GIFT DEED

 

Section 122 of the Transfer of Property Act, 1882 defines 'gift' thus:

(i) Gift is the transfer of certain existing movable or immovable property and not of future property;

(ii) It must be voluntary; it should not be induced by coercion, undue influence, fraud or misrepresentation;

(iii) It should be without consideration: it can be for natural love and affection or for past consideration. it cannot be for natural love and affection or for past consideration, it cannot be for present or future consideration;

(iv) It must be accepted by the donee. It may be pointed out that the definition of gift in the Gift Tax Act.1958, includes a transfer for inadequate consideration, a release, a discharge and surrender. But this definition is for the purposes of gift tax only.

 

Persons Capable of Making Gifts :

A person who is competent to contract can make a valid gift. A minor or a lunatic cannot make a gift. The donor must also have a disposing power over the property sought to be gifted.

 

Who can be Donee:

The donee must be on existing person. He must be an ascertained or ascertainable person. A gift can be made in favour of a minor or a Hindu idol. But a gift in favour of the public, to dharma or for worship of God is void for vagueness of donee. A gift can be made in favour of a legal person. It can even be made in favour of government.

 

Acceptance of Gift:

Acceptance of a gift be in behalf of the donee is essential to the validity of a gift. The acceptance must be made during the lifetime of the donor and while he is still capable of giving. If either the doner or the donee dies before acceptance the gift is void the acceptance can be made either orally or by conduct (e.g., by taking possession of the property) or in writing. The best and the safest course is to join the donee as a party to the deed and to state the acceptance of the gift in the deed itself. Or a separate endorsement may be made by the donee on the deed accepting the gift and signed by him A gift may be accepted on behalf of a minor by his guardian and on behalf of an idol by its manager. The donee's receiving the gift deed form the donor after execution thereof, and presenting it for registration and getting its registered, amounts to acceptance of the gift.

 

Gifts under Hindu Law:

The right given and the restrictions imposed by Hindu law in respect of the powers of a Hindu to make a gift still apply but the made of making a gift is governed by the provisions of chapter VII of the Transfer of Property Act. Thus a gift by a Hindu of his separate and self-acquired immovable property can only be made in the manner prescribed by Sec. 123 of the transfer of property Act, and it has to be accepted by the donee.

 

Gift under Mohammedan Law

The Mohammedan law of gifts is unaffected by the provisions of the Transfer of Property Act. Since Mohammedan law permits an oral gift even with respect to a gift of immobile property a registered instrument is not necessary for such a gift by a Mohammedan under Mohammedan law the essentials of a gift are a declaration of gift by the doner, the acceptance of the gift b Y the donee and delivery of possession such as the subject of 'the gift is susceptible of even a registered deed of gift is ineffectual under Mohammedan law if it is not accompanied by delivery of possession. Under Mohammedan law a Mohammedan can make a valid gift to a Hindu or any other person and such a gift is governed by the law of the donor. 

Gift How Made 

The mode of making gifts is prescribed by Sec. 123 of the transfer of property, can only be made by a written instrument signed by the donor, attested by at least two attested. A gift of movable property may be made either by a written, attested and registered document or by delivery of the property to the donee. It is permissible to make conditional gifts. The donor and donee may agree that on the happening of any specified event which does not depend on the will of he donor a gift shall stand revoked. A gift which the parties agree shall be revocable at the will of the donor. A gift can be made which is effective only during the lifetime of the donee. A donor can reserve a right in himself for life to take the profits of the property gifted or he may also, while making an outright gift, impose a condition that the donee shall maintain him. A gift may also be made for a specific purpose and on the failure of that purpose the property reverts to the donor. 

Revocation of Gifts 

A gift once duly made and accepted cannot be revoked. A conditional gift which provides that it shall stand revoked on the happening of a specified event which does not depend on the will of the donor is revoked when that event happens. A gift may also be revoked if it has been obtained by coercion, undue influence, fraud or misrepresentation. A gift for specific purpose can be revoked on the failure of that purpose.   

Stamp Duty 

An instrument of gift is chargeable with stamp duty under Art. 33 of schedule I of the Stamp Act. The duty is the same as is payable on a conveyance which is for a consideration equal to the value of the gifted property. A conveyance is charged under article 23.