REVOCATION OF GIFT BY PARENTS - Tripaksha Litigation

There are increasing number of cases going to court where the parents after having transferred their properties and other assets to their children have regretted to have done so without securing their basic needs and amenities. In such a scenario the parents who are of old age and struggling with many physical and mental ailments are left to fend for themselves without any support from the children who have received those properties. In their time of need the parents are neglected by their children and often driven away from home to old age shelter-homes. Very less can be done at a stage when all is lost, however, the laws in India are enacted to protect the elderly from these kind social evils.

In General, a property once transferred cannot be retrieved. For instance, if a property is transferred by a parent to the children by way a Gift Deed. Such a Gift Deed cannot be revoked or cancelled unilaterally, until and unless it is satisfied that grounds for revocation exists. These grounds are very circumspect and are a burden to prove in court. A Gift is governed by ‘The Transfer of Property, Act 1882’ and the provisions under section 126 of the said act deals with revocation of Gift. It is trite law that the court cannot go beyond the mandate of section 126, wherein conditions where a gift can be revoked are laid down. But the said act is a general law and is applicable in cases where there is no special provision is given to deal with a case.

In the cases of Senior Citizens there are special provisions dealing with the issue where properties of Senior Citizens are in question. Section 23 of the Maintenance and Welfare of Parents and Senior Citizens Act, 2007 (the act) provides for how the cases related to properties of the parents, who in most cases are senior citizens, are to be dealt with. In a very recent judgment of Hon’ble High Court of Madras pronounced by Justice P.T. Asha in Mr. N. Nagarajan and another vs. Mr. Schekar Raj[1] discussed the statement of Objects and reasons of the act, which are the spirit of the act, reads as follows. “Traditional norms and values of the Indian Society laid stress on providing care for the elderly. However, due to withering of the joint family system, a large number of elderlies are not being looked after by their family. Consequently, many older persons, particularly widowed women are now forced to spend their twilight years all alone and are exposed to emotional neglect and to lack of physical and financial support. This clearly reveals that ageing has become a major social challenge and there is a need to give more attention to care and protection for the older persons. Though the parents can claim maintenance under the Code of Criminal Procedure, 1973, the procedure is both time-consuming as well as expensive. Hence, there is a need to have simple, inexpensive, and speedy provisions to claim maintenance for parents.”

In the same judgment it is further discussed that Section 23 of the act, which reads as follows: –“Tranfer of Property to be void in certain circumstances – (1) Where any senior citizen who, after the commencement of this Act, has transferred by way of gift or otherwise, his property, subject to the condition that the transferee shall provide the basic amenities and basic physical needs to the transferor and such transferee refuses or fails to provide such amenities and physical needs, the said transfer of property shall be deemed to have been made by fraud or coercion or under undue influence and shall at the option of the transferor be declared void by the tribunal. Read with section 3 of the Act: – “3. Act to have overriding effect. – The provisions of this act shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act, or in any instrument having effect by virtue of any enactment other than this Act.”

Thus, under the Section 23 of the said act gives wide powers to the Tribunal established under the act to adjudicate on the matters concerning senior citizens and parents. It is also clear that for just reasons the act overrides the general provisions of ‘The Transfer of Property, Act 1882’ with respect to transfer of properties of Senior Citizens and Parents in particular. The Plain reading of the said objective leaves no doubt that the law aims to protect the Senior Citizen and Parents from the greedy predators.

The Hon’ble Kerala High Court in its recent judgment in Radhamani and Ors. Vs. State of Kerala and Ors.,[2] the learned judge referring to, Section 122 and Section 126 ‘The Transfer of Property, Act 1882’ and Section 23 of the ‘Maintenance and Welfare of Parents and Senior Citizens Act, 2007’ held that – “10. It is to be noted that the special scheme in terms of Senior Citizens Act, 2007 could declare certain transfer as void, taking note of the fact that by taking advantage of the emotionally dependent senior citizens, relatives grab the property on the pretext of providing emotional support. Therefore, Legislature thought such transaction could be declared void as the conduct, leading to transaction was based on malice or faud. Therefore, condition referred in Section 23 has to be understood based on the conduct of the transferee and not with reference to the specific stipulation in the deed of transfer. Thus, this court is of the view that it is not necessary that there should be a specific recital or stipulation as a condition in the transfer deed itself. This condition mentioned in Section 23 is only referable as a conduct of the transferee, prior to and after execution of the deed of transfer. Thus, challenge based on the ground that there is no reference in the recital of deed that transferee will provide basic amenities and physical needs to the transferor is of no consequence.”

The judgment was also approved by the Division Bench of the Kerala High Court in the Judgment reported Shabeen Martin and Ors. Vs. Muriel and Ors.,[3] wherein the learned judges held: –“Section 23(1) shows that where, after the commencement of the Act, a senior citizen has transferred his property by way of a gift deed or otherwise, subject to the condition that the transferee shall provide basic amenities and physical needs to the transferor and such transferee refuses or fails to provide such amenities and physical needs, the transfer of such property shall be deemed to have been made by fraud or coercion, or under undue influence. Reading of this provision, itself, would show that it is not the legislative requirement or intent that the document evidencing the transfer, either by gift or otherwise, should itself contain an express condition that the transferee shall provide the basic amenities and physical needs of the transfer. On the other hand, if there are evidence to the satisfaction of the authorities under the Act that the requirements of Section 23 are satisfied in a case, it is always open to the authorities to invoke their power under Section 23 of the Act and invalidate the document. Such an understanding of the section, according to us, would only advance the object of the Act.”

Relying on the above-noted principles of the Kerala High Court, a settlement deed in favour of the son by the parents was set aside as invalid who have refused to provide basic amenities and physical needs of the parents in the time of medical emergency in Mr. N. Nagarajan and another vs. Mr. Schekar Raj[4] by the Madras High Court. After discussing the above position of law, it is clear that in exercise of the powers under the said Act, relief could be given to the Parent/Senior Citizen in the certain facts and circumstances.

The courts will not be inclined to believe that each and every case fits one model. It is also trite law that every case is adjudicated upon the facts and circumstances that gives rise to the dispute. Even though the Act being a special law is not free from infirmities that cannot be exploited for gain. The Courts in India never endorse unbridled exercise of discretionary powers. Therefore, in an appeal before the Supreme Court of India in Sudesh Chhikara vs. Ramti Devi and Anr.[5], it was apt to lay down that,“Sub-section (1) of Section 23 covers all kinds of transfers as is clear from the use of the expression ‘by way of gift or otherwise’. For attracting sub-section (1) of Section 23, the following two conditions must be fulfilled:

The transfer must have been made subject to the condition that the transferee shall provide the basic amenities and basic physical needs to the transferor; and
The transferee refuses or fails to provide such amenities and physical needs to the transferor.

if both the aforesaid conditions are satisfied, by a legal fiction, the transfer shall be deemed to have been made by fraud or coercion or undue influence. Such a transfer then becomes voidable at the instance of the transferor and the Maintenance tribunal gets jurisdiction to declare the transfer as void.

When a senior citizen parts with his or her property by executing a gift or a release or otherwise in favour of his or her near and dear ones, a condition of looking after the senior citizen is not necessarily attached to it. On the contrary, very often such transfers are made out of love and affection without any expectation in return. Therefore, when it is alleged that the conditions mentioned in sub-section (1) of Section 23 are attached to a transfer, existence of such conditions must be established before the Tribunal. Thus, where it is not even pleaded that the release deed was executed subject to a condition that the transferees would provide the basic amenities and basic physical needs to the parents. No such finding that the release deed is invalid can be given by the Tribunal. Thus, the order of the Maintenance Tribunal cannot be sustained as the twin conditions incorporated in sub-section (1) of section 23 were not satisfied.

It’s crucial to carefully evaluate the relevant provisions before transferring property to loved ones, especially for senior citizens. All options should be considered before giving a gift, settling, or releasing property to children or relatives. While there are obligations for children to maintain their senior citizen parents, caution should be taken when transferring property out of love and affection, taking into account future prospects.

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