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Case Analysis: K. Balakrishnan v/s K. Kamalam - Gift To Minor

Facts Of The Case
Donor executed a registered gift-deed of 1/8th share of the property inherited by her from her maternal grandfather in favour of her minor son, appellant (done) and her daughter Kamalam, respondent.

Later, the donor executed a cancellation deed whereby she cancelled the gift-deed thereafter executed a Will bequeathing the same property comprising her 1/8th share in favour of her daughter, first respondent. The donor then died.

The appellant then filed the suit claiming declaration of his titled to the suit property on the basis of the gift-deed and cancellation deed and Will are ineffective and void in law.
The trial court held that the gift deed was invalid as there was no acceptance of gift. The High Court confirming the trial court judge dismissed the suit of the donee holding inter alia that the terms of the gift-deed do not indicate that any property was transferred thereunder.

Question Of Law
  • Whether the appellant, who was minor on the date of execution of the gift-deed, can be held to have legally accepted the property in suit gifted to him.
  • Whether the revocation of the gift was valid under S. 126.

Case Commentary
  • What is a gift?
    1. Section 122 of the Transfer of Property Act, 1882 defines a gift as follows: ‘Gift is the transfer of certain existing movable or immovable 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’. It is an act which imports a clear gain to the donee, an accession to his property, which he could not have demanded, and for which he cannot be compelled to make a return. The gift must be spontaneous.[1]

      A voluntary transfer of personal property without consideration. A parting by owner with property without pecuniary consideration. A voluntary conveyance of land or transfer of goods, from one person to another made gratuitously, and not upon any consideration of blood or money.[2]

      From the above definitions it can be understood that the essential requirements for a gift are:
      1. Made voluntarily without consideration
      2. By one person called the donor to another person called the donee,
      3. Such acceptance must be made during the lifetime of the donor and while he is still capable of giving
      4. Such acceptance must be made by or on behalf of the donee.
      5. If the donee dies before the acceptance the gift is void.
        Prima Facie in this case, it can be said that donor voluntarily without any consideration transferred the property in the name of the donee and his sister (the respondent). The parties in the transaction have already been established. The issue arises when it comes to acceptance. In the next section, the same will be answered.
         
    2. Can a minor accept a gift?
      In this case the contention is whether a minor can accept the gift.
      Clause (d) of Section 6 is not attracted on the terms of the gift-deed herein because it was not a property, the enjoyment of which was restricted to the owner personally. She was the absolute owner of the property gifted and it was not restricted in its enjoyment to herself. She had inherited it from her maternal grandfather as a full owner.

      The trial court dismissed the suit holding inter alia that the donee was a minor and no one has accepted the gift on his behalf. It, therefore, held that the gift deed was invalid and passed no title to the donee.

      The donee is the person who accepts the gift. He need not be a person who is competent to contract. A minor is not incapable of receiving property as S. 122 reads gift can be accepted on behalf of a minor. The TP Act does not prohibit the transfer of property to a minor, through gift under Section 122.[3]
       
    3. Case laws:
      In Bishan Singh v. Ved Prakash it was held that A gift by the father to his minor sons cannot be challenged on the ground that it was not accepted by the guardian of minors and possession was not delivered to them.[4]

      In Gujrant Singh v. Surjit Singh it was held that where a gift deed is executed by grandfather in favour of minor grandsons and it is duly thumb marked by the father of minor donees as guardian, the gift deed would be valid even if the father had not specifically deposed that he had accepted the gift on behalf of minor sons.[5]

      It is now clear that property under transfer of property act can be transferred via gift to a minor. This can be done by accepting the gift on behalf of the minor. The issue now is the acceptance of the gift.
       
    4. Was the gift accepted on behalf of the minor?
      Where a gift is made in favour of a child of the donor, who is the guardian of the child, the acceptance of gift can be presumed to have been made by him or on his behalf without any overt act signifying acceptance by the minor. In the instant case, a mother who is the natural guardian gifted the property to her minor son in the year 1945.

      A gift inter-vivo to a child cannot be revoked. There is a presumption in favour of the validity of a gift of a parent or a grandparent to a child if it is complete.[6]

      In a case where the father himself was the donor and executed a gift deed in favour of his minor son. In these circumstances, it was held that the gift in favour of the minor would be deemed to have been accepted as the father himself was the guardian and had himself executed the gift-deed.[7] Similarly, in this case, the gift was made by the mother under whose was the guardian of the donee. It can be said that there was an acceptance of the gift.

      Where a gift is made in favour of a child of the donor, who is the guardian of the child, the acceptance of gift can be presumed to have been made by him or on his behalf without any overt act signifying acceptance by the minor. In the instant case, the mother who is the natural guardian gifted the property to her minor son in the year 1945.

Since it has been established that the acceptance of gift from the donor to donee is valid, and the facts of the case reveal that there is a cancellation of the gift, the applicable provision under the Act, is Section 126. Section 126 provides for revocation and suspension of the gift.

A gift may be revoked either by the donor or after his death by his legal representatives, if the right survives after the death of the donor.[8] In this case, the gift was revoked by the donor herself.

Essentials for revocation to be valid:
  1. 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 an 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 be repugnant to the state created under the gift.[9]
Accordingly, if a gift is made subject to the condition of it being revoked in future the condition must be valid and enforceable under those provisions.

Section 126 lays down two modes of revocation of gift:
  1. Revocation by mutual agreement of donor and donee.
  2. Revocation by rescission as in the case of contracts.
The conditions essential for a valid revocation are not satisfied as there was no agreement whatsoever between the donor and the donee. Furthermore, a gift deed once executed, unless it is a conditional one, cannot be revoked in view of Section 126 of the Act.[10]

In the case of Abhachari v. Rama Chandrayya the court held that if a man improvidently binds himself up by a voluntary deed, and does not reserve a liberty to himself by a power of revocation, the Court will not lose the fetters he has put upon himself, but he must lie down under his own dolly.[11]

Revocation under the first paragraph of the section depends upon the agreement between the donor and the donee at the time of the acceptance, regarding a condition subsequent which puts an end to the gift. Such condition must be agreed to, at the time of the acceptance of the gift; for the donor cannot impose such a condition after the gift is perfected. Such a condition must be express. In the absence of such a condition, the gift cannot be suspended or revoked.

And, in the absence of an express reservation of a power of revocation, the donor does not continue to have that right after he has divested himself of all the right, title and interest by means of the gift, and after he has duly vested the property in the donee.[12]

Except on the ground of:
  1. condition subsequent not depending on the pleasure of the donor and
  2. on the grounds justifying of a contract, a gift cannot be revoked on any other ground.

A gift deed was validly executed in favour of the done. It was held that a simultaneous claim by the donor that the gift deed was revoked unilaterally by him and lodged for registration was not valid as there was no participation by the donee.[13]

It is pertinent to note that at the time of making the transfer via gift, the donor did not impose any such condition. So, she does not have the right to revoke the gift. The gift deed was revoked by the mother much after its execution as late as in the year 1970. By that time, the donee had become major and he never repudiated the gift.
 
Conclusion
The donor had very clearly transferred to the donees' ownership and title in respect to her 1/8th share in properties. It was open to the donor to transfer by gift title and ownership in the property and at the same time, reserve its possession and enjoyment to herself during her lifetime. There is no prohibition in law that ownership in property cannot be gifted without its possession and right of enjoyment.

Under Section 6 of the Transfer of Property Act, 1882, "property of any kind may be transferred" except those mentioned in Clauses (a) to (i). Clause (d) of Section 6 is not attracted on the terms of the gift-deed herein because it was not a property, the enjoyment of which was restricted to the owner personally. She was the absolute owner of the property gifted and it was a maternal grandfather as a full owner.

Knowledge of gift deed to both the parents as natural guardians and the donee is sufficient to indicate acceptance of the gift by the minor himself or on his behalf by the parents. Where a gift is made by a parent to a child, there is a presumption of acceptance of the gift by the donee. This presumption of acceptance is founded on human nature.

The gift was executed in 1945. It remained in force for about 25 years during which time the donee had attained majority and had not repudiated the same. It was, therefore, not competent for the donor to have cancelled the gift and executed a Will in relation to the property.

The gift having been duly accepted in law and thus being complete, it was irrevocable under Section 126 of the Transfer of Property Act. Section 126 prohibits the revocation of a validly executed gift except in circumstances mentioned therein. The gift was executed in 1945. It remained in force for about 25 years during which time the donee had attained majority and had not repudiated the same. It was, therefore, not competent for the donor to have cancelled the gift and executed a Will in relation to the property.

End-Notes:
  1. Bireswar v. Ashalata, AIR 1969 Cal 111.
  2. AIR 1981 SC 1274 (1279).
  3. K. Balakrishnan v. K. Kamlam, AIR 2004 SC 1257 (1260).
  4. 2001 AIHC 3916 (HP).
  5. AIR 2004 P & H 257; Tirath v. Manmohan Singh, AIR 1981 P&H 174; Balwant Singh v. Mehar Singh, AIR 1974 P&H 130 (relied on).
  6. See Halsbury's Laws of England Vol. 5(2) 4th Edn. Paragraphs 642 & 647
  7. Ponuchami Servai v. Balasubramanian AIR 1982 Mad 281
  8. Ghumna v. Ram Chandra, AIR 1925 All 437
  9. Nanhibai v. Govind Rao, 2007 (1) MPLJ 115.
  10. Loyola Public School Society v. P. Anil Kumar, 2007 (5) Andh LT 586.
  11. 1 MHCR 393.
  12. Ankamma v. Narasayya, AIR 1947 Mad 127
  13. Sheel Arora v. Madan Mohan Bajaj, AIR 2009 NOC 333 (Bom).

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