Earlier, trusts could place funds only in bank deposits, co-operative banks, or post offices under the Maharashtra Public Trusts Act, 1950. Any other investment required separate approval.
The new order removes the need for case-by-case permission. Trusts can now invest up to half of their funds in instruments listed in the circular.
Permitted options include mutual funds regulated by SEBI with at least 65% in listed shares. Trusts can also invest in exchange-traded funds (ETFs) and index funds that replicate indices like Sensex, Nifty, or designated disinvestment indices.
Debt options are allowed too. These include listed or proposed-to-be-listed corporate bonds with a minimum maturity of three years and at least a AA rating from two SEBI-registered credit rating agencies.
Trusts can also invest in Basel III Tier-I bonds issued by scheduled commercial banks. Government securities and securities guaranteed by the central or state government are permitted.
The circular also allows investments in shares of listed companies with a market capitalisation of at least ₹5,000 crore. Infrastructure-related debt instruments, including infrastructure debt funds regulated by RBI or SEBI, are also included.
The move is intended to provide more investment flexibility and improve returns for trusts. Many temple trusts and charitable trusts in Maharashtra keep large sums in low-yield deposits.
The new framework aims to align the state’s rules with broader national investment norms for trusts. The change clarifies that temple trusts are permitted to invest in eligible mutual funds and securities within the prescribed limit, without requiring individual approvals each time.
Trustees must still ensure compliance with conditions and exercise due diligence. The limit remains at 50% of trust funds. The remaining portion must stay invested as per the existing rules.
Maharashtra has a large number of religious and charitable trusts that could benefit from this updated investment option.
First Published: Jul 29, 2025 10:31 AM IST