ISSUE:
Whether the condition restraining alienation in the gift deed was valid under the Transfer of Property Act, 1882?
Whether defendant No.1 had right under gift deed dated 05.06.1957 to alienate the suit properties?
Whether Section 13 of the Transfer of Property Act (transfer for the benefit of an unborn person) applied to this case?
RULE:
As per section 10 of the Transfer of Property Act, 1882, conditions absolutely restraining alienation are void, except in lease cases. Section 10 expressly provides that where property is transferred subject to a condition or limitation absolutely restraining the transferee or any person claiming under him from parting with or disposing of his interest in the property, the condition or limitation is void. According to Section 10 any condition restraining the transferee the right of alienation is void.
As per section 13 of the Transfer of Property Act, 1882, transfers for the benefit of unborn persons must extend to their entire interest. It does not apply if the transfer is primarily made in favor of a living person.
A gift cannot impose absolute restrictions on the donee’s ability to transfer property.