Voluntariness and Animus necessary for execution of a valid gift deed – Donee to prove that he exerted no influence

Factual Matrix:

The Hon’ble Supreme Court vide its judgment dated 24.01.2022 in the matter of “Keshav & Ors. vs. Gian Chand & Anr., (C.A. No. 364 of 2022)” had the occasion to deal with whether voluntariness and animus are necessary for execution of a valid gift deed and whether the burden of proof that no influence was exerted in the execution of the same is on the Donee.

The Respondents before the SC had instituted a civil suit in 1991 inter-alia praying for a declaration that they should be declared to be the owner of the subject property having derived title vide gift deed dated 23.12.1985 which was registered with the Sub-Registrar, Salooni. The Petitioners before the SC on the other hand were contending that the said gift deed was not valid.

The trial court vide order dated 17.12.1997 dismissed the said suit while holding that even through the gift deed was a registered document, it was of decrepit origin. The deed was not even signed by Respondent No. 1 and the donor  in her life time had denied having executed the gift deed and opposed and objected to the request for mutation of the land in dispute made by the Respondents.

Aggrieved, the Respondents filed an appeal before the First Appellate Court which dismissed the same holding that the execution of the said gift deed was merely a delusion.

Thereafter, the Respondents filed a second appeal before the Himachal Pradesh High Court which vide order dated 08.08.2018 allowed the appeal and set aside the concurrent findings of the lower courts. It held that the gift deed satisfied Sections 122 and 123 of the Transfer of Property Act, 1882 and enjoyed presumption of truth, being a registered document.

Aggrieved by the order, the Petitioners filed a Civil Appeal before the Hon’ble Supreme Court which vide order dated 24.01.2022 allowed the appeal and set aside the judgment passed by the Himachal Pradesh High Court and restored the decision of the Trial Court and the First Appellate court.

Analysis of the Judgment:

The Hon’ble Supreme Court held that in cases where it is pleaded that a party had executed the document without knowing its contents, it may, in certain circumstances, be necessary for the party seeking to prove the document to place material before the court to satisfy it that the party who executed the document had the knowledge of its contents. While relying on Section 16 of the Indian Contract Act, 1872 which related to pardanashin ladies, the SC held that the same principle should be applied to old, illiterate, ailing or infirm persons who may be unable to comprehend the nature of document or contents thereof. Thus, voluntariness and animus are necessary to prove execution of a valid gift deed.

Additionally it was held, when a person obtains any benefit from another, the court would call upon the person who wishes to maintain the right to gift to discharge the burden of proving that he exerted no influence for the purpose of obtaining the document. Equally, one who bargains in the matter of advantage with a person who places confidence in him is bound to show that a proper and reasonable use has been made of that confidence. The burden of establishing perfect fairness, adequacy and equity is cast upon the person in whom the confidence has been reposed. Therefore, in cases of fiduciary relationships when validity of the transaction is in question it is relevant to see whether the person conferring the benefit on the other had competent and independent advice.

The Supreme Court further held that the question whether a person was in a position to dominate the will of the other and procure a certain deed by undue influence is a question of fact, and a finding thereon is a finding of fact, and if arrived at fairly in accordance with the procedure prescribed, it is not liable to be reopened in second appeal. These findings of the facts could be interfered in the second appeal only if they were perverse or some gross illegalities have been committed in arriving at such findings which was not the case in the present matter.