1979 (7) TMI 259 - HC - Indian Laws

Appeal Allowed: Transaction Ruled as Vesting Declaration, Not Gift; Significant Legal Question Certified for SC Appeal.

Suleman Isubji Dadabhai Versus Naranbhai Dahyabhai Patel and Ors.

The HC allowed the appeal, overturning the learned single judge's decision, and reinstated the District Court, Surat's order. It determined the ... - Issues Involved:1. Whether the deed of settlement executed by the appellant constituted a gift under Section 122 of the Transfer of Property Act, 1882.2. Whether the transaction was merely a vesting declaration under Section 6 of the Indian Trusts Act, 1882, and not a gift.3. Applicability of Section 63 of the Bombay Tenancy and Agricultural Lands Act, 1948, to the transaction.4. Validity and jurisdiction of the reference made to the Mamlatdar by Mr. Justice T. U. Mehta.5. Jurisdiction of the Charity Commissioner under Section 85 of the Tenancy Act.Issue-wise Detailed Analysis:1. Gift under Section 122 of the Transfer of Property Act:The court examined whether the deed of settlement constituted a gift. A gift, as defined by Section 122, is a transfer of property voluntarily and without consideration from a donor to a donee. The court found that the appellant could not be both the donor and the donee, as the transaction involved a trust where the appellant appointed himself as the sole trustee. Thus, there was no transfer of property to another legal person, and the transaction did not qualify as a gift.2. Vesting Declaration under Section 6 of the Indian Trusts Act:The court analyzed whether the transaction was a vesting declaration rather than a gift. Section 6 of the Trusts Act specifies that a trust is created when the author of the trust indicates an intention to create a trust, specifies the purpose, beneficiary, and trust property, and transfers the property to the trustee, unless the author is also the trustee. The court concluded that the appellant made a vesting declaration by creating the trust and appointing himself as the trustee, which did not constitute a gift.3. Applicability of Section 63 of the Tenancy Act:Section 63 requires permission from the Collector for transactions involving sales, gifts, exchanges, leases, and mortgages of land. The court determined that since the transaction was a vesting declaration and not a gift, the provisions of Section 63 did not apply. Therefore, no permission from the Collector was necessary.4. Validity and Jurisdiction of the Reference to the Mamlatdar:The court addressed the reference made by Justice T. U. Mehta to the Mamlatdar regarding the validity of the transaction under Section 63 of the Tenancy Act. The court held that the reference was without jurisdiction because the transaction did not involve a gift or transfer requiring the Mamlatdar's intervention. Consequently, the order of reference was set aside.5. Jurisdiction of the Charity Commissioner:While the court did not express an opinion on this issue due to the resolution of the first contention, it noted that the jurisdiction of the Charity Commissioner to determine whether properties are public trust properties was not excluded by Section 85 of the Tenancy Act.Conclusion:The court allowed the appeal, set aside the order of the learned single judge, and restored the order of the District Court, Surat. It concluded that the transaction was a vesting declaration and not a gift, thereby negating the applicability of Section 63 of the Tenancy Act. The court also granted a certificate of fitness under Article 133(1) of the Constitution for respondents 1 and 2 to appeal to the Supreme Court, recognizing the substantial question of law involved.