Do I have any right to gift my property to a charity or NGO?

I have no ancestral property. All the assets that I have accumulated—properties, investments, ESOPs— are from my professional income. However, my sons are fighting with me over the assets. Is it possible to give it away to either one of the sons or a charity during my lifetime?

—Name withheld on request

 

Whenever the asset is self-earned, the owner of the asset has the right to decide how to deal with the same. You can gift it to whomsoever you wish during your lifetime. If it is to be given to an NGO/charity, the organization should clarify whether it is allowed to accept immovable property as a donation.

 The concept of ‘gift’ is defined in Transfer of Property Act, 1882, as the transfer of certain existing moveable or immoveable property made voluntarily and without consideration, by one person, called the donor, to another, called the donee, and accepted by or on behalf of the donee. Such an acceptance must be made during the lifetime of the donor and while he is still capable of giving. If the donee dies before acceptance, the gift is void. As per Section 123 of the Transfer of Property Act,  for the purpose of making a gift of immovable property, the transfer must be effected by a registered instrument signed by or on behalf of the donor, and attested by at least two witnesses.

 Thus, whenever you go ahead with the transfer of immovable property to your son or to the charity without consideration, it will be considered as a gift, and should then be recorded in an agreement known as the gift deed

 Among other clauses, it is important to mention that you are the owner of the property, describe the property, mention if there are any liabilities on the property, that the gift deed is made without consideration and that the same is made without any exchange of money or out of coercion or fraud.

 The gift deed should be executed by and between yourself and the donee. It is pertinent that the deed is stamped with the appropriate stamp duty.  Also, the gift deed has to be signed by the donor, donee and at least two witnesses. And lastly, it should be registered with the sub-registrar of assurance or the appropriate registration authority for such property.

Neha Pathak is the head of trust & estate planning at Motilal Oswal Private Wealth.

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