We tend to gift our close people, for whom we have a natural love and also affection towards them. But, did we ever think of what are the necessities that are required to be done before the execution of gifts to that nearest person. When we talk about gifts, do we use consideration that we tend to bring in whenever there is the transfer of something? What are the modes in creating such gifts as per law? Whether the gift needs to be movable or immovable, or even both? This article will be answering all these questions by making sure that we understand the essence and basic concepts lying in the concept of the gift from the legal sense.
What do we mean by the term Gift?
Before looking into the various legal provisions that deal with gifts, it is very much important to understand what a gift means in both normal as well in legal terms.
In general, a gift is provided to any person with whom we have a close connection or bonding through natural love and affection. This may be any kind of property.
So, in essence, gift involves the transfer of any movable or immovable property, and because of this fundamental reason, we refer to important and ancient legislation named – Transfer of Property act, 1882. Let us look into the legal aspect of the said act of 1882 and its relevance in terms of gifts.
Transfer of Property act and Gift:
This enactment deals only with the transfer that takes place through the act of the parties involved. In a way, this is positioned in the center with contract acts and succession acts on both sides, giving a blend and residuary matters to be contained in this law. Coming to provisions relating to gifts, sections 122 to 129 under chapter VII of the act of 1882 exclusively define and provide the modes, requirements, types, and qualifications to the parties while making the gifts under this act. These provisions take help from the contract act as well as the succession act to ensure that there are no contradictions that exist in all other laws, especially in those two laws.
Defining Gift and Essentials under the act:
- Section 122 of the Transfer of Property act, 1882
Firstly, section 122 of the transfer of property act defines what a gift is and what few of the essentials are for the same. Let us look into the bare text of section 122 under the Transfer of Property act of 1882. It reads as follows.
“Gift is the transfer of any kind of movable or immovable property that is existing and are made by a person who is called donor of such gift voluntarily and without the consideration to another person, who is called as a donee or any person on his behalf.
Acceptance when to be made: such an acceptance of the gift offered should be made during the lifetime of the donor and while he is still capable of giving. If the donee dies without giving the acceptance, it becomes void.”
So, whenever there is a gift made, it requires the parties to ensure that two main ingredients are fulfilled. They are 1. The voluntary transfer of property,
2. No consideration for the same.
Here is where the contract act comes into the picture. Because section 2(d) of the Indian Contract act, 1872 requires pecuniary consideration, and love and affection shall be excluded from pecuniary consideration. But, this is complete only when there is love and affection while making the gift and are not contrary to what has been required under section 25 of the Indian Contract act, 1872.
The term voluntariness denotes the importance of free consent under section 14 of the contract act and no undue influence as per section 16 of the act of 1872.
What is the mode of conveyancing under the act?
Having known the definition and essentials of the gift, it is equally important for us to understand how we make ensure the conveyancing of such property to another property. Conveyance in civil contractual laws, as we know, that it is the way through which the properties are generally transferred from one party to the contract to another.
In cases of gifts, section 123 provides the mode of transfer of property. It states that a gift – if immovable – then such kind of immovable gifts should be transferred or made conveyance through a registered instrument or a deed.
Property which is of corporeal or incorporeal or whose value is more than Rs. 100, then the procedure under the act requires attesting of two witnesses and signature followed by registration.
If any possession of the immovable property is gifted to the donee without the registration as per law, then there is no good title that can be enjoyed by the donee and protected as per section 53A.
Whereas, if the same is movable in nature, then it may not require the registration but shall require to be effectuated by way of delivery of possession. There is no mandatory registration in this situation. Section 3 of the Sale of Goods act, 1930 is referred here, where delivery of goods is made as per the parties and any act which will be considered to be delivered as agreed by the parties.
Suspension or Revocation of Gifts:
Whenever there is a gift made by the donor in favor of donee, then there shall be no revocation or suspension shall take place without anything specified or agreed between the parties. This is the general rule whenever there is a gift, or any transfer of property is effectuated under the act of 1882.
Section 126 gives the power to revoke or suspend the effectuated gift between the parties in cases where there was a contract while giving the gift. It also states that parties shall agree with the revocation of gifts on the happening of any event. But, the event should not be in the complete control of the donor who made the gift, and if it was so, then such shall be held void.
