Gift under Transfer of Property Act 1882 PDF

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full notes on gifts, transfer of property act...

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Gift under Transfer of Property Act, 1882 Md. Omar Faruk* Definition: Section 122 of T.P. Act defines a gift. 'It is the transfer of certain existing movable or immovable property made voluntarily and without consideration and accepted by or on behalf of the donee'. Types of Gift: Gift has various types. These are: i. Lifetime Gifts: When the donor has intention to deliver any gift to the donee during lifetime period of the donor then that gift shall be considered as Lifetime Gifts. Lifetime Gifts are mainly given to the donee by the donor on the basis of some occasions like Birthday Party, Weeding Ceremony etc. ii. Deathbed Gifts: Deathbed gifts are future gifts which shall be expected to deliver to the donee after the death of the donor on the basis of intention made by the donor. These gifts are also considered as donations made by donor to the donee. So, any deathbed gift shall not be effective until the death of the donor. Example: Mr. V wants to donate Tk.1 crore after his death to Q Orphanage Trust as a deathbed gift. iii. Onerous Gift: Any gift which is made with a burden or obligation imposed on the done by the donor on any immovable property is called onerous gift. This gift also called the exchange of debt of an object from the donor to the donee. This gift is generally illegal but if the donee has no obligation to carry the burden of the gifted object then that gift may become valid on the basis of Section 127 of Transfer of Property Act, 1882 Example: Mr. Q wants to give his one of the building of Gulshan as a gift to Mr .E which has been mortgaged to N bank for Tk.2 Crore. If Mr. E wants to take burden of the mortgaged loan of that house by acceptance then this gift may be valid or otherwise it is illegal.1

Essentials of Gift:

1. http://www.lawyersnjurists.com/article/discuss-the-concept-of-gift-under-the-transfer-of-property-act/

1. Absence of consideration: Gift must be made voluntarily and without consideration.2 Gift differs from sale or exchange in that there is no consideration for the gift.3 2. Parties of Gift: According to sec. 122, there should be two legal parties for giving and taking a gift. These are: i) Donor or Guarantor: The person who makes the gift is donor. Example: Mr. X has given a Nokia N8 Smartphone as a gift to Mr. M at his birthday. Here, Mr. X is the donor of the gift of Nokia N8 Smartphone. ii) Donee or Guarantee: The person who is involving in taking a gift from donor is known as donee or guarantee. Example: Mr. X has given a Nokia N8 Smartphone as a gift to Mr. M at his birthday. Here, Mr. M is the donee of the gift of Nokia N8 Smartphone. 3. Subject-matter of gift: The object which is to be given as a gift to the done by the donor is considered as the subject matter of the gift. The subject matter of the gift must be in form of moveable property or immovable property. A future property shall not be considered as the subject matter of the gift.4 Only existing property can be subject matter of gift.5 4. Intention of the donor: The gift must be made voluntarily, i.e. intentionally.6 5. Delivery of possession: A gift of immovable property , unless it is effected by a registered deed, can only be completed by delivery of possession.7 In case of gift of movable property may be registered or may be effected by delivery of possession.8 Registration for gift of movable property is not mandatory. However gift of immovable property of any value requires registration under sections 17A of the Registration Act. It must be signed by the donor and must be attested by two witnesses. Gift to God Almighty may be oral or may be in writing or may be registered. 2. Sec. 122, Transfer of Property Act, 1882 3. 1929 P 591 4. Sec. 124, Transfer of Property Act, 1882 5. ibid 6. 179 IC 903 7. (1940)2 MLJ 963 8. Sec. 123, Transfer of Property Act, 1882

For example, A makes a gift of his jewels to B. This may be done by delivery. A makes a gift of a piece of land worth Rs.50/-. This is to be registered. 6. Acceptance of the gift by the donee: In order to effect a valid gift, both a transfer and an acceptance is necessary.9 Acceptance may be express or implied.10 Actual or constructive possession is however, proof of acceptance.11 The donee must accept the gift: a) during the life time of the donor and b) While the donor is still capable of giving the property gifted. But if the donee dies before acceptance the gift is void.12 Protection of Transferees: Transferees who take the property for consideration and without notice are protected against any prejudice that may result due to revocation by the donor.13 The leading case is: Allcard Vs. Skinner A, a sister executed a gift to S, the lady superior under undue influence. Later A sued to set aside the gift. A would have won but there was too much of delay is suing. Hence, her claim was dismissed. Revocation of gift: (i) Conditional gifts: The fundamental rule is that 'A resumable gift is not a gift at all.' A gift once given cannot be revoked at the mere will of the donor; such a gift if made, is void ab initio. But, a conditional gift is void. A conditional gift which attaches a condition subsequent is valid if the condition is not vague or illegal or immoral or opposed to public policy or impossible of performance. Hence conditional gifts may be made. Such as, a) A gifts to B a plot of land, reserving to himself with the consent of B, to take back the plot if B or his descendants die before A. B dies without any descendants during A's life time. The condition is valid and A may take back the plot. b) A make a gift to C, a concubine, for her continued relationship with the donor. The condition is immoral therefore gift is void.

9. 1923 P 165 10. 1932 ALJ 335 11. 25 ALJ 69 12. Supra note 2 13. Sec. 126, Transfer of Property Act, 1882

c) A gives Rs. 1 lakh to B reserving to himself with B's consent, the right to take Rs. 25,000 at his pleasure. Gift is valid upto Rs.75,000/- only. It is void in respect of Rs.25,000/-. (ii) Gift made under coercion, fraud undue influence or misrepresentation may be revoked by the donor.14 Reasons of Revoking or Suspending or Voiding a Gift by Law:

A donee or donor can revoke or suspend any future gift but a gift which is already delivered and accepted can’t be revoked or suspended or void. According to Section 126 of the Transfer of Property Act, 1882,-Any gift may become revoked or suspended or void for following reasons:

 If donee want to get a gift like Laptop from donor on a specific event like Birthday but the donor has not have intention to give any Laptop on birthday of the done but has been forced to give that gift then that gift shall become legally revoked or suspended or void.15  If the donee does not want to get any gift from the donor but has been forced to get that gift by the donor then that that gift shall become legally revoked or suspended or void.16  If the subject matter of the gift is illegal and full of debts then that gift shall become legally revoked or suspended or void.  If both donor and donee have intention to suspend any gift then that gift shall become legally revoked or suspended or void  If any gift is presented to the donee with misrepresentation and fraud information made by the donor then that gift shall be legally revoked or void or suspended.  If any gift contains compensation or consideration made by donor or donee then that gift shall be legally revoked or void or suspended.  If the donor of any gift dies before delivery then that gift shall be legally revoked or void or suspended.  If the donor or the donee of any gift is minor or disqualified person then that gift shall be legally revoked or void or suspended. Thus, any gift may become legally void or suspended or revoked.

14. Sec. 19, Contract Act, 1872 15. Gift- A comparitive study. (n.d.). Retrieved November 9, 2011, from http://www.lawyersclubindia.com/articles/print_this_page.asp?article_id=1468. 16. ibid

Reasons for Non-Revoking of a Gift: According to Mohammedan Law (Muslim Law in India), any gift can’t be revoked for following reasons:  If any gift is prepared by any Husband for his Wife or any Wife for her Husband then that gift can’t be legally revoked.  If any gift is intended for religious purpose, then that gift can’t be revoked.  If the subject matter of the gift is damaged or destroyed then that gift can’t be revoked.  If the donee dies before acceptance then that gift can’t be revoked.  If any immovable property has been willed by donor for donee then that gift can’t be revoked.  If the donee of the gift receives monetary value or other object in exchange of the original gift then that gift can’t be revoked. For Example: A wants to gift a Private Car to B But , A does not know what mobile car brand would attract B as a gift. So, if A wants to give money of Tk.25, 00,000 in exchange of a private car then this gift exchange process can’t revoke the gift contract. Thus, any gift can’t be revoked by Mohammedan Law.17 Onerous Gift : Section 127 of T.P.Act deals with onerous gift. It means a single transfer made to the donee but some of the properties gifted are burdened by obligations. The donee must take the entire gift. If he accepts only to take those which are without obligations, then the gift is void. But if the gift is in two or more separate and distinct transactions, the donee may select at his liberty and refuse those which are not beneficial to him. Example. : A gifts in one transaction, 200 shares of X & Co. a prosperous company and also 100 shares of Y & Co. a company in difficulties. Heavy calls are expected from Y & Co. A may take the entire gift. He is a onerous donee. He cannot take the gift of the shares of X & Co. only.18 Effect of Onerous gift: The donee is liable to the extent of the total gifted property in his hands. Onerous gift to disqualified person: If an onerous gift is made to a disqualified person, e.g. , a minor, and that person accepts it, he is not bound by his acceptance but can make his choice upon attaining majority either to accept the gift burdened with an obligation or to return it. It may be noted that so far as the donor is concerned, the gift is complete against him and he can’t claim back the property unless the done choses to return it after attaining majority. The gift is complete as soon as it has been accepted and won’t be in abeyance until the done attains the age of majority. Thus, the

17. Supra note 1 18. msrlawbooks, Transfer of property

completeness of the gift is not affected if the done after accepting gift, dies before attaining the age of majority.19 Universal Donee: Sec. 128 is about universal done. Here a gift of the entire property of the donor is made to a donee. The donee is liable for all the debts, dues and liabilities of the donor at the time of the gift. This liability extends to the extent of the property in the hands of the donee. Such a person who takes the entire rights and liabilities is called a universal donee. Property means here movable and immovable. If A makes a gift of his immovable only and not movables to B, B is not a universal donee. The universal donee is liable only to the extent of the immovable and movable property comprised in the gift. The liability is with reference to the tune of gift by the donor, that is universal donee is not liable for debts & liabilities incurred by the donor after the universal gift is made20. Conclusion: The conception of the term gift and subject matter of gift has been an age old and traditional issue which has developed into a distinct facet in property law. 21 This article is made to perceive ‘Gift’ under Transfer of Property Act in an easier way.

19. Subramania Ayyar v. Sitha Lakshmi, (97) 20 Mad. 147 (148) (D.B.) 20. ibid 21. Supra note 15...