Thursday 25 June 2015

PROPERTY GIFTED TO MINORS BY PARENTS - IRREVOCABLE

In an important judgement, the Hon’ble Supreme Court of India, has ruled that the Property once gifted to minor children by the parents cannot be revoked by them at a later stage even on the plea that the children did not expressly accepted the gift.

While, settling an 18 year old litigation between a brother and sister over the property gifted to them by their mother, a bench of the Hon’ble Supreme Court of India held that “where a gift is made by a parent to a child, there is presumption of acceptance of the gift by the done.”

Looking to the details of the case, it can be found that, in 1975, one Devayani of Mayyanadcherry in the State of Kerala executed a registered Gift deed in favour of her then 16 year old son and minor daughter giving them one-half each of the landed property inherited by her from her father.  However, in 2000 i.e., after 25 years, she executed a cancellation deed nullifying the Gift deed executed by her in the year 1975; and there after executed a WILL bequeathing the entire property in favor of her daughter.

When the matter was contested, the Lower Court dismissed the suit filed by the son Sri K. Balakrishnan, claiming title to the suit property on the ground that the done was a minor at the time of execution of the gift deed and hat no one has accepted the gift on her behalf.  Even though the District Court took a view contrary to the Trial Court’s view, the Hon’ble High Court upheld the earlier verdict.

Finally, when the matter came up before the Hon’ble Supreme Court of India, the Hon’ble Supreme Court of India, set aside the Hon’ble High Court’s view and held that:  “Where a gift is made in favor of the donor, who is the guardian of the child, the acceptance of the gift can be presumed to have been made by him or on his behalf without any overt act signifying acceptance of the same by the minor.”  

Referring to the case in hand, the Bench of the Hon’ble Supreme Court further held that “the knowledge of the gift deed to both the parents as natural guardians and the done (to whom property was gifted) was sufficient to indicate acceptance of the gift by the minor himself or on his behalf by the parents.  The Hon’ble Justice also held that the said gift deed was revoked by the mother much after its execution and by that time, the done had become major and that she never repudiated the gift. 

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