Gift Deed vs Will: Supreme Court Rules in Favor of Daughter in 30-Year Property Dispute

In a landmark judgment that clears the air on one of the most debated legal issues in India — the difference between a gift deed and a will — the Supreme Court has delivered its verdict on a 30-year-old property dispute between a brother and sister in Kerala. The court upheld the validity of a 1985 registered gift deed executed by the father in favor of his daughter, overruling a later 1993 sale deed made in favor of the son.

This judgment highlights the crucial legal distinction between a gift deed, which takes immediate effect, and a will, which only becomes effective upon the death of the person making it.

How the Case Unfolded

The roots of this prolonged legal battle go back to 1985, when a father transferred his property to his daughter through a registered gift deed. The document included a clause stating that the daughter would gain possession after the demise of both parents. However, in 1993, the father attempted to revoke the gift deed and instead executed a sale deed in favor of his son.

Following the father's death in 1995, the two siblings locked horns over ownership of the property. From 2001 to 2003, lower courts ruled in the brother’s favor. But in 2019, the Kerala High Court reversed the verdict, declaring the gift deed valid and binding. The brother appealed the decision, but in 2025, the Supreme Court dismissed the appeal, siding with the sister and effectively ending the decades-long dispute.

Gift Deed vs Will: What's the Legal Difference?

According to the Supreme Court, understanding the legal weight of a gift deed, settlement deed, and will is essential in property matters:

Gift Deed

• A gift deed is a legally binding document that allows a person to transfer property to another without any monetary exchange.

• Once registered and accepted by the recipient, the gift deed becomes legally valid and irreversible unless there’s a compelling legal reason.

• It is immediately effective (in praesenti), meaning the ownership is transferred during the donor’s lifetime.

Settlement Deed

• Similar to a gift deed but may come with conditions.

• For example, the donor might retain the right to use the property during their lifetime.

Will

• A will only becomes operative after the death of the person making it.

• It can be altered or revoked anytime during the person’s lifetime.

• Until the person passes away, no legal rights are transferred to the beneficiary.

What the Supreme Court Said

The apex court emphasized that the 1985 document was not a will but a gift deed, as the father had relinquished ownership during his lifetime. The court ruled that once a gift deed is legally executed and accepted, it cannot be cancelled unilaterally or nullified by a later document like a sale deed, unless proven fraudulent or unlawful.

This clarification settles one of the long-standing confusions in Indian property law — many individuals assume that any future property interest transfer with posthumous possession is a will, but if the ownership rights are legally handed over in the present, it qualifies as a gift.

Implications of the Verdict

The judgment will serve as a precedent for several pending cases involving property transfer disputes, especially those hinging on the interpretation of gift deeds versus wills. Thousands of property cases across India remain unresolved due to unclear documentation or overlapping claims, and this ruling provides critical legal clarity.

Conclusion

The Supreme Court’s decision has not only resolved a personal property conflict but also offered a valuable legal insight: a registered gift deed, once accepted, carries significant legal weight and cannot be easily overturned. If you’re planning to transfer property to a family member, understanding the legal nature of your document is essential.

For those navigating inheritance or property disputes, this case stands as a reminder to choose the right legal instrument and ensure proper registration and clarity of intent.