Legal Question in Real Estate Law in India

25.09.2013

Dear Sir / Madam,

In case of a Gift Deed of immoveable property, the Donor "conveys" the property to the Donee free of consent and cost, and without any "consideration". The important aspect for a transaction to be truly called a gift is that it should be done without "consideration", which is to say that there should not be a reward or promise of reward for executing the transaction of gift. The word "consideration" has not been defined in the Transfer of Property Act, but the Supreme Court (in Smt. Shakuntal v/s State of Haryana-1979 (3) SCR 232, and in Major V P Singh v/s State of UP - AIR 1991 SC 1502) has clearly held that the word "consideration" has been used in the same sense in which it has been used in Section 2(d) of the Indian Contract Act, 1872 (K Balakrishnan v/s K Kamalam - AIR 2004 SC 1257). The donor must give the immoveable property to the donee without expecting anything in return. The moment an element of consideration, expectation or gain, is brought in the transaction either by money or by reward of any kind, the transaction ceases to be a gift.

In view of the above, in my opinion, the clause mentioned in your query cannot be incorporated in the Gift Deed.

Regards,