Transfer of Property Act (TPA)
Gifts under Sections 122 to 129: Essentials, Formalities, Revocation, Onerous Gifts and the Universal Donee
A gift is the one transfer in the Act with no consideration at all, and the law compensates for that in two ways. It insists on form — for immoveable property, a registered instrument attested by two witnesses — and it insists on acceptance, made during the donor's lifetime and while he is still capable of giving. Beyond those two requirements the chapter deals with what may be given, what happens when a donee refuses, when a completed gift may be undone, what burdens a donee must take with a benefit, and what a person liable for the donor's debts takes on when he receives the whole of his property.
1. Section 122: The Definition
Section 122, TPA '‘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. Acceptance when to be made — such acceptance must be made during the lifetime of the donor and while he is still capable of giving. If the donee dies before acceptance, the gift is void.' |
2. The Essential Elements
2.1 Transfer of certain existing property
- Certain — the property must be identified or identifiable; a gift of an unascertained thing is void for uncertainty.
- Existing — at the date of the gift. Section 124 makes a gift of future property void, and where a gift comprises both existing and future property it is void as to the latter.
- Moveable or immoveable, tangible or intangible; an actionable claim may be given, in the manner section 130 requires.
2.2 Voluntary, and without consideration
- Voluntary — the donor's free consent. A gift obtained by coercion, undue influence, fraud or misrepresentation is not voluntary, and section 126 allows it to be revoked in the cases in which a contract might be rescinded.
- Without consideration — natural love and affection is not consideration for this purpose, and a transfer for even a nominal money price is a sale and not a gift. A gift subject to a burden is still a gift, and section 127 deals with it.
2.3 Donor and donee
- The donor must be competent to contract and entitled to the property, as section 7 requires.
- The donee must be an ascertained person in existence. A gift to an unborn person is void as a direct gift, and can be made only through the machinery of section 13. A gift may be made to a juristic person, and to several donees jointly.
2.4 Acceptance
Question | Answer |
|---|---|
When must it be made? | During the lifetime of the donor and while he is still capable of giving. If the donee dies before acceptance, the gift is void |
In what form? | No particular form. Acceptance may be express or by conduct — taking possession, taking the deed, receiving the rents, mutating the records, or dealing with the property as owner |
By whom? | By the donee, or on his behalf |
A minor donee | Acceptance may be made on his behalf by his natural guardian or other competent person; and a minor may accept a gift that is not onerous |
Several donees | Acceptance by each; section 125 provides that where a gift is made to two or more donees, of whom one does not accept, the gift is void as to the interest which he would have taken had he accepted |
Presumption | Where the gift is beneficial and the deed is in the donee's possession, or the donee is a minor child of the donor, acceptance is readily inferred from the circumstances |
3. Section 123: How a Gift Is Made
Section 123, TPA 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 so signed and attested, or by delivery; and such delivery may be made in the same way as goods sold may be delivered. |
Question | Answer |
|---|---|
Is registration essential for immoveable property? | Yes. An unregistered gift deed passes nothing, whatever the value of the property, and however clear the donor's intention |
Is attestation essential? | Yes — by at least two witnesses, each of whom has seen the donor sign or received his personal acknowledgment, and has signed in his presence with the intention of attesting |
Is delivery of possession essential? | No for immoveable property. Registration and attestation, with acceptance, complete the gift; delivery of possession is evidence of acceptance but is not a requirement of the section |
May the donor reserve a life interest? | Yes. A gift of immoveable property with the donor reserving a life interest, or a right of residence, is valid; what is given is the property subject to that reservation, and the gift is complete on registration and acceptance |
Moveable property | A registered instrument or delivery; delivery is made as goods sold are delivered — actually, or by doing what puts the donee in possession |
4. Gift Distinguished
Gift | The transaction compared | |
|---|---|---|
Will | Takes effect immediately on registration and acceptance; irrevocable once complete | A will speaks from death, is ambulatory and revocable at any time during the testator's life, and needs no acceptance in his lifetime |
Sale | No consideration | A price in money; and the seller has a statutory charge for what remains unpaid |
Settlement | A simple transfer without consideration | A disposition of property to be held on terms, often creating successive interests and involving trustees; a settlement may include gifts but is a wider arrangement |
Release or relinquishment | A transfer of property to a person who had no interest in it | A giving up of a claim in favour of a person who already has an interest; in substance a renunciation, though it may operate as a transfer where an interest passes |
Hiba under Muslim law | Registration and attestation essential for immoveable property; delivery of possession not essential | Declaration, acceptance and delivery of possession are the essentials; no writing or registration is required — and section 129 preserves this |
5. Sections 124 and 125
- Section 124 — gift of existing and future property. A gift comprising both existing and future property is void as to the latter. The rule follows from the definition itself: a gift is of certain existing property, and there is nothing for a transfer of future property to operate on.
- Section 125 — gift to several donees, one of whom does not accept. The gift is void as to the interest which he would have taken had he accepted. The rest of the gift stands, and the non-accepting donee's share does not accrue to the others unless the deed so provides.
6. Section 126: Suspension and Revocation
Section 126, TPA — the substance By agreement. The donor and donee may agree that on the happening of any specified event which does not depend on the will of the donor, the 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. On grounds applicable to contracts. A gift may be revoked in any case in which, if it were a contract, it might be rescinded — for fraud, coercion, undue influence or misrepresentation. Save as aforesaid, a gift cannot be revoked. Saving. Nothing in the section affects the rights of transferees for consideration without notice. |
The stipulation | Effect |
|---|---|
'The gift shall stand revoked if the donee predeceases the donor' | Valid — the event is specified and does not depend on the donor's will |
'The donor may revoke whenever he pleases' | Void — revocation at the mere will of the donor; the gift itself fails wholly or in part |
'The gift shall be revoked if the donee fails to maintain the donor' | A condition of the kind the section allows, provided the event does not depend solely on the donor's will; it is a conditional gift, and the condition operates as agreed |
A gift obtained by undue influence | Revocable on the ground on which a contract might be rescinded |
A completed gift which the donor regrets | Irrevocable. Regret is not a ground, and 'save as aforesaid, a gift cannot be revoked' |
Conditional gift and revocable gift A conditional gift takes effect subject to a condition, and the property passes. If the condition is one the section permits, the happening of the event suspends or revokes the gift according to the agreement. A gift revocable at the will of the donor is not a gift at all in the eye of the section: it is void, because a transfer which the transferor may undo at pleasure transfers nothing. |
7. Section 127: Onerous Gifts
Section 127, TPA — the substance One transfer. Where a gift is in the form of a single transfer to the same person of several things, of which one is burdened by an obligation and the others are not, the donee can take nothing by the gift unless he accepts it fully. Separate transfers. Where a gift is in the form of two or more separate and independent transfers to the same person of several things, the donee is at liberty to accept one and refuse the others, although the former may be beneficial and the latter onerous. A disqualified donee. A donee not competent to contract who accepts property burdened by an obligation is not bound by his acceptance; but if, after becoming competent to contract and being aware of the obligation, he retains the property, he becomes so bound. |
- This is the doctrine of election in the law of gifts. A donee may not take the benefit and reject the burden where both are parts of a single transaction.
- The test is whether the transfer is one or several. One deed conveying several properties, one of them mortgaged, is a single transfer; separate deeds are separate transfers even if executed on the same day.
- A minor donee is protected until he grows up, and then bound only if, knowing of the obligation, he chooses to keep the property.
8. Section 128: The Universal Donee
Section 128, TPA '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.' |
- The gift must be of the donor's whole property. A gift of the greater part, with something retained, does not make the donee a universal donee — though the courts look at substance and disregard a trifling retention.
- The liability is personal, and is for the debts and liabilities existing at the time of the gift.
- It is limited to the extent of the property comprised in the gift. The donee does not become liable beyond what he received.
- The object is to prevent a debtor giving everything away and leaving his creditors with nothing — the same policy as section 53, approached from the donee's side.
9. Section 129: What the Chapter Does Not Touch
Section 129, TPA 'Nothing in this Chapter relates to gifts of moveable property made in contemplation of death, or shall be deemed to affect any rule of Muhammadan law.' |
- Donatio mortis causa — a gift of moveable property made in contemplation of death, conditional on the donor's death and revocable until then — is outside the chapter and is governed by its own rules.
- Muhammadan law is expressly saved. A hiba is governed by that law: declaration, acceptance and delivery of possession, with no requirement of writing, registration or attestation.
10. Landmark Cases
📖 Renikuntla Rajamma v. K. Sarwanamma, (2014) 9 SCC 445 Held: The Court held that delivery of possession is not a condition precedent to the validity of a gift of immoveable property under sections 122 and 123. What the law requires is a registered instrument signed by the donor and attested by two witnesses, together with acceptance by the donee during the donor's lifetime. A donor may validly reserve to himself the right to enjoy the property, or to receive its income, during his life, and such a reservation does not affect the completeness of the gift. Ratio: A gift of immoveable property is complete on registration, attestation and acceptance; delivery of possession is not essential, and a life interest may be reserved. |
📖 Asokan v. Lakshmikutty, (2007) 13 SCC 210 Held: The Court considered what amounts to acceptance of a gift. Acceptance may be express or may be inferred from the conduct of the donee, such as taking possession, receiving the income, or otherwise dealing with the property as owner; and where the gift is beneficial, acceptance is readily presumed. The essential question is whether the donee has accepted the gift during the lifetime of the donor. Ratio: Acceptance need not be express; it may be inferred from conduct, and is readily presumed where the gift is beneficial. |
11. Related Topics and Provisions
- Gifts under the Act and under Muhammadan Law — the comparison treated separately
- Sale, Section 54, and Exchange, Section 118 — the transfers with consideration
- Section 13, TPA — the route by which an unborn person may be benefited
- Section 53, TPA — fraudulent transfers, and the policy behind section 128
- Doctrine of Election, Section 35 — the wider principle behind section 127
- 'Attested' under Section 3 — the attestation section 123 requires