Holding

The deed was not a pure gift; the executants retained title to the remaining property, so the cancellation was valid.

Summary

Ithara and his wife Annam, owners of 7 acres and odd land, executed a deed on 5 March 1966 giving 70 cents of land absolutely to Sosa in gratitude for her service, while reserving for themselves the right to live in the building, enjoy all income, and alienate or mortgage the remaining property during their lifetimes. They later cancelled the deed on 11 March 1968. The respondents challenged the cancellation; the trial court upheld it, but the Kerala High Court reversed, holding the deed to be a pure gift that divested the donors of title, thus precluding cancellation. On appeal, the Supreme Court held that the reservation clause showed the donors retained title to the rest of the property, so the deed was not a complete gift but part of a will, and the cancellation was valid. The Court allowed the appeal and directed that the parties partition the property and enjoy it in equal shares.

Issues considered

Whether the deed executed by the donors constituted a pure gift deed that divested them of title to the entire property, thereby barring its cancellation.
Whether the reservation of rights clause indicated that the donors retained a proprietary interest, making the deed partially a will and cancellable.
Whether the donors had the legal authority to cancel the deed after its execution.

Subjects

gift deedcancellationreservation of rightswillpartitionproperty lawsuccessioncivil appeal

Judgment

A REV. FR. M.S. POULOSE
v.
VARGHESE AND ORS.

MARCH 30, 1995

B [K. RAMASWAMY AND B.L. HANSARIA, JJ.)

Wilf-Executants giving part of land in absolute tenns to beneficiary--
Reserving his right in respect of rest of the property-Cancellation of deed- ,_ ._
Held part of deed in which executant reserved his right was a wi/1-Cancella-
C tion held valid.
I and A, having 7 acres and odd land, exec11ted a deed on March S,
1966 where11nder they gave 70 cents of land absol11tely to S for the faithful
service rendered by her. For the rest of .the properties, the executants
jointly reserved their right during their lifetime not only to live In the
D b11lldlng and enjoy the entire Income from the properties, but also to
alienate or mortgage the properties. However, on March 11, 1968 the
executants cancelled their deed. The respondents successfully challenged
the cancellation before the Trial Court but on appeal Trial Co11rt's
decision was reversed. High Co11rt held that the doc11ment was a gift deed
E and that therefore the donors having divested their title to the properties
had no right to cancel the same. Against the decision of the High. Co11rt
an appeal was preferred to this Co11rt.

Allowing the appeal, this Co11rt

F HELD: The recitals in the deed Indicate that the exec11tants bad not
divested themselves from the title to the rest of the property completely,
except 70 cents of the land given to the respondent S In absol11te terms.
The High Co11rt, therefore, was not right In its conclusion that It was a gift
deed and the donors were divested of the title on Its execution. That part
G must be read to be a will. (127, H, 128-A)

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4307 of
1995.

From the Judgment and Order dated 27.9.1990 of the Kerala High
H Court in S.A.No. 222 of 1985-B.
126
- M.S. POULOSE v. VARGHESE

H.N. Salve, Ranji Thomas, B.P. Yohaman and S. Menon for the
Appellant.
127
A

P.S. Poti and Ms. Malini Poduval for the Respondents.

The following Order of the Court was delivered:
B
Leave granted.

We have heard the counsel on both the sides. One Ithara and his
wife Annam had 7 acres and odd land. During their life-time, Sosa,
daughter of Mathew and her husband Verghese, the respondents herein,
were looking after the old people. They executed a deed dated March 5, C
1966, Ex.A-2. Thereunder they have given in consideration of the affection
and the faithful service rendered by them, 70 cents of land absolutely to
Sosa. For the rest of the lands, it was recited thus:

"We reserve our right during our life time to live according to our
wishes in the building described along with you and if need be we D
have full rights and liberty to appropriate the entire income and
profits from the properties except those set part in the name of
the second named amongst you. In the event during our life time
it becomes necessary to mortgage or alienate the schedule property
the same should be effected by you jointly with us and with the E
consent of all of us".

We are not concerned with rest of the terms· of the document. During
the life-time of the old people, they cancelled this document under Ex.A-3,
dated March 11, 1968. The respondents challenged the same. In· the trial
court they succeeded, but on appeal it was reversed. The High Court F
confirme.d the same. The High Court construed that the document is a gift
deed and that therefore, the donors, having divested their title to the
properties had no right to cancel ihe same subsequently.

There was a dispute with regard to the recitals among the parties.
Therefore, we have got officially translated the recital as extracted herein G
before. It indicates that the old people, the executants, have jointly reserved
the right during their lifetime not only to live in the building and enjoy the
entire income from the properties, but also reserved the right to alienate
or mortgage the properties. In other words, they have not divested them-
selves from the title to the rest of the property completely, except 70 cents H
128 SUPREME COURT REPORTS [1995] 3 S.C.R.

A of the land given to the respondent-Sosa in absolute terms. The High
Court, therefore, was not right in its conclusion that it is a gift deed and
-
the donors were divested of the title on execution of ExA.2 with effect
from March 25, 1966. That part must be read to be a will.

The appeal is accordingly allowed. Since the appellant is the son of
B Skaria, brother of Ithara, and the respondents are daughter and son-in-law
of Mathew, a brother of Annarn-wife of Ithara, both the parties should,
according to us, make partition and enjoy the properties in equal moiety.
No costs.
T.NA Appeal allowed.