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A Project Work In DRAFTING PLEADING CONVEYANCING

GIFT DEED

SUBMITTED TO: Ms. NEHA SINHA

FACULTY: DRAFTING PLEADING CONVEYANCING

SUBMITTED BY: PRANAV KHANDELWAL

SEMESTER 8
SECTION A
ROLL NO. 94

SUBMITTED ON:
th

15 FEBRUARY, 2016

HIDAYATULLAH NATIONAL LAW UNIVERSITY

Raipur, Chhattisgarh

Gift Deed

ACKNOWLEDGEMENTS
Thanks to the Almighty who gave me the strength to accomplish the project with sheer hard
work and honesty.
I would like to sincerely thank my faculty for DPC Ms. Neha Sinha Mam for giving me this
topic and guiding me throughout the project. Through this project I have learned a lot about
the aforesaid topic and this in turn has helped me grow as a student.
My heartfelt gratitude also goes out to the staff and administration of HNLU for the
infrastructure in the form of our library and IT lab that was a source of great help in the
completion of this project.

PRANAV KHANDELWAL

Gift Deed

TABLE OF CONTENTS
Acknowledgements .................................................................................................................... 2
Introduction ................................................................................................................................ 4
Research Methodology .............................................................................................................. 5
Objectives .................................................................................................................................. 5
Chapterisation ............................................................................................................................ 6
CHAPTER 1: GIFT ................................................................................................................ 6
CHAPTER 2: GIFT DEED .................................................................................................... 7
When a Gift Deed is made ................................................................................................. 7
Contents of Gift Deed ........................................................................................................ 8
Charges for a Gift Deed ..................................................................................................... 8
Revocation of Gift Deed .................................................................................................... 8
Points to be considered while drafting a Gift Deed ........................................................... 9
Steps in gifting process .................................................................................................... 11
Facts of Gift Deed to be drafted ....................................................................................... 11
CHAPTER 3: DRAFT GIFT DEED ................................................................................... 12
References ................................................................................................................................ 15
Acts/Statutes ........................................................................................................................ 15
Books ................................................................................................................................... 15
Websites ............................................................................................................................... 15

Gift Deed

INTRODUCTION
Gift is a Transfer of Property and is defined in Section 122 of the Transfer of Property Act,
1882. It is a unique transfer of property in the sense that it involves no consideration. The
basic essence of a gift is the complete absence of consideration.1 The law of gifts in India is
governed by Sections 122 to 129 of the Transfer of Property Act, 1882.
The right to gift away ones property whether movable or immovable is an important right
and an important element of property law. Although a gift involves no consideration in the
legal sense it involves the consideration of love, affection, spiritual and religious benefit etc.
whose importance cannot be overlooked. Thus the law relating to gifts has a humane element
in it and as such the law of gifts should be clear and unambiguous without any scope for
misuse and controversy. This objective might be idealist but ultimately the law relating to
gifts should always strive to protect the interests of the donee, donor and the property
involved in the greater interests of justice.
A gift is a common mode of transfer of property. It is the transfer of certain existing
moveable or immoveable property by one person to another. The transfer should be made
voluntarily and without consideration. The person transferring the property is called the
donor. The person to whom the property is transferred is referred to as the donee. The donee
must accept the property during the lifetime of the donor and while he is still capable of
giving. In case the donee dies before acceptance, the gift is void. The gift can be effected
through a gift deed.
A gift deed is a legal document that records and details transfer of movable or immovable
property from the donor (giver) to the donee (receiver) without any exchange of money. The
gift must be a well defined movable or immovable property and be transferable. The deed
should be based on the consideration of natural love and affection of the Donor to the Donee.
The donor in the gift deed must be solvent and should not use this arrangement for illegal
gains or tax evasion.
Transfer of property, specially an immovable one, needs to be documented in accordance
with the Transfer of Property Act, 1882 in India and must fulfill the conditions laid out.
Registration of the gift deed for an immovable property is mandatory and must be done with
the Sub-Registrar in the area where the property is situated.

Shakuntala v. State of Haryana (1979)3 SCC 226

Gift Deed

RESEARCH METHODOLOGY
This research is descriptive and analytical in nature. Secondary and Electronic resources have
been largely used to gather information about the topic.
Websites, books, journals and articles have been primarily helpful in giving this project a
firm structure.
Footnotes have been provided wherever needed to acknowledge the source.

OBJECTIVES

To discuss about the concept of gift and gift deed.

To draft a gift deed of a property.

Gift Deed

CHAPTERISATION
CHAPTER 1: GIFT
"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. 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.
The conception of the term "gift" as used in the Transfer of Property Act is somewhat
different from the use in Mohammedan law. In the Mohammedan law a gift is a transfer of
property or right by one person to another in accordance with the provisions given in the
Mohammedan law and includesa. A hiba, an immediate and unconditional transfer of the ownership of some property or
of some right, without any consideration or with some return (ewaz); and
b. An ariat, the grant of some limited interest in respect of the use or usufruct of some
property or right.
Where a gift of any property or right is made without consideration with the object of
acquiring religious merit, it is called sadaqah.
The terms "hiba" and "gift" are often indiscriminately used but the terms "hiba" is only one of
the kinds of transactions which are covered by the general term "gift". A hiba is a transfer
without consideration. A gift by a Muslim in favour of his co-religionist must be under the
Mohammedan Law. A gift is not a contract (though in Muslim law it is called a contract) but
the principle may be applicable even to gift.
In ordinary legal effect, there cannot be a `gift' without a giving or taking. The giving or
taking are two contemporaneous, reciprocal acts, which constitute a gift. Section 122 of the
Act postulates that a gift is a transfer of certain existing movable or immovable property
made voluntary and without consideration by one person called the donor, to another, called a
donee and accepted by or on behalf of the donee. The essential elements of a gift are:

a. The absence of consideration;

b. The donor;
c. The done
d. The subject-matter;

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e. The transfer; and the acceptance.
The concept of gift is diametrically opposed to any presence of consideration or
compensation.
In order to constitute a valid gift, the pivotal requirement is acceptance thereof. No particular
mode of acceptance is required and the circumstances throw light on that aspect. A
transaction of gift in order to be complete must be accepted by the donee during the lifetime
of the donor. Factum of acceptance can be established by different circumstances such as
donee taking a property or being in possession of deed of gift alone. If a document of gift
after its execution or registration in favour of donee is handed over to him by the donor
whom he accepts, it amounts to a valid acceptance of gift in law. The specific recital in the
deed that possession is given raises a presumption of acceptance.
CHAPTER 2: GIFT DEED
Under section 122 of the Transfer of Property Act, 1882, one can transfer immovable
property through a gift deed. Like a sale deed, a gift deed contains details of the property, the
transferor and recipient. But instead of a sale consideration in a sale deed, a gift deed allows
one to transfer ownership without any exchange of money. Registering a gift deed with the
sub-registrar is mandatory as per section 17 of the Registration Act, 1908, and as per section
123 of the Transfer of Property Act. If one dont do this, the transfer will be invalid.
Besides that, once a gift deed is registered in the name of the recipient, only then one can
apply for mutation of the property. Mutation is necessary to transfer utility connections in the
name of the recipient. Also, for the recipient to be able to further transfer the property, a
registered gift deed will be required.
When a Gift Deed is made
A Gift deed can be made in the following circumstances:
1. At the time of transferring the rights of property as a gift.
2. When there is no exchange of money involved.
3. To provide a legal representation to the gift being transferred.

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Contents of Gift Deed
A gift deed should contain following details:
1. Details of the donor and done.
2. Relationship details of the donor with the donee.
3. Rights & power and authority of the Donor.
4. Description and details of the property to be gifted.
5. Confirmation clause on delivery of possession.
Charges for a Gift Deed
Stamp duty and registration fee has to be paid to register a gift deed. In some states, stamp
duty rates for property transfer by way of gift are the same as for sale or conveyance deed.
However, rules vary across states; certain state governments even offer some concession if
the property is being gifted to blood relatives.
Revocation of Gift Deed
Section 126 of the Transfer of Property provides for conditions where a gift may be revoked.
The following are those conditions1. That the donor and donee must have agreed that the gift shall be suspended or
revoked on the happening of a specified event;
2. Such event must be one which does not depend upon the donor's will;
3. The donor and donee must have agreed to the condition at the time of accepting the
gift; and
4. The condition should not be illegal or immoral and should not be repugnant to the
estate created under the gift. Section 126 is controlled by Section 10. As such, a
clause in the gift deed totally prohibiting alienation is void in view of the provisions
contained in Section 10. A gift, which was not based on fraud, undue influence or
misrepresentation nor was an onerous one, cannot be cancelled unilaterally. Such a
gift deed can be cancelled only by resorting to legal remedy in a competent court of
law.

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Points to be considered while drafting a Gift Deed
To make a valid gift of property
The donor is the person who gives. Any person who is competent to contract can make a gift
of his property. A minor, being incompetent to contract is incompetent to transfer. A gift by a
minor is void.

However, a minor can accept gifts. A natural guardian can accept a gift on behalf of a minor
with the condition that the person nominated in the gift deed will act as a manager of the
gifted property. Such acceptance would amount to recognition by the natural guardian of the
nominated person as the manager or the agent of the minor for the purpose of the property.

For a valid acceptance

The donee is the person who accepts the gift. A minor may be a donee. But if the gift is
onerous, the obligation cannot be enforced against him while he is a minor. But when he
attains adulthood he must either accept the burden or return the gift. A gift may be accepted
by or on behalf of a donee.

A donee may also be a person who is unable to express acceptance. A gift can be made to a
child and could be accepted on the child's behalf. The donee must be an ascertainable person.

Process of gifting
A gift involves the process of giving and taking which are two simultaneous and reciprocal
acts. There must be acceptance of a gift as well. There is no particular mode of acceptance. It
may be express or implied. Further, the property must be accepted by the donee during the
lifetime of the donor.

The fact of acceptance can be established by different circumstances such as donee taking the
property or being in possession of the deed of gift. If a document of gift, after its execution or
registration in favour of a donee is handed over to him by the donor, it amounts to a valid
acceptance of the gift.

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Competence to contract is an important qualification required for making a gift. A gift to be
valid must be made by a person with his free consent and not under compulsion. However, a
mere weakness of the intellect would not be sufficient to invalidate the gift.
The gift must be a certain existing movable or immovable property. It may be land, goods, or
actionable claims, and must be transferable. There cannot be any gift of future property. A
gift must be of tangible property. Only an existing and tangible property is capable of being
gifted.

Absence of consideration must

A gift is a transfer without any element of consideration. Complete absence of monetary
consideration is an important prerequisite. Where there is any equivalent of benefit measured
in terms of money in respect of a gift, the transaction ceases to be a gift.

The transfer of property must be voluntary and made gratuitously. It must satisfactorily
appear that the donor knew what he was doing and understood the contents of the instrument
and its effect, and also that undue influence or pressure was not exercised upon clear
intention to make a gift.

Acceptance
Even when a gift is made by a registered instrument, it has to be accepted by or on behalf of
the donee to make it complete, failing which the gift will be void. The law requires
acceptance of the gift after its execution, though the deed may not be registered. The
acceptance may be signified by an overt act such as the actual taking of possession of the
property, or such acts by the donee as would in law amount to taking possession of the
property where the property is not capable of physical possession. Delivery of possession is
an essential condition for the validity of the gift.

However, it is not necessary that in every case there should be a physical delivery of
possession. Possession may be either actual or constructive. The donor should divest himself
completely of all ownership and dominion over the gift.

Registration
A gift of immovable property can be made only by a registered instrument. A gift of
immovable property, which is not registered, is bad in law and cannot pass any title to the
Gift Deed

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donee. Documents should be stamped with appropriate non judicial stamp, registered as
required under the India Registration Act and attested by two witnesses. A mere delivery of
possession without a written instrument cannot confer any title. A deed cannot be dispensed
with even for a property of small value.
Steps in gifting process
Gifting process can be subdivided into three parts as described below:
1. Drafting the Gift Deed A gift deed is drafted with the help of a lawyer and it
describes what is being transferred and to whom. Gift Deed is a contract between
donor and the donee which defines simultaneous and reciprocal act of giving and
taking. A gift to be valid must be made by a person voluntarily and not under
compulsion without any exchange of money.
2. Acceptance Acceptance of the gift after its execution is a legal requirement and
Donee must accept the gift during the lifetime of donor. In case donee fails to accept
the gift, it is rendered invalid. The acceptance may be validated by acts such as taking
possession of the property.
3. Registration As per Section 123 of the Transfer of Property Act, a gift of immovable
property cannot pass any title to the donee unless it is registered. Attestation by two
witnesses is required during registration and post registration, title transfer is possible.
Facts of Gift Deed to be drafted
Brief facts of gift deed are as follows:
1. Details of donor: Shri Mahendra Kumar Gupta, aged 63, years, S/o, Late Shri P.C.
Gupta, Residing at 119, Chandela Vihar, Bilaspur
2. Details of donee: Shri Kunal Gupta, aged 35 years S/o Shri Mahendra Kumar Gupta
Residing at 119, Chandela Vihar, Bilaspur
3. Details of gift: Kothi No. 65, Ring Road, Bilaspur situated approximately on 2 acres
of land
4. Reason for Gift: The gift has been made as the donor has immense love and affection
for the donee as donee is his most beloved son.

Gift Deed

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CHAPTER 3: DRAFT GIFT DEED

GIFT DEED

THIS DEED OF GIFT is made at Bilaspur this 15th day of February 2016 between Mr.
Mahendra Kumar Gupta, aged 63, years, S/o, Late Mr. P.C. Gupta, Residing at 119, Chandela
Vihar, Bilaspur hereinafter referred to as the Donor of the One Part and Mr. Kunal Gupta,
aged 35 years S/o Mr. Mahendra Kumar Gupta Residing at 119, Chandela Vihar, Bilaspur
hereinafter referred to as the DONEE, of the Other Part.
WHEREAS the Donor is seized and possessed of the land and premises situate at Kothi No.
65, Ring Road, Bilaspur situated approximately on 2 acres of land and more particularly
described in the Schedule hereunder written.
AND WHEREAS the DONEE is related to the Donor as his Son.
AND WHEREAS the Donor desires to grant the said property to the DONEE as gift in
consideration of natural love and affection as hereinafter mentioned
AND WHEREAS the DONEE has agreed to accept the gift as is evidenced by his executing
these presents.
AND WHEREAS the market value of the said property is estimated to be Rs. Eighty Five
Lacs Only.
NOW THIS DEED WITNESSETH that the Donor without any monetary consideration and
in consideration of natural love and affection, which the Donor bears to the DONEE, doth
hereby grant and transfer by way of gift the said property situate at Kothi No. 65, Ring Road,
Bilaspur and more particularly described in the Schedule hereunder written together with all
and singular the building, and structures, thereon and all the things permanently attached
thereto or standing thereon and all the liberties, privileges casements and advantages
appurtenant thereto And all the estate, right, title, interest use, Inheritance, possession,
benefit, claims and demand whatsoever of the Donor To Have And To Hold the same unto
and to the use of the DONEE absolutely but subject to the payment of all taxes, rates,
assessments, dues and duties now and hereafter chargeable thereon to the Government or
Municipality or other Local Authority.

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AND he the Donor doth hereby covenants with the DONEE
(a) That the Donor now has in himself, good right, full power and absolute authority to grant
the said property hereby granted as gift in the manner aforesaid.
(b) The DONEE may at all times hereafter peaceably and quietly enter upon have occupy.
possess and enjoy the said piece of property and receive the rents, Issues, and profits and
rents thereof and every part thereof to and for his own use and benefit without any suit,
lawful eviction, interruption, claim or demand whatsoever from or by the Donor or his heirs,
executors, administrators and assigns or any person or persons lawfully claiming or to claim
by, from, under or in trust for the Donor.
(c) That the said property is free and clear and freely and clearly and absolutely and forever
released and discharged or otherwise by the Donor and well and sufficiently saved, kept
harmless and Indemnified of and from and against all former and other estate, titles, charges
and encumbrances whatsoever, had made, executed, occasioned or suffered by the Donor or
by any other person or persons lawfully claiming or to claim by, from, under or in trust for
the Donor.
(d) AND FURTHER that the Donor and all persons having or lawfully claiming any estate or
Interest whatsoever to the said land and premises or any part thereof from under or in trust for
the Donor or his heirs, executors. administrators and assigns or any of them shall and will
from time to time and at all times hereafter at the request and cost of the DONEE do and
execute or cause to be done and executed all such further and other acts, deeds, things,
conveyances and assurances in law whatsoever for better and more perfectly assuring the said
land and premises and every part thereof unto and to the use of the DONEE in the manner
aforesaid as by the DONEE, his heirs, executors, administrators and assigns or counsel in law
shall be reasonably required.
IN WITNESS WHEREOF the Donor as well as the DONEE (by way of acceptance of the
said gift) have put their respective hands the day and year first hereinabove written.

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THE SCHEDULE ABOVE REFERRED TO

Signed and Delivered by the within named Donor Mr. Mahendra Kumar Gupta in the
presence of .
Signed by within named DONEE Mr. Kunal Gupta In the presence of .

WITNESSES:
1. -----------------------2. ------------------------

Gift Deed

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REFERENCES
Acts/Statutes
1. Registration Act, 1908
2. Transfer of Property Act, 1882
Books
1. ODGERNS ON DRAFTING AND PLEADING, 3rd EDITION (2008) UNIVERSAL
PUBLICATION, NEW DELHI
Websites
1. http://articles.economictimes.indiatimes.com/2009-06-07/news/27647546_1_giftdeed-gifted-property-donee last visited on 13th February 2016
2. http://www.legalserviceindia.com/articles/transfer.htm last visited on 13th February
2016
3. http://legalsutra.com/837/gifts-under-transfer-of-property-act/ last visited on 13th
February 2016
4. http://www.livemint.com/Money/PYvt8NpP8AXnea8nKAn9FI/For-a-transfer-ofproperty-through-gift-deed-to-be-valid-it.html last visited on 13th February 2016
5. http://taxguru.in/income-tax/faq-performa-gift-deed-list-relatives-gift-received-taxliability.html last visited on 13th February 2016

Gift Deed