Gift
Sec.122-129
1. Definition– Sec.122
A gift is the transfer of certain existing movable and
immovable property made voluntarily and without
consideration by one person called the donor, to another
person called the donee, and accepted by or on behalf of the
donee.
Acceptance when to be made—
Such acceptance must be made during the life time of the
donor and still he is capable of giving. If donee dies before
acceptance the gift is void.
2. Essentials of the Gift
i) There must be transfer of Ownership-
As in the case of a sale, three must be transfer of all the
rights from the donor to donee.
It may be however be noted that it is permissible to make a
conditional transfer. However that condition should not be
repugnant to any provision in the Act.
ii) Existence of Property—
The transfer may take effect in present or in future but it
cannot be made of any property which is not in existence at
the date of the gift. Existence of property is necessary.
iii) Voluntarily—
The word voluntarily signifies the exercise of unfettered
will. His will said to be free, when his consent is not influence
by coercion, undue influence and fraud.
Smt. Nishmani Singh v Dibya
Donor pleaded that donee had taken her signatures on
document after giving her understanding that it was merely a
power of attorney for managing her properties. Donee also not
shown to have remained in possession of property.
Attestation also not proved.
Hence, no benefit can be derived by donee form such deed.
( not a valid gift)
iv) Without Consideration–
The word Consideration is used in the same sense as in
the Indian Contract Act 1872 and excludes natural love and
affection.
Tulasidas v CIT
A transfer in consideration of an expectation of spiritual and
moral benefit, or in consideration of natural love and affection
is a gift.
v) Donor–
He is a person who makes gift . He must be sui juris (legally
qualified to enter into contract ) . A minor cannot be a donor.
vi) Donee–
Donee is a person who accept the gift. There is no
restriction that the donee should be a sui juris. He may be any
person except for a Onerous gift.
vii) Acceptance by the Donee—
A gift must be accepted by the donee or some one on behalf
of the donee, during the life time of the donor and while he is
capable of giving. A gift cannot be made to the public or
charity.
3.Gift how made effected– Sec.123
For the purpose of making a gift of immovable property the
transfer must be effected by a registered instrument signed by or
on behalf of the donor and attested by at least two witness.
For the purpose of making gift to movable property, the transfer
may be effected either by registered instrument signed as
aforesaid or by delivery.
Such delivery may be made in the same way as the goods sold
may be delivered.
Late Radha Sah through L.Rs v. Most.Girja Devi through
L.R. (AIR 2018 Pat.115)
The gift deed executed with only one witness. The deed
executed is apparently not according to law. Hence the same is
void document.
4. Suspension and Revocation of Gift-Sec.126
The general rule is that duly completed gift cannot be revoked
or suspended. However this section provides circumstances
under which a gift may be suspended.
a) A gift may be revoked in any of the circumstances in which
if it were a contract it could be revoked.
i.e if the consent is not free, and object is not lawful etc.
b) If any agreement between donor and donee the gift is made
revocable on the happening of a certain condition which does
not depend on the mere will of the donor.
E.g – A gives the field to B, reserving to himself, with B’s assent,
the right to take back the field in case B and his children die
before A.
B dies without children in A’s life time . A may take back the
field.
A resumable gift is no gift at all
A resumable gift is one which can be revoked at any time
at the mere will of the donor. Such gift is void at notice.
E.g. A gives Rs.50,000 to B , reserving to himself with B’s
assent the right to take back at his pleasure Rs.10,000 at
any time. The gift holds good as to Rs.40,000 but it is
void as to Rs.10,000 – which continues to belong to A.
Cannot be revoked
The last part of this section says that though a gift may be
validly revoked, in any of the cases mentioned above, the
donor will not be able to recover the property, if it passed to
the hands of bonafide transferee for consideration without
notice. ( i.e it cannot be revoked)
Chameli v Naresh Kumari
A gift deed was executed by the owner in favour of the donee
on the condition that they would serve him during his life
time, failing which, it would revert back to the donor or to his
heirs.
The donee properly served the donor till his death and it was
held that the gift remained perfectly valid absolute as the
condition was adequately fulfilled.
Kinds of Gifts
1. Onerous Gift– Sec.127
Principle underlying in this section is based on the maxim “qui
sensit commodum debt et sentire onus” he who receives the
advantage must bear or suffer the burden also.
Where a gift is in the form of single transfer to same person of
several things of which one is burden and the others are not
burdened by obligation the donee can take nothing by the gift
unless he accepts it fully.
Ex. A has shares in X a prosperous company and also shares in
Y company which is in difficulty. A gives B all his shares in
both companies . If B refuse to accept the shares in Y he
cannot take the shares in X company.
But, where a gift is in the form of two or more separate and
independent transfers to the same person, the donee is at
liberty to accept one of them and reject the others, although
former may be beneficial and the latter onerous.
2. Universal Donee- Sec.128
He is a person to whom the entire properties of the donor has
given.
In order to treat any person as universal donee, he would have
received the whole property of the donor without retaining a
single pie with him.
When the gift consist of all the immovable property and does
not comprise of movable property, the donee cannot be said to
be universal donee.
He is liable personally for all the debts and liabilities of the
donor.
To the universe, it is the universal donee who is accountable on
behalf the donor for all his debts and liabilities.
The universal donee is responsible to the universe for his
donor’s debts and liabilities only to the extent of the amount
received by him at the time of gift.
3. Donatio Mortis Causa ( Death Bed Gift)
Sec.129
If a gift is made when the donor is seriously ill or suffering
from a disease which actually causes death, it is known as
donatio mortis causa.
In other words it is called a donation made out of fear of death
or in contemplation of death. That is why it is called death bed
gift.
Donatio Mortis Causa of movable property is excluded from the
purview of the T.P.Act .
So this chapter will apply only to immovable property.
For movable property Indian Succession Act applicable.
Conditions-
a) A person making gift must have expected his death due to
illness
b) The death bed gift is valid only when donor dies
c) The gift has no effect prior to the death of donor.
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