Sale, Exchange & Gift

Meaning & Difference;

Rights and Liabilities of Buyer and Seller
 Outline of the Lecture
• Section 54
• Nature, Scope & Ambit of Section 54.
• Vidyadhar v. Manikrao [1999]
• Rights & Liabilities of Buyers & Sellers [Section 55]
 Section 54
Sale Defined— sale is a transfer of ownership in exchange for a
price paid or promised or part promised. Sale how
made— Such transfer, in case of a tangible immoveable property of the
value of 100 rupees and upwards, or in the case of a reversion or other
intangible thing, can be made only by a registered instrument. In the case
of tangible immovable property of a value less than one hundred rupees,
such transfer may be made either by a registered instrument or by
delivery of the property. Delivery of intangible property takes place when
the seller places the buyer, or such person he directs, in possession of the
property. Contract for Sale— A contract for the sale of immovable
property is a contract that a sale of such property shall take place on
terms settled between the parties. It does not of itself create any
interest in or charge on such property.
 Ingredients
Competency of Seller;
• Buyer: Competency to enter into contract;
Subject Matter of a Sale: Tangible, immoveable property
Price: Monetary consideration.
• Price Paid or Promised
• Mandatory: Not monetary, then its exchange or barter
Formalities For Affecting Transfer
-- A validly executed sale deed, by the transferor in writing, is properly
attested, and registered
 Sale Deconstructed
Rights: Title; Exclusive Right to Possess, Exclusive Right to Alienate.
• Power of Attorney: Not a Sale. It does not confer title.
• Sale and a Hire-purchase Agreement: Not really.
• Sale and Exchange
• Sale with condition of repurchase and Conditional Mortgage
• Sale & Lease
Difference B/w Sale & Agreement of Sale
Sale
Transfers Ownership
Ownership vests in the Buyer
Executed Contract
Confers absolute title to the purchaser
Agreement of Sale
Sale is to take place at a future date
Ownership remains with the Seller
Executory Contract
Does not convey any title.
 Vidyadhar v. Manikrao
Defendant number 2 is the owner of a piece of property. He takes a
loan of Rs. 1500 from Defendant number 1 by executing a mortgage
deed and giving the property. There was a stipulation in the document
that if the entire amount of Rs. 1500 was returned before the expiry of
2 years, the property would be given back to Defendant number 2. The
property was subsequently transferred to Vidyadhar for a sum of Rs.
5000 by a registered sale deed. D1 was not a party to the transaction of
sale between D2 and Vidyadhar. He had no knowledge about the terms
settled between Vidyadhar and the plaintiff. The transaction was not
settled in his presence and nor any payment was made in his presence.
Could D1 in this situation raise a plea as to the validity of the sale deed
on the ground of inadequacy of consideration or part payment thereof?
 Vidyadhar v. Manikrao
The definition indicates that in order to constitute a sale, there must be a
transfer of ownership from one person to another, i.e., transfer of all rights
and interests in the properties which are possessed by that person are
transferred by him to another person. The transferor cannot retain
any part of his interest or right in that property or else it would
not be a sale. The definition further says that the transfer of
ownership has to be for a ‘price paid or promised or part-paid
and part-promised.’ Price thus constitutes an essential ingredient
of the transaction of sale. The words price paid or promised or
part-paid and part promised indicate that actual payment of
whole of the price at the time of the execution of sale deed is
not sine qua non to the completion of the sale. Even if the whole
of the price is not paid but the document is executed and
thereafter registered, if the property is of the value of more than
Rs. 100/- the sale would be complete. There is a catenary of decisions
of various High Courts in which it has been held that even if the whole of
the price is not paid, the transaction of sale will take effect and the title
would pass under that transaction
 Test
…it was held that…part payment of consideration by vendee itself proved the
intention to pay the remaining amount of sale price. The real test is the intention of
the parties. In order to constitute a ‘sale’ the parties must intend to
transfer the ownership of the property and they must intend that the
price would be paid either in presenti or in future. The intention is to be
gathered from the recital in the sale deed, conduct of the parties and
the evidence on record. Applying these principles to the instant case, it will be
seen that defendant No. 2 executed a sale deed in favour of the plaintiff, presented it
for registration, admitted its execution before the sub-registrar before whom
remaining part of the sale consideration was paid and, thereafter, the document was
registered. The additional circumstances are that when the plaintiff instituted a suit
on the basis of his title based on the aforesaid sale deed, defendant No. 2 who was
the vendor, admitted in his written statement, the whole case set out by the plaintiff
and further admitted in the witness box that he had executed a sale deed in favour of
the plaintiff and had also received full amount of consideration. These facts clearly
establish that a complete and formidable sale deed was executed by defendant no. 2
in favour of the plaintiff and the title in the property passed to plaintiff.
Registration
REGISTRATION AND STAMP DUTY
 • Cases which mentioned on Registration and Stamp
Duties
• Ananda Behera v. State of Orissa; Shantabai v State of
Bombay; Duncan Industries Ltd. v State of Uttar
Pradesh; KT Plantation v. State of Karnataka
• Structure of the Module
RECAP • Suraj Lamps v. State of Haryana
• Section 17 & 18 of the Indian Registration Act
• Indian Stamp Act
• Process for Registering Property
Recap
Suppose you have an agreement of sale, does it create an Sale? Not really.
You may in some cases will have to sue for specific performances according
to that agreement of sale.

How can that be done? Simple. Section 54.

You have an agreement of sale. Approach the courts. Ask for specific
performance of the contract.

Basically you will be asking for the immoveable property to be convened to

you in accordance to the terms of that sale and then there is a chance the
property will be conveyed to you.

The contract of sale may not suffice and you will need an instrument that is
registered.
• Illustration— suppose you have an agreement for sale but the seller of the
property is not holding up his side of the bargain. What are the remedies her? You
remedy in the instant case will be to approach the Court for the specific
performance of the contract. If the Court agrees with you and passes a decree in
your favour then you have to subsequently execute the contract and register the
instrument, which would be the sale deed, and once you have the sale deed, you
will have to approach the sub-registrar’s office and get the deed registered.

• Illustration 2: Can there be a case when the sale deed has been duly registered? If
the vendor has not received the entirety of the purchase money, and the property,
which is worth 1 lakh rupees but you have paid only 50,000 rupees and effectively
the buyer owes the seller? The registration and all the formalities have been
completed as well.
 SALE UNDER SECTION 54

• 54 — Sale Defined— sale is a transfer of ownership in

exchange for a price paid or promised or part promised.
This Photo by Unknown Author is licensed under CC BY-SA

• Sale how made— Such transfer, in case of a tangible

immoveable property of the value of 100 rupees and
upwards, or in the case of a reversion or other intangible
thing, can be made only by a registered instrument. In the
case of tangible immovable property of a value less than
one hundred rupees, such transfer may be made either by a
registered instrument or by delivery of the property.
• What does section 54 say about registration of property?
 REGISTRATION

Section 17. Documents of which registration is

compulsory
• Immoveable Property of Rs. 100 and upwards
Section 18: Optional Registration
• Immoveable Property of below Rs. 100.
Effects of Non-Registration
• Recognition & Evidence in Courts
This Photo by Unknown Author is licensed under CC BY-SA

16
 COMPULSORY REGISTRATION

(1) The following documents shall be registered…namely:--

(a) instruments of gift of immovable property;
(b) other non-testamentary instruments which purport or operate to create,
declare, assign, limit or extinguish, whether in present or in future, any right, title or
interest, whether vested or contingent, of the value of one hundred rupees and
upwards, to or in immovable property; […]
(d) leases of immovable property from year to year, or for any term exceeding one
year, or reserving a yearly rent; […]
 OPTIONAL REGISTRATION

Section 18: Documents of which registration is optional.

Any of the following documents may be registered under this Act, namely:-
(b) Instruments (other than instruments of gift and wills) which purport or operate to
create, declare, assign, limit or extinguish, whether in present or in future, any right, title
or interest, whether vested or contingent, of a value less then one hundred rupees, to
or in immovable property; […]
(c) leases of immovable property for any term not exceeding one year, […];
(d) instruments (other than wills) which purport or operate to create, declare, assign, limit or
extinguish any right, title or interest to or in movable property;
(e) wills; and
(f) all other documents not required by section 17 to be registered.
 EFFECTS OF NON-REGISTRATION

Section 49: Effect of non-registration of documents required to be registered.

No document required by Section 17 (or any provision of the Transfer of
Property Act) to be registered shall
(a) affect any immovable property comprised therein, or […]
(c) be received as evidence of any transaction affecting such property or
conferring such power,
unless it has been registered…
 POWER OF ATTORNEY ‘SALES’

• Method of `transfer' in Delhi to bypass paying unearned increase.

• `Unearned Increase', is the difference between the market value/sale
price and the original cost of allotment.
• Allottee/holder of the flat, on receiving the agreed consideration would deliver
the possession of the flat to the purchaser and execute the following documents:
• (a)An Agreement of sale confirming the terms of the sale, delivery of
possession and payment of full consideration and undertaking to execute any
document when required in future.
• (b)An Irrevocable General Power of Attorney in favour of the purchaser or
his nominee authorizing him to manage, deal with and dispose of the
property without reference to the vendor.
• (c)A will bequeathing the property to the purchaser as safeguard against the
consequences of death of the vendor before transfer.
• Legality of Such transfers?
 SURAJ LAMPS V. STATE OF
HARYANA: FACTS

The petitioner claims that one Ramnath and his family members
sold two and half acres of land in Gurgoan to them by
means of an agreement of sale, General Power of
Attorney and a will in the year 1991 for a consideration of
Rs.716,695/-. It is further alleged that the petitioner verbally
agreed to sell a part of the said property measuring one acre to
one Dharamvir Yadav for Rs.60 lakhs in December 1996. It is
stated that the said Dharamvir Yadav, and his son Mohit Yadav,
instead of proceeding with the transaction with the petitioner,
directly got in touch with Ramanath and his family members and
in 1997 got a GPA in favour of Dharamvir Yadav in regard to the
entire two and half acres executed and registered and illegally
cancelled the earlier GPA in favour of petitioner.
 SURAJ LAMPS V. STATE OF
HARYANA: REGISTRATION

Object & Purpose of Registration Act: “The Registration Act,

1908, was enacted with the intention of providing
orderliness, discipline and public notice in regard to
transactions relating to immovable property and
protection from fraud and forgery of documents of
transfer. This is achieved by requiring compulsory registration of
certain types of documents and providing for consequences
of non-registration. Section 17 of the Registration Act clearly
provides that any document (other than testamentary
instruments) which purports or operates to create, declare,
assign, limit or extinguish whether in present or in future "any
right, title or interest" whether vested or contingent of the value
of Rs.100 and upwards to or in immovable property”.
 SURAJ LAMPS V. STATE OF HARYANA:
BENEFITS OF REGISTRATION

Section 49 of the said Act provides that no document required by section 17 to be registered
shall, affect any immovable property comprised therein or received as evidence of any transaction
affected such property, unless it has been registered. Registration of a document gives notice to
the world that such a document has been executed. Registration provides safety and
security to transactions relating to immovable property, even if the document is lost or
destroyed. It gives publicity and public exposure to documents thereby preventing
forgeries and frauds in regard to transactions and execution of documents.
Registration provides information to people who may deal with a property, as to the
nature and extent of the rights which persons may have, affecting that property. In
other words, it enables people to find out whether any particular property with which
they are concerned, has been subjected to any legal obligation or liability and who is
or are the person/s presently having right, title, and interest in the property. It gives
solemnity of form and perpetuate documents which are of legal importance or relevance by
recording them, where people may see the record and enquire and ascertain what the particulars
are and as far as land is concerned what obligations exist with regard to them.
 SURAJ LAMPS V. STATE OF
HARYANA: CONSEQUENCES

GPA Sales makes title verification and certification of title, which is an

integral part of orderly conduct of transactions relating to immovable property,
difficult, if not impossible, giving nightmares to bonafide purchasers wanting to
own a property with an assurance of good and marketable title.
If a property worth `5 millions is sold for `2 millions, the Undervaluation Rules
may enable the state government to initiate proceedings so as to ensure that the
deficit stamp duty and registration charges are recovered.
 SURAJ LAMPS: AGREEMENT TO SELL &
HOW IT IS DIFFERENT FROM SALE DEED

Section 54 of the TP Act makes it clear that a contract of sale, that is, an agreement of sale does
not, of itself, create any interest in or charge on such property. (In a previous judgement) this
court held that: “Protection provided under section 53A (part performance) of the Act to the
proposed transferee is a shield only against the transferor. It disentitles the transferor from
disturbing the possession of the proposed transferee who is put in possession in pursuance to
such an agreement. It has nothing to do with the ownership of the proposed transferor who
remains full owner of the property till it is legally conveyed by executing a registered sale deed in
favour of the transferee. Such a right to protect possession against the proposed vendor cannot
be pressed in service against a third party. It is thus clear that a transfer of immovable
property by way of sale can only be by a deed of conveyance (sale deed). In the
absence of a deed of conveyance (duly stamped and registered as required by law), no
right, title or interest in immoveable property can be transferred. Any contract of
sale (or agreement to sell) which is not a registered deed of conveyance (deed of
sale) would fall shout of the requirements of section 54 and 55 of the TP Act and will
not confer title nor transfer any interest in an immovable property (except to the
limited right granted under section 53A of the TP Act)
 SURAJ LAMPS: CONCLUDING POINTS

• There cannot be a sale by execution of a power of attorney nor can there be a

transfer by execution of an agreement of sale and a power of attorney and will.
• That a transfer of immoveable property by way of sale can only be by a deed
of conveyance (sale deed). In the absence of a deed of conveyance (duly
stamped and registered as required by law), no right, title or interest in an
immoveable property can be transferred. Any contract of sale (agreement to
sell) which is not a deed of conveyance, will fall short of the requirements of
(Section 54) of the TP Act.
• “We make it clear that our observations are not intended to in any way affect
the validity of sale agreements and powers of attorney executed in
genuine transactions.”
 EXCEPTIONS??

“A person may give a power of attorney to his spouse, son, daughter,

brother, sister or a relative to manage his affairs or to execute a deed
of conveyance. A person may enter into a development agreement with a
land developer or builder for developing the land either by forming
plots or by constructing apartment buildings and in that behalf execute an
agreement of sale and grant a Power of Attorney empowering the developer to
execute agreements of sale or conveyances in regard to individual plots of land
or undivided shares in the land relating to apartments in favour of prospective
purchasers. In several States, the execution of such development
agreements and powers of attorney are already regulated by law and
subjected to specific stamp duty. Our observations regarding `SA/GPA/WILL
transactions' are not intended to apply to such bonafide/genuine transactions.”
 PROCESS OF REGISTRATION

• The sale deed must be classified as either a “Deed of Sale” if the property is being sold, or as a
“Deed of Mortgage” if the property is being leased or mortgaged. The sale deed must contain
accurate information pertaining to the sale so as to enable a person to identify the immovable
property which is the subject matter of the deed. A sale deed is incomplete if it is not
accompanied by a Sale Agreement containing all the terms and conditions that have been
agreed to by the buyer and the seller.
• The value of the property has to be estimated based on the circle rate or guidance value
(minimum value set by the State Government’s revenue department or the local development
authorities at which the sale can occur) in that area. The circle rates of the area and the actual
price paid for the property are compared. While calculating the stamp duty, the higher of the
two values, i.e., the circle rate and the actual price paid, has to be taken into consideration.
Non judicial stamp paper of the value so calculated has to be purchased thereafter.
Subsequently, the deed has to be prepared and typed in stamp papers.
• The final step involved for getting the sale deed registered is to approach the Sub-Registrar’s
office in order to get the sale deed registered.The parties be accompanied by two witnesses.
 INDIAN STAMP ACT, 1899

The main purpose of this Act is to generate revenue for the Indian
Government.
Stamp duty is a tax levied on any kind of transaction that takes place and is
documented.These may include a sale deed, Lease deed etc.
Technically it is a tax that is paid for acquiring any document or instrument that
facilitates the creation, transfer, limiting or recording any right or liability.
After the stamp duty is paid these documents become legally valid and have
evidentiary value in a court of law.

29
• What is Stamp Duty? Tax levied on instruments
• State subject
• Lends legality to a document + Boosts revenue
• The stamp duty percentage depends on several factors, such as:
• Age of the property – whether it is old or new.
• Value of the property: higher the value higher the stamp duty
• Location of the property – city area, rural area, metropolitan area, suburban, etc.
• Age and Gender of the owner – discounts may be available for senior citizens, in some states.
• Usage of property – whether it is for commercial use or residential use.
Who is Liable to Pay
In the absence of any agreement to the contrary, the
purchaser/transferee has to pay stamp duty or in case of exchange of
properties, both parties have to bear stamp duty equally.
• In case of a lease, the lessee is liable
• In case of exchange deed, both the parties are liable equally.
• In case of partition deed, all the parties are liable in proportion to
their shares.
 CONSEQUENCES OF NON-
STAMPING

Section 33: Examination and impounding of instruments.— Every person

having by law or consent of parties, authority to receive evidence, and every
person in charge of a public office, except an officer of police, before whom
any instrument, chargeable, in his opinion, with duty, is produced or comes in
the performance of his functions, shall, if it appears to him that such
instrument is not duly stamped, impound the same.
Section 35: No instrument chargeable with duty shall be admitted in
evidence for any purpose by any person having by law or consent of parties
authority to receive evidence, or shall be acted upon, registered or
authenticated by any such person or by any public officer, unless such
instrument is duly stamped.
Section 40 (1)(b)- If he (Collector) is of opinion that such instrument is chargeable with
duty and is not duly stamped, he shall require the payment of the proper duty or the amount
required to make up the same, together with a penalty of the five rupees; or, if he thinks
fit, [an amount not exceeding] ten times the amount of the proper duty or of the
deficient portion thereof.
Section 45- Power to Revenue authority to refund penalty or excess duty in certain cases.—
• (1) Where any penalty is paid under section 35 or section 40, the Chief Controlling Revenue-
Authority may, upon application in writing made within one year from the date of the payment,
refund such penalty wholly or in part.
• (2) Where, in the opinion of the Chief Controlling Revenue-Authority, stamp-duty in excess of
that which is legally chargeable has been charged and paid under section 35 or section 40, such
authority may, upon application in writing made within three months of the order charging the
same, refund the excess.
 QUESTIONS

• Can property be transferred using any other instrument other than a conveyance deed?
• Is a Court Decree compulsorily registrable?
• Is this a ‘transfer’?
• An agreement of sale by the vendor in favour of the purchaser confirming the terms of sale,
delivery of possession and payment of full consideration and undertaking to execute any
document as and when required in future
• An agreement of sale agreeing to sell the property, with a separate affidavit confirming receipt of
full price and delivery of possession and undertaking to execute sale deed whenever required
• An irrevocable general power of attorney by the vendor in favour of the purchaser or his
nominee authorising him to manage, deal with and dispose of the property without reference to
the vendor
• A will bequeathing the property to the purchaser
Rights and Liabilities
of Buyers and
Sellers
 Section 55
Rights and liabilities of buyer and
seller.— In the absence of a contract to the
contrary, the buyer and the seller of
immovable property respectively are subject
to the liabilities, and have the rights,
mentioned in the rules next following or
such of them as are applicable to the
property sold…
Sellers Duties
• Disclose Defects
• Produce Documents
• Duty to Answer
• Duty to Execute Conveyance Deed Properly
• Duty to Care
• Duty to handover possession
• Duty to Clear dues
• Deliver Documents of Title
(1) (a): Duty to Disclose Defect
in Property
The seller is bound—

to disclose to the buyer any material defect in the property or in the seller’s
title thereto of which the seller is, and the buyer is not, aware, and which
the buyer could not with ordinary care discover;
Defect: Latent or Patent.
**“An omission to make such disclosures as are mentioned in this section,
paragraph (1), clause (a), and paragraph (5), clause (a), is fraudulent.
• Defects in title are
• 1) Restrictive covenants
• 2) Liability to compulsory acquisition
• 3) Allottment of property to another coowner
• 4) Voidable title.
(1)(b) Duty to Produce Documents
of Title; (c) duty to answer
The seller is bound—

to produce to the buyer on his request for examination all documents

of title relating to the property which are in the seller’s possession or
power;

(c)to answer to the best of his information all relevant questions put to
him by the buyer in respect to the property or the title thereto;
(1)(d)Duty to Execute Proper
Conveyance on Payment
The seller is bound—

on payment or tender of the amount due in respect of the price, to

execute a proper conveyance of the property when the buyer tenders it
to him for execution at a proper time and place;
(1)(e)(f)(g) Duty of care; to
Handover possession; Clear Dues
The seller is bound—

between the date of the contract of sale and the delivery of the
property, to take as much care of the property and all documents of
title relating thereto which are in his possession as an owner of ordinary
prudence would take of such property and documents;
to give, on being so required, the buyer, or such person as he directs,
such possession of the property as its nature admits;
to pay all public charges and rent accrued due in respect of the property
up to the date of the sale, the interest on all encumbrances on such
property due on such date, and, except where the property is sold
subject to encumbrances, to discharge all encumbrances on the
property then existing
(2) Saleable Interest and Right to
Transfer
The seller shall be deemed to contract with the buyer that the interest
which the seller professes to transfer to the buyer subsists and that he
has power to transfer the same:
Provided that, where the sale is made by a person in a fiduciary
character, he shall be deemed to contract with the buyer that the seller
has done no act whereby the property is encumbered or whereby he is
hindered from transferring it.
The benefit of the contract mentioned in this rule shall be annexed to,
and shall go with, the interest of the transferee as such, and may be
enforced by every person in whom that interest is for the whole or any
part thereof from time to time vested.
(3)Delivery of Documents of
Title on Payment
Where the whole of the purchase-money has been paid to the seller, he
is also bound to deliver to the buyer all documents of title relating to
the property which are in the seller’s possession or power…
Subsection (4)
• The seller is entitled—
a) to the rents and profits of the property till the ownership thereof
passes to the buyer;
b) where the ownership of the property has passed to the buyer
before payment of the whole of the purchase-money, to a charge
upon the property in the hands of the buyer, any transferee without
consideration or any transferee with notice of the non-payment, for
the amount of the purchase-money, or any part thereof remaining
unpaid, and for interest on such amount or part from the date on
which possession has been delivered.
 (5) Duties of Buyer
• to disclose to the seller any fact as to the nature or extent of the seller’s
interest in the property of which the buyer is aware, but of which he has
reason to believe that the seller is not aware, and which materially
increases the value of such interest;
• to pay or tender, at the time and place of completing the sale, the
purchase-money to the seller or such person as he directs: provided that,
where the property is sold free from encumbrances, the buyer may retain
out of the purchase-money the amount of any encumbrances on the
property existing at the date of the sale, and shall pay the amount so
retained to the persons entitled thereto;
• where the ownership of the property has passed to the buyer, as between
himself and the seller, to pay all public charges and rent which may
become payable in respect of the property, the principal moneys due on
any encumbrances subject to which the property is sold, and the interest
thereon afterwards accruing due.
 Section 55(6)
• The buyer is entitled—
• where the ownership of the property has passed to him, to the
benefit of any improvement in, or increase in value of, the property,
and to the rents and profits thereof;
• unless he has improperly declined to accept delivery of the property,
to a charge on the property, as against the seller and all persons
claiming under him, to the extent of the seller’s interest in the
property, for the amount of any purchase-money properly paid by the
buyer in anticipation of the delivery and for interest on such amount;
and, when he properly declines to accept the delivery, also for the
earnest (if any) and for the costs (if any) awarded to him of a suit to
compel specific performance of the contract or to obtain a decree for
its rescission.
Exchange
& Gift
 Exchange
[118] “Exchange” defined.—When two persons mutually transfer the
ownership of one thing for the ownership of another, neither thing or
both things being money only, the transaction is called an
“exchange”. A transfer of property in completion of an exchange can be
made only in manner provided for the transfer of such property by sale.

Sale Exchange
Reference to Immoveable Property only. Reference to both immoveable and
Subject matter is absolute interest in moveable property
such property.
Consideration for sale is price, part paid Consideration is one property for
or part promised. another.
Seller exercises lien on the property if No such case is there.
the price is unpaid in part or in full.
 Gift
“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. Acceptance when 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.

Essentials
Transfer of Property in Existence.
Voluntary & Without Consideration.
Capacity to Transfer
If Immoveable, then it must be registered.
 Gift
Kinds of Gifts
Void
Onerous
Universal
Death Bed Gifts
Subhash Chandra v. Ganga
Prasad
• Can a gift deed be void if the donee has undue influence over the
donor?
• Plaintiff’s father gifts the entire property in favour of the defendant
and the plaintiff newphew.
• Presumption of undue influence not satisfied if the transfer is made “in
the case of a gift to a son, grandson, or sonin-law, although made
during the donor's illness and a few days before his death” (citing
Halsbury with approval)
Sridhar v. N. Revanna
“NOW THIS INDENTURE WITNESSETH that in pursuance of the aforesaid agreement and in consideration of extreme love and
affection which the donor cherishes for the done his grandson and the donee’s, offspring’s and the donee’s young brothers and their
male offspring’s who may be born hereafter he the donor doth hereby grant, convey, makeover and transfer by way of gift to the
done above name the immovable property described in the schedule hereunder given which bears Municipal No.324, Old Poor
House Road Civil Station Bangalore, to be taken by his as a gift subject to the conditions hereinafter mentioned.The donor covenants
with the donee, that on the date of these presents, the property that is now endowed as a gift is free from all encumbrances, liens,
charges, attachments from Court and lispardens and that he has absolute and unimpeachable right to grant it as a gift and that no one
else has any right to question the same. The donor has this day handed over possession of the property hereby gifted to the donee,
in accordance with Law which the donee shall enjoy on and from this date, over which she can exercise all rights of ownership
subject to the conditions detailed hereinafter namely:-
1. The Donee or his younger brothers who may be born hereafter have no right to alienate the schedule property in any manner
whatsoever by way of sale, gift mortgage or otherwise.
2. The donee or his younger brothers who may be born hereafter shall enjoy the property during his or their life time as the case
may be and on his or their demise it shall devolve on his or their male children then surviving who shall be at liberty to deal with the
property mentioned in the schedule hereunder in any mentioned her their to do with unstructed gifts.
3. In case the Donee or his younger brother or brothers who may be born hereafter die issue-less, the said property hereby gifted
shall devolve on Sri SOMESWARASWAMY of Sri Someswara Temple Ulsoor Civil Station Bangalore, for the benefit of the said
Temple.”
Sridhar v. N. Revanna
Muniswamappa executed a gift deed in favour of his grandson. A
condition is there which restrains the alienation of the property.

Whether the condition mentioned in a gift deed which restrains the

alienation of property valid ?

Can the condition be declared void?

Rule: the gift deed was certain and the condition restraining the
alienation of the suit property is void.
Rule as per section 13: Section 13 not applicable.