N.P. Saseendran v. N.P. Ponnamma & Ors.

N.P. Saseendran v. N.P. Ponnamma & Ors.

shall not be liable under his covenant, that later provision is to be rejected as repugnant and void, for it altogether destroys the covenant. But if the later clause does not destroy but only qualifies the earlier, then the two are to be read together and effect is to be given to the intention of the parties as disclosed by the deed as a whole.” (AC p. 259)(emphasis in original)], as approvingly taken note of by a three-Judge Bench of this Court in Radha Sundar Dutta v. Mohd. Jahadur Rahim [Radha Sundar Dutta v. Mohd. Jahadur Rahim, 1958 SCC OnLine SC 38: AIR 1959 SC 24] . However, we have been able, as noted above, to reconcile the three clauses in the current scenario.”

16. In the instant case, the clear and unambiguous language employed in the first part, reveals a clear disposition by Defendant No.1/ father to the plaintiff, by only retaining a life interest in the second part. Therefore, the instrument of 1985, according to us, is a gift by settlement. Ascertainment of the nature of the document is different from validity. We have already held that Defendant No.1 was only holding an ostensible possession by way of life interest. Though, in cases of settlement, possession is deemed to be transferred along with the title, since we have held that there is an element of gift in every settlement, we deem it necessary in the facts of the present case to ponder further and examine, whether the gift was accepted and acted upon.

17. In this connection, we may refer to the following decisions, in which the effect of non-acceptance during the life time of the donor has been discussed: (i) Naramadaben Maganlal Thakker v. Pranjivandas Maganlal Thakker & Ors25 “5. Section 122 of the Transfer of Property Act, 1882 (for short, “the TP Act”) defines ‘gift’ to mean the

25 (1997) 2 SCC 255

p. 1006

transfer of certain existing moveable or immovable 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.

6. Acceptance by or on behalf of the donee must be made during the lifetime of the donor and while he is still capable of giving.

7. It would thus be clear that the execution of a registered gift deed, acceptance of the gift and delivery of the property, together make the gift complete. Thereafter, the donor is divested of his title and the donee becomes the absolute owner of the property. The question is whether the gift in question had become complete under Section 123 of the TP Act? It is seen from the recitals of the gift deed that Motilal Gopalji gifted the property to the respondent. In other words, it was a conditional gift. There is no recital of acceptance nor is there any evidence in proof of acceptance. Similarly, he had specifically stated that the property would remain in his possession till he was alive. Thereafter, the gifted property would become his property and he was entitled to collect mesne profits in respect of the existing rooms throughout his life. The gift deed conferred only limited right upon the respondent- donee. The gift was to become operative after the death of the donor and he was to be entitled to have the right to transfer the property absolutely by way of gift or he would be entitled to collect the mesne profits. It would thus be seen that the donor had executed a conditional gift deed and retained the possession and enjoyment of the property during his lifetime. The recitals in the cancellation deed is consistent with the recitals in the gift deed. He had expressly stated that the respondent had cheated him and he had not fulfilled the conditions subject to which there was an oral understanding between them. Consequently, he mentioned that the conditional gift given to him was

p. 1007

cancelled. He also mentioned that the possession and enjoyment remained with him during his lifetime. He stated, “I have to execute immediately this deed of cancelling the conditional gift deed between us. Therefore I hereby cancel the conditional gift deed dated 15-5-1965 of Rs 9000 in words rupees nine thousand presented at Serial No. 2153 on 15-5- 1965 in the Office of the Sub-Registrar, Baroda for registration. Therefore, the said conditional gift deed dated 15-5-1965 is hereby cancelled and becomes meaningless. The property under the conditional gift has not been and is not to be transferred in your name”. Thus he expressly made it clear that he did not hand over the possession to the respondent nor did the gift become complete during the lifetime of the donor. Thus the gift had become ineffective and inoperative. It was duly cancelled. The question then is whether the appellant would get the right to the property? It is not in dispute that after the cancellation deed dated 9-6-1965 came to be executed, duly putting an end to the conditional gift deed dated 15- 5-1965, he executed his last Will on 17-5-1965 and died two days thereafter.” (ii) Khursida Begum (D) by Lrs vs. Mohammad Farooq (D) by Lrs26 “17. …gift of immovable property is not complete unless the donor parts with the possession and donee enters into possession but if the property is in occupation of tenants, gift can be completed by delivery of title deed or by request to tenants to attorn to the done or by mutation.” (iii) Sarojini Amma v. Velayudha Pillai Sreekumar27 “14. Gift means to transfer certain existing moveable or immoveable property voluntarily and without

p. 1008

consideration by one person called the donor to another called the donee and accepted by or on behalf of the donee as held by the Supreme Court in Naramadaben Maganlal Thakker Vs. Pranivandas Maganlal Thakker & Ors. As further held by this Court in Naramadaben Maganlal Thakker (supra) “It would be clear that the execution of a registered gift deed, acceptance of the gift and delivery of the property together make the gift complete. Thereafter, the donor is divested of his title and the done becomes absolute owner of the property.

15. 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. ..

18. … there is no provision in law that ownership in property cannot be gifted without transfer of possession of such property. However, the conditions precedent of a gift as defined in Section 122 of the Transfer of Property Act must be satisfied. A gift is transfer of property without consideration.

19. In the instant case, admittedly, 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. We are thus constrained to hold that there was no completed gift of the property in question by the appellant to the respondent and the appellant was within her right in cancelling the deed.”

18. The ratio in the above judgments would have to be applied considering the facts of the case. It is settled law that delivery of possession is not sine qua non to validate a gift or settlement. Therefore, for the

p. 1009

document to be valid, it is sufficient if it is proved that the same was acted upon during the life time of the executant. In the present case, it is not in dispute that the plaintiff has registered the instrument. Such registration by the plaintiff is possible only if the document was handed over by Defendant No.1. The factum of acceptance can be derived from the conduct of the parties. This Court in the judgment in Daulat Singh (Supra) has held that the possession of the gift itself would amount to acceptance. The plaintiff, when the suit was filed, was in possession of the original title deed. The stand of the defendants that the plaintiff took away the document later is unbelievable. Even assuming that the original deed was returned after registration, the fact that it was already acted upon, cannot be altered. Once a gift has been acted upon, the same cannot be unilaterally cancelled. As already held by us, delivery of possession is only one of the methods to prove acceptance and not the sole method. The receipt of the original document by the plaintiff and registration of the same, would amount to acceptance of the gift and the transaction satisfies the requirement of Section 122 of the Transfer of Property Act, 1882. The creation of life interest with rights to enjoy the income from the property is a plausible and justifiable reason for the plaintiff not to reside in the premises. Once the document is declared as “gift”, Defendant No.1 had no right to cancel the same unilaterally and the Sub Registrar had no right to register the cancellation deed. Once the document is categorized as a gift, in the absence of any clause or reservation to cancel, the executant has no right to cancel the same. The reasons for cancellation or revocation of gift have to be proved in a court of law. Therefore, according to us, the unilateral cancellation of the document is void and as a natural corollary, the sale deed dated 19.10.1993 executed by Defendant No.1 / father also, is invalid.

19. The facts on record also reveal that the other family members, namely, Defendant Nos.3 and 4 supported the case of Respondent No.1/ plaintiff cannot be ignored. Furthermore, the recitals in the document apparently demonstrate and satisfy the requirement to classify the document as a “settlement”.

20. In view of the foregoing discussion, we find that the trial Court as well as the First Appellate Court had erroneously come to the conclusion that Ext.A1 document was a Will, without appreciating the law. However, the High Court rightly set aside the concurrent judgments

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of the Courts below by treating the document as settlement in the judgment impugned herein.

21. Accordingly, this appeal is dismissed, confirming the judgment passed by the High Court. The parties shall bear their own costs. Connected Miscellaneous Application(s), if any, shall stand disposed of.

Result of the case: Appeal dismissed.