(1) What is a Gift Deed?
A Gift Deed means, in simple terms, we can say that a Gift Deed is a written document created by the donor in favour of the donee. Here, the donor means a person who gives a gift, and a donee means a person who receives a gift from the donor. Through the Gift Deed, the donor can easily transfer a property that he wishes to give as a gift as per law.
The donor’s general intent in making a Gift Deed is for love, affection, charity, or a similar object. The creation of a Gift Deed is not compulsory for gifting any property to another one.
But it is advisable to create or execute a Gift Deed in writing to establish validation of gifts in the future with the documentary record and proof so that the Gift Deed can be enforceable as per law.
Now the question arises is that what kind of property can be giftable? Any property can be a gift like movable, immovable, which is transferable and tangible.
If we refer to the provision under Section 122 of the Transfer of Property Act, 1882, there is mention that gift is the transfer of particular property, whether moveable or immovable property, such transfer is made by the donor voluntarily as without any consideration.
And these terms must be specifically mentioned in the Gift Deed that there is no consideration or payment or compensation to be received for the transfer of property.
Also Read: Suit for Recovery of Possession of Immovable Property: Law, Procedure & Remedies
(2) What are the essential elements of a Gift Deed?
Here are some essential factors we should know to make a useful and legally valid Gift Deed in India. These things need to be specifically defined in the Gift Deed.
- To make a valid gift deed, two persons are necessary, for example, the Donor and the Donee. This relationship between the Donor and Donee is an essential part of the Gift Deed.
- But there is no mandatory requirement that the Donor and Donee be blood relations. The Third-person may become a Donee without any blood relationship.
- The transfer must be voluntary, with the donor’s donative intent and not under any pressure or fraudulent intention. The transfer must be by a voluntary, major, and sound-minded donor without any force or fraud.
- The transfer must be without consideration, and no money transaction or compensation should be aspected by the donor. The gift deed should be executed out of love and affection only.
- If the Donee does not accept the donor’s gift property, then such a gift deed becomes invalid. That way, Donee must have to accept the transfer of property during a lifetime as per the mandatory requirement of a valid Gift Deed.
- In case the donor wishes for other rights and liabilities related to the gift property, they should be mentioned specifically in writing.
For example, these rights should include how to enjoy the property or receive any other income or future profit earned through the property. Accordingly, if there are any future expenses like maintenance of the property, the tax should be specifically mentioned in the deed.
- A delivery clause must be mentioned, which would confirm the delivery of the property’s possession.
(3) Who can execute a Gift Deed?
Any sound-minded person is eligible to execute a Gift Deed; As a donor, he is a competent person who can give a Gift Deed as per his desire and transfer it to the donee.
As we know, that Gift Deed is a legal contract, so here is one thing we should have to know that a minor can not make a Gift Deed. A contract with a minor is void as per law; he/she can not become a donor to do a Gift Deed. Therefore, if a Gift Deed created by a minor is null and void, and it is not valid in law.
(4) Who can be a Donee?
Anyone who receives and accepts a gift from the donor is called donee that can be in blood relations like son, brother, mother, father, etc. A Gift Deed can also be made without blood relations, such as a relative, nephew, friend, non-government organisation, etc.
In the case of a minor: If, in some circumstances, the donor wants to give a gift to a minor, there is no bar in the law that a minor can not become a donee. A natural guardian of the minor can accept a gift on his behalf. They can receive the gift as a manager or agent of a minor. However, after becoming an adult, a minor has to decide whether he has accepted a gift or not.
(5) Whether a Gift Deed should be registered?
The answer to the question is yes. The gift deed is required to be registered. As per Section 17(1)A of the Registration Act, there is specific mention that instruments of the gift of immovable property have to be compulsory require to register, and charges of registration will have to be paid.
Here one thing we should know is that without registration of a Gift Deed of the immovable property, there is no value in the eye of law. Held, without registering the Gift Deed of immovable property, it does not validly affect the evidentiary value of such a gift. However, there is not a mandatory requirement of registration for the transfer of moveable property. A Gift Deed should be registered at the registrar’s office or sub-registrar’s office of your town area.
(6) What necessary steps are involved in drafting a Gift Deed?
Here are some necessary steps that should be included in the gift drafting process to make a valid gift in India.
The first essential step for the draft a Gift Deed; there is mention of the full name of a donor and a donee with a residential address, age, the relation between the donor and donee( If any).
- Mentions the full details of properties, which is a donor want to gift to the donee.
- To put on both parties’ signatures as well as two attesting witnesses’ signatures in the Gift Deed, which is a crucial part of a valid Gift Deed.
- The second step is to attach a stamp paper that counts upon a value of the properties, and it might be different from the state-wise.
- Now the third step is to register a Gift Deed at the nearest registrar’s office or sub-registrar office, which is a mandatory part of a valid gift deed in India according to the law.
(7) What type of documents are required for registration of a Gift Deed?
These types of documents are commonly used for the registration process of a Gift Deed. (These types of documents may be changed or different for the registration purpose.)
- First is a copy of the original Gift Deed that is to be registered.
- Identity proofs of parties ( Donor, Donee, witnesses), like PAN card, Aadhaar card, etc.
- Documents of the donor’s property for the proofs of the title of the donor.
- Any other documents like valuation certificate of property, property tax-related documents, etc.
(8) Which type of property can be gifted?
The following types of property can be gifted through a Gift Deed:
- It should be an existing movable or immovable property, like cash, shares, land.
- It should be transferable property.
- Any property that probably exists in a future property that does not exist today; it should not be covered in the gift deed.
- It should be a transferable property.
- It should be tangible property.
(9) Is the gift deed revocable/can be taken back?
As per the proposition of legal terms, any registered document cannot be cancelled through a cancellation document in India. i.e. a sale deed, a will, or a gift deed cannot be cancelled through a cancellation document.
Similarly, a Gift Deed registered as per the Registration Act cannot be revoked through a cancellation document. In a Gift Deed after registration, the donee becomes the owner of the Gift property. If the donor wants to cancel a Gift Deed, he must go to court and seek the cancellation of the deed.
If the parties of a deed agreed and mutually mention wholly or any part of will be revocable, as per the donor wishes, then said Gift Deed is not valid in the eye of law.
We show the legal proposition regarding the cancellation of a Gift Deed, which is specifically mentioned u/s.126 of the Transfer of Property Act,1882. This section deals with when the gift can be revoked or suspended. When a specific event does not depend on the will of the donor, on that occasion, the said Gift Deed might be suspended or revoked.
