The Gift

Meaning:
According to Section 122 of Transfer of Property Act, 1882 ‘Gift’ is defined as the transfer
of certain existing moveable and immoveable property made voluntarily and without
consideration, by one person called the donor, to another, called the donee, and accepted by
or on behalf of the donee.

Gift, as defined in this section, is gratuitous transfer of ownership in some existing property
made voluntarily. The definition includes gift of both movable as well as immovable
property. The transferor is called donor and the transferee is called donee.
Essentials of a Valid Gift
The essentials of a valid gift are given below:
1. There must be transfer of ownership :
As in case of a sale, there must be a transfer of all the rights in the property by the donor to the done.
It may, however, be noted thait is permissible to make conditional gifts. The only restriction is that
the condition must not be repugnant to any of the provisions of Section 10 to 34 of the Transfer of
Property Act, 1882.
2. The ownership must relate to a property in existence:
Gift must be made of existing movable or immovable property capable of being transferred. Future
property cannot be transferred. The share obtained after partition of the joint family property can be
gifted. Even a gift of property that obtained after a preliminary decree of partition is passed by the
court is valid.
3. The transfer must be without consideration
4. It must have been made voluntarily
5. The donor must be a competent person
6. The transferee must accept the gift
Registration of Gift deed: Section 123

According to Section 123, a gift of immoveable property must be made by a registered instrument
signed by or on behalf of the donor and attested by at least two witnesses.

Where a gift in favour of someone is registered but it is not accepted by the donee, the gift is
incomplete. Suppose, a document is executed by the donor making a gift of immoveable property
and the deeds are delivered to the donee, and the donee accepts the gift but the document is not
registered? The Courts held the gift as valid in the eyes of law.

While registration is a necessary formality for the enforcement of a gift of immoveable property, it
does not suspend the gift until registration actually takes place. The donee in such a case can ask the
donor to complete the gift by registration. Thus, the most essential thing for the validity of a gift is
its acceptance. If the gift is accepted but not registered it is a valid gift.
Suspension or Revocation of Gift Section 126
Section 126 of Transfer of Property Act, 1882 deals with when gift
may be suspended or revoked.
1. Revocation by mutual agreement of donor and donee.
2. Revocation by rescission as in the case of contracts.

Illustrations
(a) A gives a field to B, reserving to himself, with B’s assent, the right
to take back the field in case B and his descendants die before A. B dies
without descendants in A’s lifetime. A may take back the field.
(b) A gives a lakh of rupees to B, reserving to himself, with B’s assent,
the right to take back at pleasure Rs. 10,000 out of the lakh. The gift holds
goods as to Rs. 90,000, but is void as to Rs. 10,000, which continue to
belong to A.
No Revocation on any other ground
Except on the ground of (a) condition subsequent not depending on the pleasure of the donor and (b)
on the grounds justifying of a contract, a gift cannot be revoked on any other ground.
Sheel Arora v. Madan Mohan Bajaj, AIR 2009 NOC 333 (Bom).
A gift deed was validly executed in favour of the done. It was held that a simultaneous claim by the
donor that the gift deed was revoked unilaterally by him and lodged for registration was not valid as
there was no participation by the donee.
Asokan v. Lakshmikuty, (2007) 13 SCC 210.
A father executed a registered deed of gift in favour of his son. He had done it because of love and
affection for the son and also to enable him to live a peaceful life. There was no proof of undue
influence. The done remained out of India for a long time. In the meantime the gift deed remained
with the donor and he also kept paying taxes. There was no mutation for that period in the revenue
records. The Supreme Court held that these circumstances were not sufficient in themselves to show
that the execution of the gift deed was not voluntary. The deed could not be rescinded on the
premise that it was an onerous gift and that the done had failed to fulfill the condition for the gift of
contributing towards the marriage of the donee’s sister the specified sum. Once a gift is complete, it
cannot be rescinded for any reason whatsoever. The subsequent conduct of the done is not a ground
for rescission of a valid
Transferee for Consideration without Notice

The last paragraph of Section 126 of the Act protects the interest of a bonafide transferee for
consideration without notice of donor’s right of revocation.

For example, A makes a gift of his house to B with a condition that he shall revoke the gift if B’s son
does not take up the studies of law after graduation. B sells the house to C. C has no notice of any such
condition. After graduation B’s son does not join the law course. A cannot revoke the gift because C’s
interest shall be affected. If C has notice of such condition or that C was a gratuitous transferee, A could
have revoked the gift.
Suspension or Revocation of Gift under Mohammedan Law

A gift, where both the parties are Muslims, is governed by the provisions of Quranic Law, also known as the
Mohammedan Law, and not by the transfer of Property Act as it is inconsistent with the provisions of this act. A
Mohammedan, as opposed to others, can revoke a gift even after delivery of possession except in the following
cases-
1. When the gift is made by a husband to his wife or by a wife to her husband;
2. when the donee is related to the donor within the prohibited degrees;
3. when the gift is Sadaka (i.e. made to a charity or for any religious purpose).
4. when the donee is dead;
5. when the thing given has passed out of the donee's possession by sale, gift or otherwise;
6. when the thing given is lost or destroyed;
7. when the thing given has increased in value, whatever be the cause of the increase;
8. when the thing given is so changed that it cannot be identified, as when wheat is converted into flour by
grinding; and
9. when the donor has received something in exchange for the gift Except in those cases, a gift may be revoked at
the mere will of the donor, whether he has or has not reserved to himself the power to revoke it, but the
revocation must be by a decree of court.
Types of Gifts

1. 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.
2. 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.
3.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.

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 an
onerous donee. He cannot take the gift of the shares of X & Co. only.
Effect of Onerous gift

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 completeness of the gift is not affected if the done after accepting gift, dies before
attaining the age of majority.
Universal Donee Sec. 128
Meaning of Universal Donee

The universal Donee is one to whom the donors whole property is given and who consequently become liable for all the
debts due by and liabilities of the donor at the time of the gift to the extent of property comprised in the gift

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

made.

.
Section 128 of Transfer of Property Universal Donee

Subject to the provisions of section 127, where a gift consists of the donor's whole property, the donee is
personally liable for all the debts due by and liabilities of the donor at the time of the gift to the extent of the
property comprised therein.

Essential

All the properties of Donor should have been transferred to the donee. In order that a person maybe Universal
Donee, all the properties both movable and immovable of the donor must be given to him. Universal Donee is
personally liable for all the debts and liabilities of the donor at the time of the gift to the extent of the property
comprised therein. The object of section 123 is to protect the interest of the creditor, similar like section 53.
For example fraudulent transfer. In Universal Donee under section 128 all the properties of the donor should
have been transferred to the donee. It has been held that even if the life interest in the part of the property is
retained by the donor, the donee is Universal donee. However if only all the immovable properties are
transferred the donor continue to hold movable, the donee cannot be called as universal Donee. But if only the
doner retain a small insignificant part of the property, the donee will be treated as a universal Donee.