HomeGovernanceGifting it legally
Gifting it legally
October 14, 2011 Geeta Sajjanshetty
We usually hear about gift being presented to one another on occasion of marriage, birthdays, anniversaries etc, the gifts are usually presented on such occasions are material gifts which can be delivered immediately. However, one may also choose to gift immoveable property, hence it may be good to know and understand what the law says about gift of immoveable properties.
What according to law is a 'gift'?
As per the Transfer of Property Act, 1885, Section 122 of the Act, defines gift as "gift is the transfer of certain existing moveable or immoveable property made voluntarily and without any consideration by one person called donor (one who gives the gift), to another called the donee and accepted by or on behalf of donee (one who recieves the gift). Such acceptance can 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 above definition makes it very clear that the gift should be made voluntarily without any force or coercion by the donee or any other person. The said property should be existing, that is you cannot gift the dividend that would accrue on your shares, since they do not exist yet. In the same way both the donor and donee should be alive at the time of gift. For example, transfer of a house to an unborn child is not valid.
One can gift jewellery, cash, paintings or antique collection too. But typically these need not be registered they can be handed over to the donee directly. But if the donor wants to register it he/she may do so at his/her discretion )
How to ensure the 'gift' is valid?
Whenever the gift involves an immoveable property, it should always be transferred by a way of registered deed. That is the document transferring the property by way of gift should be registered with registrar office, by registering the gift deed the transfer becomes legal.
If the gift deed is not registered then there is no transfer of the property, the gift deed does not hold any value. Irrespective of the value of the property, the gift deed needs to be registered. The document should be attested by two witnesses who have seen the donor signing the document. It is the donor who needs to get it registered and should be attested by two witnesses.
The gift deed should essentially mention the details of the property that is being gifted, it should state that the donor is voluntarily and willingly gifting the said property and it is being done gratuitously without taking anything in return from the donee whatsoever. The details of the donee should also be mentioned. The deed also should mention that there was no consideration taken which means it is being gifted gratuitously to the donee.
There is no need of a lawyer to be present while the deed is being signed, however it is advisable to get the services of a lawyer. If you do not want to engage a lawyer you could contact the concerned Sub Registrar's office to get further clarifications about the procedures and other details. The deed needs to be stamped with appropriate non judicial stamp which depends upon the value of the property. The process of registering has to be carried out in the appropriate registrar's office wherever the property is situated.
When is the 'gift' considered invalid?
If the donor dies before registering the gift deed then gift is not valid. The donee also has to accept the gift during the lifetime of the donor. There is no prescribed method of accepting the gift, acceptance by expressed or implied. For example, the donee may start residing in the property or has taken possession of the property. The donee's name being entered in the mutation records also amounts to acceptance of gift. If the donor dies even before donee accepts the gift, the gift becomes invalid.
If any of the conditions mentioned above i.e. the donor has to transfer the property willingly and gratuitously and that the donee accepts the gift during the lifetime of the donor and that the gift deed is registered, are not met this gift deed could be contested.
The following is the format for a gift deed. This will be valid on with judicial stamps on i.t
This Deed of Gift is executed today i.e …………..day of ……………… 2011 by Smt/Shri …………………….. aged around …….years, residing at ……………………………………………(herein after called the 'Donor') in favour of
Smt/Shri ……………………….aged around ……………….. residing at………………………….(hereinafter called the donee).
Whereas, the term Donor and Donee unless repugnant to the context shall mean
and include their representatives heirs, successors, executors, administrators,
trustees, legal representatives and assigns
1. Whereas the donor is absolute and sole owner of House no. 121 , at………………, the said property is surrounded by ……. on north side …………. on east side………………………….. on west and …………………..towards the south. More specifically prescribed in the schedule herein attached, hereinafter reffered as scheduled property.
2. Whereas the donor is the absolute owner of the said property and is in possession of the said property and has been paying all the property taxes
3. Whereas the Donee is related to the Donor as ____________.
4. Whereas the Donor desires to grant the said scheduled property to the Donee as gift in consideration of natural love and affection subject to the condition herein after mentioned.
NOW THIS DEED WITNESSETH that the Donor, without any taking any monitory
Consideration or anything in return from the done and donor out of love and affection for the done hereby transfer by way of gift, the scheduled
property situated at ___________________________together with all the things
permanently attached thereto or standing thereon and all the liberties, privileges,
easements and advantages appurtenant thereto and all the estates, rights, title,
interest, use, inheritance, possession, benefits, claims and demand whatsoever of
the Donor TO HAVE AND TO HOLD the same unto the use of the Donee
absolutely but subject to the payment of all taxes, rates, assessments, dues and
duties now and here after chargeable thereon to the Government or local
authorities.
5. Whereas the Donor hereby covenant with the Donee;
(a) That the Donor now has in himself, absolute right, full power, and absolute
authority to grant the said scheduled property hereby granted as gift in the
manner aforesaid.
(b) The Donee may at all times herein after peacefully and quietly enter upon, take
possession of the scheduled property and enjoy the said scheduled property as
he deems fit without any 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) AND FURTHER that the Donor and all persons having or lawfully claiming
any estate or interest whatsoever to the said scheduled property 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 scheduled property 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.
SCHEDULE OF THE PROPERTY
(Gifted under this deed)
All the piece and parcel of immovable property 5 bearing No.____________
Measuring _______________
Bounded by:-
On the East :
On the West :
On the South :
On the North :
Market value of the property gifted under this deed is Rs._____________
(Rupees____________________________________only).
The Stamp duty is paid on the market value as computed above.
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 herein above
written.
1. DONOR
2. DONEE
Adv.Geeta Sajjanshetty
This is not a legal advice and we are not liable for anybody acting or any act committed in pursuant to the above mentioned statements. You may take appropriate legal opinion.
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