A gift to unborn children is valid if it does not offend Sec. 13 or 14 of the Transfer of Property Act. The unborn children acquire vested interest on their birth under Sec. 20 of the Act. The relinquishment of life estate by the life estate holder does not defeat the interests of the unborn children.

RAMANUJULU NAIDU, J.

( 1 ) "in view of the pursutnce of the question verified in the second appeal, and not covered by any authority I am of opinion that the Second appeal should be posted before a Division Bench, the papers may be placed before the Hon ble the Chief Justice for appropriate order. "pursuant to the order of Reference by ramanujulu Naidu. J. dt. 18-12-79 this Second Appeal came op for final hearing on 2-11-1982 before a Division Bench of this court, consirting of P. A. Choudary J. and kodandaramayya, J. and the court delivered the following. JUDGMENT

( 2 ) THIS appeal is referred by our learned brother Ramanujulu naidu, J. , as it involves interpretation of Sec. 16 of the Transfer of Property act.

( 3 ) THE facts are not in dispute but only iti effect in Law. The plaintiff is the appellant in this second appeal. One P, Muthiah had a son ganga Raju and executed a settlement deed in respect of the suit property conferring life estate on his son and after his death to the sons of Ganga raju to be born abso utely. Ganga Raju in his turn executed a relinquishment deed of his life estate got under Ex. A-3 in favour of his father muthaiah on 31-8-1934 under Ex. A-4. Ganga Raju died in 1971 leaving behind three sons viz , Rama Rao, Lakshmanarao and Muthaiah. The first son Ramarao was born in the year 1942. The plaintiff happened to be ths auction purchaser of the one-third share of Mutbaiah under a sale certificate Ex. A-1 in a court auction in execution of the decree. The plaitiff also purchased the share of Lakshmanrao from bis wife Raghavamma under a registered sale deed dated 24-2-1972 as per Ex. A-2 and he filed the present sent for the recovery of this two thirds share. The 1 st defendant is the son of Muthaiah who resisted the suit. The other defendants are in possession of the property andjthe suit is contested by the 1 st defendant contending that the relinquishment deed in favour of Ganga Raju, executed a relinqaishment deed long before the birth of his sons and hence the gift in favour of the unborn sons has failed.

( 4 ) THE courti-below held that the settlement deed is true and valid but not a nominal one and Ganga Raju executed a rehnquishment deed before the birth of sons to him and consequently the entire estate has gone out of the original donee and hence the gift in favour of unborue children has failed and the present suit is not maintainable and liable to be dismissed.

( 5 ) IT is seen that the result of the suit depends upon the correct interpretation of Sec. 16 of the Transfer of Property Act and hence it is necessary to examine its terms which may be extracted in full. "16 Where, by reason of any of the rules contained in sections 13 and 14, an interest created for the benefit of a person or of a class of persons fails in regard to such person or the whole of such class, any interest created in the same transaction and intended to take effect after or upon failure of such prior interest also fails. "the section embodies the English Law that a Limitation following upon a limitation void for remoteness is itself void even though it may not of itself transgress the rule against perpetuity. A reading of the section discloses that three conditions must be present before the said section is attracted. (1) There should be an interest created for the benefit of a person or claes of persons which must fail by reason of the rules contained in Secs. 13 and 14. (2) There should be another interest created in the same transaction. (3) The other interest must intend to take effect after or upon failure of the prior interest. A gift made to an unborn person should not offend sec, 13 or Sec. 14. Sec. 13 requires two conditions to be fulfilled. (1) The Tranifer inter vivos cannot be made directly to an unborn person but must be preceded by a prior disposition in favour of a living person. (2) The interest given to the unborn person is the whole of the interest remaining in the transferor. Sec. 14 embodies the rul

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