The Supreme Court of India on 11 March 2026 declined to hear a petition challenging a 144-year-old provision that exempts Muslims from mandatory registration and stamp duty requirements when gifting immovable property, directing the petitioner to instead approach the Law Commission of India. Let us learn a little bit about this law.
When a Hindu, Christian, or Sikh gifts a piece of land to a family member, they must execute a written deed, register it at the sub-registrar’s office, and pay stamp duty to the state government – a cost that typically ranges between 3% and 7% of the property’s market value. If they skip any of these steps, the gift is legally invalid.
When a Muslim gifts the same piece of land to a family member, none of that is required.
This is not a loophole or an administrative oversight. It is the law and it has been so since 1882.
How the Law Is Structured
The Transfer of Property Act, 1882, enacted by the British colonial administration governs property transactions in India. Chapter VII of the Act deals with gifts of immovable property.
Section 123 mandates that all gifts of immovable property must be made through a signed, attested, and compulsorily registered instrument. Under the Stamp Act, 1899, the gift deed must also carry stamp duty before it is accepted for registration.
Section 129, however, carves out a direct exemption. It states that nothing in Chapter VII shall affect any rule of Mohammedan law. This means Muslim gifts, known as Hiba under Islamic personal law are governed entirely outside this framework.
Under Hiba, a valid gift requires only three elements: a declaration of intent by the donor, acceptance by the recipient, and delivery of possession of the property. The gift can be made orally. It does not require a written deed. It does not require registration. And it does not attract stamp duty.
A Concrete Illustration
Consider two scenarios involving the same piece of land worth ₹50 lakh:
A Hindu father gifts land to his son – He must execute a gift deed, pay stamp duty of approximately ₹1.5–3.5 lakh (depending on the state), and register the deed at the sub-registrar’s office. Only then does the son have legal title.
A Muslim father gifts land to his son – He declares his intent, his son accepts, possession is transferred. The gift is legally complete. No paperwork. No government office. No payment.
The Legal Basis
Section 129 is not a stand-alone anomaly – it is part of a broader architecture of personal law in India, where inheritance, marriage, and property matters are governed by religion-specific codes. The Muslim Personal Law (Shariat) Application Act, 1937 reinforces the application of Islamic personal law, including Hiba, for Muslims in India.
Courts have consistently upheld the validity of unregistered Hiba transactions – the Supreme Court and various High Courts have ruled that an oral Hiba, if accompanied by delivery of possession, creates a valid and enforceable title.
The Provision Is Now Being Questioned
The differential treatment came under direct legal scrutiny on 11 March 2026, when Advocate Hari Shankar Jain petitioned the Supreme Court, arguing that Sections 123 and 129 together violate Articles 14 and 15 of the Constitution which guarantee equality before the law regardless of religion.
The Supreme Court declined to hear the challenge on merits and instead directed the petitioner to approach the Law Commission of India – the body that advises Parliament on legal reforms. The court noted that the law has existed for 144 years without a constitutional challenge and that Parliament is the appropriate forum for any amendment.
The provision has remained unchanged since 1947, through multiple governments, despite periodic debates over uniform civil law in India.
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