Each one of us desires of getting gifts from our loved ones. It is a way of exhibiting love, care and affection to your friends and family members. These days, gifting a property is one of the most trending ways to show love for your closed ones. However, gifting a property to someone is not as same as gifting a chocolate box. So, read this post further and know what are all those things that you should know about gift deed.
What is a Gift Deed?
Under section 122 of the Transfer of Property Act, 1882, a gift deed is defined as a legal document through which one can transfer movable or immovable property to a person without any monetary exchange. It is as same as a normal sales deed and bears all the details of the property, recipient and transferrer. As per section 17 of the Registration Act, 1908 and section 123 of the Transfer of Property Act, it is mandatory to register a gift deed by a sub-registrar.
Eligibility of a Gift Deed
As per the law, the donor cannot be a minor. On the other hand, the recipient can be minor with a guardian as the nominee, who can take care of the property until the recipient becomes an adult. Apart from this, the recipient should be alive or else the property can become void and null.
Inclusions in a Gift Deed
Below are some details that are needed to be furnished in a gift deed:
- Date and place of documentation
- Details of donor (Name, Father’s Name, Date of Birth and Address)
- Details of recipient (Name, Date of Birth, Father’s Name, Address and Relationship with the Donor)
- Relationship between donor and recipient
- Details of the gifted property
- Signatures of donor and recipient
- Details of the two witnesses available at the time of property transfer
- Signature of the witnesses
One has to pay the registration fee and stamp duty to register a gift deed. The charges for stamp duty varies from state to state. However, in most states, the rates of stamp duty for transferring a property is as same as for conveyance or sales deed.
For Delhi, the stamp duty charges for a property transfer via gift or sales deed is similar – 4% for men and 6% for women. In the same way, if someone wants to gift a property in Uttar Pradesh, he/she has to pay a stamp duty of 2% on the market value of the property. In Karnataka, a gift deed property attracts a stamp duty of 5% on the property’s market value. As rules vary state wise, there are certain states in India that even concessions if the property is being gifted to some in the same relation.
Cancellation Process of Gift Deed
As per the section 126 of the Transfer of Property Act, 1882, a gift deed can be cancelled under the following circumstances:
- A gift deed can be revoked with the mutual consent of the both parties
- In this regard, the deed of cancellation must be duly stamped and registered by a sub-registrar.
We have tried to accumulate as much as we can but, outlining everything in one post is not possible. So, it is always advisable that you should consult a legal expert in this matter so that everything can be done legally and the donor doesn’t have to face any trouble after your demise.