Gift and settlement deeds cannot be cancelled unilaterally, says court

Category : Court MADURAI; Those who give away their immovable properties either by way of registering settlement deeds or gift deeds to near and dear ones cannot cancel those instruments unilaterally by simply registering cancellation deeds with the Sub-Registrars concerned, the Madras High Court Bench here has ruled. Allowing two writ petitions, one filed against cancellation of a settlement deed and another against cancellation of a gift deed, Justice S.S.Sundar directed a Sub-Registrar at Kodaikanal in Dindigul district as well as Madurai District Registrar to delete entries related to registration of those cancellation deeds. The judge recalled that while dealing with a case related to cancellation of sale deeds in 2011, a Full Bench of the High Court held that a deed of cancellation of a sale executed by the transferor unilaterally would not create, assign, limit or extinguish any right, title or interest in the property and would be of no effect. Observing that cancellation would also not create any kind of encumbrance on the property that had already been sold by the transferor to the transferee and registered through a valid deed, it was ordered that such deeds of cancellation could not be accepted for registration at all. " Once title to the property is vested in the transferee by the sale of the property, it cannot be divested unto the transferor by execution and registration of a deed of cancellation even with the consent of the parties. The proper course would be to re-convey the property by a deed of conveyance by the transferee in favour of the transferor," the Full Bench had said. The Bench had also said that such sale deeds could be cancelled by taking recourse to the civil law and obtaining civil court decree for cancellation of sale deed on the ground of fraud or any other valid reasons. Taking a cue from that judgment, a single judge of the High Court, in 2014, held that registration of cancellation of settlement deed was also against public policy. Insofar as the present cases were concerned, Mr. Justice Sundar pointed out that the first writ petitioner Santha Suresh had received a property in Kodaikanal by way of a settlement deed and the second petitioner A. Jaffar Hameed, now residing in California, had got a property in Madurai through a gift deed. Cancellation of both those deeds unilaterally by the transferors was liable to be quashed, he said. ( Madurai edition of The Hindu, Sunday, September 11, 2016 ) Courtesy : MPS