Validity of Gift Deed: Supreme Court Rules on Revocation and Possession Rights
The legal dispute between N. Thajudeen and the Tamil Nadu Khadi and Village Industries Board revolved around the validity and revocation of a registered gift deed. The Supreme Court examined whether the gift deed executed in 1983 was validly acted upon and whether its revocation in 1987 had any legal standing. The Court also addressed the issue of limitation in suits seeking declaration and possession of property.
Background of the Case
The case originated from a suit filed by the respondent, Tamil Nadu Khadi and Village Industries Board, seeking declaration of title over a property measuring 3750 square feet in Kotlambakkam Panchayat, District Cuddalore. The suit was based on a gift deed dated 05.03.1983, allegedly executed by the appellant, N. Thajudeen, and accepted by the Board.
The trial court dismissed the suit on 23.08.1994, holding that the gift deed was not valid as it was neither accepted nor acted upon. However, the District Judge reversed this decision on 05.08.1997, decreeing the suit in favor of the respondent. The appellant’s second appeal was dismissed by the High Court on 11.01.2011, affirming the validity of the gift deed and ruling that it could not be revoked.
Aggrieved, the appellant approached the Supreme Court, which granted leave to appeal and examined the case in detail.
Key Legal Issues
1. Validity of the Gift Deed
The Supreme Court examined whether the registered gift deed dated 05.03.1983 was duly acted upon and accepted, making it legally binding.
2. Right to Revoke the Gift
The Court considered whether the revocation deed dated 17.08.1987 was valid and whether the donor had the right to revoke the gift.
3. Limitation for Filing the Suit
The Court analyzed whether the suit for declaration and recovery of possession filed in 1991 was barred by limitation.
Petitioner’s Arguments
The appellant, N. Thajudeen, contended that:
- The gift deed was invalid as it was not accepted or acted upon by the respondent.
- The property was never transferred in favor of the respondent as no possession was handed over.
- The revocation deed dated 17.08.1987 was valid, and the donor had the right to revoke the gift.
- The suit filed in 1991 was barred by limitation as it was not instituted within three years from the date of revocation.
Respondent’s Arguments
The respondent, Tamil Nadu Khadi and Village Industries Board, countered these claims, arguing that:
- The gift deed was absolute, unconditional, and accepted immediately.
- The possession of the property was taken over by the Board, and necessary steps for mutation were initiated.
- The donor had no right to revoke the gift deed as no such provision was included in the deed.
- The suit was filed within the limitation period as the right to possession was a continuing right.
Supreme Court’s Observations
1. Acceptance and Validity of the Gift Deed
The Supreme Court noted that the gift deed itself stated that the plaintiff-respondent had accepted the property. It was further reinforced by documents such as Exhibit A-4, proving that possession was taken and construction had begun.
The Court ruled:
“A simple and complete reading of the aforesaid gift deed would reveal that the gift is absolute with no right reserved for its revocation in any contingency.”
2. Right to Revoke the Gift
The Court referred to Section 126 of the Transfer of Property Act, 1882, which governs the conditions under which a gift can be revoked. The Court held:
“The gift cannot be revoked except for certain contingencies enumerated therein. Since the donor did not reserve any right to revoke the gift, the revocation deed dated 17.08.1987 is void ab initio.”
The Court emphasized that non-utilization of the property for the stated purpose did not automatically trigger revocation.
3. Limitation for Filing the Suit
The trial court had dismissed the suit as time-barred, ruling that it should have been filed within three years from the date of revocation. However, the Supreme Court held that the limitation was to be governed by Article 65 of the Limitation Act, 1963, which allows 12 years for suits for possession based on title.
The Court stated:
“Since the suit was for possession based on title, the limitation period was 12 years. The suit was well within time.”
Final Judgment
The Supreme Court dismissed the appeal and upheld the judgments of the District Judge and High Court, affirming the validity of the gift deed and ruling that:
- The gift deed executed in 1983 was valid and irrevocable.
- The respondent had rightfully acquired ownership of the property.
- The revocation deed executed in 1987 was void and without legal effect.
- The suit filed in 1991 was within the limitation period.
Conclusion
The ruling reaffirmed the principles of irrevocability of gifts under the Transfer of Property Act. It emphasized that once a gift is validly made and accepted, it cannot be revoked unless specific conditions allowing revocation are stipulated in the deed.
This judgment serves as a crucial precedent in property law, reinforcing the sanctity of registered gift deeds and limiting arbitrary revocations.
Petitioner Name: N. Thajudeen.Respondent Name: Tamil Nadu Khadi and Village Industries Board.Judgment By: Justice Pankaj Mithal, Justice Ujjal Bhuyan.Place Of Incident: Kotlambakkam Panchayat, Cuddalore, Tamil Nadu.Judgment Date: 24-10-2024.
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