Gift Deed Registration
A gift deed, as per Section 122 of the Transfer of Property Act 1822, is a legal instrument through which a person can voluntarily transfer an immovable or a movable property to the other person without any money exchange. In simple words, gift deed is for gifting a property. The person gifting the property is called Donor and the person receiving the gift is called Done.
A gift deed is valid only when it is done out of natural love and affection and with no exchange of money. In addition, as per Section 17 of the Registration Act 1908, if you wish to gift an immovable property, it is compulsory to register your gift deed.
A Gift Deed Contains the Following:
- Details of the Donor and the Donee.
- Details of the property to be gifted, such as its description, location, etc.
- Rights and liabilities of the Donee after property transfer.
- Terms and conditions in delivering the gifted property.
- Conditions wherein the gift can be revoked and this should be agreeable between the Donor and the Donee.
Pre-Requisites of Gift Deed Registration:
- Proof of ownership of the property by the Donor. In this case a sale deed can be produced.
- Draft of the gift deed.
- ID proofs of the Donor and the Donee. (It can be Aadhar Card, PAN Card, driver’s license, etc.)
- Passport size photos of both the parties.
- Two witnesses, along with their ID proofs.
Procedure for Creating and Registering a Gift Deed
- Contact a lawyer and discuss with him/her your intention of gifting your property to somebody through gift deed.
- The lawyer will draft the gift deed.
- Pay the stamp duty. This varies with states and the type of property. Your lawyer will help you in this regard.
- Visit the office of the sub-registrar for gift deed registration. You must pay a registration fee.
- Produce all the required documents.
- Sign the gift deed. The donee will also sign it in the presence of the registrar.
- The two witnesses should also be present during this time. They will sign the deed too.
- Registration of the gift deed is done and the property is ready for transfer.
Properties That can be Gifted are as Follows:
- Any immovable or movable property that is tangible and can be transferred. This includes house, car, jewellery, antique objects, cash, cheque, etc.
- Existing property. You cannot gift a future property, which at present does not exist.
Benefits to choose service
It is crucial to have a lawyer by your side when you create and register a gift deed. Any mistake or omission can make your gift deed invalid. Also, a lawyer will provide guidance regarding the whole process and educate you about revoking the gift deed or what property you can gift, and so on. Gift deed is a legal document, so it is wise to take legal assistance. Online Legal Center can provide you lawyers who are skilled in drafting gift deed. They will help you in registration.
Frequently Asked Questions (FAQs)
No. A minor cannot sign a contract. Even if he/she does, it is considered void ab initio. So, a minor cannot gift a property. But you can gift a property to a minor. In this case, the minor’s natural or legal guardian will accept the gift on the minor’s behalf. The guardian will be the gift’s caretaker until the minor becomes an adult and then the gift is automatically transferred to the real Donee (the minor who has become an adult).
The world is not so fair. For example, after the Donor’s death, there can be conflict between the siblings and one may try to snatch away the gift or threaten the Donee to transfer the gift or so on. Therefore, it is important to make a legal document such as gift deed and register it so that it becomes legalized and allows legitimate transfer of the property to the Donee. The Donee can claim legal ownership of the property and nobody else can claim that property.
Also, gift deed allows for quick transfer of property from the Donor to the Donee.
A gift deed cannot be revoked under regular circumstances wherein the Donee accepts the gift and the gift deed is valid. However, as per Section 126 of the Transfer of Property Act 1882, a gift deed can be revoked under two circumstances:
- The Donor and the Donee mutually agree to revoke the gift deed.
- The Donee fails to fulfill the conditions which were mentioned in the gift deed. For example, if the Donor mentioned the condition that the Donee will take care of him/her until his/her death and the Donee does not fulfill this condition, then the gift deed can be revoked. It is important that the condition is mentioned in the contract.
The following are the key differences between Will and Gift Deed:
- Will can be changed or revoked any number of times by the Testator (one who makes the will). On the contrary, a Gift Deed once executed cannot be revoked, except under special circumstances.
- Will is executed only after the Testator’s death. On the contrary, Gift Deed is executed immediately after it is made.
Yes. The procedure stays the same. A lawyer can help you in drafting and registering the gift deed.
Yes. When the value of the gift exceeds Rs. 50,000/-, then it is taxable (for the Donee). However, if you receive a gift from an NRI and the property is outside India, then it is exempt from tax.
A gift deed is invalid, if the Donee does not accept the gift or if the Donee dies before the gift deed is executed.
Also, if the Donee dies after the execution of the gift deed, then the property will go to the Donee’s legal heirs. It will not go back to the Donor, unless mentioned as a condition in the gift deed.