Gift may be revoked by the donor (but not by his heirs after his death) at any time before delivery of possession. Until delivery of possession, there is no complete gift. Therefore, before delivery, the gift is always revocable by the donor. In theory, a gift may be revoked even after delivery of possession, except, in certain cases; but in effect, because of wide exceptions, once the possession is delivered, nothing short of a decree of Court is sufficient to revoke the gift.
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Neither a declaration of revocation by the donor, nor even the institution of a suit for resuming the gift, is sufficient to revoke the gift. Until a decree is passed, the donee is entitled to use and dispose of the subject of gift.
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Under Sunni law, a gift may be revoked even after delivery of possession, except in the following nine cases:
1. When the gift is made by a husband to his wife, or by a wife to her husband.
2. When the donor and the donee are related to each other within prohibited degrees.
3. When the donee is dead.
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4. When the thing given has passed out of the donee’s possession,
5. When the thing given is lost or destroyed.
6. When the thing given has increased in value, whatever be the cause of the increase.
7. When the thing given is so changed that it cannot be identified, as for instance, when wheat is converted into flour.
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8. When the donor has received something in exchange for the gift.
9. When the gift is sadaquah.
The reason why a gift to a person other than a husband or wife or to a person other than one related within the prohibited degrees may be revoked is thus stated in the Hedaya (p. 486) : “The object of a gift to a stranger is a return; for, it is a custom to send presents to a person of high rank, that he may protect the donor; to a person of inferior rank, that the donor may obtain his services; and to a person of equal rank, that he may obtain an equivalent; and such being the case, it follows that the donor has the power of annulment, so long as the object of the deed is not answered, since a gift is capable of annulment.”
Shia Law:
According to the Shia law:
(i) A gift may be revoked by a mere declaration; no judicial decree is necessary;
(ii) A gift between husband and wife is revocable; and
(iii) A gift to any blood relation, whether within the prohibited degrees or not, is not revocable after delivery of possession.