Sunday, 28 October 2018

Whether conditional gifts of immovable property can be cancelled by donor?

Gift means to transfer certain existing moveable or
immoveable property voluntarily and without consideration by
one person called the donor to another called the donee and
accepted by or on behalf of the donee as held by the Supreme
Court in Naramadaben Maganlal Thakker Vs. Pranivandas

Maganlal Thakker and Others1. As further held by this Court
in Naramadaben Maganlal Thakker (supra) “It would be clear
that the execution of a registered gift deed, acceptance of the gift
and delivery of the property together make the gift complete.
Thereafter, the donor is divested of his title and the donee
becomes absolute owner of the property.”
15. A conditional gift with no recital of acceptance and no
evidence in proof of acceptance, where possession remains with
the donor as long as he is alive, does not become complete
during lifetime of the donor. When a gift is incomplete and title
remains with the donor the deed of gift might be cancelled.

18. We are in agreement with the decision of this Court in
Reninkuntla Rajamma (supra) that there is no provision in law
that ownership in property cannot be gifted without transfer of
possession of such property. However, the conditions precedent
of a gift as defined in Section 122 of the Transfer of Property Act
must be satisfied. A gift is transfer of property without
consideration. Moreover, a conditional gift only becomes
complete on compliance of the conditions in the deed.
19. In the instant case, admittedly, the deed of transfer was
executed for consideration and was in any case conditional
subject to the condition that the donee would look after the
petitioner and her husband and subject to the condition that the
gift would take effect after the death of the donor. We are thus
constrained to hold that there was no completed gift of the
property in question by the appellant to the respondent and the
appellant was within her right in cancelling the deed. The
judgment and order of the High Court cannot, therefore, be

sustained.
REPORTABLE
THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 10785 OF 2018
(Arising out of SLP (C) No. 35515 of 2017)

S. SAROJINI AMMA Vs  VELAYUDHAN PILLAI SREEKUMAR 

Dated:OCTOBER 26, 2018
Indira Banerjee, J.

Leave granted.
2. This appeal has been filed against the judgment and order
dated 03.04.2017 passed by the High Court of Kerala at
Ernakulam in R.S.A. No. 757/2011 whereby the High Court was
pleased to allow the Second Appeal filed by the respondent and
set aside the judgment and decree passed by the First Appellate
Court in favour of the appellant.
3. The short question involved in this appeal is whether a
document styled as gift deed but admittedly executed for
consideration, part of which has been paid and the balance
promised to be paid, can be treated as formal document or

instrument of gift. Another related question is whether a gift deed
reserving the right of the donor to keep possession and right of
enjoyment and enforceable after the death of the executant is a
gift or a will.
4. The appellant is a childless widow aged 74 years whose
husband expired on 06.06.2015. The respondent is the nephew of
the appellant (brother’s son). In the expectation that the
respondent will look after the appellant and her husband and also
for some consideration, the appellant executed a purported gift
deed in favour of the respondent. The gift deed clearly stated that
the gift would take effect after the death of the appellant and her
husband.
5. According to the appellant on or about 02.06.1999, the
appellant executed the deed of cancellation No. 1844/1999
cancelling the gift deed. After about eight months, on or about
01.02.2000, the respondent filed Original Suit No. 32/2000 in the
Court of the learned Munsif Sasthamcotta for declaration that the
cancellation deed executed by the appellant is null and void and
also for declaration of his right over the suit property being the
subject matter of the purported deed of gift.
6. On or about 20.03.2000, the appellant filed Original Suit
being O.S. No. 97/2000 before the Court of the learned Munsif,

Sasthamcotta for permanent injunction restraining the respondent
or his men from trespassing or committing waste or mischief in
the suit property.
7. On 12.05.2000, the appellant and her husband filed the
written statement in the suit being O.S. No. 32/2000 filed by the
respondent. On 25.07.2000, the defendants in O. S. No. 97/2000
filed their written statement contending that the registered
document No. 687/2000 was executed for consideration.
8. By a judgment and order dated 11.12.2006, the learned
Munsif, Sasthamcotta decreed Original Suit No. 32/2000 and O.S.
No. 97/2000.
9. Being aggrieved, the appellant filed First Appeal being A.S.
No. 30/2007 before the District Court Kollam. The defendants in
O.S. No. 97/2000 filed their First Appeal before the District Court
Kollam. By an order dated 23.09.2010, the Additional District
Judge III, Kollam allowed the application being A.S. No. 30/2007
filed by the appellant and dismissed A.S. No. 77/2000 filed by the
respondent in O.S. No. 97/2000.
10. The respondent filed Regular Second Appeal against the
judgment and decree in A.S. No. 30/2007. By the judgment and
order dated 03.04.2017, the High Court allowed the R.S.A. No.
4
757/2011 and set aside the judgment and decree in A.S. No.
30/2007.
11. On behalf of the appellant, it was contended that the
document styled as gift deed was to come into effect only after
the death of the appellant and her husband. The question was
whether a document in terms whereof the executant of the
document retained possession and reserved her right over the
property being the subject matter of the document could be a
deed of gift or whether such a document was a document in the
nature of a will.
12. Section 122 of the Transfer of Property Act 1882 defines gift
as hereunder:-
“122. “Gift” defined. – “Gift” is the transfer of certain
existing moveable or 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.”
13. Some of the relevant provisions of the Transfer of Property
Act, 1882 with regard to a gift are set out herein-below:-
123. Transfer how effected. - For the purpose of making a gift
of immoveable property, the transfer must be effected by a
registered instrument signed by or on behalf of the donor, and
attested by at least two witnesses.
For the purpose of making a gift of moveable property, the transfer
may be effected either by a registered instrument signed as
5
aforesaid or by delivery.
Such delivery may be made in the same way as goods sold may be
delivered.
124. Gift of existing and future property. – A gift comprising
both existing and future property is void as to the latter.
125. Gift to several of whom one does not accept.-A gift of a
thing to two or more donees, of whom one does not accept it, is
void as to the interest which he would have taken had he
accepted.
126. When gift may be suspended or revoked.- The donor
and donee may agree that on the happening of any specified event
which does not depend on the will of the donor a gift shall be
suspended or revoked; but a gift which the parties agree shall be
revocable wholly or in part, at the mere will of the donor, is void
wholly or in part, as the case may be.
A gift may also be revoked in any of the cases (save want or failure
of consideration) in which, if it were a contract, it might be
rescinded.
Save as aforesaid, a gift cannot be revoked.
Nothing contained in this section shall be deemed to affect the
rights of transferees for consideration without notice.
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.
14. Gift means to transfer certain existing moveable or
immoveable property voluntarily and without consideration by
one person called the donor to another called the donee and
accepted by or on behalf of the donee as held by the Supreme
Court in Naramadaben Maganlal Thakker Vs. Pranivandas

Maganlal Thakker and Others1. As further held by this Court
in Naramadaben Maganlal Thakker (supra) “It would be clear
that the execution of a registered gift deed, acceptance of the gift
and delivery of the property together make the gift complete.
Thereafter, the donor is divested of his title and the donee
becomes absolute owner of the property.”
15. A conditional gift with no recital of acceptance and no
evidence in proof of acceptance, where possession remains with
the donor as long as he is alive, does not become complete
during lifetime of the donor. When a gift is incomplete and title
remains with the donor the deed of gift might be cancelled.
16. In Reninkuntla Rajamma Vs. K. Sarwanamma2 a Hindu
woman executed a registered gift deed of immovable property
reserving to herself the right to retain possession and to receive
rent of the property during her lifetime. The gift was accepted by
the donee but later revoked.
17. In Reninkuntla Rajamma (supra), this Court held that the
fact that the donor had reserved the right to enjoy the property
during her lifetime did not affect the validity of the deed. The
Court held that a gift made by registered instrument duly
1 (1997) 2 SCC 255
2 (2014) 9 SCC 445

executed by or on behalf of the donor and attested by at least two
witnesses is valid, if the same is accepted by or on behalf of the
donee. Such acceptance must, however, be made during the
lifetime of the donor and while he is still capable of making an
acceptance.
18. We are in agreement with the decision of this Court in
Reninkuntla Rajamma (supra) that there is no provision in law
that ownership in property cannot be gifted without transfer of
possession of such property. However, the conditions precedent
of a gift as defined in Section 122 of the Transfer of Property Act
must be satisfied. A gift is transfer of property without
consideration. Moreover, a conditional gift only becomes
complete on compliance of the conditions in the deed.
19. In the instant case, admittedly, the deed of transfer was
executed for consideration and was in any case conditional
subject to the condition that the donee would look after the
petitioner and her husband and subject to the condition that the
gift would take effect after the death of the donor. We are thus
constrained to hold that there was no completed gift of the
property in question by the appellant to the respondent and the
appellant was within her right in cancelling the deed. The
judgment and order of the High Court cannot, therefore, be

sustained.
20. The appeal is allowed and the judgment and order under
appeal is set aside.
.................................J.
(ARUN MISHRA)
.................................J.
(INDIRA BANERJEE)
OCTOBER 26, 2018
NEW DELHI.
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