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THE TRANSFER OF PROPERTY ACT, 1882

CHAPTER VII OF GIFTS

This Chapter consists of eight sections (Section 122 to Section 129) dealing with
"gifts".

[s 127]Onerous gifts.—

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.

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.

Onerous gift to disqualified person.—A donee not competent to contract and accepting
property burdened by any obligation is not bound by his acceptance. But if, after
becoming competent to contract and being aware of the obligation, he retains the
property given, he becomes so bound.

Illustrations

(a) A shares in X, prosperous joint stock company, and also shares in Y, a joint stock
company in difficulties. Heavy calls are expected in respect of the shares in Y. A
gives B all his shares in joint stock companies. B refuses to accept the shares in
Y. He cannot take the shares in X.

(b) A, having a lease for a term of years of a house at a rent which he and his
representatives are bound to pay during the term, and which is more than the
house can be let for, gives to B the lease, and also, as a separate and
independent transaction, a sum of money. B refuses to accept the lease. He
does not by this refusal forfeit the money.

Comments

[s 127.1] Onerous Gifts (Section 127)

A gift is said to be onerous when it is accompanied with a burden or obligation. This

section is based on the maxim qui sentit commodum sentire debetet onus which means
that he who receives advantage must also bear the burden.

First paragraph of section 127 provides that where a gits 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. Here the following elements are essential:—

(1) the gift must be in the form of a single transfer;

(2) to the same person;

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(3) of several things (properties);

(4) of such thing only one is burdened with obligation and others are not.

When such conditions are present, the donee will have to accept the gift fully. He
cannot accept the benefits of gift only and reject the burdens or obligation. This
provision provides that the donee may either accept the full gift or reject that, partial
acceptance is not allowed.

When a sale deed was executed in favour of a mother in which her minor son was
included as a co-purchaser, it was held to be a valid onerous gift.78.

Illustration (a)

A shares in X, prosperous joint stock company, and also shares in Y, a joint stock
company in difficulties. Heavy calls are expected in respect of the shares in Y. A gives B
all his shares in joint stock companies. B refuses to accept the shares in Y. He cannot
take the shares in X.

Second paragraph provides that 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. Thus, if a gift is made in the form of two or more independent gifts
to the same person, the donee may accept the beneficial one and reject the onerous
property. Here the gifts are separate and do not form the part of the same transaction.
The donee is not bound to accept both the gifts.

Illustration (b)

A, having a lease for a term of years of a house at a rent which he and his
representatives are bound to pay during the term, and which is more than the house
can be let for, gives to B the lease, and also, as a separate and independent transaction,
a sum of money. B refuses to accept the lease. He does not by this refusal forfeit the
money.

[s 127.2] Disqualified Donee

Section 127 provides that a donee not competent to contract and accepting property
burdened by any obligation is not bound by his acceptance. But if, after becoming
competent to contract and being aware of the obligation, he retains the property given,
he becomes so bound.

When an onerous gift is made to an incompetent or disqualified donee, for example, a

minor, he has a right to reject or repudiate the gift on attaining competency i.e.,
majority. Incompetent person is not bound by the acceptance of the gift after attaining
competency. He has to exercise his option immediately because if after becoming
competent to contract and being aware of the obligation he retains the property given
to him, he becomes bound by the obligation.
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78. Naaz Jaffar v JM Sadiq Sait, AIR 2018 (NOC) 481 (MAD).