Party within his rights to cancel a conditional transfer deed executed for consideration before completion of condition: SC

Supreme Court: The Bench comprising of Arun Mishra and Indira Banerjee, JJ. allowed an appeal while setting aside the judgment and order of the Kerala High Court concerning a ‘gift deed’.

In the present case, the facts of the case are that the appellant executed a purported gift deed in favour of the respondent with the expectation that the respondent will look after the appellant and her husband. The said deed was to come into effect only after the death of the appellant and her husband. On 02-06-1999, the appellant executed the deed of cancellation and after a period of 8 months, respondent filed a suit for declaration that the cancellation deed executed by the appellant is null and void. Appellant filed original suit for permanent injunction restraining the respondent or his men from trespassing or committing waste or mischief in suit property.

The Original Suit was challenged before the Munsif, however, it was decreed. The district court upheld the decree, but the High Court set aside the concurrent findings and dismissed the suit.

The Supreme Court on placing the analysis of provisions of Transfer of Property Act along with the decisions pertaining to the same subject matter stated that:

“A conditional gift with no recital of acceptance and no evidence in proof of acceptance, where possession remains with the donor as long as he is alive, does not become complete during lifetime of the donor. When a gift is incomplete and title remains with the donor the deed of gift might be cancelled.”

On placing reliance on Reninkuntla Rajamma v. K. Sarwanamma, (2014) 9 SCC 445, in which it was stated that “there is no provision in law that ownership in property cannot be gifted without transfer of possession of such property”, the Court stated that the deed of transfer was executed for consideration and was, in any case, conditional subject to the condition that the donee would look after the petitioner and her husband and subject to the condition that the gift would take effect after the death of the donor. Therefore, the Court held that there was no completed gift of the property and the appellant was within her right in cancelling the deed.

The appeal was allowed and judgment and order under appeal were set aside. [S. Sarojini Amma v. Velayudhan Pillai Sreekumar,2018 SCC OnLine SC 2200, decided on 26-10-2018]

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