Case Note & Summary
The petitioner, Mohammed Yusuf, a Muslim, challenged a stamp duty demand notice dated 14/12/1998 issued by the Sub-Registrar and Stamp Collector, Bhandara. The demand was based on an oral gift deed that was reduced to writing on stamp paper and mutated in the revenue records. The petitioner argued that under Muslim law, an oral gift (hiba) is valid without writing or registration, and therefore no stamp duty is payable. The court referred to two Supreme Court judgments: Hafeeza Bibi v. Sk. Farid (2011) 5 SCC 654 and Rasheeda Khatoon v. Ashiq Ali (2014) 10 SCC 459, which held that the essential ingredients of a valid oral gift under Muslim law are: (i) declaration of gift by donor, (ii) acceptance by donee, and (iii) delivery of possession. Writing is not essential, and such a gift is complete and irrevocable upon fulfillment of these conditions. The court noted that in the present case, all three ingredients were satisfied: the gift was oral, possession was handed over, and mutation was effected. The writing was only for mutation purposes. The court also observed that Sections 122 to 129 of the Transfer of Property Act, 1882 are not applicable to Muslim gifts by virtue of Section 129, and there is no provision for levying stamp duty on oral gifts made by a Muslim of sound mind. The respondents conceded to the legal position. Consequently, the court quashed the stamp duty demand notice and allowed the writ petition.
Headnote
A) Muslim Law - Oral Gift (Hiba) - Stamp Duty - Essential Ingredients - The court considered whether stamp duty is leviable on an oral gift under Muslim law that was later reduced to writing for mutation. Held that a valid oral gift under Muslim law requires only declaration, acceptance, and delivery of possession; writing is not essential. Since the gift was oral and the writing was only for mutation, no stamp duty is payable. (Paras 2-4) B) Transfer of Property Act, 1882 - Applicability to Muslim Gifts - Section 129 - The court noted that Sections 122 to 129 of the Transfer of Property Act, 1882 are not applicable to Muslim gifts by virtue of Section 129. Therefore, the provisions regarding registration and stamp duty under the Act do not apply to such oral gifts. (Para 4) C) Registration Act, 1908 - Sections 17 and 49 - Oral Gift - The court, relying on Supreme Court judgments, held that an instrument of gift in every matter is not required registration. An oral gift, even if reduced to writing for mutation, does not require registration under Sections 17 and 49 of the Registration Act, 1908. (Para 3)
Issue of Consideration
Whether stamp duty can be levied on an oral gift made by a Muslim which was subsequently reduced to writing for mutation purposes
Final Decision
The writ petition is allowed. The stamp duty demand notice dated 14/12/1998 issued by respondent No.3 is quashed and set aside.
Law Points
- Oral gift under Muslim law does not require writing or registration
- Stamp duty not leviable on oral gift
- Sections 122-129 of Transfer of Property Act
- 1882 not applicable to Muslim gifts
- Essential ingredients of valid oral gift: declaration
- acceptance
- delivery of possession
