Each question consists of legal propositions/ principles (hereinafter referred to as 'principle') and facts. These principles have to be applied to the given facts to arrive at the most reasonable conclusion. Such principles may or may not be true in the real sense, yet you have to conclusively assume them to be true for the purposes of this section. In other words, in answering the following questions, you must not rely on any principles except the principles that are given herein below for every question. Further, you must not assume any facts other than those stated in the question. The objective of this section is to test your interest towards study of law, research aptitude and problem solving ability even if the 'most reasonable conclusion' arrived at may be unacceptable for any other reason. It is not the object of this section to test your knowledge of law.

PRINCIPLE: A gift comprising both existing and future property is void as to the latter.

FACTS: 'X' has a house which is owned by him. He contracted to purchase a plot of land adjacent to the said house, both the sale (of the plot of land) in his favour is yet to be completed. He makes a gift of both the properties(house and land) to 'Y'.

Under the afore-mentioned circumstances, which of the following derivations is CORRECT?

The correct answer is: Gift of house is valid, but the gift of the plot of land is void.

Let us carefully break down the principle and the facts to arrive at this conclusion.

Understanding the Principle:
The principle states: "A gift comprising both existing and future property is void as to the latter."
This means that if a person makes a gift that includes two types of property — one that he already owns (existing property) and one that he does not yet own (future property) — the gift is not entirely void. Instead, only the portion relating to the future property is void, while the gift of the existing property remains perfectly valid.

Identifying the Properties in the Facts:
Let us categorize the two properties 'X' is gifting to 'Y':

1. The House — The facts clearly state that the house is "owned by him" (i.e., owned by 'X'). This means the house is existing property at the time of the gift — 'X' has a present, vested ownership over it.

2. The Plot of Land — 'X' has only contracted to purchase the plot. The sale in his favour is "yet to be completed." This means 'X' does not currently own the plot; he only has a contractual right to acquire it in the future. Therefore, the plot is future property at the time of making the gift.

Applying the Principle to the Facts:
The principle draws a clear distinction between existing and future property within the same gift:

- Gift of existing property (the house) → VALID, because 'X' owns it at the time of the gift.
- Gift of future property (the plot of land) → VOID, because 'X' does not own it yet; the sale is incomplete and his ownership is yet to be acquired.

Why the Other Options are Incorrect:

- "Gift of both properties is valid" — Incorrect. The principle explicitly states a gift of future property is void. The plot is future property, so its gift cannot be valid.

- "Gift of both properties is void" — Incorrect. The principle does not void the entire gift; it only voids the part relating to the future property. The gift of the house, being existing property, remains valid.

- "Gift of house is void, but the gift of the plot of land is valid" — Incorrect. This is the exact opposite of the correct legal position. The house is existing property (gift valid) and the plot is future property (gift void).

Conclusion:
Since 'X' owns the house at the time of the gift, the gift of the house to 'Y' is valid. Since 'X' has not yet acquired ownership of the plot of land (the sale is still pending/incomplete), the plot is treated as "future property," and the gift of the plot to 'Y' is void. This is a direct and straightforward application of the given principle, which severs the valid portion of the gift from the void portion rather than invalidating the entire transaction.