As per the Transfer of property act, 1882 a Gift is defined as ‘the
transfer of certain existing movable or immovable property made voluntarily and
without consideration, by one person, called the donor and accepted by or on
behalf of the donee.’
These
provisions of Gift provided under this act are not applicable to Muslims.
The definition includes:
1.
A Transfer which is defined as conveying of
property;
2.
Voluntary transfer by the
donor:
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The decision
should not reasonably appear to have been taken due to any coercion or fraud.
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A Donor can be any person who owns the
property, except a minor. A gift deed by a minor is void.
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For a gift deed to be valid, the soundness of
mind of the donor is also essential. The donor must not be insane. A mere
weakness of mind is not sufficient to declare the gift deed to be void.
3.
Property;
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The subject matter of the gift shall be an
existing movable or immovable property not being provided as an exception as
per Section 6 of the Transfer of Property Act, 1882.
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A gift comprising of future property is void. A
gift with both existing and future property is void to the extent of future
property.
4.
Without any consideration to the
donor
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Out of natural
love and affection,
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Without any
monetary element involved in the transaction.
5.
Acceptance by donee, made
during the lifetime of the donor.
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If the donee dies before accepting the gift,
then it becomes void. Thus, ideally, the acceptance given must be recorded at
the time of execution of the deed and registration.
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Also, a gift is made to more than 1 donee, and
is not accepted by all, then the gift shall be void up to the share/ interest
of only those who did not provide the acceptance.
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A minor can be a donee and a natural guardian can accept the gift on his behalf.
What
are essentials of a gift deed?
1.
A gift deed
should clearly mention the name and details of the Donor and the Donee.
2. State the details of the title and ownership
of the Donor.
3. Relation between parties, if any
4. Details of the property which is the subject
matter of the Gift-deed
5. Gift deed to be signed by
a.
the Donor
consenting the transfer of subject matter through Gift-deed,
b.
the Donee
accepting the gift, and
c.
two adult
witnesses
6.
Date and place of
execution shall also be mentioned.
How
to proceed with registration of gift deed?
As per the Section 123 Transfer of Property Act 1882 and Section 17
the Registration Act,
1908, for a gift deed to
be effective, there should mandatorily be a registered instrument signed by or
on behalf of the donor, and attested by at least two witnesses.
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Mere delivery of the subject matter shall not
validate the transfer or the gift.
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Once the Gift deed is duly registered, the
transfer of title shall then be made.
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Stamp duty has to be paid for the registration
which varies from state to state.
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Stamp duty to be paid is according to the
market value of the subject matter, gender of the donor etc (available on the state
websites)
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Stamp duty can be paid through a non-judicial stamp paper.
Can gifts be revoked
or suspended?
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As per the provisions of the Transfer of
Property Act, gifts are possible to be suspended or revoked if the Donor and
the Donee have agreed upon it in event of happening of a specified event which does not depend on the will of the Donor.
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This is not applicable when the suspension or
revocation of the gift, wholly or in part, is dependent upon mere will of the
Donor, and such shall be void, wholly or partly, to the same extent.
Ø
A gift may also be revoked in cases where it
would be rescinded if it were a contract.
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