Chapter 7: THE TRANSFER OF PROPERTY ACT, 1882

CHAPTER VII: OF GIFTS

Section 122: “Gift” defined

This section defines the essential legal ingredients that make a transfer a “gift.”

“Gift” is the transfer of certain existing moveable or immoveable 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.

Simple Translation: A “gift” is a transaction that must have five key parts:
1. A Transfer: Ownership must actually move from one person to another.
2. Existing Property: The property (house, car, jewelry) must exist right now. You can’t gift something you don’t own yet.
3. Voluntarily: The person giving the gift (the “donor”) must do it of their own free will (no force, threats, or coercion).
4. Without Consideration: This is critical. The donor must get nothing of value in return. If you get money or another item in return, it’s a sale or an exchange, not a gift.
5. Acceptance: The person receiving the gift (the “donee”) must accept it.
Real-World Example: Your aunt (the donor) decides to give you her car. She does this “voluntarily” because she wants to, and “without consideration” because you are not paying her for it. When you (the donee) say, “Thank you, I accept!” and take the keys, the gift is legally complete.

Acceptance when to be made. Such acceptance must be made during the lifetime of the donor and while he is still capable of giving.

Simple Translation: The person receiving the gift must accept it before the person giving the gift either passes away or becomes legally “incapable” (e.g., due to severe mental illness or a coma).
Real-World Example: Your grandfather writes you a letter on Monday stating, “I am gifting you my house.” He tragically passes away on Wednesday. You receive the letter on Friday and immediately reply, “I accept.” The gift is void (invalid). You cannot accept the gift after the donor has died. The house will go to his legal heirs, not to you.

If the donee dies before acceptance, the gift is void.

Simple Translation: The gift is also cancelled (“void”) if the person who was supposed to receive it dies before they can accept it.
Real-World Example: You decide to gift a valuable painting to your friend. You send the painting to her house with a gift card. The package arrives, but before your friend can open it or even know what it is, she passes away. The gift is void. Since she never accepted it, the painting still belongs to you. It does not become part of her property for her heirs to inherit.

Section 123: Transfer how effected

This section explains the mandatory legal process for making a gift, which is different for immovable and movable property.

For the purpose of making a gift of immoveable property, the transfer must be effected by a registered instrument signed by or on behalf of the donor, and attested by at least two witnesses.

Simple Translation: You cannot gift immovable property (like land, a house, or a flat) just by saying so or by a simple letter. The only way to legally make such a gift is to:
1. Create a formal written document called a “gift deed.”
2. The donor must sign this deed.
3. At least two witnesses must watch the donor sign (or hear the donor acknowledge their signature) and then sign the deed themselves.
4. This deed must be registered at the government’s sub-registrar office (which also involves paying stamp duty).
Real-World Example: A mother wants to gift her apartment to her son. She tells him, “The house is yours,” and he moves in. Legally, this gift is invalid. To make it valid, she must draft a “Gift Deed,” sign it in front of two witnesses (e.g., her neighbor and her lawyer, who also sign it), and then register the deed at the sub-registrar’s office. Only after registration does the son become the legal owner.

For the purpose of making a gift of moveable property, the transfer may be effected either by a registered instrument signed as aforesaid or by delivery.

Simple Translation: To gift movable property (like a car, jewelry, laptop, or cash), you have two options:
- By Registered Instrument: You can (but don’t have to) use the same formal process as gifting a house (create a registered deed).
- By Delivery: You can simply hand over the item to the donee.
Real-World Example: You want to gift your old motorcycle to your nephew.
- Option 1 (By Delivery): You can just hand him the keys and the signed RTO transfer forms. The moment he takes possession, the gift is complete and legal.
- Option 2 (By Instrument): You could (if you wanted a very formal record) draft a “gift deed” for the motorcycle, sign it with two witnesses, and register it. This is also legally valid but usually unnecessary.

Such delivery may be made in the same way as goods sold may be delivered.

Simple Translation: “Delivery” doesn’t just mean a physical handover. It can also be symbolic, just as in a “sale” transaction.
Real-World Example: You want to gift your daughter a large piano that is currently in a locked storage unit. Instead of physically handing her the piano, you hand her the key to the storage unit and the paid receipt. This symbolic act counts as “delivery” and completes the gift.

Section 124: Gift of existing and future property

This section clarifies what happens if you try to gift something you don’t own yet.

Simple Translation: You can only gift property that you own right now (“existing property”). You cannot legally gift property that you expect to get in the future (“future property”). If you make a single gift that mixes both, the gift is valid for the existing property but void (invalid) for the future property.
Real-World Example: A grandfather writes in a gift deed: “I hereby gift to my grandson (A) my house in Mumbai (which I currently own) and (B) the house in Delhi which I will inherit after my older brother’s death.”
- Result: The gift of the Mumbai house (existing property) is valid.
- The gift of the Delhi house (future property) is void. The grandfather cannot gift a property he only has a chance of inheriting.

Section 125: Gift to several, of whom one does not accept

This section explains what happens when a gift is made to a group, and one person refuses it.

Simple Translation: If you give a single gift to two or more people, and one of those people refuses to accept it, the entire gift is not cancelled. Only the portion that the refusing person would have received is cancelled. That “void” portion remains the property of the donor.
Real-World Example: A man gifts a plot of land to his three children—Amit, Bharat, and Charu—in equal 1/3rd shares, all in one deed.
- Amit and Bharat accept the gift.
- Charu refuses the gift, stating she doesn’t want it.
- Result: The gift is not voided. Amit and Bharat each get their 1/3rd share. Charu’s 1/3rd share is “void” and remains the property of the father (the donor). It does not automatically go to Amit and Bharat.

Section 126: When gift may be suspended or revoked

This section explains the very limited and specific situations in which a legally completed gift can be cancelled.

The donor and donee may agree that on the happening of any specified event which does not depend on the will of the donor a gift shall be suspended or revoked…

Simple Translation: A donor can make a “conditional gift” that can be taken back (revoked) or put on hold (suspended). This is only valid if:
1. Both the donor and the donee agree to this condition at the time of the gift.
2. The condition is based on a specific event that is not in the donor’s control.
Real-World Example (Illustration ‘a’): A father (donor) gifts a field to his son (donee). They both agree, in the gift deed, that “if the son and all his descendants die before the father, the father shall get the field back.” This is a valid condition because the son’s death is a “specified event” not dependent on the father’s “will” or wish.

…but a gift which the parties agree shall be revocable wholly or in part, at the mere will of the donor, is void wholly or in part, as the case may be.

Simple Translation: If a “gift” includes a condition that the donor can take it back whenever they feel like it (“at their mere will”), then the gift is legally invalid (void) for that part. It’s not a real gift because ownership never truly transferred.
Real-World Example (Illustration ‘b’): A man gives his friend Rs. 1 lakh, but they agree that the donor can ask for Rs. 10,000 back at any time, for any reason.
- Result: The gift of Rs. 90,000 is valid.
- The gift of that Rs. 10,000 is void. That Rs. 10,000 legally still belongs to the donor, as he never truly gave it away.

A gift may also be revoked in any of the cases (save want or failure of consideration) in which, if it were a contract, it might be rescinded.

Simple Translation: A gift can be cancelled for the exact same reasons a contract can be cancelled—for example, if the gift was made due to fraud, coercion, or undue influence.
Key Exception: You cannot cancel a gift just because you “got nothing in return.” That (failure of consideration) is the whole point of a gift.
Real-World Example: An elderly, sick man is pressured by his caretaker, who threatens to stop giving him medicine. Under this “undue influence,” the man signs a gift deed for his house to the caretaker. Later, the man’s children can file a lawsuit to have the gift revoked (cancelled) on the grounds of undue influence, just as if it were a fraudulent contract.

Save as aforesaid, a gift cannot be revoked.

Simple Translation: This is the most important rule. Once a gift is legally complete (meets the rules of Sec 122 and 123), it is final and permanent. It cannot be taken back unless it meets one of the two specific conditions listed above (a pre-agreed condition or fraud/coercion).
Real-World Example: You give your sister a car for her birthday. The transfer is registered, and she accepts it. Six months later, you have a big argument. You cannot legally demand the car back. “Donor’s remorse” is not a valid reason for revocation.

Nothing contained in this section shall be deemed to affect the rights of transferees for consideration without notice.

Simple Translation: This protects an innocent person who buys the gifted property.
Real-World Example: Let’s use the caretaker example. The caretaker (donee) gets the house through undue influence. Before the elderly man can revoke it, the caretaker sells the house to an innocent buyer (a “transferee for consideration”) who pays a fair price and has no idea about the family drama (“without notice”).
- Result: The elderly man cannot get the house back from the innocent buyer. His only option is to sue the caretaker for the money the caretaker received from the sale.

Section 127: Onerous gifts

This section deals with “onerous” or burdensome gifts—gifts that come with an obligation or debt attached.

Where a gift is in the form of a single transfer to the same person of several things of which one is, and the others are not, burdened by an obligation, the donee can take nothing by the gift unless he accepts it fully.

Simple Translation: If someone gives you multiple things as one single gift (e.g., “I give you all my stocks”), and one of those things is a burden (like a failing stock with a debt attached), you must accept everything (the good and the bad) or nothing. You cannot cherry-pick.
Real-World Example (Illustration ‘a’): Your uncle gifts you “all his shares in all companies.” This single gift includes (A) 100 shares of a profitable company and (B) 50 shares of a failing company that requires shareholders to pay “heavy calls” (a debt). You cannot accept the profitable shares and reject the failing ones. You must accept both, or you get neither.

Where a gift is in the form of two or more separate and independent transfers to the same person of several things, the donee is at liberty to accept one of them and refuse the others, although the former may be beneficial and the latter onerous.

Simple Translation: If someone gives you multiple gifts as separate and independent transactions (even on the same day), you can cherry-pick. You can accept the good ones and reject the bad ones.
Real-World Example (Illustration ‘b’): Your aunt gives you two separate gifts: (1) a gift deed for a house lease that is losing money (the rent is higher than its value), and (2) a separate bank transfer for Rs. 5 lakh. You can legally refuse to accept the burdensome lease but still accept the Rs. 5 lakh.

Onerous gift to disqualified person. A donee not competent to contract and accepting property burdened by any obligation is not bound by his acceptance.

Simple Translation: If a “disqualified person” (like a minor, who cannot legally enter a contract) accepts a burdensome gift, they are not legally responsible for the attached obligation.
Real-World Example: You gift your 16-year-old nephew a plot of land, which has Rs. 20,000 in unpaid property taxes (a burden). He accepts the gift. He is not personally liable to pay that tax debt while he is a minor.

But if, after becoming competent to contract and being aware of the obligation, he retains the property given, he becomes so bound.

Simple Translation: However, once that minor turns 18 (becomes “competent to contract”) and knows about the burden, they have a choice: (1) return the gift, or (2) keep it. If they choose to keep the property, they are now legally responsible for the burden.
Real-World Example: The nephew turns 18. He is fully aware of the Rs. 20,000 tax debt on the land. He decides to keep the land. By making this choice as an adult, he has also legally accepted the debt and is now responsible for paying it.

Section 128: Universal donee

This section defines a special type of donee who receives everything the donor owns.

Simple Translation: If a donor gives all of their property (movable and immovable) to one person, that person is called a “universal donee.” This person is now personally responsible for all the debts and liabilities of the donor that existed at the time of the gift.
The Limit: The universal donee’s liability is limited to the total value of the property they received.
Real-World Example: A man gives his son his entire estate (a house, car, and all bank balances) worth Rs. 2 crore. This makes the son a “universal donee.” At the time of the gift, the man had an outstanding business loan of Rs. 30 lakh. The son is now personally liable to the bank for that Rs. 30 lakh. If the loan had been Rs. 2.5 crore (more than the gift), the son would only be liable up to the Rs. 2 crore he received.

Section 129: Saving of donations mortis causa and Muhammadan law

This section acts as an “exception” clause, stating what this chapter does not apply to.

Simple Translation: The rules written in this chapter about gifts (e.g., the need for a registered deed in Sec 123) do not affect:
1. Donations mortis causa: These are “gifts made in contemplation of death” (e.g., a soldier going to war gives a friend his watch, saying “If I don’t come back, it’s yours”). These are covered by different laws (like the Indian Succession Act).
2. Any rule of Muhammadan law (Hiba): Islamic law has its own rules for making a valid gift (known as Hiba), which are not overridden by this Act.
Real-World Example: Under Section 123, a gift of a house must be by a registered instrument. However, under Muhammadan law, a donor can make a valid oral gift of a house if it involves (1) a clear declaration of gift, (2) acceptance by the donee, and (3) immediate delivery of possession. This section (129) confirms that this oral Hiba is still legally valid, even without a registered deed.