Gifting property to loved ones, especially children, is a heartfelt gesture usually rooted in love and goodwill. But if for some reason, circumstances change, the donors might legitimately want to know—can they revoke the gift once it has really been made? While in general, gift deeds are irrevocable, Indian law permits them to be revoked in special cases.
The blog will introduce the gift deed, the elements of a valid gift deed, the legal grounds for revocation, and the steps in revocation. Formerly, you may be thinking of gifting property, or on the other hand, you may be thinking of how to revoke the gift. Either way, an understanding of these matters will help you in arriving at informed decisions.
What is a Gift Deed?
A gift deed is a legal document by which one person voluntarily transfers ownership of movable or immovable property to another person (called the donee) without making any payment in return. This transfer must be made out of love and affection and not on any unlawful grounds, such as fraud or coercion.
A gift deed under the Transfer of Property Act, 1882 must have its acceptance from the donee during the lifetime of the donor. Once the gift comes to be accepted and duly registered, the gift becomes a binding act.
Essentials for a Valid Gift Deed
- Voluntary Transfer: The donor must make the gift out of their own will and free from any pressure, undue influence, or deceit.
- Donor’s Capacity: The donor should be a person of sound mind and should be competent to transfer the property by way of gift.
- Acceptance by Donee: The donee must accept the gift during the lifetime of the donor.
- Registered Document: The gift deed has to be registered at the office of the sub-registrar and stamped as per the laws prevailing in such State.
- Possession Transfer: Either actual or constructive possession of the property ought to be given to the donee.
Conditions for Revoking a Gift Deed
In India, per Section 126 of the Transfer of Property Act, a gift deed can only be revoked under certain conditions. Changing one’s mind or a feeling of dissatisfaction with the donee cannot be valid ground for revocation.
- By Mutual Agreement: The gift deed can be revoked if both the donor and the donee consent.
- By Conditional Gifts: If the deed establishes some conditions (like that the donee must take care of the donor) and when these conditions are not fulfilled by the donee, the donor will be entitled to seek revocation.
- By Fraud or Misrepresentation: If the gift was procured by some kind of manipulation, fraud, or coercion, it shall be subject to legal redress.
- By Mental Incapacity of the Donor: When the donor was of unsound mind or under undue influence during the gifting process.
- By Illegal or Immoral Considerations: If a gift is made for any unlawful consideration, the deed is void, and the gift can, therefore, be revoked.
Keep in mind that emotional grievances or petty disputes are not grounds for redeeming a gift deed.
Gift Deed Rules
Before creating or contesting a gift deed, one should realise the legal framework surrounding it:
- Stamp Duty: The stamp duty is chargeable according to the state laws; in many states, gifts to blood relations may attract reduced rates.
- Registration: The Registration Act 1908 remains mandatory until registration, beyond which the gift deed has no legal standing.
- No Consideration: The giver must not expect anything in return for the gift.
- Irrevocability: The gift deed is final if not challenged on any legal grounds.
Process of Revocation of Gift Deed
Identify a Valid Legal Reason
The very first step involved is to see whether your case actually falls within the purview of revocation under Indian laws. The valid grounds include fraud, undue influence, misrepresentation, breach of a condition laid down in the deed, or mutual agreement between the donor and donee. Mere emotional dissatisfaction or family dispute would not be considered legally sufficient.
Consult a Property Lawyer
Seek advice from a suitable legal professional who will review your gift deed and ascertain whether you have a valid legal ground to oppose the gift and, if so, what would be the best line of action. Early legal advice would only save on time and unnecessary expenses incurred by you.
Collect Supporting Evidence
To build a strong case, you must collate proper evidence. This may consist of the original gift deed, communication between the parties, evidence of fraud or coercion, and even medical evidence in cases of mental incapacity. The more irrefutable the evidence is, the more success lies ahead.
File a Civil Suit in Court
Wherever revocation is justified, your lawyer will prepare and file a civil suit for cancellation in the district court having jurisdiction of the place where the property or the gift is situated, stating specifically the grounds for cancellation and attaching copies of supporting documents as evidence therewith.
Send Legal Notice to Donee
Send a legal notice to the donee, intimating him/her about your intention to revoke the gift deed. This notice shall clearly state the reasons for such revocation and may pave the way for an amicable settlement before going to court.
Attend Court Proceedings
Once the case accrues in court, both sides will plead their matters. The judge will have to examine whether the gift was lawful and under what circumstances it was made. The proceedings may take their time to come to a conclusion depending on its complexity.
Waiting for the Court’s Decision
If the court finds that your claims are valid, it orders the revocation of the gift deed. Such an order settles the question of the ownership of the property back to the donor, while such an order also strips the donee of legal ownership. Whereas if the case is dismissed by the court, the gift remains intact.
Recording in Government Property Books
After getting the court order, you have to approach the sub-registrar’s office for updating the property records based on that court decision that nullifies the earlier transfer in the records.
Termination of Gift Deed
Apart from the revocation, gift deeds can also be terminated under special circumstances, like:
- Death of Donee Before Acceptance: If the donee dies before accepting the gift, then the deed becomes void.
- Donor Dies Before Execution: If the donor dies before executing registration, then the gift is still incomplete and therefore, terminates.
- Unlawful Object or Purpose: If the gift was to be for illegal activities, then it becomes void.
Conclusion
To gift property is a noble gesture, thus it’s imperative to know the relevant legal details pertinent to the gift deed before and after its execution. In India, a gift deed, once executed and registered, is generally considered irrevocable. However, the gift deed can certainly be cancelled on the grounds of fraud, non-fulfilment of terms agreed, mutual consent, and the like.
Whenever you consider gifting property or are among those who, after gifting, are running into trouble, approach a competent lawyer who can explain the intricacies of the situation and help you arrive at decisions that align with your rights and wishes. Remember, lack of clarity in documents today can lead to legal complications tomorrow.