What are the grounds for cancellation of the gift deed

Gifting is a gratuitous act of giving property to your loved ones. According to Indian laws, you can gift your property to anyone you desire. While gifting, the donor (owner of the property) transfers the property in the favour of the donee (person receiving the property) without any exchange or consideration.

However, a person can sometimes reconsider their decision of gifting something valuable.  The donor may revoke his gift transaction from the donee due to several reasons such as donee not acting up to his promise, non- acceptance of a gift, etc.
 

Cancellation/ Revocation of a gift deed

The revocation of gift includes cancellation of the gift deed and the donee returning the possession of the property back to the donor. Section 126 of the Transfer of Property Act deals with laws relating to the revocation of gift deed for immovable property.

According to this section, the donor may agree to revoke a gift transaction. This can be through a provision mentioned in the gift deed or by mutual understanding between the two parties or happening of an event mentioned in the deed. A gift transaction can also be canceled if the donor signed the deed under coercion or undue influence such as in a toxic state, etc. If the donee disagrees to give back the gifted property, you can approach a lawyer who will help you in fighting a case in the court to get back your property.
 

Grounds for Cancellation of the gift deed

There exist certain grounds through which cancellation of gift deed can be done. They are-

• By Mutual Agreement: The donor and the donee can mutually agree to cancel or revoke a gift transaction. It can be done by mentioning such conditions in the gift deed. The condition, even when not mentioned in the deed, must be made in mutual agreement and understood by both parties. The parties can mutually cancel the gift transaction and donee has to hand back the possession of the property.

• When Donee fails to accept the gift: The process of gifting a property includes the donor transferring the property in the favour of the donor and the donee accepting the same. If the donor refuses or fails to show his acceptance towards the gift, then such a gift transaction has to be canceled. A gift transaction cannot be validated if the donee doesn't accept it.

• Through rescissions- Like a contract, a gift can also be made subject to certain conditions and can be rescinded if such conditions are not fulfilled. Such conditions must be expressly mentioned in the gift deed. This includes that on the happening of a specific event or the donee failing to fulfill a condition, the donor can revoke the gift transaction and get the possession of the property back. The donor has a limited period of 3 years to revoke the gift transaction from the date of the event.

• When consent of donor was obtained through undue influence or fraud- A gift is a gratuitous transfer made voluntarily by the donor. Like a contract, if it can be proved that the consent of the donor was not free, then such a transaction can be revoked. If the consent of the donor is caused by coercion, fraud, undue influence or misrepresentation, then the gift deed can become voidable at the option of the donor. The period given to the donor to revoke such gift transaction is 3 years from the date of discovery of such facts. The right to revoke the transaction can also be canceled if the donor ratifies the gift either by saying so or through his conduct.

• Other grounds for cancellation of gift deed: Forgery of a gift deed is a valid ground for its cancellation. Further, the gift deed can also be canceled if it is unregistered.

Thus, the above-mentioned are the grounds on which a gift deed can be revoked.