Gift Deed can be cancelled by the Donor, if the Conditions precedent are not completed.

A conditional gift with no recital of acceptance and no evidence in proof of acceptance, where possession remains with the donor as long as he is alive,  does not become complete during life time of the donor. When a gift is incomplete and the title remains  with  the donor, the deed of gift may be cancelled.  The Honble  Supreme Court of India, while  deciding Civil Appeal No. 10785 of 2018, arising out of the SLP (C)  No. 35515 of 2017 in case S. Sarojiniamma Versus  Velayudhan Pillai Sreekumar observed that the Deed of transfer in this case was executed for consideration  and was in any case conditional subject to the condition that the donee would look after the Petitioner  and her husband  and subject to the condition that the gift would  take effect after the death of the donor.  We are thus  constrained to hold that there was no completed gift of the property in question by the Appellant to the Respondent  and the Appellant was within  her right in cancelling the Deed.

The Court while referring to Raninkuntla Rajamma case observed that the fact that the donor had reserved the right to enjoy  property during her life time did not affect the validity of the  Deed.  

There  is no provision  in law that ownership in property can be gifted  without  transfer  of possession of such property. However, the conditions precedent of a gift as defined in Section-122 of the transfer of Property Act must be satisfied.  A gift is transfer of property without consideration. Moreover, a conditional gift only becomes complete  on compliance of the conditions  in the Deed.  

The Appellant a childlesse widow of  74 years, executed a gift deed in favour of  her nephew (brothers son) in the  expectation  that he will look after the Appellant and her husband. The Gift Deed  was conditional one  that it would  take  effect  after the death of the Appellant and her husband. However, later on 02.06.1999, the  Appellant cancelled  the Gift Deed, where upon the Respondent filed a Civil Suit before Munsif Sasthamcotta for declaration that the  cancellation  executed by the Appellant is null and void and therefore , also a suit for declaration claiming his right over the property  on the strength of the Gift Deed. The said suit was  decreed.  

The High Court while dealing with the  RSA dismissed the suit and held that the donor had reserved the right to enjoy the property during her life time and it did not affect  validity of the Deed.

The Supreme Court finally observed as under :-  

We are thus constrained to hold that there was no completed gift of the property  in question by the Appellant  to the  Respondent and the Appellant was within her right in cancelling the Deed.

 

         

                    

 

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