Whenever I receive a gift from my friend..I go to inbox..I select ACCEPT and nothing happens -> it just takes me back to my island

That's the usual behaviour, you should have the item added to your inventory, I received a few baseball bats this morning and used them in my next few games..

Also: The ACCEPT button will change to SEND BACK if you've not gifted that friend already that day.

But once the INBOX is empty, it will automatically take you back to the game. :)