Mutual Fund Investment for Public Trusts - Maharashtra Charity Commissioner Circular No. 619


BDPS Associates • Trust Investment & Compliance

Maharashtra Charity Commissioner Circular No. 619: Mutual Fund Investment for Public Trusts

A practical guide to Section 35 of the Maharashtra Public Trusts Act, the 50% general permission, eligible securities, Mutual Fund categories, and the separate Income-tax compliance under Section 11(5) and Rule 17C.

Official Charity Commissioner Circular

Circular No. 619 dated 21 July 2025 was issued by the Office of the Charity Commissioner, Maharashtra State, Mumbai, under Section 35 read with Section 3 of the Maharashtra Public Trusts Act.

Download Official Circular No. 619 View Official Circular List

Why Circular No. 619 Is Important for Public Trusts

Section 35 of the Maharashtra Public Trusts Act deals with Trust money that cannot immediately or at an early date be applied to the purposes of the Public Trust. Circular No. 619 records the statutory framework and uses the Charity Commissioner’s power under the second proviso to Section 35 to issue a general order for specified investments.

The Circular states that trustees of Public Trusts may invest up to fifty per cent (50%) of Trust money in the securities specified in the general order, subject to the conditions contained in the Central Government notification dated 21 April 2017. This removes the need to file a separate application before the Charity Commissioner every time for an investment that falls within the scope and conditions of the general order.

Important: The 50% permission is not a blanket approval for every investment product. The proposed investment must fall within the categories and conditions specified in Circular No. 619.

Mutual Fund Categories Specifically Covered

1. SEBI-Regulated Debt Mutual Funds

The Circular expressly includes units of debt mutual funds regulated by the Securities and Exchange Board of India (SEBI). This gives Public Trusts an additional regulated investment avenue beyond conventional deposits, subject to the Trust’s own documents, investment policy, liquidity needs, risk considerations and applicable tax law.

2. Certain SEBI-Regulated Mutual Fund Schemes

The Circular also includes units of SEBI-regulated Mutual Funds that have a minimum of 65% of their investment in shares of body corporates listed on recognised stock exchanges. Therefore, eligibility should be checked at the scheme level and not merely by the name of the AMC or investment platform.

3. ETFs and Index Funds

Eligible SEBI-regulated Exchange Traded Funds (ETFs) and Index Funds are also covered where they replicate the portfolio of the BSE Sensex or the NSE Nifty, along with the other eligible structures specified in the Circular.

Other Specified Securities Mentioned in the Circular

  • Government securities.
  • Securities whose principal and interest are fully and unconditionally guaranteed by the Central Government or a State Government.
  • Specified listed or proposed-to-be-listed debt securities.
  • Basel III Tier-I bonds of Scheduled Commercial Banks, subject to the stated conditions.
  • Specified infrastructure-related debt instruments.
  • Eligible Infrastructure Debt Fund securities/units.
  • Certain listed equity shares satisfying the conditions in the Circular.
  • Eligible Mutual Fund units, ETFs and Index Funds as described above.

Charity Commissioner Compliance and Income-tax Compliance Are Separate

A very important distinction must be maintained. An investment being permitted under Charity Commissioner Circular No. 619 does not automatically mean that it satisfies the requirements applicable to a charitable or religious trust under the Income-tax Act.

For Income-tax purposes, trusts claiming exemption must separately examine the permissible investment modes under Section 11(5) and the additional modes prescribed under Rule 17C. Rule 17C includes investment in units issued under any scheme of a Mutual Fund referred to in Section 10(23D), subject to the applicable law.

Official Income-tax Section 11 Official Rule 17C

Before a Trust Invests: Recommended Compliance Checklist

  1. Review the Trust Deed and verify that the proposed investment is not restricted by the governing document.
  2. Pass a Trustee / Board Resolution approving the investment and authorised signatories.
  3. Check Circular No. 619 eligibility for the exact security or scheme.
  4. Check Section 11(5) and Rule 17C where Income-tax exemption is relevant.
  5. Verify the exact Mutual Fund scheme rather than relying only on the AMC/platform name.
  6. Assess risk, liquidity and time horizon because Trust funds carry fiduciary responsibility.
  7. Complete Trust KYC and bank verification in the name of the Trust.
  8. Maintain full documentation including resolution, KYC, application, bank proof, statements, scheme documents and redemption records.
  9. Review the portfolio periodically for continued suitability and compliance.

Why Scheme-Level Verification Matters

An AMC may offer liquid funds, money market funds, corporate bond funds, banking & PSU funds, government securities funds, dynamic bond funds, index funds, ETFs, equity funds and hybrid funds. The legal and tax treatment can differ between schemes. Therefore:

Check the Scheme — Not Just the Mutual Fund Company.

BDPS Associates – Trust Mutual Fund Investment Assistance

BDPS Associates assists Public Charitable Trusts, Religious Trusts, Educational Institutions, NGOs and other eligible organisations in understanding and implementing suitable investment options while keeping the applicable Charity Commissioner and Income-tax compliance in view.

Investment Access / Assistance Available Through

Click any logo or the WhatsApp Enquiry button to connect directly with BDPS Associates for an enquiry related to that investment platform / Mutual Fund provider. The names and marks belong to their respective owners. Availability of a platform, AMC or scheme is subject to onboarding, KYC, product availability and eligibility for the concerned Trust. Listing here does not mean that every scheme offered by the entity is eligible for every Trust.

Our Assistance Can Cover

  • Charity Commissioner Circular No. 619 compliance guidance.
  • Section 11(5) / Rule 17C investment-mode review assistance.
  • Mutual Fund scheme eligibility review.
  • Trust Investment Resolution format.
  • KYC and investment-account documentation guidance.
  • Investment platform selection assistance.
  • Existing Trust investment portfolio review.
  • FD vs Debt Fund vs eligible Mutual Fund comparison.
BDPS Associates

Mutual Fund Investment Assistance for Trusts

For Public Trusts, NGOs, Educational Institutions, Religious Trusts and Charitable Organisations.

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Official References

Charity Commissioner, Maharashtra State: Circular No. 619 dated 21-07-2025.
https://charity.maharashtra.gov.in/Portals/0/Files/CircularSerialwise/619.pdf

Income Tax Department: Section 11 and Rule 17C.
https://www.incometaxindia.gov.in/w/section-11-5
https://www.incometaxindia.gov.in/w/rule-17c

Disclaimer: This article is for general educational and informational purposes and should not be treated as legal, tax or investment advice. Mutual Fund investments are subject to market risks. Read all scheme-related documents carefully. A Public Trust should evaluate the Trust Deed, Maharashtra Public Trusts Act, Charity Commissioner Circular No. 619, Income-tax Act including Section 11(5), Rule 17C, scheme-level eligibility, risk and all other applicable requirements before investing. BDPS Associates does not represent that every Mutual Fund scheme offered by any AMC or platform is automatically eligible for every Public Trust.
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