PRO

JEC of gift and the

Essentials
Presumption of advancement.
T

Submitted by:
Submitted to:

Dr. Radheshayam Prasad

Ketan Suri
Asst. Prof. of Law Roll no 66
Property law Enrollment no.- 130101065

Dr. RMLNLU Section A

Ketan Suri
BA. LLB. (hons)
Roll no 66
 ACKNOWLEDGEMENT

I express my gratitude and sincere thanks to Radheshayam Prasad Sir, for his support

throughout the making of this project. He has provided valuable guidance as and when

required without which this project would not have been in this shape. I would like to thank

Dr. Ram Manohar Lohiya National Law University for giving me this opportunity to work on

this project.  I would also like to thank my family for their endless support throughout the

making of this project. Lastly, I thank my friends for their support, for their help in collecting

the material and for critically going through the project and correcting the mistakes. 
TABLE OF CONTENTS

1. Introduction

2. Subject of gift

3. Conditions for valid gifts

a. The absence of consideration

b. The donor

c. The done

d. The subject matter

e. The transfer and acceptance

4. Presumption under gift

a. Relationship giving rise to presumption of advancement

b. Relationship not giving rise to presumption of advancement

5. Conclusion

6. Bibliography
INTRODUCTION

A gift is a transfer. But it does not contain any element of consideration. Complete absence of
monetary consideration is the main, hallmark, which distinguishes a gift from a grant or any
other transactions for valuable or adequate consideration. Where there is any equivalent of
benefit measured in terms of money in respect of a gift, the transaction ceases to be a gift.
Love, affection, spiritual benefit and many other factors may enter in the intention of the
donor to make a gift but these financial considerations cannot be called or held to be legal
considerations as understood by law. Legal consideration is one recognised or permitted by
law as valid and lawful. The term is also sometimes used as equivalent to a 'good' or
'sufficient' consideration. Love and affection is a sufficient consideration when a gift is
contemplated, but it is not considered as a 'valuable' consideration when such is required.

The conception of the term "gift" as used In the Transfer of Property Act is somewhat
different from the use in Mohammedan law. In the Mohammedan law a gift is a transfer of
property or right by one person to another in accordance with the provisions given in the
Mohammedan law and includes-
a) A hiba, an immediate and unconditional transfer of the ownership of some property or of
some right, without any consideration or with some return (ewaz); and
b) An ariat, the grant of some limited interest in respect of the use or usufruct of some
property or right.
Where a gift of any property or right is made without consideration with the object of
acquiring religious merit, it is called sadaqah.

The terms "hiba" and "gift" are often indiscriminately used but the terms "hiba" is only one of
the kinds of transactions which are covered by the general term "gift". A hiba is a transfer
without consideration. A gift by a Muslim in favour of his co-religionist must be under the
Mohammedan Law. A gift is not a contract (though in Muslim law it is called a contract) but
the principle may be applicable even to gift.

In ordinary legal effect, there cannot be a `gift' without a giving or taking. The giving or
taking are two contemporaneous, reciprocal acts, which constitute a gift. Section 122 of the
Act postulates that a gift is a transfer of certain existing movable or immovable property
made voluntary and without consideration by one person called the donor, to another, called a
donee and accepted by or on behalf of the donee. The essential elements of a gift are 
(a) The absence of consideration;
(b) the donor;
(c) The donee;
(d) The subject-matter; 
(e) the transfer; and the acceptance

SUBJECT OF GIFT
The subject matter of the gift must be certain existing movable or immovable property. It
may be land, goods, or actionable claims. It must be transferable under s 6. But it cannot be
future property. A gift of a right of management is valid; but a gift of future revenue of a
village is invalid. These cases were decided under Hindu and Mohammedan law respectively
but they illustrate the principle. In a Calcutta case, it was said that the release of a debt is not
a gift, as a gift must be of tangible property. It is submitted that the release of a debt is not a
gift as it does not involve a transfer of property but is merely a renunciation of a right of
action. It is quite clear that an actionable claim such as a policy of insurance may be the
subject of a gift It is submitted that in a deed of gift the meaning of the word 'money' should
not be restricted by any hard and fast rule but should be interpreted having regard to the
context properly construed in the light of all the relevant facts. Therefore in order to
constitute a valid gift, there must be an existing property. In Mohammedan law any property
or right which has some legal value may be the subject of a gift.1

CONDITIONS FOR VALID GIFT

There was a divergence of view between the two schools of Hindu law as to the necessity of
acceptance of the gift by the donee, Dayabhaga holding that it was not necessary but
Mistakshara holding the contrary. This section has modified the indigenous Dayabhaga law.
A transfer of a stock to the name of the donee vests the property in him subject to his right to
repudiate the gift, even though he be unaware of the transfer And this is so even though the
gift be onerous. The mutation entries of the property alleged to be gifted does not conveyor
extinguish any title and those entries are relevant only for the purpose of collection of land
revenue.2
Gift defined under the Transfer of Property Act is as given below-

1
Rao, Kruthika, Gift as under the TPA, 2013.
2
Githala, Shubham, Transfer of Property, 2015.
122. "Gift" defined. - "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.3

It is required to be a voluntary transfer of property to another made gratuitously and without

consideration. This section applies to those gifts that are gifts inter vivos or an absolute gift.
Property under the above section can be both moveable or immoveable but however have to
be tangible in nature. In order to constitute a valid gift, there must be an existing property as
already earlier elaborated.

Voluntarily - In this section the word 'voluntarily' bears its ordinary popular meaning. It
denoting the exercise of the unfettered free will, and not its technical meaning of 'without
consideration'. When a gift is made, it must satisfactorily appear that the donor knew what he
was doing and understood the contents of the instrument and its effect, and also that undue
influence or pressure was not exercised upon clear intention to make an out-and-out gift, but
the intention has failed for want of transfer or any other cause, the courts will not convert
what was meant to be an out-and-out gift into a trust, and the donor will not be deemed a
trustee of the property for the intended donee. The gift will fail. Also where the husband
deposited certain ornaments with a bank for safe custody in the joint names of himself and his
wife, with direction to be delivered to be either or survivor, it did not amount to a gift, as the
husband retained dominion over the property. Where a person keeps money to fixed deposit
in the name of his niece, brought up and given in marriage by him, there is an inference of
gift in favour of the niece.

Where the motive behind the deed of gift was unequivocal to give the transferee a title which
would act as a safeguard against any claim for pre-emption, the transaction for that reason
cannot be called a sale. Similarly where a person settles an annuity upon his alleged wife, the
settlement cannot be construed to be a contract for consideration of love and affection, but is
a gift pure and simple.

Donative intention (motive) and consideration- A gift is a transfer. But it does not contain
any element of consideration. Complete absence of monetary consideration is the main,
hallmark, which distinguishes a gift from a grant or any other transactions for valuable or
adequate consideration. Where there is any equivalent of benefit measured in terms of money

3
Section 122 of the Transfer of Property, 1882.
in respect of a gift, the transaction ceases to be a gift. Love, affection, spiritual benefit and
many other factors may enter in the intention of the donor to make a gift but these financial
considerations cannot be called or held to be legal considerations as understood by law. Legal
consideration is one recognised or permitted by law as valid and lawful. The term is also
sometimes used as equivalent to a 'good' or 'sufficient' consideration. Love and affection is a
sufficient consideration when a gift is contemplated, but it is not considered as a 'valuable'
consideration when such is required.

It is one of the essential requirements of a gift that it should be made by the donor 'without
consideration'. The word 'consideration' has not been defined in the T.P. Act, but means the
same as in the Contract Act excluding natural love and affection. If not, and if the transfer
involved consideration, the transaction would amount to a sale within the meaning of sec. 54
or to an exchange within the meaning of sec. 118. The essence of a gift inter vivos must be
without 'consideration' of the nature defined in sec. 2(d) of the Contract Act.

Where a very old man, with weak eyesight, sues for cancellation of the deed of gift executed
by him in favour of his son alleging that it was not his voluntarily act. The circumstance also
indicated that the donee was in a position to dominate the will of the donor. Under such
circumstance the onus shifts on to the donee to prove that the gift was made voluntarily.

In another case of the Orissa High court, Gift deed is alleged to have been taken from a
pardanashin lady by practicising fraud. When the plaintiff is an illiterate or pardanashin lady,
in spite of the fact that she is unable to establish her case of practising fraud, the onus still
remains uponi the donee to establish conclusively that the document was executed after it was
read over and explained to her and after she understood the contents thereof. 

'Without consideration' - A gift is a transfer without consideration and if there is any

consideration in any shape, there is no gift. The word 'consideration' means valuable
consideration, i.e. consideration either of money or money's worth. A gift in lieu of
conferring spiritual benefit to the donor is not a transfer with consideration, but is to be
treated as a gift.

Where a mother gifts property to her only daughter, who promises to maintain the former
throughout her life, the promise is not enforceable in law because the gift has to be for natural
love and affection and not for any consideration . A minor may be a donee and the minor's
natural guardian can accept the gift on behalf of the minor. But if the gift is onerous, the
obligations cannot be enforced against the minor during his minority. But on his attaining
majority, the minor must accept the burden or return the gift. The donee can even be a child
en ventre sa mere (in its mother's womb).

When Acceptance to be made. - Such acceptance must be made during the lifetime of the
donor and while he is still capable of giving. If the donee dies before acceptance, the gift is
void. 

Acceptance. - The gift must be accepted by the donee or by someone on his behalf. An offer
without acceptance by the donee cannot complete the gift. Acceptance may be inferred from
acts prior to the execution of the deed of gift. Mere silence may sometimes indicate
acceptance provided the donee knows about the gift, slighest evidence of acceptance being
sufficient.

Even when a gift is made by a registered instrument, the same has to be accepted by or on
behalf of the donee to make it complete, failing which the gift will be bad, because it so
provides in sec. 122. What the law requires is acceptance of the gift after its execution,
though the deed may not be registered. Anterior negotiations or talks about the gift would
not amount to acceptance. Person accepting gift on behalf of the minors appended his thumb-
impression on the deed in token of acceptance. It was held that the gift was complete.
Acceptance must be essentially made before the death of the donor. There must be something
shown to indicate an acceptance. The acceptance may be signified by an overt act such as the
actual taking of possession of the property, or such acts by the donee as would in law amount
to taking possession of the property where the property is not capable of physical possession.
Acceptance may be implied, but the rule of implied acceptance ought not to be extended so
far as to hold that the acceptance will be presumed unless dissent is shown. Acceptance will
be presumed if there is possession, actual or on the parties where some right, interest, profit
or benefit accrues to one party, or some forbearance, detriment, loss, or responsibility is
given, suffered or undertaken by the other. There is nothing in section122 of the transfer of
property Act to show that the acceptance under this section should be express. The
acceptance may be inferred, and it may be proved by the donee's possession of the property,
or even by the donee's possession of the deed of gift.
Delivery of possession of the gifted property is not absolute requirement, for the
completeness or the validity of the gift as found in Muslim Law of Gifts.
When a gift of immovable property is not onerous, only slight evidence is sufficient for
establishing the fact of acceptance by the donee. When it is shown that the donee had
knowledge of the gift, it is only normal to assume that the donee had accepted the gift,
because the acceptance would only promote his own interest. Mere silence may sometimes be
indicative of acceptance, provided it is shown that the donee knew about the gift. No express
acceptance is necessary for completing a gift.

While mere possession by or on behalf of, a donee may amount to acceptance, mere
possession cannot be treated as evidence of acceptance where the subject matter is jointly
enjoyed by the donor and the donee.

A gift of immovable property can only be made by a registered instrument. A deed cannot be
dispensed with even for a property of small value, as in the case of a sale. And as a further
precaution, attestation by two witnesses is required. This provision excludes every other
mode of transfer and even if the intended donee is put in possession, a gift of immovable
property is invalid without a registered instrument.

PRESUMPTION IN GIFT

In some circumstances where a person voluntarily transfers property into the name of
another, or contributes to its purchase, the law presumes that a gift was intended and that the
transferor/contributor did not intend to retain any interest in the property concerned. This
presumption, known as the ‘presumption of advancement,’ displaces the presumption of
resulting trust. The presumption of advancement arises as a consequence of a pre-existing
relationship between the parties to the transfer or acquisition, where the transferor/contributor
is regarded as morally obliged to provide for the person benefiting.4

The range of relationships where equity recognises a presumption of advancement reflects a

nineteenth-century understanding of family responsibility, and it is clear that, today, the
strengths of the presumptions vary to reflect the differing social circumstances.

Relationships giving rise to Presumption of advancement5

4
Re Levy 131 DLR 3d 15 (Nova Scotia Supreme Court, 1981)
5
Gliser, Jamie, Is there a presumption of Advancement, 2009
  Father and child

Traditionally, there was a strong presumption of advancement between a father and his child.
In Re Roberts6 it was held that the presumption of advancement applied where a father had
made payments on a policy of assurance taken out on his son’s life. In B v B7, a Canadian
court held that the presumption of advancement applied where a father had purchased a
winning lottery ticket in the name of his 12-year-old daughter. She was therefore entitled to
the winnings absolutely. The rationale for the presumption of advancement between a father
and child is that a father, by the very nature of his position, is under a duty to provide for his
child. This may include the child’s mother if she is stands in loco parentis. There is no
presumption of advancement in the case of other family relationships.

 Person standing in loco parentis

A presumption of advancement also arises between a child and a person standing in loco
parentis. The rationale for this extension of the presumption was stated by Jessel MR in
Bennet v Bennet8 that a person not the father of the child may put himself in the position of an
in loco parentis to the child and so incur the obligation to make provision for the child.

 Husband and wife

The presumption of advancement also arises between a husband and his wife. The principle
was stated in Re Eykyn’s Trusts as the law of this court is perfectly settled that when a
husband transfers money or other property into the name of his wife only, then the
presumption is, that it is intended as a gift or advancement to the wife absolutely at once,
subject to such marital control as he may exercise. And if a husband invests in money, stocks
or otherwise, in the names of himself and his wife, then also it is an advancement for the
benefit of the wife absolutely if she survives her husband.

The operation of the presumption in this context reflects a nineteenth-century social

understanding of a husband’s obligation to provide for his wife.9

6
[1946] Ch 1
7
(1976) 65 DLR
8
(1879) 10 Ch D 474
9
Pettitt v Pettitt [1970] AC 777
Relationships where no presumption of advancement arise
 Mother and child

No presumption of advancement arises between a mother and her child, and therefore if a
mother transfers property voluntarily to her child the counter presumption of resulting trusts
will apply. In Bennet v Bennet, Jessel MR explained the absence of the presumption on the
basis that ‘there is no moral legal obligation…no obligation according to the rules of equity-
on a mother to provide for her child.’ Again such reasoning reflects nineteenth-century
concepts of the family and in modern social conditions mothers almost invariably share the
responsibility to provide for their children. Despite the socially archaic rationale, more
modern cases have confirmed that there continues to be no presumption of advancement
between a mother and a child.

Despite the absence of a presumption of advancement between mother and child the
presumption of resulting trust arising in default is relatively weak and easily rebutted.

 Wife and husband

Similarly, no presumption of advancement operates between a wife and her husband. So that
if a wife voluntarily transfers property into the name of her husband, or contributes to the
purchase of property in his name, a presumption of resulting trust arises. Thus, in Re
Curtis  in the absence of evidence that a gift was intended, a wife was presumed to enjoy the
equitable interest in shares, which she had voluntarily transferred into the name of her
husband, by way of a resulting trust. The absence of the presumption seems to have been
accepted in the more recent case of Mossop v Mossop10, and led to the presumption of a
resulting trust in Abrahams v Trustee in Bankruptcy of Abrahams11, where a wife contributed
to a syndicate purchasing National Lottery tickets in the name of her husband.

 Co-habiting couples/mistresses

There is no presumption of advancement between cohabiting couples (whether heterosexual

or homosexual), not between a man and his mistress.12 The presumption of resulting trust will
therefore apply if property is voluntarily transferred in such cases.

10
[1988] 2 All ER
11
[1999] BPIR 637
12
Mowbray, W., Lewin on Trusts (London: Sweet & Maxwell, 1964), pages 133-134 and 139.
Conclusion
The conception of the term gift and subject matter of gift has been an age old and traditional
issue which has developed into a distinct facet in property law. Different aspects related to
gift in property act and its distinction with the Mohammedan law and its implications has
been the major subject matter of this article. In considering the law of gifts, it is to be
remembered that the English word 'gift' is generic and must not be confused with the
technical term of Islamic law, hiba. The concept of hiba and the term "gift as used in the
transfer of property act, are different. As we have seen in the project that Under
Mohammedan law, to be a valid gift, three essentials are required to exist: (a) declaration of
gift by the donor (b) an acceptance of the gift, express or implied, by or on behalf of the
donee, and (c) delivery of possession of the subject of gift. The English law as to rights in
property is classified by a division on the basis of immoveable and moveable (real and
personal) property. The essential elements of a gift are (a) The absence of consideration; (b)
the donor; (c) the donee ;(d) the subject-matter; (e) the transfer; and the acceptance Thus this
striking difference between the two laws relating to gift forms the base of this project in
understanding its underlying implications. Historically, the presumption of advancement has
been applied in two situations.  The first is where the transferor is a husband and the
transferee is his wife.  The second is where the transferor is a father and the transferee is his
child. A presumption of advancement applies in regards to any purchase of property made in
the name of the child or spouse of the purchaser. The term has important application in
family and estate law as it can significantly affect the determination and division of assets as
between spouses or beneficiaries.
Bibliography

BOOKS:

 Manohar & Chitaley, The Transfer of Property Act, Volume 1, 7th Edition, All India
Reporter, Nagpur, 2010.
 Row, Sanjiva, The Transfer of Property Act, Volume 1, 7th Edition, Universal Law
Publishing Co., New Delhi, 2011.
 Mulla, The Transfer of Property Act, 10th Edition, Lexis Nexis Buttorworths, 2005.
 Sarathi, Vepa.P., Law of Transfer of Property, 5th Edition, Eastern Book Company,
2011.
 Garner, B.A., Black's Law Dictionary, 7th ed.,
 Mowbray, W., Lewin on Trusts (London: Sweet & Maxwell, 1964)

BARE ACTS:

 a) Transfer of Property Act, 1882.