Declaration
Intention (niya) is a necessary component of every action in Islamic Law, be it Ibadat (religious matters) or Muamalat (worldly matters). So, where a hiba is declared without a real intention of giving away the gifted property, it is not hiba. Hiba without the intention may be benami transaction, but not hiba
An oral declaration may validly create a hiba. It is not necessary that a written hiba namah (gift deed) must be executed. No registration is necessary if hiba is made of even immovable property like land or house if it through oral declaration. The donee must accept the hiba, and the delivery of possession from donor to done must take place.
Declaration of Registration
Once the hiba is declared through a written deed, its registration becomes compulsory.
However, registration does not confer any special or preferential status on the registered hiba. For instance, if someone claims to have received a land through an oral hiba, while another person counterclaims to have received the hiba of the same land through a written hiba which he got registered, then if the first person is unable to prove the oral hiba to him, the second hiba with registration would take effect
But if in the above example, the first donee could prove the validity of the oral hiba, then the second hiba of the same property effected through registration could not override the first hiba, even though it was oral
Registration of Oral Gift
The Indian Registration Act, 1908 (Sections 16 and 49) does not require an oral gift to be registered. But if it is created through registration a written instrument, its registration is necessary. Section 123, Transfer of Property Act, 1882 demands registration of a gift of immovable property but if the gift is oral and the donor is a Muslim, then Section 129 exempts such gift from registration requirement
If the unregistered document is one which merely refers to a previous oral gift, it can be acted upon, notwithstanding the fact that it was not registered. But if the gift is made through such unregistered document, the lack of registration will make the gift invalid. The Privy Council upheld the validity of an oral gift of landed property without registration, where possession was transferred to the done
In India, oral hiba is governed by Islamic Law Rules. There is requirement of registration even when the subject-matter of gift is immovable property, which requires registration in all other cases. It is important judgment of the Supreme Court in Hafeeza Bibi v SK Farid overruling the judgments of the Andhra Pradesh High Court, Jammu and Kashmir High Court and Madras High Court; it was held that merely because the gift is reduced to writing instead of making it orally, such writing not becoming the formal instrument of the gift, registration is not necessary. Form is immaterial and cannot become the substance of the gift.
The Supreme Court held:
In our opinion, merely because the gift is reduced to writing by a Mohammedan instead of having been made orally, such writing does not become a formal document or instrument of gift. When a gift could be by a Mohammedan orally, its nature and character is not changed because of it having been made by a written document. What is important for a valid gift under Mohammedan Law is that three essential requisites must be fulfilled. The form is immaterial. If all the three essential requisites are satisfied constituting a valid gift, the transaction of gift would not be rendered invalid because it has been written on a plain piece of paper. The distinction that if a written deed of gift recites the factum of prior gift then such deed is not required but when the writing is contemporaneous with the making of the gift, it must be registered, is inappropriate and does not seem to us to be in conformity with the rule of gifts in Mohammedan Law
The trial court on consideration of the entire evidence on record has recorded a categorical finding that Shaik Dawood (donor) executed the gift deed dated 5-2-1968 in favor of the donee (Mohammed Yakub), the donee accepted the gift and the donor handed over the properties covered by the gift deed to the donee. The trial court further held that all the three essentials of a valid gift under the Mohammedan Law were satisfied. The view of the trial court is in accord with the legal position. The gift deed dated 5-2-1968 is a form of declaration by the donor and not an instrument of the gift as contemplated under Section 17 of the Registration Act. As all the three essential requisites are satisfied by the gift deed dated 5-2-1968, the gift in favor of Defendant 2 became complete and irrevocable.
Acceptance of “Hiba”
The donee must accept the gift. This acceptance may be expressed or implied (i.e. by conduct). But the gift of a debt to a debtor or his heir is valid without acceptance and not invalidated by his rejection. For example, A owes Rs 100 to B. B makes a gift of this debt of Rs 100 to A, which A does not accept and insists on paying the money to B. The gift shall, however, be valid and effective even on A’s refusal to accept it. Also, no acceptance is required when the gift is to a son or ward by the father or guardian
The acceptance of the gift must be made by a person competent to accept. Till the gift in favor of the minor is accepted by a person competent to accept the gift, it cannot become valid. Thus, where the father and grandparents executed gift deed in favor of minor children and one of the donees who was a minor at the time of the gift on behalf of her younger brothers and sisters, it was held that she was not competent to accept the gift on behalf of her younger brothers and sisters, it was held that she was not competent to accept the gift on behalf of other minors and the gift was invalid
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