Hiba (Gift)

Hiba

The gifts in India are governed by the Transfer of Property Act, 1872. However, the provision of the gift does not apply to the Muslims, which is from the transfer of property act. “Hiba” means “gift” in the Muslim law. The term gift is a very wide concept in English, and hence the gift given in the English sense is a gift without consideration. Whereas, the term “Hiba” has a very narrow meaning. ‘Dur-ul-Muhtar’ states that “Hiba” is the transfer of the transfer of property in substance by one human to another without any return in demand. Hanafi lawyers define Hiba in a different way, they say that it is an act of bounty by which a right of property is conferred in something specific without an exchange.

Shias’ say that Hiba was an obligation by which is a very specific object which is transferred immediately and unconditionally without any exchange, also free from a religious or pious purpose on the donor’s part.

Muslim law allows a muslim to give its entire property as a gift inter vivos , even with the object of not inheriting its heirs.

Muslim law has certain instructions which are similar to the concept of hiba, even though they are completely distinguishable from it.

There are the following :

1. Aariat

2. Sadaqa

3. Wakf

4. Hiba-bil-iwaz

5. Hiba-ba-shart-ul-iwaz

Essentials of a Hiba are the following :

Requisites of Hiba

1. Capacity to make Hiba

2. The subject matter of gift

3. Donee

4. The formalities of the Hiba

The ingredients of valid gift are :

1. Declaration of the gift

2. Delivery of subject matter of the gift by the donor to the done

3. Acceptance

Capacity to make Hiba

Mental Capacity :

Every muslim male or every muslim female who has attained the age of majority and is also of sound mind has the capability to make a gift. The age of the majority is 18years to make a gift. If the person is under the certificated guardian then the age of majority is 21years. The muslim law says that the mere attainment of the puberty does not mean the ability to give a gift. Also, if a person is of unsound mind then the person is only able to give a gift when the person is in a lucid interval.

Muslim law recognizes the doctrine of ikrah or compulsion, and a gift deed executed under the compulsion is not valid. In these types of cases the gift is voidable and it can be avoided by the donor whose consent was taken.

On the ground of ikrah the transaction can be avoided if the compeller was to carry out the threat held out by him and the threat itself was such as it would be influencing the conduct of a reasonable person.

Financial Capacity :

The Hanafis told that insolvency does create an incapacity to create a gift, but the kazi has the power to make such a gift of no value, if it is made with the view to defraud the creditors.

The Indian Courts follow the Hanafi view. The indebtedness of the donor or him having embarrassed financial circumstance is not a ground to avoid a gift. Since from the last fact of indebtedness only, the deceptive intention cannot be deduced.

In every gift there must be a bona fide intention on the donor’s part to transfer the property to the donee. If it is obvious that the gift is of an intention to defraud the creditors then the gift is invalid.

Subject matter of the gift

All forms of the property (mal), over which the dominion can be exercised or anything which would be taken into possession or which could exist as a specific entry, or as an enforceable right, might be the subject matter of a valid gift. A gift of any property can be made and given. A Hiba or a gift inter vivos can be of an entire property.

Gift of actionable claims or incorporeal property – the delivery of the physical possession of the subject matter of the gift is necessary in all cases for the validity of Hiba. Those properties which cannot be delivered physically are not a valid gift. Thus, Hiba can only be of a corporeal property.

In muslim law in India the incorporeal property can be of as much subject matter as the corporeal property. Thus, negotiable instruments, government promissory notes, Malikana rights, or Zamindar rights can be a valid gift. When a gift of an actionable claim is made in written then the acceptance of the gift by the donee is essential.

Gift of equity of redemption – When the mortgagee is does not have the possession of the mortgaged property, the gift of equity of redemption is valid, as the mortgager can put the donee into possession. There is a difference of opinion in our high courts about this. Some courts agree and some disagree majorly on it being valid or not.

Gift of property held adversely to the donor – The property which is in the possession of the usurper can’t be the subject matter of the gift. The gift of such a property is not valid as the donee can’t be possessor of such a property. It is valid only when the doner puts donee into possession or does an overt act to make the possession of the donee. It has been held that the gift of immoveable property by the purchaser at a sale in execution made before the confirmation of the sale before the acquisition of possession is not void where the donor authorizes the donor to take the possession of the property.

Gift of a non-existent object – Fatwani says that a gift of something which is non existent at the time of the conduct will not be valid. Muslim authorities say that these kind of things change constantly in their character, in the process of making and in the and a new thing altogether comes into being. The gift will be valid when they are separated and made over to the donee. Specs successions cannot be made a subject matter of hiba.

Assignment of insurance policy – The assignment of the insurance policy by any human is statutorily permitted in India. Section 38(7) of the Insurance Act, 1938 states that notwithstanding any law or custom having the force of law to the contrary, an assignment in favor of a person made with the condition that it shall be inoperative, or that the interest shall pass to some other person on the happening of a specified event during the life of the policy holder, and an assignment in favour of the survivor or survivors of a number of persons shall be valid. It applies to the muslims.

Gift of Musha – Musha means an undivided share or part in a property, movable or immovable. Among the Shafis and the Ithana Asharis, the gift (musha) is valid, if the donor withdrawns his dominion and allows the donee to control. The rule is otherwise among the Hanafis. The general rule is laid down in the Hedaya. The latter rule says that the incomplete possession must suffice. Whereas the former rule says that the part capable of division cannot be valid till the delivery of the complete possession of the gift, dividing it from the rest of the gift.

A share or part in the property may be:

(i) By its nature invisible, for example share a same staircase or a same bathing tank or hamam

(ii) It can be divided by separating it from the rest. In the first case the share is undivided, thus, the gift is valid. In the second case, it is not incorrect (void) but it is irregular. It can be perfected by the division and share and handing over its possession to the donee.

The concept of musha has faced much criticism. The doctrine is completely unadapted to the progressive society. There are certain exceptions:

(a) The gift of one co-sharer to the other. In these cases the donor shall necessarily divest itself totally of the proprietary rights.

(b) The gift of share in a zamindaari or taluka. A gift of undivided share in Kaimi was held valid.

(c) The gift of share in freehold property in a large town. The gift is held valid.

(d) The gift of share in a land company. The doctrine has been applied to different categories of property.

The Donee

A gift may be made to anyone without considering the age, sex or religion. Thus, a gift may be made to a minor or adult, married or unmarried, muslim or a non-muslim. Under Hanafi law, the donee must be legally present at the time of hiba. Thus, gift to an unborn, one not in esse, actually or presumably is invalid. In Shia, the gift to an unborn can be made validly, provided that the gift commences a person with esse. In both Shia and Sunni a gift to a person and his children or to the descendants of his, line after line, will take affect to that person, the conditions limiting that estate to be void. However, a gift to a child in the womb of the mother is valid if the child is born within the six months of the gift. In these kind of cases the muslim law presumes that the child was in existence as a distinct entity in the womb of the mother. When a gift is made to a minor or a person of unsound mind, the gift will be complete by the delivery of possession to the guardian of minor or the guardian of the unsound mind person. The gift when given to a group of persons where some are minors and some are major, the gift shall be accepted by the majors and the minors acceptance will be made by their guardians. Muslim law allows the gift to be made jointly to two or more persons, but where gift of property is capable of division is made to two or more than two people without specifying the shares in the property or without dividing the property then that gift is invalid. It can be valid if separate possession is taken by the donees by mutual arrangement or in accordance with the deed.

Formalities :

1. Delivery of possession

A gift may be oral or written, it does not depend on the fact that the property is movable or immovable. The acceptance of the gift is very necessary. In every case the delivery of possession must be made to the donee. The requirements of the formalities under the section 123, Transfer of Property Act, are not applied on the muslim gifts.

2. Delivery of possession of immovable gifts

In this case, of immovable property, the delivery of possession is necessary. If the property is in the possession of tenants then the delivery of possession may be made by the attorning the donee, by delivery of title-deeds or by mutation in the revenue records.

3. Delivery of possession of incorporeal property

The incorporeal property or actionable claims, the distinction is made between those properties which can do the delivery of possession and which cannot. In the first case, actual deliver is necessary. In the second case the donor shall divest completely of the ownership of and dominion over, the property. The delivery of possession can be made this way as the subject matter of the gift is very susceptible of. Thus, zamindari right may be completed by mutation of names in the records of the right.

In some cases delivery is only symbolic:

a. Where donor and donee reside in the same house. Where subject matter of the gift, the actual delivery of possession is not necessary. The clear and unequivocal manifestation of intention on the part of the donor to divest himself of ownership and dominion is necessary.

b. Where husband makes a gift to the wife or the wife makes gift to the husband of property in the joint possession of theirs, then the actual delivery of possession is not necessary. Even after husband lives in the house, subject-matter of gift, collects rent after the date of the gift then also the gift is valid. It will be presumed that he collected the rent on behalf of the wife.

4. Gift through the medium of a trust

In the modern India, muslims can create a trust validly. When a muslim makes a gift through a medium of trust, all formalities of the gift must be complied with. Where a muslim makes a gift of inter vivos, he may make a gift through the trust. In such cases delivery of possession shall be made to the trustee.

Conditional gift and gifts with conditions

1. Contingent or conditional gifts

These are those gifts which are made dependent for their operation on the occurrence of the contingency. A contingency is a possibility, a chance, an event, which may or may not happen in the near future. In muslim law, such contingent gifts are void.

2. Gifts with condition and life estate

When one makes a gift for speculated condition, the gift is valid but the condition is void. The gift is not rendered invalid by involving an invalid condition.

3. Gift in future

The muslim law givers consider time as the most important thing to give a gift. If a gift is given at any time in the future the gift is clearly void. However, a gift of rights to receive a share in offerings made by pilgrims at a shrine is valid. Since the gift is:

the right of the donor to receive a fixed share in the offerings made after they have been made.

Similarly a gift of future revenue of the land is valid, because it is the gift of the usufruct.

Revocation of gifts

There is a tradition that indicates that the prophet was against the revocation of gifts. It is a rule in muslim law that the voluntary transactions, including gifts are revocable.

All the gifts except those made by one spouse to another or to the person related to the donor within the decree of prohibited relationship are revocable.

Point of view of revocability :

i. Revocation of gifts before the delivery of possession

ii. Revocation of gifts after the delivery of possession.

Revocation of gifts before the delivery of possession -

All gifts are revocable in muslim law, before the delivery of possession, given by the donee. No order of the court is necessary.

Revocation of the gift after the delivery of possession –

Just the declaration of the revocation by the donor, or institution of a suit or any other action is not enough to revoke a gift. Till the decree is not passed of revoking the gift, the donee is entitled to use the property in any way; he can also alienate the property.

According to the Hanafi, in the following cases, gift can be revoked even after the delivery of possession :

i. When a gift is made by a spouse to the other.

ii. When donor and donee are related in prohibited decree of marriage.

iii. When donee or donor is dead.

iv. When the subject-matter is no longer in possession of donee, i.e. when he disposed it by sale, gift or otherwise or where he consumed it or where it had gone lost or been destroyed.

Who can challenge a gift –

A stranger can’t challenge a gift claiming the gift is bad, as he does not have the delivery of possession. A gift can be challenged only when the issue is raised between the donor or those claiming under him on one side, the donee and those claiming under him on the other side.