is intended to be held and used by the manager for the time being, for the purpose of providing for the worship of an idol or of carrying out any other religious or charitable obligation of the original donor.

The earliest legislation on trusts had three different legislative measures called Regulations: