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Land laws (Property law)

Study of law relating to the transfer of property in two parts. Part I relating to the general principles of transfer of property Part II relating to specific types of transactions like sale, mortgage, lease, exchange, gift, charge and actionable claims. Easements Act regarding licenses. Registration act and Stamp Act regarding alienations covered under transfer of property act. General study regarding rent control legislations.

Marks distribution and type of exam


Total Marks 100 Project marks 25 Viva marks. 10 Mid term exam. marks 20 End term exam marks 40 Attendance 05 Close book exam only bare acts are permitted to be referred to and bare acts to be supplied by the Examination Department.

Transfer of property
Part I Historical background of transfer of property. What are the types of property. What types of property are covered under transfer of property law. What is a transfer. Rules relating to the transfer of both movable and immovable properties. Specific rules relating to the transfer of immovable properties. Conditional transfer, condition precedent condition subsequent,

Transfer of property
Part II Sale: ingredients needed to effect a sale. Rights and liabilities of a seller, buyer. Mortgage: ingredients needed to effect mortgage. Types of mortgages Rights and liabilities of mortgagor and mortgagee. Lease: ingredients of a lease concept of a sub lease. Rights and liabilities of lessor and lessee. Lease a special study with reference to rent control legislation. Gift: ingredients of a gift and its role. Rights and liabilities of Donor and Donee. Exchange, actionable claims. Difference between the above concepts.

Easements Act
Topics relating to license. Difference between lease and license. Types of licenses Rights and liabilities of licensor and licensee. How to terminate a license and recover possession.

Registration and stamp Act


What is meant by registration. Steps to be taken regarding registration. Effects of non registration. Impact of section 49 of registration act. Stamp Duty payable. Non payment of stamp duty and effects.

Books to be referred to
Transfer of property Act by Mulla Transfer of property act by C.V.Subba Rao. Lectures on transfer of property by justice Shah. Law relating to properties by Meggaray. The transfer of property act AIR commentary. Law of mortgages by S.P.Sen Gupta. Law of easements by Kattiayar. Registration Act by Mulla. Stamp act by sanjeeva Rao.

Historical background of transfer of property Act.


Ancient India. During the period of Moguls. During the early period of British. During the Later period of British. In independent India.

Ancient India.
The properties were of two types. Like stavara and jangama. The modes of acquisition of properties were that of from (i) learning, (ii) purchase, (iii) mortgage, (iv) by valour, (v) through wife, (vi) inheritance from ancestors, (vii) succession,

During the period of Moguls.


The concept of property and the mode of acquisition did not differ to a great extent. The mode of acquisition and disposal of the property was akin to that of the pattern which existed in India before the commencement of Mogul and pre-Mogul rulers. Personal laws of Hindus and Mohammedans were Applicable to them separately. There was not common uniform law.

During the early period of British.


English law and rules of equity governed British who came to India as the laws of Hindus and Mohammedans were more a personal law. In the absence of any statutory law necessarily they were forced to depend on the English law of real properties. The courts were not certain as to what were the rules and practices which were in force. The English rules were not clear as they were having a divergence on account of the application of principles of equity and common law practices. The first law commission was appointed to find out solution to this piquant situation and to work of a uniform having application to all. The first law commission went in detail and prepared a draft bill. When the bill was introduced in the Parliament to enact a law for India the same was referred to the select committee.

During the early period of British


The bill was referred to the local Provincial Governments to make their recommendations. The bill was redrafted by the Third Law Commission, based on the recommendations and comments. The said work was done under the Chairmanship of Sir Charles Turner, the chief justice of Madras. The other members of the committee were such as Sir Raymond west and Dr. Whitley Strokes. The major work relating to the drafting of the Act was done by Whitely Strokes. The bill was prepared for almost seven times before a final draft was prepared and tabled on the floor of the parliament. The bill was passed and came in to force from 17th February 1882. The preamble to the Act indicates that the Act was to amend the law relating to the Transfer of property by the Act of the parties.

During the Later period of British.


1885 Transfer of property amendment act to amend sec 1,4,6, and 69. 1895 Crown Grant Act savings of crown grant from the application of T.P.Act. 1900 T.P.ACT to amend section 3, 6 1904 T.P.ACT to amend sec 1, 59, 69, 1908 Code of civil procedure. 1915 repealing act to amend 59, 69. 1917 T.P.(validating) ACT 1920 T.P.(amendment) ACT 1925 T.P.(amendment) ACT 1926 T.P.(amendment) ACT 1927 Repealing and amending Act. 1929 T.P.(amendment) ACT major amending act. Since 1930 till 1944 the act was amended during 1930, 1934, 1937, 1938, 1944.

In independent India.
1947 India Adaptation of Existing Indian laws order. 1948. India independence adaptation of central Acts and ordinances order. 1950. Adaptation of laws order 1950 1951. Part B States (laws) Act 1951. Since 1952 till 2002 the act were amended several times during 1954,1956, 1959, 1963, 1964, 1970, 1976. 2002. major amendment to section 106, and 53A were done

Whether transfer of property act is exhaustive?


Characteristic feature of exhaustive code is that it covers all matters specifically and it is not the province of the judge to fill up the gaps to understand the true construction. Preamble Government grants not applicable Easements not applicable. Official receivers receiving property act does not apply. Partition in the family the act does not apply. Section 2 of the Act though repeals some of the Acts specified in the schedule the said repeal is to the extent specified in the schedule and for the rest of the extent those Acts continue to have effect. Provisions of the Act which have not been specifically repealed continues to apply. Provisions of any contract or constitution of the property which are consistent with the provisions of Transfer of Property Act and are allowed by any law for the time being in force.

Whether transfer of property act is exhaustive?


Any right or liability arising out of legal relationship constituted before coming in to force of the Act and they to continue even after coming in to force of the Act. In pursuance to the court orders does not apply. Not applicable to transaction other than inter vivos Certain provisions are not applicable to Mohammedans section 2,gifts, etc/. Certain provisions were not applicable to Hindus till 1929. not applicable to certain parts of India. Depends on the definitions of contract Act .major part applies to immovable properties and not in respect of Movable properties There fore the provisions of the Transfer of property Act is not an exhaustive Act.

What is property.
Property is a right and interest a person has in respect of lands, chattels or any thing seen or not seen to the exclusion of others. The property is a generic term for all that a person has domain over. It has an extensive application. While strictly speaking it would mean only the right a person has in relation to some thing or a domain over it. It cannot be held to be confined to a material object. Property signifies every species of property and it comprehends all a mans worldly possession. Some times the property may be owned by one person but yet another may have a lease hold interest, an interest as a mortgagee, an interest to collect rent, an interest to enjoy and so on so forth. In the modern days in contrast to the earlier period the property has a very wide meaning. It covers various types of things or rights.

The property should be given a liberal meaning. In fact it extends in respect of various things which are found in a persons day to day life Property can not remain in vacuum. Some one must be there to hold it.

Illustrative but not exhaustive list of what a property is.


                  Building, Car Money, Lease hold rights Right over an art piece, song, drama, story, prepared by oneself, Trade mark and trade names, Debt Goods or objects or things of tangible nature Goods or objects or things of intangible nature Books, Pen, pencil, television, Animals Gun, bombs, ammunition, Insignia, passport, To collect usufructs from tree till debt is wiped off, Claim for breach of contract Assets of every description whether corporeal or not, tangible or not , deeds, instruments evidencing title,  Actionable claims

Types of Property

property

immovable

Movable

Property
.

property

Corpereal that is which affects senses

Incorporeal That which cannot be seen or handled

movable property movable property Intangible. tangible

Property
.

property

intellectual

Non intellectual

Intellectual property
Trade mark Copy right Patent Geographical indications Industrial designs. Lay outs Integrated circuits.

Non Intellectual property


Real property like land, tenements, hereditaments and all rights connected there to, either of equitable or of legal consequences. Debts and action claims. Insurance policies. Money. Movable properties such as growing crops, money, all corporeal property, standing timber, corporeal properties, and property of any description other than immovable property.

Whether the definition of immovable property is exhaustive?

Immovable property a non comprehensive definition. Do you agree?

Immovable property
Transfer of property Act defines immovable propety to the effect that; Immovable property does not include 1.standing timber, 2.growing crops or 3.grass. What is a standing timber. What is meant by growing crops. What is meant by grass. Whether the similar definition is adopted in other laws.

Immovable property
T. P. Act 1882 sec 3 Unless there is any repugnancy otherwise Immovable property does not include 1.standing timber, 2.growing crops or 3.grass. Registration Act.1908. Immovable property includes land, building, hereditary allowance, right of way, General clauses Act.1897. Section 3(25) Immovable property shall include land, benefit to arise out of land and things attached to earth or permanently fastened to any thing attached to earth.

benefit to arise out of EARTH


All benefits which arise out of earth would constitute immovable property. The said benefits cannot be severed out of the earth/land. For the purpose of sustenance of the benefit they support of the land. The benefits may in the form of; collection of leaves from trees or climbers, Collecting fish from a pond, Right to enter the lands and cut the trees, Right to collect minerals from the earth/land NOTE: however the right to have benefit from any standing timber, growing crops, and grass would not amount to immovable property. These benefits which arise out of land are generally referred to as Profits a prendre.

Profits a prendre.
Profits a prendre is a right vested in one person to enter on to the land of another person to collect the profits which arises from the land of the another. It is a right exercised one person on the land of another to enjoy the profits which arise from the land of another. The profits a prendre is different from easements, as in case of an easement a person will have a right to enjoy on the land of another without taking any profits from the land.

Rooted in earth as in the case of trees Embedded in the earth as in the case of buildings or walls Attached so to what is so embedded for a permanent beneficial enjoyment of that to which is attached. Examples : doors, windows, shutters, The test to be applied is to find out whether it is a permanent one and that it is for the beneficial enjoyment of the one to which it is attached. If it is of a temporary nature though for the beneficial enjoyment, then it would not come under this clause. Similarly even if it is of a permanent nature but not for the beneficial enjoyment of the one to which it is attached then it would not come under the category of attached to earth

attached to earth. and permanently fastened to the things attached to the earth

standing timber,
What is a timber, What is a fruit bearing tree, When could a fruit bearing tree be standing timber. Whether all types of trees become a immovable property. Note: whether a particular tree continues to be a standing timber or not will depend on the intention of parties. If a party wants to enjoy the benefits of a fruit bearing tree without cutting them then it would not be a standing timber. On the other hand if the parties intend to cut the said fruit bearing tree forth with for the purposes of severing it from land then it would be a standing timber to not to fall with in the category of Immovable property under transfer of property act. Profits a pendre concept with reference to trees.

Test to be applied to find out whether is it a standing timber.


Standing timber must be a tree that it is in a state of fit for the purposes and further a that is meant to be converted in to timber shortly that it can already be looked upon as timber for all practical purposes even though it is still standing. If not, it is still a tree because unlike timber, it will continue to draw sustenance from the soil. AIR 1958 SC 532,Shanta bai Vs State of Bombay.

Marshall Vs Green 33 L.T.404


A contract was entered in to cut the trees and taken away immediately to the ware house for being sold in a public auction. Question: whether the tree is a movable property or an immovable property? Test: whether the tree to have a continued nutrient from the earth or not. Solution: the tree in this case to be cut and removed immediately to ware house for the purpose of sale. So the tree will not have nutrient from the earth to grow. In view of the said fact the tree will not be a immovable property, but on the contrary would be a movable property.

Problem.1.
Government of Karnataka entrusts the work to Ashok Kini for the formation of Nandi corridor road from Bangalore to Mysore by widening the existing road. Mr. Ashok kini notices that there are road side Mango and jackfruit trees to the existing road. He engages the services of Jacob Paul and Co. of Calcutta, who have expertise knowledge in uprooting trees and transporting them to such of his place for disposal to facilitate kini to form the road. Jacob Paul and Co, insists to have a written registered agreement. Therefore kini and Paul goes to the office of the sub registrar to have the document registered as an agreement. Sub registrar insists to pay stamp duty as there is a transfer of immovable property. What is the solution? The trees though are fruit bearing trees yet the intention of the parties is to cut and remove it. It is not for the purposes of enjoying the usufructs of the tree. When once the trees are cut and removed they do not draw any sustinance from soil. Hence they are not immovable property with in the meaning if Transfer of property act. Here the intention of the parties are to be taken in to account.

Problem.2.
Government of Karnataka entrusts the work to Ashok Kini for taking care of cubbon park at Bangalore and maintain trees for a period of 25 years. The park has 4000 trees of all types and ages ranging from 1 to 35 years. The contract envisages that kini could cut and remove the trees located in the park, provided the said trees have a girth of 3 feet or the trees which are of 30 years age. Sub registrar insists to pay stamp duty as there is a transfer of immovable property. What is the solution? The trees though are not fruit bearing trees yet the intention of the parties is not to cut and remove it immediately but to wait till such time the trees either will have a girth of 3 feet or is aged 30 years. Till the trees are cut and removed they do draw any sustenance from soil. Hence they are immovable property with in the meaning of Transfer of property act. Here the intention of the parties are to be taken in to account.

Problem 3
Government of Karnataka entrusts the work to Ashok Kini for taking care of cubbon park at Bangalore and maintain it for a period of 25 years. The park has mango and cashew trees. Kini entrusts the contract of collecting the fruits for a period of 4 years to Somashekara Alwa. Sub registrar insists to pay stamp duty as there is a transfer of immovable property. What is the solution? The right of collecting fruits for a period of four years . The trees to their existence draw sustenance from the earth. Hence the right to collect fruits is a profit a prendre and an immovable property with in the meaning of Transfer of property act. Here the intention of the parties are to be taken in to account.

Movable property
Not specifically defined in transfer of property Act. Includes standing timber, growing crop and grass, fruit upon and juices in tree and property of every other description except immovable property. Sec.2(9) registration act.1908
Movable property includes growing crops. Sec.2(9) civil
.procedure code. 1908

Illustrative but not an exhaustive list of immovable property


A jalkar right Equity of redemption Right to ferry Right and interest of grove holder in grove Right to slag and earth before separation from soil Right to easement Advertisement hoarding fixed on substantial manner on the land. Hereditary office under Hindu law Right to hold bazaar Right to collect rent Right to severe and collect tendu leaves Right to collect lac, resin and gum from trees Right to tap coconut and palm tree to collect toddy. Right to catch fish from pond. Collect coal from coal land.

Illustrative list of non immovable property


Copy right Royalty to the owner of the soil Right to turn worship Right to obtain specific performance. Temporary right to reap produce from a land. Collection of sludge from tank. Interest of partners in a partnership business. Right to recover mesne profit Right to receive prasadam in a temple. Right to receive compensation. Court decree.

Shri Tarakeshwara sio Thakur Jiu Vs Dar Das Dey and Co. 1979(3) SCC 106 The definition of immovable property given in section 3 para 1 of the transfer of property act being in negative terms and not exhaustive, the definition given in section 3(26)of the general clauses Act will apply to the expression used in the transfer of property Act as modified by the definition of the definition in the first clause of section 3. the expression immovable property comprehends all that would be real property according to the English law arising out of land.

There fore it could be said that the definition of immovable property is not an exhaustive one Or in other words it could be said that the definition of Immovable property as used in Transfer of property Act is not a a comprehensive definition.

What is profits a prendre?


Profits a prendre is a right vested in one person to enter on to the land of another person to collect the profits which arises from the land of the another. It is a right exercised one person on the land of another to enjoy the profits which arise from the land of another. The profits a prendre is different from easements, as in case of an easement a person will have a right to enjoy on the land of another without taking any profits from the land.

profits a prendre
The profits a prendre may be classified with reference to the ownership and with reference to the land

ownership
One person claiming to the exclusion of others known as Several profit

to the land
Profits appurtenant Profit appendant.

One person claiming in common With others known as Profit in common

Profits in gross

One person claiming to the exclusion of others known as Several profit In this category only one person would be granted the right or authority to use the profits. The persons who have not been permitted can not use. Illustration: A applies in a tender to do fishing at Sankey tank for the year 2008-09. the bid offered by him is accepted by the Corporation of city of Bangalore and is granted a right to do fishing at Sankey tank during the year 2008-2009. the said right is in exclusion to the rights of others. So he could be said as a person claiming to the exclusion of others and it is known as several profits.

One person claiming in common with others known as Profit in common

Profit in common is also known as rights of common. The profits could be enjoyed not in exclusion of others but it could be enjoyed with all. In respect of land which is treated as a common land or a land held for the benefit of community at large this concept would arise and not in respect of a land held in individual capacity or as a property of an individual or authority. Example: pasturage land in a village to allow the cattle of the village to graze.

profits a prendre to the land


Profits appurtenant : this is a
profit where several or in common, which by act of parties, actual or presumed, is annexed to some nearby dominant tenement and runs with it.

Profit appendant: this is a profit


annexed to land by operation of law and it is often similar to the common pasturage created under a statute.

Profits in gross: this is a profit


enjoyed by the owner independently of his ownership of the land.

How it could be created


The profit a prendre may be created By custom or usage: the local custom would be responsible to create.  By operation of law: the operation of law would mean that when a statute specifically envisages that a property is meant for the usage of certain persons, or group of persons or category of persons then it is known as a profit a prendre by operation of law. By conduct of parties. Express conduct of parties the property is dedicated or permitted to be used.

AIR 1956 s.c.17 Ananda Behra Vs State of Orissa

Chilka lake fishing rights and to sell the said fish were given to a party, Z. With the said party Z Ananda Behra entered in to a contract. As per the said contract Ananda was to do the fishing and selling work. The State of Orissa enacted a law to abolish any estate given to others and said the compensation would be paid to the person interested. Ananda filed a claim petition. The same was opposed by contending that at the most Ananda was a licensee and not a person having valid title as the document containing clause is against the provisions of section 54. The compensation should be given to Z predecessor of the ananda. The property being an immovable property registration was a must. Ananda contended that the said right is only a sale of goods. The fishing right and carrying thereof is not a sale relating to immovable property.

AIR 1956 s.c.17 Ananda Behra Vs State of Orissa

The supreme court did not agree with the said view and on the other hand held that the sale of a right to catch and carry away fish in specified portions of the lake over a specified future period amounts to a license while taking away the said fish was a profits a prendre. This is regarded in India as an immovable property. Sale of a profit a prendre is a immovable property. If the worth of the said right is more than Rupees one hundred then compulsorily it requires registration.

Problem regarding benefits which arise from land


Government of Karnataka entrusts the work to Ashok Kini for taking care of cubbon park at Bangalore and maintain it for a period of 25 years. The park has lakes and ponds. Kini entrusts the contract of catching fish from the lakes and ponds for a period of 4 years to Somashekara Alwa. Sub registrar insists to pay stamp duty as there is a transfer of immovable property. What is the solution? The right of fishing for a period of four years . The fishes to their existence draw sustenance from the water and the pond. Hence they are a profit a prendre and immovable property with in the meaning of Transfer of property act. Here the intention of the parties are to be taken in to account.

If a property is movable then the sale could be oral but if it is in respect of a immovable property worth more than Rs.100/ it can not be so.
Kini orally entrusts a contract to catching fish from the lakes and ponds for a period of 4 years to Somashekara Alwa, on a consideration of rs.1000/. A dispute arises between parties and Somashekara Alwa contends that Kini had sold the right in his favour. Kini contends that it is not a sale but a license. The right of fishing for a period of four years. The fishes to their existence draw sustenance from the water and the pond. Hence they are a profit a prendre and immovable property with in the meaning of Transfer of property act. Here the intention of the parties are to be taken in to account. The consideration is more than rs.100/- it requires registration under section 54 of T.P.Act. As the registration is not there and also as the transaction is of a oral nature the incident of sale is not there. Hence the position of Somashekara Alwa is not that of a buyer of the rights of Kini but is only as a permissive possession as against a consideration.

Fixtures
A movable otherwise becomes immovable property if it is a fixture. Then whether all types of movables would become immovable property or is there any special features is an important aspect. We have different principles regarding this aspect in Indian and English law. This question would arise especially when a theatre or a drama hall is leased, or a house is sold with certain fixtures regarding which the party puts forth that he has not been given possession in entirety but only in part.

English law concept regarding fixtures


Under English law we have two important maxims to explain this aspect. They are 1.Quic Quid Plantatur solo solo credit and 2.Quic Quid inaedificatur solo solo credit. Quic Quid Plantatur solo solo credit means what ever is planted in the earth becomes the part of the earth and consequently who ever owns that piece of earth also owns the thing planted. Quic Quid inaedificatur solo solo credit means what so ever is built in to or embedded in to or attached to soil becomes the part of the earth, and consequently whosoever is the owner of that piece of land would become the owner of the thing so attached. These maxims have two important exceptions such as, A. there shall be no contract to the contrary. B. regarding the trade fixtures fixed by a tenant.

Quic Quid Plantatur solo solo credit and exception 1


Quic Quid Plantatur solo solo credit means what ever is planted in the earth becomes the part of the earth and consequently who ever owns that piece of earth also owns the thing planted. Illustration A as a mortgagee in possession plants two coconut trees and collects the fruits of those trees. After the mortgage period whether A could collect the fruits of those trees. If there is no contract between A and B on this aspect then A cannot take fruits the said trees, and it becomes the property of the mortgagor. If there is a contract then subject to the said contract he could.

Quic Quid inaedificatur solo solo credit and exception 1


Quic Quid inaedificatur solo solo credit means what so ever is built in to or embedded in to or attached to soil becomes the part of the earth, and consequently whosoever is the owner of that piece of land would become the owner of the thing so attached. Illustration A as a mortgagee in possession constructs a zinc sheet roofed pump house to install a pump to lift water from sump to the overhead tank fitted at the building of B. After the mortgage period whether A could take away the said zinc sheet roofed pump house and the pump installed with a cement bedding. If there is no contract between A and B on this aspect then A cannot take away the said structure, and it becomes the property of the mortgagor. If there is a contract

Exception 2
Exception 2 to the said maxims applies where for the purposes of the trade activities if any thing is planted or fixed then the tenant while vacating the premises could take away the things planted or embedded by him. Example: Ramachandra Reddy the owner of the building gives the same on lease to State Bank of India for banking purposes. State Bank of India wants to have a safe chest to keep the cash. Hence it gets a chest embedded in the building. While vacating the premises State Bank of India is free to take away the said chest. Ramachandra Reddy cannot claim the said chest as belonging to him on the principle that the things have been embedded in to the earth or building and hence he would be the owner of the chest.

Indian scenario
Though the principles of English law applies in India the same is with certain modifications and not in a blind way. Generally the principle laid down in Quic Quid Plantatur solo solo credit is not applicable. The same applies with the condition 1. that the person while vacating the property he is entitled to remove the attachment but should leave the land in the same state in which it was prior to attachment. 2. If he allows the same to remain and if the owner enjoys the benefits thereof then the owner has to compensate to the person who has left the said fixtures.

Illustration.
Amar inducts Baldwin, an advocate, to be the tenant of the a hall. B puts up partition cabin in the said hall to have a proper seating arrangements to the junior advocates and typist. While vacating the premises of Amar, Baldwin is entitled to take the partition which he had put up in the hall but he has to keep the condition of the hall in the same condition in which it was given to him by Amar. In the event if Baldwin allows them to remain and Amar makes use of the same, then he has to compensate to Baldwin the costs of the material so used. Here the tests to be applied is whether the said fixtures were fixed with an intention to use the same as a part of the building or otherwise is an important thing. If instead of a partition if a photo is hung then it would not become an immovable property and will have a characteristic feature of a movable property. In that event the principle of these maxims would not apply.

Holland Vs Hodgson 1872(7) CP 328


In this case the looms were attached to the earth and floor of a mill. The question arose was whether it was an immovable property or not Justice Black burn said that the general maxim of law is that what is attached to land becomes the part of the land, but it is difficult if not impossible to say with precision what constitutes an annexation sufficient for this purpose. It is a question of fact and depends on circumstances of each case and mainly on two circumstances indicating the intention and degree of annexation of the object.

Instrument
The transfer of property act defines the instrument as to that of a non testamentary type

instruments

testamentary

Non testamentary

Testamentary and non testamentary instrument


Non testamentary instruments are such as sale deed, mortgage deed, lease deed, gift deed, deed of exchange. These are the deeds which will have effect forthwith after execution. The effect of the document would not wait till the death of the person who executes the document. The person who transfers a right or interest in respect of a property or a thing is known as the transferor while the person to whom the transfer is made is the transferee. Will is a testamentary instrument. It comes in to force only after the death of the person who executes it. The person who executes the document is known as the Testator while the person who derives the title would be known as the legatee.

:Attestation:
The transfer of property act defines as to attested and not attestation. The meaning of the word attested has a specific meaning it is in respect of an instrument. The concept of attestation in Indian law and English law differs. The word attested was introduced in to the frame work of t.p.act during 1929. There was a conflict of views as to what an attestation would mean earlier to 1929. In order to resolve the said dispute the Act was amended. In view of the amendment the view expressed by the Courts in Shamu Patters case which held the field till then became non applicable or not a good law. .

Attestation and attested


The person who attests the document is an attester. Attestation is the process of attesting. In the process of attesting the attester attests execution. He speaks about subscribing the signature by the person who has executed the document. what is a valid requirement of an attestation. Who could be an attester. Is there any legal qualification Some of the instruments require a compulsory attestation, while few of them do not require compulsory attestation. The documents which require compulsory attestation are Will, Mortgage deed, gift deed. When a document requires compulsory attestation the said document can not be accepted to have been proved in a court of law, unless at least one of the attesting witness is examined.

Persons Who cannot be an attester


A person who is not sue generis. A person with unsound mind. A minor A corporate body that is in other words a biological person and not a person created under a legal fiction. A party to an instrument can not be an attester. If a party becomes the attester the attestation is good but the party will not get any right.

What is needed for attestation.


Animus attestandi. That is intention to attest. Sign. Sigh would mean signature or any mark of special identification. Acknowledgement of the signature of the executant need not be express. There is no specific mode or format as to how an attestation should be there.

Whether the following persons could be attesters.


Scribe. Yes if he attests the document in dual capacity and not in the capacity of a scribe. Sub registrar in his official capacity when he signs he can not be an attesting witness, but if he attests then the process of registration is perfunctory and not the process of attestation.

Should both the witnesses sign simultaneously


For the purposes of attestation in Indian law what is needed is attestation by at least two persons and it does not require that both the witnesses should sign simultaneously. Earlier to 1929 the law was that both the witnesses should sigh simultaneously, but now it is not so. What is required is that the witnesses should have got satisfied that the person who has executed the document is the real executant whose signature they are attesting.

Attestation in case of a purdashin lady


In case of a purdashin lady it is not necessary that the attesting witness should see the purdashin lady sign the instrument. It is sufficient if the purdashin lady sits behind the curtain and sings the document. What is needed is that the witness should have got satisfied that the person who sits behind the curtain is the person who is signing the instrument.

Illustration
Ramu signs a will at Bangalore and takes it to Chennai and asks his friend shrikrishna to attests it, shrikrishna being satisfied with the signature of Ramu sings the instrument. Then Ramu takes it to Mumbai and asks Brijesh to attest it. Brijesh being satisfied with the signature of Ramu sings the instrument. There is a valid attestation as per Indian law

Problem
Ramu executes a will in favour of Brijesh, sham, and seetha.. Brijesh and Muthaiah signs the instrument as an attesting witness Question whether the instrument is valid. The instrument is valid as in favour of sham and seetha but not against Brijesh. Reason the attesting witness can not be a beneficiary and in the event if the attesting witness is a beneficiary then the attestation is good while he will not as a beneficiary.

Problem 2
Ramu is supposed to have executed a gift deed in favour of Brijesh, sham, and seetha.. jayant and Muthaiah signs the instrument as witnesses. They put the signature to the said document, as they were asked to do so by Hanuman the father in law of Brijesh. Ramu was a stranger to the said persons. Question whether there is a valid attestation. Answer No. because the requirement is that the persons who signed as attesting witness should have an intention to attest and they knew that the person who had signed the instrument was Ramu. In the absence of it the mere act of putting signature at the instance of Hanuman will not be sufficient.

Person is said to have notice of the fact.


Notice is a concept based on the principle of equity. When he actually knows that fact. He would have known it but has willfully abstained to make inquiry and know it. Explanation No.1 regarding registered document. Explanation No.2 deemed notice when a portion or a share is acquired. Explanation No.3 if an agent acquires for and on behalf of the principal.

The definition of notice is applicable generally in respect of all branches of law and not confined to T.P.Act alone

Notice
Express Or actual
Willful abstinence

Implied Or constructive

registration Actual possession Gross negligence

Notice To agent

Express notice or actual notice Express notice or actual notice is the notice where a person acquires actual knowledge of a fact. To constitute an actual notice it must be definite. it must be given in the course of transaction or negotiation between parties and not by strangers. it may be in writing or orally.

NOTE:A vague rumor would not be an express notice. Knowledge of information not connected with the transaction is not a notice.

CONSTRUCTIVE NOTICE Constructive notice is based on a concept of equity. The constructive notice is the equity which treats a person who ought to have known a fact as if he actually does it. Constructive notice is the knowledge which the courts imputes to a party upon a presumption, so strong that it cannot be allowed to be rebutted. Illustration. B borrows money from C and deposits with C, by way of equitable mortgage the sale deed by which he had purchased the property from A. the sale deed has a recitation that a part of purchase money had been retained by B to clear the debts of A. B had not cleared the said debts. C while making advance to B makes no enquiry what so ever as to whether the debt had been cleared or not, or equally as to whether the money had been paid to A, Here C had a constructive Notice of As lien for unpaid purchase money

What is a willful abstention.


Willful abstention is one where a party is bound to do something but has not cared to that thing. This concept is recognized in section 199 of Law of Property Act 1925 of England. With reference to the transferee a duty is based on him to make necessary investigation to know the details of title. Illustration. B borrows money from C and deposits with C, by way of equitable mortgage the sale deed by which he had purchased the property from A. the sale deed has a recitation that a part of purchase money had been retained by B to clear the debts of A. B had not cleared the said debts. C while making advance to B makes no enquiry what so ever as to whether the debt had been cleared or not, or equally as to whether the money had been paid to A, Here C had a constructive Notice of As lien for unpaid purchase money and mortgage is subject to As lien. Not making enquiry is a willful abstention as the contents of the deed itself is clear.

S has left his house and land to his sons by first wife and appointed them as executors of his will. He left Rs.30000/ to his sons of second wife, charged on the said property given to the sons of the first wife. The sons of the first wife borrowed Rs.52000/ from the bank and deposited title deeds of the house and created an equitable mortgage, to secure loan. The will was not among the documents of the title deeds produced to the bank. Later the said sons of the first wife defaults in making payment to the Bank. Bank brings an action to enforce the mortgage and sell the property to realise the dues. The sons of the second wife resists the said action. Whether there is a constructive notice and willful abstention? The bank ought to have made an enquiry to know as to how the said sons of the first wife had got the title to the property then they would have known about the existence of the will. If they had known the existence of the will then they should have make proper scrutiny to know the details as to who else had interest in respect of the said property. The bank on knowing the fact that the sons of second wife had interest could have taken proper steps to safeguard their interest. In this case the bank has not done that and has advanced the loan blindly. So they have the constructive notice of the claims of the sons of the second wife.

Problem
A buys two properties such as B and C, from X, and leaves a part of purchase money unpaid and sells the property B to Z. A informs that when he purchased property B and C he had not paid to X a portion of the purchase money. Then Z purchases it subject to the charge on property C, towards the amount payable to X. During the same year A sells the property C to Z. at that time A did not inform Z about the unpaid money or the charge in respect of property C to be payable to X. Question whether the information received by Z while buying the property B would amount to a constructive Notice, and whether there is any willful abstention of the part of Z. Answer: the information received by Z is not in the course of the transaction of Z with A while having the transaction in connection with property C. hence there can not be a constructive notice.

Problem 2
Amaresh Gupta borrows money to a tune of 7,00,000 from Bank of Baroda on an equitable mortgage by giving his shopping complex at Jayanagar as a security. The said shopping complex contains 10 shops. Out of the said 10 shops Amaresh Gupta sells 2 shops to Siddesh Gupta for 3,00,000 each. At the time of sale of those two shops Siddesh Gupta asks Amaresh Gupta to show the original deeds in respect of the shopping complex. Amaresh Gupta promises Siddesh Gupta that he would produce it later as he had misplaced it. So Siddesh Gupta scrutinises the certified copies and purchases the shops. Subsequently Amaresh Gupta fails to produce the originals. Siddesh Gupta did not continue his efforts to make any further enquiry Question whether conduct of Siddesh Gupta is hit by the principles of Constructive Notice. Answer: the conduct of Siddesh Gupta is effected by the principle of constructive notice.

Gross negligence
Negligence is such an act where in a party fails to take such care as a reasonable person would take while performing his part of the duty. Mere negligence or want of caution is not sufficient to constitute a constructive notice. The concept of gross negligence is once again invented by the courts of equity to safe guard the interest of the parties. What is a gross negligence depends on the facts of the case.

Lloyds Bank Vs Guzdar 1926(56) Cal 868


A deposited the title deeds of this property with Bank N to secure an over draft. After some time the Bank asked A to clear the outstanding dues. A asked the manager of the Bank to give the documents to him so that he could show them to other prospective buyers and and raise the funds. The usual practice of the Bank was to as the Buyer to go over to it and verify the documents. Bank did not follow this procedure in case of A and obliged to give the original documents. A approached Lloyds bank and made a false representation that the property is free from all encumbrances. Lloyds bank trusted A and advanced the money. Question whether there is a case made out for gross negligence. Answer yes. The act of Bank N is in gross negligence, hence it has no priority over the claim of Lloyds Bank.

Tilakdhari lal Vs K.Lal AIR 1921 PC 112


A wanted to buy a property from Z. The title in respect of the property was the question. There were certain documents available at the office of the subregistrar. A did not go through the said documents. He purchased the properties from Z. later it was found that the properties were not of Z but of X. Question is whether the action of A amounted to an act of gross negligence. Answer: yes. A was duty bound to go through the said document and get confirmed about the title. A did not do so. Hence A was gross negligent in his act of scrutiny of the documents. Note In view of this judgment T.P.Act was amended to impose an obligation to look such of the documents which require compulsory registration and not the documents which require only an optional registration.

Whether the verification of Municipal records constitute a duty?


regarding the verification of Municipal records Allahabad High court had held that it is a duty to scrutinize them by the buyer and failing to do so would amount to a gross negligence, but the supreme court has not accepted this view on the principle that the Municipal records do not constitute a title. Ahmedabad Municipality VS Haji Abdulla AIR 1971 SC 1201.

REGISTRATION AS A NOTICE
Some of the documents which require compulsory registration should be looked in to. If they are not looked in to then it would be a constructive notice. If the documents which do not require compulsory registration is not looked in to then it would not be a constructive notice. Explanation 1 was added in 1929 in view of the ruling of Tilakdhari lal case. Compulsory registratable document is a deemed notice.

Whether the notice to an agent is a constructive notice.


any act of an agent would be for and on behalf of a principal, unless it is specifically restricted. If a notice is given to the agent then it would amount to a notice to the principal. In such an event it would be a constructive notice.

Actual possession
When a person other than the transferor is in possession, the intended transferee shall make enquiry as to the person who is in possession of the property. If no enquiry is made then the transferee is deemed to have notice regarding the transaction between the transferor and the person in possession of the property.

The transfer is a generic term to cover different types

Transfer
Voluntary Involuntary Intervivos

Transfer

Testamentary Note 1.Transfer by operation of law, through a decree of court, grant, Are involuntary transfers. 2.Transfer through a will is a testamentary transfer. 3.Partition in a family is not a transfer

Types of transfer:
Transfers could be classified as

Transfer
conditional unconditional

Conditional transfer

absolute partial

Parting or alienation enjoyment

Types of conditional transfer:


Conditional Transfers could be classified as. .
Conditional transfer

.
partial

Conditional transfer

absolute

precedent Parting Or alienation Money.

enjoyment

subsiquent

time

Vested interest

Contingent interest

Transfer of property
The transfer of property means an act by which.
1) a living person conveys property, that is in present, or in future 2) to another or more living persons OR 3) To himself, OR 4) To himself and one or more living persons
Note: living person includes company, association, or body of individuals, incorporated or not

Transfer of property

Movable

Immovable

Whether the transfers under T.P.Act is exhaustive or not.


In the beginning the framers of law and the courts were of a view that the transfer as contemplated in T.P.Act, is exhaustive and would cover all types of transfers. The said view is not accepted now. The provisions of T.P.Act are not applicable in respect of: 1. pledge of movables, 2. Relinquishment 3. Family arrangement 4. Through will 5. Surrender 6. Charge 7. Easement 8. Future transfer or Property not in existence 9. Non inter vivo 10. Court decree 11. In favour of official liquidator 12. Grants by government 13. Auction sale 14. Non living entities like idol, Hence the transfer under transfer of property Act is not a transfer.

transfers under T.P.Act is not exhaustive


 pledge of movables:- pledge is defined to be a bailment of personal property as a security for some debt or engagement. It is governed generally under Indian contract Act, Money lenders Act, Pawn brokers Act etc. Relinquishment:- an act of abandoning or giving over Family arrangement: an arrangement made in a family regarding the existing rights of members of the family. Hence it can not be said that there would be a transfer. Surrender:- in case of surrender both the persons will have right and one would not like to exercise and would give up in favour of another, where by the right of the other person which limited to some extent gets enlarged to a greater extent.

 

transfers under T.P.Act is not exhaustive


 Through will:- will is a document which comes after the demise of the person.  Charge:- is not a transfer of property for in charge no right in rem is transferred, but only a personal obligation is created.  Easement:- easement is a restriction one enjoyment of ones property for the utilization of another of his property. It is governed under the provisions of Easements Act.  Future transfer or Property not in existence:- a property which is not there in existence.

transfers under T.P.Act is not exhaustive


    Non inter vivo: not between two persons Court decree: an order or a decree directing that a property shall be given to another person. In favour of official liquidator:- under the provisions of Insolvency Act, or under a Companies Act when there is an insolvency or winding up proceedings. Grants by government:- any grant made by the Government in favour of a person or body of persons then it would not constitute a transfer under transfer of property Act. Auction sale: an auction conducted by the court the same would not amount to a transfer, as it would more by operation of law. Non living entities like idol,:- an idol though is a juristic person capable of holding property, but it is not a living person. The living person is specifically explained in the proviso to the section. This creates a legal fiction in respect of a living person to cover a corporation or an association, therefore the said legal fiction can not be extended to an idol which as a juristic person can hold a property but can not have a transfer in its favour.

 

Conveys Property, in present or in future


This would denote that the property must be there in existence on the date of convey but the said conveyance may be in future. If the property is not there in existence then the same can not be transferred. To transfer a property one must have right at present, but the transfer of the said right may occur in future. If the property itself is not there then there can not be any transfer. In present or future qualifies the word convey and not that of property, therefore the meaning shall be that the property shall be there in existence and could be conveyed in future, and not convey a property which is not there and to be got in future.

Conveys Property, in present or in future


Illustration. 1 Amar is the owner of a house, at Trivendrum and he executes a deed in favour of jyothirlingam on 15th November 2007. In the said document a recital to the effect is there that the house is transferred from 1st of January 2008. It is a case of future convey. Transfer is permissible. Because the property is already there in existence.

Conveys Property, in present or in future


Illustration.2 Amar intends to buy a house, at Trivendrum and he executes a deed in favour of jyothirlingam on 15th November 2007. In the said document a recital to the effect is there that the house is transferred forth with. It is a case not of future convey but a convey without any property. Transfer is not permissible. Because the property is not there in existence.

Problem 1
Xian e ping transfers certain properties to Anthony Sylvester for life, then to Barrington for life and thereafter to Cromwell. Question: Whether there is a conveyance, and if so of what nature. Answer: there is a conveyance and it is in present to Anthony Sylvester and in future to Barrington and Cromwell. Barrington and Cromwell get a vested interest.

Problem 2
Xian e ping transfers certain properties to Anthony Sylvester for life with reminder to Barrington if he should have attained the age of 21 at the time of Anthony Sylvesters death. Question: Whether there is a conveyance and if so of what nature. Answer: there is a conveyance and it is in present to Anthony Sylvester and in future to Barrington. Barrington gets a contingent interest.

Problem 2
Xian e ping transfers certain properties to Anthony Sylvester for life with reminder to Barrington if he should have attained the age of 21 at the time of Anthony Sylvesters death. On the date of transfer he is not having any property and intends to have a property in case if he could win a jackpot at Derby Race. Question: Whether there is a conveyance and if so of what nature. Answer: there is no conveyance either of present or future to Anthony Sylvester and to Barrington as on the date of the deed Xian e ping had no property at all.

What may be transferred


1. 2. Property of any kind may be transferred, except as otherwise provided under; Transfer of Property Act, or Any other law for the time being in force. Section 6 (a) to (i) enumerates the list of properties which can not be transferred. General policy of law is to promote free alienation and circulation of property based on the principle alienatio rei praefertur juri accrescendi law favour alienation and not accumulation. Transferability is a general rule while non-transferability is an exception. Test to find out as to a property could be transferred or not is to apply the test laid down in transfer of property act or any other provision of law If there is no prohibition then the property could be transferred.

Following properties as per T.P.Act can not be transferred.


A. spes scucessionis., chance of getting property in the event of death of a relation, or other mere possibility of like nature. B. transfer of right to re-entry. C. transfer of easement. D. restricted interests. Dd. transfer of right to maintenance. E. transfer of a mere right to sue. F. transfer of a public office. G. transfer of pensions. H. (i) opposed to nature of interest affected thereby. (ii) for un lawful object or consideration with in the meaning of section 23 of contract Act. (iii) persons legally disqualified to transfer. untransferable right of occupancy.

What can not be transferred under other law


Any restriction imposed in the other law relating to the transfer. This has to be viewed and interpreted strictly and not in a narrow sense. The restriction should not be readily inferred as the right to transfer is an incidental right of ownership, and it can not be curtailed or taken away otherwise than a statute. The restrictions are noticeable in Hindu law with reference to co-parcenary properties, mohammodean law relating to wakfs, land reforms law relating to transfer of agricultural land to a non agriculturist, etc.

spes scucessionis.
A person can transfer what he has and not what he would get. Spes scucessionis means a mere chance of getting a property in near future. It is more in the form of a speculation and not a certainty to have a thing. To effect a transfer the property shall be there, but in case of a spes scucessionis the person will not have either the property or the right in respect of it. It is more an expectation to get some thing in near future. Example: Chance of a heir apparent succeeding to an estate., Chance of relations obtaining a legacy,

spes scucessionis.
Illustration:

Ramachandra rao, a senior scientist at ISRO, had properties such as a land measuring 25 guntas at survey no.623 at Jeerige halli of Hassan district as inherited from his father and had acquired properties on account of self earning. Ramachandra rao had three sons and a daughter. The properties situated at jeerige halli would be an ancestral property and regarding the same sons and daughters of Ramachandra rao had an interest by birth. the properties on account of self earning of Ramachandra rao is his absolute property and the sons and daughter of him will not have any right by birth and Ramachandra rao could dispose of the said properties as he likes. Getting the said properties would depend on the fact of death of Ramachandra rao and that too with out any will. During the life time of Ramachandra rao the rights of sons and daughter with reference to the self earnings is only a spes scucessionis and not a vested right. Hence sons and daughters of Ramachandra rao can not transfer it during the life time of the father.

Problem.
Amarnath a rich land lord of Willington of Tamilnadu had four sons namely kutti, chippi, appu and teva. Amarnath acquired the properties on account of his efforts. He started his life as a wood cutter and by shear efforts he be came rich. Amarnath wanted to dispose his properties during life time and writes a Will to the effect each of his son should get equal share in the properties but kutti being the eldest son should be paid a sum of Rs.2,00,000 extra in order to facilitate him to perform the last rites to Amarnath and his wife in the event of their death during the life time of Kutti. After some time Amarnath bequeaths all his properties to Kanakamma his wife and after her life time to the sons, as he felt that his sons may squander the property and kanakamma may become a destitute. Question what is the nature of the properties with reference to the said sons kutti, chippi, appu and teva. Answer:-The properties in respect of kutti, chippi, appu and teva is only a chance to get and not with any vested right. So it is a spes scuccessionis. Further kutti, chippi, appu and teva getting property after the demise of the mother after the death of Amarnath is a chance of a relation getting the property on the death if a kinsman.

Problem 2
Amarnath a rich land lord of Willington of Tamilnadu had four sons namely kutti, chippi, appu and teva. Amarnath acquired the properties on account of his efforts. He started his life as a wood cutter and by shear efforts he be came rich. Amarnath wanted to dispose his properties during life time and writes a Will to the effect each of his son should get equal share in the properties but kutti being the eldest son should be paid a sum of Rs.2,00,000 extra in order to facilitate him to perform the last rites to Amarnath and his wife in the event of their death during the life time of Kutti. After some time Amarnath bequeaths all his properties to Kanakamma his wife and there after the death of Kanakamma to the sons equally. During the life time of Amarnath, Kutti gifts a house situated walnut street to Pitambari as she had shown love and affection to him. Some years later kutti dies of heart attack. Pitambari puts forth a claim in respect of the house situated at walnut street. Question what is the nature of right Pitambari got in respect of the house. Answer:-The properties in respect of kutti, was only a chance to get and not with any vested right. So it is a spes scuccessionis. The transfer made by him in favour of Pitambari was without any right. Hence the transfer is bad.

Chance of a Mohammedan succeeding as a heir is only a spes succession.


In Mohammedan law there is no concept of acquiring right by birth, and a person gets the property only after the death. So the relatives can not have any property during the life time of a person. A a Mohammedan has a wife and 4 sons 3 brothers, mother, and 2 uncles. Each of them though they are sharers and residuary they would not get any right till the death of A. Hence the right of the said relatives are a spes succession.

Any other possibility of like nature cannot be transferred.


This is to be understood in the background of the earlier instances given in the clause and not independent of it. This is to be looked in to in the backdrop of the principle of eujusdem generis.

Some of the illustration regarding Any other possibility of like nature cannot be transferred. Chance of a person getting income in future as a software engineer, which job he expects to get after completion of his B.E. Chance of a person getting rent in future in respect of a building which he would construct in future. Mere chance of succession a will Expectancy of title being settled with the seller. Chance of getting an inalienable land in near future

Mere right of re-entry for breach of condition subsequent can not be transferred
The Mere right of re-entry for breach of condition subsequent can not be transferred, except to the owner of the property. The right of re-entry could be sought for by the owner and not a stranger. If a contract is entered in to with a person having no right to the property for effecting the re-entry in future then such a right can not be transferred. What is a right of re-entry? A as a owner of property enters in to a lease with B for a period of five year. After the lapse of the said stipulated period A will have a right to enter in to the property. The said right is known as right of re-entry. The right of re-entry while could be transferred a mere right of re-entry can not be transferred.

breach of condition subsequent


Important ingredients needed are that there shall be a condition subsequent. When the said breach occurs the person seeking re-entry shall be a person having interest in the property and not a stranger. Illustration: A as a owner of property enters in to a lease with B for a period of 5 years. After five years he transfers the right to C to get possession. Here the right is not a right of mere re-entry but a right of re-entry. A as a owner of property enters in to a lease with B for a period of 5 years. The lease contains a clause that B shall not cause any damage to property and in case if he causes any damages then A could re-enter the property. A intends to transfer such a right to C. here the right is a mere right of re-entry and not a right of re-entry. Therefore the transfer in case of illustration 1 is good, while the transfer in case of illustration 2 is bad.

Re Davis & Co exparte


The goods were delivered under a hire purchase agreement. The agreement gave the bailer a right to enter the premises where the goods were kept and take possession of the goods in the event of default of payment of any installment. The bailer assigned the right under the agreement by way of security to his creditors. Question what is the situation with reference to the position as to mere right to transfer or the right to transfer. Answer: it comes under the category of mere right to transfer and not the right to transfer. Therefore the court held that the creditor could not enforce the right of re-entry. Besides this it is only a personal license and it can not be assigned.

Transfer of Easement by a dominant owner apart from the dominant heritage. Easement is a right enjoyed by a person in respect of some ones land for the better enjoyment of his land. The easement goes along with the land. It runs along with the land. It can not be separated from the tenure. The provisions of easement are governed under Indian Easements Act. Even otherwise as the easements can not be segregated from the main holding the easement can not be transferred independently.

Restricted interests can not be transferred .


What is a restricted interest? An interest restricted in enjoyment to the owner personally. Life interest holder. Person having a limited enjoyment. Person having a pre-emptory right. Service tenure.

Restricted interests
Illustration:- Achutan is the owner of a land namely Rohini. He gives the said land to Balaam batti for enjoyment, that is so long the said Balaam batti is alive and there after to the children of Balaam batti. The property is transferred to Balaam batti for life time. Balaam batti is a life interest holder while the children of Balaam batti are the absolute owners. Balaam batti can not transfer the property so given to him for enjoyment during his life time.

Restricted interests
Person having a limited enjoyment. In respect of a property a person may have a limited interest would mean that the said person/s instead of having the right of ownership may have right to take use fruits. Illustration:- Land Rohini is gifted to Lord Balaji by karimalappa. The title in respect of the land vests with Lord Balaji. The Archak of the temple of Balaji, takes the fruits and flowers grown in the said land. Just because Archak of the temple takes the fruits and flowers he would not become an owner. While the archak will have a right to receive any of the fruits and flowers he can not sell the property which stands in the name of Lord Balaji. The right of archak is of a restricted nature. It is a restricted interest.

Person having a right of pre emption.


What is a pre emption? Right of Pre emption is a right in respect of an immovable property. Under this right a person who is the owner of a neighboring property could insist that his neighbor shall give first preference to sell the property to him in the event of the sale. This is a personal privilege. Among Mohammedans this rule is applied on the principle of justice, equity and good conscience while among Hindus either by contract or under a Statute. A right of pre emption can not be transferred but a decree for pre emption could be transferred.

Right of pre emption.


Illustration. Amar owner of a land bearing survey No.2/1 situated at Kembhavi village. Sham is his neighbor being the owner of the land in S.No.2/2. Amar and sham had a common ancestry. They had got the property under a partition deed. The original deed contained a clause that in the event either of them intends to sell the property then they should give notice to the other and in the event if the other declines to buy the property then the person who intended to sell the property could sell it to a third party. Here the right of one each one of them against other is a right of pre emption. Amar intends to sell the land. Then Sham can insist Amar to sell the property to him. It is known as the right of pre emption

Transfer of right to maintenance.


The right to claim future maintenance is a personal right. What is a maintenance? When the maintenance could be paid. The payment of maintenance may be due to a contract, decree, usage, will, statute. Right to claim maintenance in future is different from that of a decree of maintenance. A mere right to claim future maintenance can not be transferred while a decree of maintenance could be transferred.

Transfer of a mere right to sue


Right to sue is a personal right. The right to sue may arise on account of a breach of contract or a tort. The right to sue is different from a right under a decree. A right to sue while can not be transferred a right under a decree can be transferred. Right to sue would be a right in a form of liquid or a gas with out specific form, while the right under a decree is a crystalline form

Mere right to sue is different from an actionable claim.


An actionable claim is a property while right to sue is not a property. Amar owes certain amount to Bhasyam. The amount payable by Amar to Bhasyam is a debt. The right of Bhasyam to recover the amount from Amar is the right of recovery of debt. Bhasyam while can transfer debt recoverable by him from Amar to Chitra, he can not transfer a mere right to recover the debt to chitra . The debt while is an actionable claim the right to recover debt is not an actionable claim.

A public office can not be transferred.


Every one who is appointed to discharge a public duty and receives a compensation of what so ever nature in what so ever manner from the Crown or the State is said to have held a public office. Examples: Judge,. District collector, Police official, Village account, etc etc. A public office can not be transferred a benefit which has come from a public office could be transferred. A gratuity payable to a public servant could be assigned.

Transfer of pensions
Pension payable to a person for having rendered civil or military service can not be transferred. Pension is a periodical payment of money by the Government to a government official for his past services. Grant of land in lieu of periodical pension could be transferred but not the pension. So long the amount is not paid and is in the hands of the Government it retains the character of a pension, but once it is paid it will not par take the character of a pension and could be attached or be transferred or sold.

Oppose to the nature of interest.


Res communes; the things belongs to no body. Eg. Air, light, running water in a river, sea water,. Res extra commercium; things dedicated to the public or religious use. They can not be bought or sold. Shebaitship. Transfer of a service inam not permitted.

For un lawful object or consideration with in the meaning of section 23 of contract Act.
a. b. c. d. e. f. Under section 23 of indian contract Act a consideration or object is unlawful if it is Forbidden by law. Is of such nature that it defeats the provisions of law Fraudulent. Involves or implies any injury to a person or property of another person. Where the courts regard as immoral. Opposed to the public policy.

A person disqualified to be a transferee.


A person who is specially disqualified to be a transferee like a judge, court official, legal practitioner in a court auction or a proceedings. minor as a transferee. EXAMPLE Lease to a minor . A non agriculturist purchasing or holding an agricultural property.

Transfer of property
The transfer of property means an act by which.
1) a living person conveys property, that is in present, or in future 2) to another or more living persons OR 3) To himself, OR 4) To himself and one or more living persons
Note: living person includes company, association, or body of individuals, incorporated or not

Transfer of property

Movable

Immovable

Transfer

Property,

persons immovable movable

Transferee

Transferor.

:Persons competent to transfer or competence to be a transferor:


Living person, which term includes a company, association, or body of individuals whether incorporated or not. Every person competent to contract can transfer a transferable property. Every competent person who is authorized to effect the transfer of a transferable property which does not belong to him. Section 11 of the contract act defines as the person who has capacity to contract. Minor, person with unsound mind, can not transfer.

A person who cannot be a transferee. 0r competence of a transferee.


A non living person can not be a transferee. A person who is specially disqualified to be a transferee like a judge, court official, legal practitioner in a court auction or a proceedings. minor as a transferee. EXAMPLE Lease to a minor . A non agriculturist purchasing or holding an agricultural property.

Operation of transfer
Unless a different intention appears either expressly or impliedly transfer of property passes forthwith to the transferee all the interest of the property which the transferor had and capable of effecting transfer. The said transfer includes all legal incidents there to. Legal incidents may be with reference to a land. With reference to machinery. House or building. Debt or any other actionable claims. Money or other property yielding income, interest

A. B. C. D. E.

Incidents of Transfer with reference to immovable properties.


It is an inclusive description. With reference to land are such as easements, rents, profits accruing after transfer. With reference to a building or a house easements, rent there of after transfer, locks and keys, bars and doors, windows and all other things for permanent use there with.

Immovable properties

land

Buildings

Amaranth the owner of land bearing No.12/2 of siddalgatha Village. On his land there were mango trees. Kasim a fruit vendor had entered in to a registered agreement with Amaranth to collect the fruits grown in those trees for a period of 15 years. Amaranth had a financial crisis. To get over the same he wanted to sell the land. He sold the land to Jagan. Sale deed did not contain any clause with reference to the said transaction between kasim and Amaranth. Question: whether Kasim could enforce the right against Jagan, Alternatively whether Jagan is bound to the agreement on the ground that the sale deed executed by Amaranth had not specified any thing about the agreement? Answer:-collecting mango from trees for a period of 15 years is a profit a prendre. The interest in respect of it would pass on to the buyer in the absence of any specified intention. Further query? If the agreement had not been registered then what would be the situation.

Illustration

Amaranth the owner of land bearing No.12/2 of siddalgatha Village. Kasim is the owner of the land bearing Sn.12/3. Amaranth had a right of way to pass through the land of Kasim to go to his land. Kasim had a financial crisis. To get over the same he wanted to sell the land. He sold the land to Jagan. Sale deed contained a clause that the buyer could enjoy the land with out any interference of what so ever nature. Question: whether jagan could restrain Amaranth, on the ground that the sale deed executed by Kasim had not specified any thing about the right of way? Answer:- The right of way over the land of Kasim was an easementary right. The said right runs with the land. The position of Kasim was that of a servient owner. The land of Kasim a servient heritage. There was no specific intentention between the parties that is Amarnath and Kasim on one hand and Jagan and Kasim on the other hand that the sale of property should put an end to the easement. Hence in the absence of any specific intention the right was there in respect of the land of Kasim continues and jagan is to honour it. on account of sale of land the right of easement as an incedent would pass on to jagan.

How transfers are made or mode of transfer.


Oral transfers were rule of order in olden days and written transfer was only an exception. Oral transfer is permitted in respect of all types of movable properties. Oral transfer not permitted in respect of a immovable property worth more than Rs.100/=

Transfer
Writing oral

Where writing is not a rule

Where writing is a rule

Law prior to transfer of property Act regarding transfer.


The Hindu law did not require any writing for the validity for a transfer of a property. What was needed is a commitment. If the commitment is broken then the person who was responsible to cause breach would go to hell was the fear which played a dominant role. Word of mouth had a high value. Of course smrithikara like Narada says that if a transaction in respect of an immovable property is there to have an effect for a period of six months then the said transaction should be in writing as the human memory may fade gradually and there may be a scope for dispute. The Mohammedan law also did not require any specific documentation in writing. What was needed was a mere declaration and acceptance.

What is writing
The transfer of property Act has not defined the word writing. The writing shall be construed as defined in General clauses Act.Section 3(65) of the said Act defines Writing to mean, Writing shall be construed as including reference to printing, lithography, photography and other mode of representing or reproducing words in visible form.

Where the writing is a rule.


Under transfer of property Act. Sale in respect of immovable property worth more than Rs.100. Part performance under section 53A. Mortgage as contemplated under section 59 Exchange. Lease from year to year or for a term exceeding one year section 107. Gift as contemplated under section 123 Transfer of actionable claims Section 130. Under registration Act. Section 17 of the Indian Registration Act 1908.

Whether a document in writing needs registration.


The following transactions needs compulsory registration besides being in writing. sale of tangible immovable property of value of Rs.100 or up wards or reversion or other intangible things Simple Mortgage Lease of immovable properties from year to year or for a term exceeding one year or reserving rent on annual basis Exchange of properties worth value Rs.100 or upwards Gifts of immovable property.

Transfers expressly permitted by the Act to be made with out writing


Sale in respect of immovable property worth less than Rs.100. Mortgage by deposit of title deed and mortgages less than Rs.100/ Exchange in respect of immovable property worth less than Rs.100/. Lease for a term not exceeding one year section 107. Gift of movables as contemplated under section 123 Transfer of actionable claims Section 130.

Types of transfer:
Transfers could be classified as

Transfer
conditional unconditional

Conditional transfer

absolute partial

Parting or alienation enjoyment

Types of conditional transfer:


Conditional Transfers could be classified as. .
Conditional transfer

.
partial

Conditional transfer

absolute

precedent Parting Or alienation Money.

enjoyment

subsequent

time

Vested interest

Contingent interest

Types of conditional transfer:


Conditional Transfers or alienation could be . classified as.
Conditional transfer
Unborn child Sec 13,

.
Perpetuity Sec 14-17 Insolvency Sec 12

Conditional transfer

Enjoyment Sec 11
Parting Or alienation

Alenation Sec 10

precedent

enjoyment subsequent

Money.

time

.Condition restraining alienation.


Transfer of property subject to a condition or limitation absolutely restraining the transferee or any other person claiming under him from parting with or disposing off his interest in the property (alienation)

the condition or the restrain is void,

Exception to the above said rule:rule

1. In case of a lease where the condition is for the benefit of the lessor or those claiming under him, 2. Married women, that is Provided that property may be transferred to or for the benefit of a women (not being a Hindu, Mohammedan, or Buddhist) so that she shall not have power during her marriage to transfer or charge the same or her beneficial interest there in.

Absolute Restraint
condition or limitation absolutely restraining alienation.

the condition or the restrain is void,

Absolute restrain
.
Time

Absolute restrain regarding Alienation.

price

Person.

Absolute Condition of restrain and personal laws.


Hindu law: the shastric Hindu law had considered it that an condition of absolute restraint was void. As per the then prevailing rule absolute restraint either in a will or inter vivos was considered as bad. Hindu law had not accepted the wealth being accumulated in the hands of few. It had encouraged distribution of wealth rather than concentration or accumulation. Mohammedan law had contained a similar bar.

:Illustration:
Hayavadana rao gives a gift of his property to Shamachari, with a condition that Shamachari shall not sell the property. Shamachari sells the property to Jasmine Marry. Question: what is the effect of the transaction between Shamachari and Jasmine Marry with reference to the property. Answer:-The restraint is of an absolute nature in time. The condition imposed on Shamachari is bad as hit by section 10 of T.P.Act.. Hence it it void. The sale by Shamachari to Jasmine Marry is valid.

Appu, chippu and teva were the members of a joint family. They had certain properties. They entered in to an agreement to effect partition. The partition deed contained a clause that the said persons in the future eventuality of sale shall sell their respective share to any one of them and not for others. Appu wanted to perform the marriage of his daughter. He was in need of money. He sold his share to Kubera. Chippu and teva contended that the sale in favour of Kubera is bad. Question:- whether the sale in favour of Kubera is bad. Answer:-. The condition imposed in the deed of partition itself is void in view of section 10 of t.p.act. So the sale in favour of Kubera is not bad

Appu, chippu and teva were the members of a joint family being the sons of Amaranath Shetty. Janaki was their sister. Amaranath Shetty gave certain properties to his sons. In the said document he mentioned to the effect that in he event if the said sons intend to sell the properties given to each one of them, then they could do so only in favour of Janaki. Appu wanted to perform the marriage of his daughter. He was in need of money. He sold his share to Kubera. Janaki contended that the sale in favour of Kubera is bad. Question:- whether the sale in favour of Kubera is bad. Answer:-. The condition imposed in the deed of partition itself is void in view of section 10 of t.p.act. So the sale in favour of Kubera is not bad

Appu, sold his properties to Kubera with a condition that said kubera if intends to sell the property shall sell it to him alone for Rs.3,00,000/ = Kubera sold the properties to Jasmine Marry for Rs.15,00,000/= as the market value was to that extent. Appu contended that the sale in favour of Jasmine Marry is bad. Question. Whether the said transaction is bad? Answer:- the restriction imposed is on the basis of the price. Though a seller could impose a condition that the buyer in the event of sale in future has to give a first option to him to buy back the property he can not impose any restriction about the price to which it should be sold. As it is a restriction based on the price and as it is an absolute restriction it is hit by section 10 of the T.P.Act. So the transaction in favour of Jasmine Mary is not Bad as the condition is void.

Saraju Balu Vs Jyothermayee. 1931(58) I.A.270. P.C


A gave a gift to D. It was an absolute gift.
However there was a condition that in case of failure of descendents to D the property shall go back to the heirs of A. P.C.held: The condition is bad and D could dispose of the property as he desires.
Note: the gift is of an absolute nature so there can not be any condition that the heirs of donor could get back

Appu, sold his properties to Kubera. He entered in to a seperate agreement with with a condition that said kubera if intends to sell the property he shall sell it to him alone for Rs.3,00,000/ = Kubera sold the properties to Jasmine Marry for Rs.15,00,000/= as the market value was to that extent. Appu contended that the sale in favour of Jasmine Marry is bad. Question. Whether the said transaction is bad? Answer:- the restriction imposed is on the basis of the price in the separate agreement and in the deed of transfer or sale. As it is not a restriction based on the price in the document it is not hit by section 10 of the T.P.Act. So the transaction in favour of Jasmine Mary is Bad as the condition is not void.

Types of conditional transfer:


Conditional Transfers or alienation could be . classified as.
Conditional transfer
Unborn child Sec 13

.
Perpetuity Sec 14-17 Insolvency Sec 12

Conditional transfer

Enjoyment Sec 11
Parting Or alienation

Alenation Sec 10

precedent

enjoyment subsequent

Money.

time

Types of conditional transfer:


Conditional Transfers could be classified as. .
Conditional transfer

.
partial

Conditional transfer

absolute

precedent Parting Or alienation Money.

enjoyment

subsiquent

time

Vested interest

Contingent interest

Restriction repugnant to interest created.


Transfer of property an interest is created absolutely in favour of any one person, that is a transferee. but the terms of transfer direct that such interest shall be applied or enjoyed by him in a particular manner, he shall be entitled to receive and dispose of such interest as if there were no such interest.

Exception to the above Rule. Where such a direction is made in respect of one piece of immovable property for the purpose of securing the beneficial enjoyment of another piece of such property then the said restriction would not apply.

Section 11
When ever a property is transferred absolutely it means that it is transferred with all its incidents. Enjoyment of the property is one of the incident. The restriction on enjoyment of property in contrast to the restriction on alienation is dealt with in section 11. Any such restriction on enjoyment of the property if is imposed then the said condition imposing restriction is bad. The transferee could use the property as if there was no such restriction. Corresponding law in Indian succession Act is section 138. Section 11 would not be attracted unless there is an absolute interest is created by the transferor in favour of the transferee. Section 11 applies in respect of both movable and immovable properties. It does not make any distinction. Section 11 does not apply in respect of a lease, as in case of lease only a limited interest of enjoyment is created in favour of a transferee. In case of a lease the lessee is bound by all express and implied covenants.

Amarnath sells a property to Kubera. In the sale deed he imposes a condition that Kubera shall use the property only for the purposes of construction of a house. Kubera constructs a cinema theatre. Amarnath files a case against Kubera contending that the action of the later is bad. Kubera resists the suit. Question: whether the action of Amarnath is proper and Kubera is bound by the covenant. Answer: the sale is a transaction where in there would be a transfer of absolute interest. The buyer can use the property as he likes. The seller can not impose any restriction on the buyer as to how the later has to use the property. So the condition is bad.

Amarnath sells a property to Kubera. The said property is a house. In the said house a person by name Laxman is in occupation as a tenant. In the sale deed Amarnath imposes a condition that Kubera shall utilize the rental income for the purpose a charity run by Narayana guru seva trust. Kubera declines to do so. Narayana guru seva trust files a case against Kubera contending that they should be paid money as per the terms of the sale deed. Kubera resists the suit. Question: whether the condition binds Kubera. Answer: the sale is a transaction where in there would be a transfer of absolute interest. The buyer can not be asked to enjoy the income as per the desire of the seller. So the condition is bad.

Amarnath Gifts a property to Kubera, his son. The said property is a house. In the said house other dependents were living. In the gift deed Amarnath imposes a condition that Kubera shall pay maintenance to the dependents. Kubera contends that he need not pay any maintenance to the said dependents. Question: whether the condition binds Kubera. Answer: yes it binds the son. The said condition is not in any way repugnant to the interest created by the instrument of gift deed. It is not hit by the provisions of section 11 of the transfer of property act. So the condition is not bad.
BASED ON THE PRINCIPLE LAID DOWN IN Panna Lal Hazara Vs Phulmony Hazara. AIR 1987 CAL 368

Amarnath Gifts a property to Kubera, his son absolutely. The said property is a house. In the gift deed Amarnath imposes a condition that Kubera shall stay. Kubera contends that he need not stay. Question: whether the condition binds Kubera. Answer: No. The said condition is repugnant to the interest created by the instrument of gift deed. Gift given was an absolute gift. A direction given repugnant to the terms of the interest created is bad. It is hit by the provisions of section 11 of the transfer of property act. So the condition is bad

Amarnath Gifts a property to Kubera, his son on a condition that he shall stay in the said property. If he fail to stay in the property the gift stands forfeited. Kubera contends that he need not stay. Question: whether the condition binds Kubera. Answer: yes. The said condition is not repugnant to the interest created by the instrument of gift deed. Gift given was not an absolute gift. A direction given is not repugnant to the terms of the interest created. So it is not bad. It is not hit by the provisions of section 11 of the transfer of property act. So the condition is not bad.

Amarnath assigns a life interest in respect of his garden in favour of his daughter lakshmi for her maintenance. In the said deed of assignment he had indicted that Lakshmi shall not cut the trees. Lakshmi wanted to cut the trees to improve her income. Question: could Lakshmi do so. If not why. Answer: the interest created in favour of lakshmi is not an absolute interest. It is a life interest. In view of it Amarnath can impose any condition. The present condition is not repugnant to the interest created and is n consonance to the interest created. Hence the condition can not be said to be bad.

Amarnath sells by an absolute sale deed the interest he had in respect of his garden in favour of Lakshmi. In the said deed he had indicted that Lakshmi shall not cut the trees. Lakshmi wanted to cut the trees to improve her income by constructing a multistoried shopping complex. Question: could Lakshmi do so. If not why. Answer: the interest created in favour of lakshmi is an absolute interest. It is not a life interest. In view of it Amarnath can not impose any condition. The present condition is repugnant to the interest created and is not in consonance to the interest created. Hence the condition can be said to be bad.

Jafri begum vs syed.ILR 1901all 383


A as an arbitrator made an award between two sisters giving each a half share of an estate and appointing the husband of one of the sister as the manager. He also directed that neither sister would have a right to claim a partition. One of the sister died. There after her son filed a suit for partition Question could he do so. Answer:- the privy council held that the said condition may bind the parties to the agreement and not others. Further the court held that the arbitrator can not make a divisible property as an indivisible one for ever.

Section 10 and 11

Transfer of rights may be Absolute transfer. That is either all rights or only no right is retained by the few rights, that is absolute transferor, or may be partial in nature.

Power of alienate and makes restraint void.

Power to enjoy without being any dictation by others as how to enjoy.

On the happening of an insolvent or intend to dispose of.


Transfer of property an interest is created absolutely in favour of any one person, that is a transferee. but the terms of transfer direct that such interest shall cease to have any effect if the transferee becomes an insolvent, or endeavoring to transfer or dispose off the same. he shall be entitled to receive and dispose of such interest as if there were no such interest.

Exception to the above Rule. Lease for the benefit of the lessor; or persons claiming under the lessor., then the said restriction would not apply.

Section 12.
Corresponding law section in succession Act 1925 is not there. However in the succession Act of 1865 vide section 107 there was a corresponding provision. Forfeiture on insolvency then the condition is bad. Forfeiture in the event of sale or alienation the transfer ceases the condition is bad. The tenor of the bar under this section would not be applicable if it is in the interest of the lessor or any person claiming under him This applies mainly in case of transactions which are akin to gift. In case of sale or mortgage generally this contingency would not arise.

Section 12
Condition subsequent. The condition is intended by the transferor to have effect of defeating the interest created. The object of this section is to encourage free alienation and circulation. This is another limb of the principle law favors circulation and not accumulations The condition would be bad and not the transfer. The clause of forfeiture shall be construed strictly.

Alexander gifts the property to Thomas. The deed contains a clause that in the event Thomas becomes insolvent then the transfer would become inoperative and the property would revert back to Alexander or his heirs. Thomas after some time becomes an insolvent person. The official liquidator puts forth a claim in respect of the said property which stood in the name of Thomas to liquidate the liabilities. Alexander puts forth a claim and contends that the property has revered back to him in pursuance to the Covent in the gift deed. Question:- whether the plea of Alexander is sustainable. Answer: No. the condition in the deed that in the event Thomas becomes insolvent the property gets revered to the transferor is against the principle laid down in section 12. hence the same is bad. The claim of the liquidator is to be upheld.

Alexander gifts the property to Thomas. The deed contains a clause that in the event Thomas intends to sell the property, then the transfer would become inoperative and the property would revert back to Alexander or his heirs. Thomas after some time tries to dispose of the property. The son of Alexander puts forth a claim in respect of the said property and contends that the property has revered back to him in pursuance to the Covent in the gift deed. Question:- whether the plea of the son of Alexander is sustainable. Answer: No. the condition in the deed that in the event Thomas tries to dispose of the property, the property gets revered to the transferor is against the principle laid down in section 12. hence the same is bad. The claim of the son of Alexander cant not be upheld.

Transfer to the benefit of an unborn son is bad.,


On transfer of a property interest is created for the benefit of a person not in existence at the date of transfer, subject to a prior interest created by the same transfer, the interest created for the benefit of a person shall not take effect, unless it extends to the whole of the remaining interest of the transferor in the property. The transfer could be there only in respect of a living person and not an unborn person. Any transfer in favour of a person who is not born on the date of transfer is bad. This principle is reflected in section 113 of succession Act and section 13 of the transfer of property Act.

Specific mechanism of section 13


Person intending to transfer the property for the benefit of an unborn person shall at first create a life interest/estate in favour of a living person and after it an absolute interest in favour of an unborn person. Till the person in whose favour a life interest is created is alive, he would hold the possession of the property, enjoys its usufructs. During his life time, if the person is born then the title of the property would vest in him immediately but he would get the property only after the death of holder of life interest.

Example Specific mechanism of section 13


On 1.1.1900 A executes a deed creating a life interest in favour of his Brother B. The document provides that the property shall vest absolutely in favour of his Brothers child. On 1.1.1900 B was not a married Person. On 1.1.1900 B took possession of the property. On 1.12.1900 B got married. On 1.1.1903 B got a child. On 1.1.1909 B died. The said child got the right in respect of the property on the date of birth itself. However the possession continued with B. the said child got possession on 1.1.1990. that is on the death of B.

Example Specific mechanism of section 13


On 1.1.1900 A executes a deed creating a life interest in favour of his Brother B. The document provides that the property shall vest absolutely in favour of his Brothers child. On 1.1.1900 B was not a married Person. On 1.1.1900 B took possession of the property. On 1.12.1900 B got married. On 1.1.1903 B got a child. On 1.1.1907 Bs child died. On 1.1.1909 B died. So the property vested with child on 1.1.1903, and thereafter the death of B the right to possession goes to the heirs of the child.

Example Specific mechanism of section 13


On 1.1.1900 A executes a deed creating a life interest in favour of his Brother B. The document provides that the property shall vest absolutely in favour of his Brothers child. On 1.1.1900 B was not a married Person. On 1.1.1900 B took possession of the property. On 1.12.1900 B got married. On 1.4.1909 B got a child. On 1.1.1909 B died. Then what happens? //////////????????????////////////

Example Specific mechanism of section 13


On 1.1.1900 A executes a deed creating a life interest in favour of his Brother B. The document provides that the property shall vest absolutely in favour of his Brothers child. On 1.1.1900 B was not a married Person. On 1.1.1900 B took possession of the property. On 1.1.1909 B died unmarried. Then what happens? ??????????????????

Life interest and absolute interest


Life interest:- an interest or estate which determines on termination of life. Absolute interest:- an interest or estate which is given without any condition to regulate about the vesting. That is full and absolute interest. Amarnath a rich planter at Wellington has four sons and two daughters. Among the said daughters the first daughter who had got married at an age of 12 years lost her husband and came to the house of her parents to take shelter. The second daughter did not marry as she felt that her life may end in tragedy. Amarnath wanted to give property to the sons and daughters. He created a document that the sons shall take the property subject the condition that the daughters shall have a right enjoy the property till they are alive and after their death the sons shall take the property.. What is the type of interest the daughters had in contrast to the rights of the son.

Life interest could be in respect of any number of persons but it should be in favour of living persons and not a person yet to born. Life interest in favour of an unborn person is bad, unless it extends to the whole of the remaining interest of the property. Amarnath a rich planter at Wellington has four sons and two daughters. Among the said daughters the first daughter who had got married at an age of 12 years lost her husband and came to the house of her parents to take shelter. The second daughter did not marry as she felt that her life may end in tragedy. Amarnath wanted to give property to the sons and daughters. He had an apprehension that the sons may squander the property which he had earned due to life long struggle. He created a document that the sons and daughters shall take the property subject the condition that they shall have a right enjoy the property till they are alive and after their death to the son of the last son of the first son who had then attained an age of 6 months. What is the nature of interest of the daughters, sons and grand son? All the sons and daughters will have the property as life interest while the child will have the absolute interest.

Salient aspects of section 13.


Applicability. Regarding Movables. The principle laid down in this section applies. Regarding immovable. The principle laid down in this section applies Regarding Mohammedans. Gift to a person not in existence is void Regarding Hindus. According to pure Hindu law gift in respect of an unborn person is void. Persons not in existence.

Persons not in existence.


Person in existence whether covers the concept of a person not yet born but in womb = En ventre sa mere Child in womb is regarded as person in existence as per Hindu law and English law. Lord Russell says in Elliot Vs. Joyce:- There are many cases decided by the courts in England in which posthumous children have been held to be included in gifts to children born in fathers life time or children living at the time of the death of the father. The foundation for the said decisions is not the natural or ordinary meaning of the word used in such they include posthumous child, but an artificial meaning shall be placed upon the words because the potential existence of such child places it plainly with in the motive and reason of a gift.

Problems.
Amarnath bequeaths the property to his eldest son Appu. After the death of Appu the property shall go to the eldest son Choma for life and after the death of Choma the proper shall go to Ramu, the eldest son of Choma. On the day of death of Amarnath Appu had no son and choma was born subsequently. Question: what is the nature of interest of each one of them. The bequest to choma is not an absolute interest and is of a liited estate. A limited estate can not be there in favour a child unborn. So the life interst in favour of choma fails as it is void.

Section 13, 15, 16 and 17


Section 13, 15,16 and 17 should be read together.
Section 16

Section 13 Section 15 Section 17

Section 13 deals with the principle relating to un born child. Section 15 deals with reference to transfer to a class. Section 16 deals with reference to transfer to take effect on failure of prior interest. Section 17 deals with reference to transfer to create accumulation.

Section 13 vis a vis 15. Section 15 of the transfer of property Act deals with Class transfer. Section 13 speaks about transfer to unborn persons as bad. Section 15 speaks regarding transfer to a class. When ever there is a transfer to a class and few come under the cloud of section 13 the transfer altogether is not bad though it is bad in part. Section 15 corresponds with section 115 of succession Act. What is a class? When all those come under one category then it is a class. When they come under a particular description then it is a class. When they come under particular definable formula then it is a class.

Section 15
Example:  Transfer to sons sons,  transfer to sons daughters,  transfer to widows,  transfer to brothers,  transfer to sisters,  Transfer to grand children,  Transfer to Nephews,  Transfer to nieces. Where the name of transferee is specifically named then it would not amount to a class transfer but would constitute individual transfer.

Where the name of transferee is specifically named then it would not amount to a class transfer but would constitute individual transfer. Example: Transfer to the grand children namely Ramu, somu, Mohan and suraj it is not a class transfer. Transfer to the grand children born to Ramu, it is not a class transfer.  Transfer to the children born to Ramu through his first wife namely prema it is not a class transfer.

Section 16 vis a vis 13


Section 16 corresponds with section 116 of succession Act. Section 16 is an extended limb of the rule relating to transfer to an unborn person. Here we have to look at prior interest and ulterior interest or subsequent interest. When a prior interest is void due to the reason of section 13 the section 16 will apply. If the prior interest is not void due to any other reason then section 16 will not apply.

Girish dutta vs dattadin.


A made a gift to her nephews daughter B for life and then to Bs male descendents absolutely, if she had any descendents. In case if she had no male descendents then to the Bs daughter without any power of alienation. In case B had no male or female descendent then to her nephew, D. B died without any child.

Question: What is the nature of gift to the Bs unborn daughters. Answer: Bs unborn daughters had a limited interest. Question: What are the prior interests created. Answers: (i) prior interests were in favour of B for life, (ii) Bs daughter with a limited interest. Question: What are the ulterior interest created. Answer (i) Bs male descendent absolutely. (II) in case B has no male or female descendent then to D. Question: What would be the impact of these interests. The court held: That the gift to Bs unborn daughters was a limited interest only. Hence the transfer to nephew which was dependent upon prior interest also failed.

Section 17 vis a vis 13


Direction regarding accumulation. Section 117 of indian succession act is analogous to this section. What is accumulation and to extent it is permitted. What is the difference between indian law and English law regarding the principle of accumulation.

Direction for Accumulation


Section 17 of the t.p.act envisages that any direction to accumulate the income arising out a property is bad. There are certain limitations in this context. They are with reference to (i) the life time of the transferor, or (ii) period of 18 years from the date of transfer.

However the said directions would not apply with reference A. to any direction towards the payment of debt of the transferor or any other person taking interest under the transferor. B. Provisions of portions for children or remoter issue of the transferor or any other person taking the interest under the transferor. C. Preservation and maintenance of the property transferred.

This section is based on the principle that the law favors transfer and not accumulation. Section 117 of the Indian Succession Act is the analogous provision. The section 17 underwent a change in 1928 when compared to its earlier counterpart. Earlier to 1928 the rule relating to accumulation was too rigid and did not the accumulation in a liberal way.

Accumulation and to what extent it is permitted.


The rule against accumulation resembles the rule against inalienability. This rule is based on the principle of remoteness of control over property whether or not vested in a beneficiary, rather than the remoteness of vesting. The common law principles had envisaged twin rules with reference to the transfer of property, and they were (i) regarding inalienability (ii) regarding accumulation. These two restrictions originally went hand in hand. They parted the company of one another when the Accumulations Act 1800 was enacted. The other being that of Thellusion Act. Now provisions of both the Acts are merged in English Law of property Act 1925. Section 164 of the English Law of property Act 1925 is the relevant provision. The direction for accumulation may be express and as well as implied.

Accumulations.
Accumulation is permissible to a limited extent. Excessive Accumulations, are the directions to be for long time than that is allowed by the section. Section 11 speaks about the voidness regarding the repugnancy when there is an absolute creation of interest on transfer of property. Section 17speaks about the voidness regarding the accumulation for which there need not be an absolute transfer of property

Accumulation
As per the Hindu law texts the accumulation for the benefit of Donee was not permitted. The old Hindu law had considered that the accumulation of income goes along with capital. Under Mohammedan law the gift takes effect forthwith absolutely and therefore the question imposing any condition would not arise. Imposition of any condition would be repugnant to the very basis of foundation of Mohammedan law. As per Mohammedan law a direction for accumulation in a gift is invalid. The section 17 is in consonance with the principle reflected in section 17 main part

Accumulation in English law and Indian law


Life or lives of the transferor or transferors. 21 years from the death of the transferor. Life or lives of the transferor or transferors 18 years from the death of the transferor.

During minority of any During minority of any person living at the death of person living at the death of the transferor. the transferor. During the minority of any person who would be entitled to the property, if was of full age. During the minority of any person who would be entitled to the property, if was of full age.

Period of 18 years from the date of transfer.


The computation of the period of 18 years in Indian law should be done from the date of transfer. If the transferor transfers the property and directs its income for a period of eighteen years which is to commence from a later date the accumulation would be allowed only during the portion of 18 years from the date of transfer. With reference to the rest of the period the condition would be void.

Illustration. Amarnath transfers to choma property in 1920. The gift deed contains a clause that the income derived from the property shall be accumulated. Amarnath dies 20 years after the date of said transfer. Question till what time the restriction regarding accumulation of the income runs. Answer: the restriction regarding the accumulation with reference to the date is taken it is 18 years. With reference to the life of transferor is taken it would be 20 years. Taking the longer of the said two dates the date should be taken as to 1940.

Illustration. Amarnath transfers to choma property in 1920. The gift deed contains a clause that the income derived from the property shall be accumulated. Amarnath dies 10 years after the date of said transfer. Question till what time the restriction regarding accumulation of the income runs. Answer: the restriction regarding the accumulation with reference to the date is taken it is 18 years or the life of the transferor. With reference to the life of transferor is taken it would be 10 years, that means the accumulation could be done till 1930. if the date from 18 years is taken then it would be till 1938. Taking the longer of the said two dates the date should be taken as to 1938.

Illustration. Amarnath transfers to choma property in 1920. The gift deed contains a clause that the income derived from the property shall be accumulated. The said accumulation should commence from 1930. Question till what time the restriction regarding accumulation of the income runs. Answer: the accumulation as per deed is taken then it would be 1938. from the date of the deed is taken then it would he 1948 law contemplates that the accumulation could be there for 18 years from the date of transfer and any period in excess is void. There fore the period from the date of transfer is 18 years. Any period after 1938 is void.

A transfers a property to B in 1940. A direction will be there that the accumulation shall be there for 30 years till 1970. A dies in the year 1965. Question which period shall be taken in to consideration as to the accumulation. Answer: the life span of transferor shall be taken in to account and not the 18 years from the date of transfer or 30 years as stipulated in the deed to run the period till 1970. Hence the restriction is valid till 1965. any period beyond the life span of the transferor is not valid. So the period from 1965 till 1970 shall be ignored.

A transfers a property to B in 1940. A direction will be there that the accumulation shall be there for 30 years till 1970. A dies in the year 1950. Question which period shall be taken in to consideration as to the accumulation. Answer: the life span of transferor or 30 years as stipulated in the deed to run the period till 1970 shall not be taken in to account and 18 years from the date of transfer. Hence the restriction is valid till 1958. any period beyond the 18 years is not valid. So the period from 1958 till 1970 shall be ignored

Amarnath transfers a property that is deposits of money to Billa in 1940. A direction will be there that the interest derived from the deposits if the said property shall be used for the loan which he had barrowed from Chinmaya. Chinmaya puts forth a plea with Billa to clear the outstanding payable by Amarnath. Billa contends that any restriction imposed on him to enjoy the accumulation is bad and hence he can not be made to pay the amount as the gift is an absolute transfer. . Answer: the direction of Amarnath is to clear his debts payable to Chinmaya. So the direction is protected under the exception. Therefore the plea of Billa can not be accepted. Billa has to pay the amount payable to Chinmaya.

Amarnath transfers a property to Billa in 1940 by way of trust. A direction will be there that the rent payable by the tenant shall be used for the loan which he had barrowed from Chinmaya. Chinmaya puts forth a plea with trust to clear the outstanding payable by Amarnath. Trust contends that any restriction imposed on him to enjoy the accumulation is bad and hence he can not be made to pay the amount as the gift is an absolute transfer. . Answer: the direction of Amarnath is to clear his debts payable to Chinmaya. So the direction is protected under the exception. Therefore the plea of Trust can not be accepted. Trust has to pay the amount payable to Chinmaya.

Amarnath transfers a property to Billa in 1940. A direction will be there that the income derived shall be used to look after the minor children of Amarnath and provide them proper education. Question whether Billa could contend that the said clause is hit by the doctrine of accumulation. Answer: the direction of Amarnath is to provide education for the children. So the direction is protected under the exception. Therefore the plea of Billa can not be accepted. Billa has to pay the amount towards the education of the children of Amarnath.

Whether the entire accumulation to be spent or only a portion.


The exception number 2 envisages about the portion for children or remoter. The said children shall be of transferor or any other person taking benefit under the transfer. If the said children are not under the said category then the exception would not apply. The portion would mean the portion of the property settled or provided in favour of the children means from the said property so given an not the other property.

Rule against perpetuity.


No transfer of property can operate to create an interest which is to take effect after the life time of one or more persons living at the date of such transfer and the minority of some person who shall be in existence at the expiration of that period and to whom he attains full age the interest created is to belong. What is perpetuity and What is English counter part on this aspect. Why this rule against perpetuity Impact regarding the rule against perpetuity. Whether this rule is regulated by any other provision of the transfer of property Act. Is there any corresponding rule in other laws.

Accumulation for preservation of property


Thellusion Act in England had not made any provision with reference to making provision for accumulation for the preservation of the property. In India the law specifically envisages that the provisions could be made in the deed to provide accumulation for the purpose of preservation of the property. Note while interpreting the exception No.1, 2 or 3 the same shall be interpreted strictly and not liberally as any exception needs a strict interpretation and it could be there to aid the main provision and not to annul the main provision.

Perpetuity.
Perpetuity means continuous or unending transaction. It is tying up property for an indefinite period. When there is a transfer of property from generation after generation then it is known as perpetuity. Jarman says in his book on law of Wills: that the perpetuity in the primary sense of word is disposition which makes a property unalienable for an indefinite period Lewis says that the perpetuity is a future limitation whether executory or by way of remainder and of either real or personal property which is not to vest until after expiration of or will not necessarily vest with in the period fixed and prescribed by law for the creation of the future interests. The object of the rule against perpetuity is to restrain the creation of future conditional interest in the property.

Why perpetuity not accepted.


Based on public policy. Every effect to create perpetuity is void. The perpetuity may arise in two ways in English law that is:Taking away from the owner of the property the power of alienation which is an inseparable part of ownership. Traceable to section 10 in Indian law. By creation of future remote interest. Traceable to section 14 in Indian law. The English rule against perpetuity in fact a development in an extended form the rule against alienation.

English law relating perpetuity.


Historical back ground in English law: Origin is traceable to Statute of users 1535 and Statute of Wills 1540. The statute of users took birth from the concept of Trusts. The statute of Wills took birth from the concept of succession. These statutes continued to hold the field till 1925. During 1925, the English law of Property Act was enacted to bring about a consolidated property legislation. This replaced several legislations which had a direct bearing on the law relating to the property.

Section 14
Section 114 of Indian succession Act is analogous to this section. The Indian law relating to rule against perpetuity and English law has a slight difference. English law envisages that the property could be tied up during a life or lives of any existing persons and for 21 years after the death of the survivor irrespective of minority of any person. Indian law envisages that the property could be tied up during a life or lives of any existing persons and for minority of the person to whom the interest is created is to belong.

Why to accept the rule against perpetuity.


The reason for rule against perpetuity is that the mischief that would arise to the public from estates remaining for ever, or for a long time unalienable or untransferable from one hand to another, being a damp on industry and prejudice trade, to which may be added the inconvenience and distress that would be brought on families whose estates are so fettered.

Section 14
A transfer can not operate to create an interest:1. which is to take effect after the life time of one or more persons living at the date of such transfer, and 2. Minority of such person who shall be in existence at the expiration of that period.

Note:- the age of minority ceases in India as per the provisions of Indian Majority Act at 18 years.

Siddesh gupta bequeaths A property. In the said deed it it stipulated that the property is bequeathed to Amarnath for his life. It also states that after the death of Amarnath the property should go to Balu for life. A further stipulation is there that after the death of Balu the property shall go to such of the sons of Balu who attains an age of 25 years. Amarnath and Balu are of the age group where in Amarnath is elder than Balu. Amarnath and Balu survives Siddesh Gupta. Son to Balu is born after the death of Siddesh Gupta. The said son attains 25 years after 18 years from the date of death of longer liver of the two. Question what is the position regarding the vesting of the rights Answer: vesting of rights may be postponed from the date of death of younger of the two for a period of 18 years and not more than that. In this case the vesting of rights is made more than a period of 18 years the bequest after Bs death is void.

Siddesh gupta gifts A property. In the said deed it it stipulated that the property is bequeathed to Amarnath for his life. It also states that after the death of Amarnath the property should go to Balu for life. A further stipulation is there that after the death of Balu the property shall go to such of the sons of Balu who attains an age of 25 years. Amarnath and Balu are of the age group where in Amarnath is elder than Balu. The said son attains 25 years after 18 years from the date of death of longer liver of the two. Question what is the position regarding the vesting of the rights Answer: vesting of rights may be postponed from the date of death of younger of the two for a period of 18 years and not more than that. In this case the vesting of rights is made more than a period of 18 years the bequest after Bs death is void.

Rule against perpetuity would not apply in respect of Charge. Because the charge does not involve any transfer of property. The charge is only to secure a claim over an immovable property. Rule against perpetuity would not apply in respect of easement. Creation of an easement is not a transfer. Easement is only creation of a right to enjoy over others property for the better enjoyment of ones own property. A stipulation in a lease for renewal can not be construed as covenant offending the Rule against perpetuity. The future right of redemption is not a clause hit by rule against perpetuity. A covenant which runs with the land the rule against will not apply. The rule against perpetuity as incorporated in section does not apply to Mohammedans as the Mohammedan law does not otherwise recognize the rule regarding perpetuity. The rule against perpetuity as incorporated in section does apply to Hindus though Hindu law does not otherwise recognize the rule regarding perpetuity except in case of endowment.

Salient features of In

respect of future

interests.
What is a future interest. 1. An interest intended to vest or come in to existence in future. 2. Regarding the interest which has to come on a future date the law prescribes certain limitation and time frame. 3. Beyond the said time frame and limitation the vesting can not take place. 4. If an interest is not created at a future date then this section will not have any application. 5. The transferor may create interest in respect of as many persons as he likes.

Section 14, 15, 16,17 and 18


Section 14, 15,16,17 and 18 should be read together.
Section 16 Section 17

Section 14 Section 15 Section 18

Section 13, 15, 16 and 17


Section 13, 15,16 and 17 should be read together.
Section 16

Section 13 Section 15 Section 17

Transfer in perpetuity

Private purposes

Public Purposes.

Prohibited And is subject to Rule in sec.14,16 17.

Permitted vide section 15 and 18

Section 14 and section 18


Where there is a transfer for the benefit of the public in the advancement of religion, knowledge, commerce, health, safety or any other object beneficial for mankind the tenor of law as laid down in section 14 would not apply . Transfer of property for charitable purposes have always regarded by law with great favour. The dedication for charity is an exception to the rule of perpetuity. Word charity is not used in section 18. This is common in both English law and Hindu law and Mohammedan law. In Indian succession Act though there is a corresponding section to section 14 of the T.P.Act , there is no corresponding section to section 18.

Section 15 and 18
Section 15 deals with class transfer and if the interest in respect of some of the members fails the transfer to the class will not fail. Section 18 envisages where the transfer is for the benefit of the general public. The object of both the provisions are similar. They do not have any conflict. They are to promote a same cause. Therefore the framers of law have made provision for 14, 16 and 17 in section 18 as one group while they have not brought section 13 in to the said group, though section 13 will have an impact on section 15,16 and 17.

General rule while interpreting section 14,15,16,17 and 18.


While construing a case where there is a combination of both private and public purposes: The part relating to private purposes are hit by section 14, 16, and 17. The part relating to public purposes would be protected by section 18. English law speaks about charities. If the same conditions are for general public and private purposes the part relating to the private purposes would be bad. Therefore what is beneficial to the public purpose shall be maintained.

Transfer in perpetuity for benefit of public


The restriction in section 14: rule against perpetuity. The restriction in section 16: rule regarding failure of prior interest the subsequent interest shall also fail. The restriction in section 17: rule against accumulation.

Not to apply to the transfer of property for the benefit of the public in advancement of religion, knowledge, commerce, health, safety, or any other object beneficial to mankind.

Section 18, 14, 16 and 17


Section 18, 14, 16 and 17 should be read together.
Section 16

Section 14

Section 18

Section 17

Transfer in perpetuity for benefit of public section 18.

`what is a religious purpose? what is a purpose for knowledge? what is a purpose for commerce? what is a purpose for health? what is a purpose for safety? what is a purpose for any other purposes? These purposes are not specifically defined .they depend on the facts of each case. However the characteristic feature of it should be for public purposes and not private purposes.

Transfer in perpetuity for benefit of advancement of public religious purposes*section18*


A gift in favour of a religion is recognized as entitled to the exemption. A gift in perpetuity for the purposes of masses for the soul of the donor has a divergent views. There is no uniformity on this aspect. If any part of the transfer has both partial dedication to the religious purposes and other part is for private or non religious purposes the later would fail, while the former will have a protection.

Controller of Estate Duty Vs Usha. 1980(1) S.C.C.315


A gift deed was created with certain conditions such as No. 1 for the benefit of A, B, and C. No.2. to promote the cause of veerashavas Question. What is the nature of the condition and to what extent they could be sustained. Answer. Condition No.1 invalid as hit by section 18 as it is not for public purposes and for the purposes of individuals. Condition No. 2 valid as, section 18 protects it as it is for advancement of veerashaiva activities of a religion. The supreme court said that if the terms of the document under which the properties or their income are gifted, amount to their complete dedication for religious or charitable purposes, then any part thereof which is given by way of gift to any person contrary to the rules against perpetuities inures to the benefit of the endowment and becomes part of properties endowed. On the other hand if the dedication is partial, such part which is hit by the rule against perpetuities reverts to the donor or his heirs.

Transfer in perpetuity for benefit of advancement of public health and education purposes*section18* Any bequest of the property for the advancement of any hospital, is exempt from the rule. Gifts or settlement of property for charitable dispensaries, trauma centre, eye care centers hospitals, institutions offering medical care, establishment of yoga and nature care therapy are exempt from the rule against perpetuity. In Brighton vs. Murex a gift was effected to establish a hospital for the benefit of the people of the locality. A pleas was put forth that the same is hit by the principles of perpetuity. The court held that though there is a creation of perpetuity, but the same is to advance the condition of health of the public at large. Hence the said gift in favour of trust to establish a hospital is not bad.

M. Keshva Gownder Vs Rajan.


A created a trust and settled some properties and appointed himself as one of the trustee. The objects were as under: No. 1. To erect the statue of his father. No. 2. to pay fee to prosecute education by four students of his community. No.3. to maintain statute. No.4. to celebrate the birth day every year. No.5. After his death the property shall be divided in to four parts and each of the trustee shall be given a part. The said part could be inherited by the male issues of the respective trustee.

Madras high court held: The dedication did hit the rule against perpetuity as the dedication of the property was on the descendents of the donor in certain specified lines and at all material times the income was to be divided amongst the trustees. The payment of fee for four children of the community is not hit by the provisions of rule against perpetuity and rule under section 18 as it is for the benefit of the community. The erection of statute of the father, celebrating the birth anniversary were not for the benefit of public. The clause in the deed providing the tuition fee for four deserving students could be separated and to that effect trust is valid. AIR.1976 Mad.102

Interests
It is a term of generic nature having a wide meaning. With reference to the property one can say that to what an extent a person has got direct involvement with reference to the property. The interest may be that of a absolute owner, mortgagor having much concern about the money one has advanced to another with reference to the security value, lessee to enjoy the property as against the payment of a fixed premium payable once in a month or even an year.

Interests
Contingent
Vested.

forthwith

On happening of an event which must happen Specified uncertain event happen

In terms specifying that it is to take effect forthwith

Specified uncertain event not happen

Vested interest.
On transfer of a property, Without specifying the time as to when the said interest to take effect, or In terms specifying that it is to take effect forthwith,
1. an interest is created in favour of one person by another,

or

On happening of an event which must happen, Then such an interest is vested unless a contrary intention appears from the terms of transfer. Note:A. The part (i) 0f section 19 shall be read with part (ii) and the Explanation of that section. B. the section 19 shall be read with section 20 with reference to the unborn persons.

Contingent interest.
On transfer of a property, 1. an interest is created in favour of one person by another, to take effect only on specified uncertain event happens, or Specified uncertain event shall not happen. Then on non happening of such an event such an interest as acquired is known as a contingent interest. On happening of the interest the interest becomes vested interest. On non happening of the uncertain interest the interest the interest would be a vested interest.

Analogous provisions
Section 19 of Transfer of property Act corresponds with section 119 of Indian Succession Act. Section 21 of Transfer of property Act corresponds with section 120 of Indian Succession Act. The provisions of section 19 and 21 are not applicable in respect of Mohammedans. Prior to 1929, the provisions of section 19 and 21 were not applicable to Hindus, but now the said provisions are applicable to Hindus.

Amarnath a rich land lord bequeaths to Balla Rs.10,000,00/= The said amount to be paid to Balla on the death of Chandrasekhar. Prior to the death of Amarnath what would be the position. Answer:- The property with reference to Balla is only a spes succession. Balla has no right with reference to the property. On the death of Amarnath, what would be the position. Answer:- The property with reference to Balla has become a vested interest. On the death of Chandrasekhar what would be the position. Answer:- The property with reference to Balla would pass on, due to the event of death of Chandrasekhar. On the death of Balla before Chandrasekhar what would be the position. Answer:- The right to property with reference to Balla would pass on to the heirs and they would take it subject to death of Chandrasekhar.

Amarnath a rich land lord bequeaths to Balla property worth of Rs.10,000,00/= The said property to be given to Balla on the Balla attaining an age of 18 years. Prior to the death of Amarnath what would be the position. Answer:- The property with reference to Balla is only a spes succession. Balla has no right with reference to the property. When the property gets vested in Balla. Answer: on the death of Amarnath property gets vested in Balla. When does Balla get the property. Answer: on attaining an age of 18 years.

Zio a pang gives to Amarnath a bequest. The said bequest was for life. After the death of Amarnath it shall go to Balla. Question. On the death of Zio a Pang what is the position of the property vis a vis Amarnath and Balla. Answer: Regarding Amarnath it is a life interest, while Balla it is a vested interest.

Zio a pang gives to Amarnath a bequest. The said bequest was till Balla attains 18 years. on Balla attaining 18 years, he shall have the property . Question. On the death of Zio a Pang what is the position of the property vis a vis Balla. Answer: on the death of Zio a pang the property becomes Ballas vested interest

Amarnath transfers his whole of estate to Balla. One of the condition is that Balla shall clear certain dues and debts of Amarnath. On clearing the debts and enjoying property for a period of 10 years the same shall go to Chandrasekhar. Question: what shall happen to the property at the death of Amarnath. Answer: ///////////??????????////////

On happening of an event which must happen.


The death of a person is certain and it can not be said to be an event of uncertainty. If a transfer is made to a person that the transfer shall take effect from the date of another person, it can not be said that the event is of an uncertain nature. Amarnath gives certain properties to Balla with a condition that Balla shall get the possession on the death of Chandrasekhar. The event of death of Chandrasekhar is certain, and it may happen either now or later but it is of a certain nature. Therefore the property vests with Balla forthwith and possession would be delayed.

Amarnath gives certain properties to Balla with a condition that Balla shall get the possession on the death of Chandrasekhar. A condition is imposed that in case if Balla dies earlier to Chandrasekhar then the property shall go to Mallika. The event of death of Chandrasekhar is certain. Similarly the death of Balla is certain. However the death of Balla may happen before or after the death of Chandrasekhar. Therefore the property does not vests with Balla forthwith. It is not a vested interest but an interest of a contingent nature, that is the event of death of Balla vis a vis Chandrasekhar.

Characteristic feature of a vested interest.


Transferable. Heritable The interest would vest but the enjoyment would be postponed. An unborn person acquires interest on birth. In case if there is a contrary intention then vesting would take place on happening of the said event. Vested interest will not have condition precedent.

U.Zeo Vs Ma Mya May. AIR 1930 Rangoon 184


Trust was created A). to pay yearly a sum of money for the life of X for life, out of rents and profits. B). To discharge the Mortgage out of the balance, C). Convey to B after the death of X . Question: what is the nature of interest on the death of X. Answer: it is a vested interest, as the death of X is an event of certainty.

Bhaga Bhatti Barmanya Vs K.C.Singh ILR.38 Cal 468


Bequest was made (1) to mother for life (2) wife for life, and thereafter (3) Nephews. When did the Nephews took the interest. Was the question The interest in favour of nephews would pass on due to the death of the testator.

Section 20 and its impact on section 19


Section 20 envisages that on transfer of a property, 1. an interest is created in favour of a person not living, He acquires upon his birth, unless a contrary intension is indicated from the terms of transfer. A vested interest, although he may not be entitled to enjoyment immediately on his birth. Section 20 has to be read with section 13 and section 19. Illustration: Property is given to Amarnath for life. After that the property shall go to his son. On the date of transfer Amarnath had no son. The interest in favour of son is of a contingent nature. Soon after the son is born the interest becomes a vested interest. The condition that the son shall take property after fathers death does not make the interest of the son any less a vested interest.

Trust was created A). to pay yearly a sum of money for the life of X for life, out of rents and profits. B). To discharge the Mortgage out of the balace, C). Convey to B on the birth of a child to X . Question: what is the nature of interest to the B Answer: it is not a vested interest, as the birth of a child to X is an event of uncertainty. The child if is born then it becomes a vested interest.

Kokilambal vs N.Ramn
A inherited certain properties from her husband and settled them in the following manner; 1. in favour of B the son of the sister of her husband, whom she wanted to adopt as she was not having any children. 2. the property should be enjoyed by her and B for her life time. 3. B was authorized to collect rent and carry on the repairs and pay municipal taxes. The remaining amount shall be divided between her and B equally. Though she wanted to relinquish her right to alienate the did in deed provided the right to alienate to both of them jointly. B died during the life time of A. A revoked the deed of settlement and created a fresh settlement deed in favour of D her sisters daughter and husband of D. Bs brother as a legal heir of B instituted a suit claiming property by contending that under settlement deed B had acquired a vested interest.

The trial court and high court had held that vested right was created in favour of B and therefore the Bs brother had inherited the property. The revocation by A subsequently as bad as she had no authority Issues before supreme court were:1. Whether the nature of interest created in favour of B was a vested interest or a contingent interest. 2. If it were to be vested interest then Bs brother would inheret on the death of B, and A had no authority to cancel the settlement to create an interest in favour of D and her husband. 3. If it were to be a contingent interest then Bs brother would not get any property as B would have got the property after the death of A. Supreme court held that A had retained some right in the property for herself and had not relinquished the right completely. She had not created any absolute right in favour of B during her life time. Therefore the right of B was not heritable to the brother of B. thus the court dismissed the claim

Contingent interest and salient features.


Transfer depends on happening of an event that is bound to happen, and on happening the transferee gets a vested interest. Contingent interest is not an absolute transfer when compared to a vested interest. The ownership still continues with the original owner till the contingent happens. The transfer is not complete in case of contingent interest.

Impact of section 19 and 22


Section 19 deals with vested interest. Section 22 deals with the concept of transfer in favour of a class of persons getting property on attaining a particular age. Whether any such transfer would create vested interest or not in respect of persons who have not attained the said age. The section 22 envisages that it would not create any vested interest in respect of those persons who have not attained the specified age.

Amarnath creates a transfer of the property to the grand children who have attained an age of 16 years. He had few grand children aged less than 16 years. Would they get any vested interest. In view of section 22 they will not get any vested interest in respect of the property. The interest of the said grand children is dependent on the fact of attaining an age of 16 years. If the transfer is in respect of people as and when they attain an age of 16 years they get the right on attaining the said age. So a contingent interest at one point of time becomes a vested interest at a later point of time. If the transfer is not a continuous one to cover the situation of as and when they attain the age of 16 years then they will not get the property as and when they attain the age of 16 years. Hence there is no contingent interest or much the less a vested interest.

: distinction between Contingent interest and


vested interest: Contingent interest not heritable, where as the vested interest is heritable. Contingent interest can not be attached while executing a decree, where as the vested interest could be attached. A contingent interest may become a vested interest but a vested interest can not become a contingent interest, as the law favors vesting and not divesting.

Transfer with condition.(Sec.25 to 30,33, 34)


Where the transferor makes the existence of a right dependent on happening or non happening of an event or a condition then the transfer is said to be a transfer with condition. What type of conditions could be there or could not be there is an important aspect. If a condition is imposed in such a manner to not to fulfill the condition then such a condition is bad. If a condition is imposed in such a manner that it is forbidden by law then the condition is bad. If a condition is imposed in fraudulent way then the condition is bad. If a condition is imposed which in the opinion of the court is immoral then the condition is bad. If a condition is imposed which in the opinion of the court is against public policy then the condition is bad If a condition is bad then what shall happen, whether the condition should be ignored or should the transfer be ignored are the aspects which needs a look.

Amarnath transfers a property to Billa. One of the condition is that Billa shall walk 100 miles with in one hour. Question whether the condition is good or bad. Answer: the condition imposed is of such a nature that it can not be performed by any human being in a natural course of events or life. Therefore the said condition is bad on the ground of impossibility.

Amarnath transfers a property to Billa. One of the condition is that Billa shall marry Hema, the daughter of Chandrasekhar. On the date of transfer chandrashekara,s daughter Hema was dead. Question whether the condition is good or bad. Answer: the condition imposed is of such a nature that it can not be performed in a natural course of events or life. Therefore the said condition is bad on the ground of impossibility.

Amarnath transfers a property to Billa. One of the condition is that Billa shall murder Hema, the daughter of Chandrasekhar. Question whether the condition is good or bad. Answer: the condition imposed is of such a nature that it is forbidden by law. Hence the condition is bad.

Amarnath transfers a property to Billa. One of the condition is that Billa shall divorce Hema, the daughter of Chandrasekhar, whom Billa had married. Question whether the condition is good or bad. Answer: the condition imposed is of such a nature that it is not to promote the public policy and is to advance a situation of destabilizing the family life. Therefore the said condition is bad.

Conditional transfer
.

Conditional transfer

Condition precedent
Permitted

Condition subsequent.

Conditional limitation.

Non permitted

permitted

Non permitted

Condition precedent
A condition which is needed to be followed to have the transfer effected. If the said condition is not fulfilled then the transfer will not take place. If a condition is of such nature which can not be performed or forbidden by law or is considered as against public policy or immoral by the court, the transfer itself would be void. If a condition is imposed of such a nature that its performance is not other wise hit by above clause but is performed substantially then the same is sufficient to say that it has been fulfilled.

Amarnath transfers a property to Billa. One of the condition is that Billa shall marry Hema, the daughter of Chandrasekhar. By taking consent of Damodara and Emberaman. Question what is the nature of condition. Answer:- it is a condition precedent as the marriage could take place with the consent of Damodara and Emberaman. On the date of transfer Emberaman is dead. Billa takes the approval of Damodara. Question whether the condition is fulfilled or not Answer: the condition imposed is deemed to have been fulfilled substantially. So there is a substantial compliance.

Amarnath transfers a property to Billa. One of the condition is that Billa shall marry Hema, the daughter of Chandrasekhar. By taking consent of Damodara and Emberaman. Question what is the nature of condition. Answer:- it is a condition precedent as the marriage could take place with the consent of Damodara and Emberaman. Billa marries Hema, and there after goes to Damodara and Emberaman to seek their consent. Question whether the condition is fulfilled or not Answer: the condition imposed is not fulfilled substantially. So there is no substantial compliance.

Bene chand Vs Ekram Ahmed AIR 1926 All 181 An agreement was there between A a widow and B,C, and D. In the agreement it was provided that A should not transfer the property without the consent of B,C, and D. A transferred the property with the consent of B. the other two were dead on the date of transfer. Question whether there is a substantial compliance or not. The majority view of the court held that there was no substantial compliance as majority persons had not consented.

Question whether the view of the court is correct? No. Minority view of Justice Boys said that the substantial compliance shall be considered not with the numerical majority but shall be considered in the back ground of the reality as to whether the consent could be obtained or not. Hence the true test is to find out the situation whether the possibility is there or not. If it is not possible then instead of defeating the vesting a favorable approach shall be adopted. Next question of importance is that whether such a condition be imposed in view of section 10 of Transfer of property act. This aspect was not considered by the court.

Could there be an alternate condition.


Amarnath transfers a property to Billa. One of the condition is that Billa shall marry Hema, the daughter of Chandrasekhar. By taking consent of Damodara and Emberaman. Or he has to marry saroja on her attaining 18 years. Question what is the nature of condition. Answer:- it is a condition precedent as the marriage could take place with the consent of Damodara and Emberaman. Alternatively it had provided that Billa can marry Saroja on her attaining 18 years. Billa marries Saroja on her attaining 18 years. Question whether the condition is fulfilled or not Answer: As there is an alternate option the condition imposed is deemed to have been fulfilled substantially. So there is a substantial compliance.

Can the court relieve the condition precedent and give the property Under certain circumstances while the condition subsequent could be relieved by the Court, it can not relieve the condition Precedent. Lord Chancellor had said in Pop ham Vs Bam field that precedent conditions must be literally performed and this court will never vest an estate, where by reason of a condition precedent, it will not vest in law .

:Condition subsequent:
A condition subsequent is one on happening of an event the interest once vested is either determined or shifted from the grantee to another person. The principle is reflected in section 28 of the transfer of property act. This provision of transfer of property act has corresponding provision in section 131 of Indian succession Act. As per section 28 the transfer of interest created to accrue to the transferee with a condition super added.

The section 28 speaks about ulterior disposition and not the ulterior interest. The condition so super added envisages that on happening or non happening of an event what had been vested would be divested in favour of another person or may even get shifted to another person. The rule relating to the condition subsequent is subject to the rule laid down in section 10, 12,21,22,23,24 and 25 of the transfer of property Act. A condition subsequent shall be fulfilled strictly if the divesting has to take place. Section 29 contemplates that the ulterior disposition contemplated in section 28 cannot take effect unless the condition is strictly fulfilled.

Amarnath had two wives. His first wife had a son. The second wife was not having any son. Amarnath settled property to his second wife for life. He had made provision further that the property shall go to the son of second wife if a son is born to her. Further a provision was made that in case if no son is born to the second wife, then the property shall go to the son of the first wife. Question:- What is the nature of interests of the sons of the first wife and what is the consequence which follows on account of the birth of a son to the second wife. Answer:- the nature of interest of the son of the first wife is a vested interest liable to be divested on happening of the event. The said event is of an uncertain nature. That is the birth of a son to the second wife of Amarnath.
Umesh chander Vs Zahoor Fatin. ILR1891 Cal 18

Amarnath and the members of his family arrive at a compromise. The family consists of lakshman and Rama, The terms of the compromise runs to the effect that lakshman should have the estate for life and Rama shall be the owner in full if lakshman survived Rama. If Lakshman did not survive Rama then the entire estate would pass on to the lineal descendents of Rama. The estate shall go to Ramas lineal descendents as per the law of primogeniture. Question:  what is the type of condition imposed.  what types of interest which have been created. Answer:the condition imposed is that of condition subsequent, as the same is imposed after the vesting has taken place and it is for the purposes of divesting the interest which has already vested. vested interest in favour of Rama subject to the condition that it shall get divested on not happening of the death of Lakshman before Rama.
Sunder bibi vs. Rajendra. ILR 1925 All 496.

Prior disposition will not be affected by invalidity of ulterior disposition


In case of a transfer if there are two stages to effect disposition the fact that the later stage is invalid would not render the earlier transfer invalid. Amarnath transfers a property to Billa for life. One of the condition is that Billa shall divorce Hema, the daughter of Chandrasekhar, whom Billa had married. Question whether the condition is good or bad. Answer: the condition imposed is of such a nature that it is not to promote the public policy and is to advance a situation of destabilizing the family life. Therefore the said condition is bad. Question No.2. whether Billa is entitled to the property for his life time. Answer: Billa is entitled to the property as if the subsequent condition is not there. Note: it is only the subsequent interest is bad and not the entire transaction.

Saraju Balu Vs Jyothermayee. 1931(58) I.A.270. P.C


gave a gift to D. It was an absolute gift. However there were three conditions that the properties shall not pass to the grantees daughters, they were not to be transferred by gift except to a limited extent for religious purposes and the transferor and his heirs shall have a right of pre-emption on happening of certain specified event. There was a defeasance clause that on the failure of designated heirs, namely sons of transferee and their sons successively. The transferee died without issue but left a will leaving the properties to the respondent. Appellant claimed to be the nearest relative and filed a suit. P.C.held: The condition is bad and D could dispose of the property as he desires.
Note: the gift is of an absolute nature so there can not be any condition that the heirs of donor could get back

Amarnath transfers his field to Billa. One of the condition is that Billa shall set fire to the crops grown at the land of Zahir with in one year. If the said crops are not destroyed then the field would get reverted to Amarnath. Billa after taking the property declines to set fire to the crops to destroy the same. Question which arises is whether Amarnath is entitled to have the property back as Billa failed to perform his part of contract. Answer: the condition imposed by Amarnath to the effect that the crops shall be destroyed is an illegal act. So Billa could refuse to do it later. The transfer of property to Billa will not get divested though the later vesting is bad due to the fact that the condition was bad.

In Re beard Reversionary General Securities Ltd Vs Hall 1908(1) Ch 383

A gave a devise that B shall get the property provided that B shall not join Army or Navy. In case if B joins Armed forces then the devise gets cancelled. The court held: The condition is bad as opposed to public policy. Hence B will get the property notwithstanding the condition.

Amaranth transfers property to Hema. 3 The said transfer was subject to the condition that she should marry Bob at or before she attains an age of 21 years. In case if she fails to do so then to Yamini. Bob dies before Hema attains an age of 21 years. Question what is the position regarding getting of the property either by Hema or Yamini. Answer Yamini gets no interest in the property, Hema gets the property as she could not perform the obligation for her fault but as Bob died as a consequence of the Natural event. The subsequent condition which needs to be performed needs a strict compliance. In the absence of the strict compliance of the subsequent condition the question of condition to dispossess subsequently can not be given effect.

Section 30 corresponds with section 133 of the succession act, Section 31, 32, 33 and 34 are the other sections relating to the conditions to be imposed while there is a transfer. Section 31 corresponds with sec 134 of Indian Succession Act. This section deals with a contingency of a condition super added that the transfer of interest ceases to exist if a event of uncertain nature happens or in case of specified uncertain event shall not happen. Section 32 corresponds with section 135 of the I.S.A. This envisages that the condition would be void for uncertainty but the interest would not be void. These conditions may be in respect of residence, marriage, employment, or any other nature of work.

Amaranth bequeaths a fund to be paid to Hema on her attaining an age of 21or on her marriage, which ever happens first.

The another condition is to the effect that she should obtain the consent of the executors of the will. Further it is stipulated that if Hema dies before the fund becomes payable on the condition mentioned then the property shall go to Yamini as a gift.

The executor dies before Hema could attain the age of 21 years. Hema marries sampath without the consent of the Executor. Question: what is the position of Hema and Yamini with reference to the property. Answer: The property would go to Hema absolutely and not to Yamini. What is the reason: the property goes to Hema as already it had vested in her on the death of Amaranth, to dispossess the said vesting the compliance of strict nature is needed.

:Time for performance:


If the condition imposed does not specify any time as to when the condition shall be performed, and the performance of the condition becomes impossible then the said condition is bad and the transfer will not be effected. Section 33 of the Act which corresponds with section 136 of the Succession Act. A transfer is made to Billa by Amaranth that, Billa shall marry Sumathi and if not the properties shall go to Hema. Billa marries Prema. His act of marrying Prema renders it impossible to marry Sumathi. What shall happen to the transfer: The transfer is not bad. Bill will have the property and Hema will not get the property.

Time for performance is specified but the element of fraud had intervened.
When a time is specified and the person is prevented by fraud then section 34 of the transfer of property act will apply. This section is based on the principle that no person shall be permitted to take benefit of fraud as practiced by him. The ultimate beneficiary if he practices fraud on the other person who has to fulfill the condition, then as against the said person the period would be extended. If the said person who had do so certain things for performance, and due to the fraud the said thing is not performed, it should be deemed that the performance has taken place. The fraud has no sanctity in law. Where ever there is an element of fraud the same goes to the root of the matter and would vitiates the transaction. The person who intends to have the benefit of the fraudulent act as practiced by him he would not be entitled to the said benefit. This section corresponds with section 137 of the succession act.

Conditional limitation.
Conditional limitation is one where there would be a condition that the transfer which had been effected once, would cease to have effect on happening of an event the transfer ceases and the same would be in favour of another. Conditional limitation is a kind of condition subsequent, but all condition subsequent are not conditional limitation. In case of conditional limitation it limits the transfer on happening of a condition. A combined reading of section 27,29, and 30 would indicate the concept of conditional transfer. Under conditional transfer, transfer would be coupled with a transfer to another person on failure of a prior disposition. Sec, 129 of the Succession Act deals with aspect. Conditional limitation is a condition of defeasance, that is it terminates the interest of one and vests with another.

Elections Section 35.


This principle has got its roots in English law though there is a difference between the principles as applied in English Courts and Indian Courts. Section 35 of Transfer of Property Act enumerates the said principles relating to Elections

Elections The basis of this doctrine is based on the rule  that what one intends and expresses would be acted upon. Allegans contraria non est audeiendus not to blow hot and coldwith reference to the transction. Qui septet commodum, sentire debet et onushe who derives the advantage shall take the burden there of. This was the rule in early part of 18th century. This is on the principle that he who volunteers to take a thing has to do things which he has to do under the instrument.

Elections

Modern requirement is * intention on the part of testator/transferor to transfer certain object or thing. * the property shall not be of the transferor. * There should be certain benefit being given to the true owner of the property.

The foundation of this doctrine is that a person taking the benefit of an instrument must also bear the burden. He cannot take the benefit under a document of transfer and cannot say that he would not honor the liabilities arising under the document. He cannot use document as a sword to get the benefit and as a shield to prevent the liabilities. This is based on the principle of approbation and reprobation- which is an extended limb of principle of estoppel.

Election in law is left to ones own free will to take or do one thing or another, which he pleases.(Jacob) It is more frequently used to choose between two rights that is one regarding to derive certain things while other not ready to loose an already existing thing.

Elections
five Essential ingredients regarding application 1. The transferor should dispose of the property which he has no right to transfer. 2. The transferor should confer a benefit out of his own property on the owner of the property which he profess to dispose of 3. Disposition of the property and he conferment of a benefit on its owner should be parts of the same transaction 4. The transferee put to an election should have an independent proprietary right in the property dealt with to his detriment by the transferor. 5. The beneficiarys proprietary right should be such that the disposition of the instrument can be perfected if he waives his objection.

Section 167 to 177 of Indian Succession act deals with the concept of elections. Rules relating to Election are not contradictory to; *** Hindu law *** Mohammedan law Hence the principle of election applicable to Hindus and Mohammedans. The doctrine of election has universal application irrespective of the religious denomination. It is more equity based. Principle of election not applicable to the government grants. Parties to an election are **** transferor not as the owner of property. **** refractory transferee ****disappointed transferee.

Ingredients of section 35
Property transferred must belong to another. Transferor must profess to transfer such property which does not belong to him. Confers benefits on the owner of the property which he profess to transfer. Such a transfer should form a part of the same transaction. If the transfer is not a part of the same transaction, the section 35 of T.P.Act is not applicable. Primafacie every person is presumed to have transferred only what is his and not what belongs to others. Profess would mean purports, claims or acknowledges. Therefore a person claims, or acknowledges or purports to transfer a property which is not his then this doctrine would apply.

Section 35
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. This section consists of in all ten parts. They could be stated as under; General principle. clause of reverting to the transferor. Belief of transferor. Indirect benefit. Different capacity. Acceptance. Two years enjoyment. Status quo cannot be restored. Time for election. Disability.

First rule of election under section 35. instrument reverts to The benefit conferred by the
the donor or his representatives, except under two situations specified in the section. Indian rule is based on forfeiture while the English rule is based on compensation. Illustration: Anandagives to Bhisma by a document rs.50000/ and to Cadambi a property of Bhisma worth about 10000/.Bhisma refuses to surrender the property to Cadambi. As per English law, Bhisma as a refractory donor can take rs.50000 and compensate Cadambi the disappointed donee, to an extent of 10000. but under Indian law the said rs.50000 reverts to Ananda, because Bhisma forfeits it and Ananda or his representative will have to give Cadambi a sum of Rs.10000.

second rule of election under section 35


While applying the second clause of the section is whether the transferor has some right in the property disposed of but was not absolutely entitled to it.
It must be established that the transferor intended to transfer more than he could.

Illustration: Ananda owns a life interest in certain property known as Vemalodge and grants it to Bhisma and by the same instrument confers certain benefits to candade who was entitled to the reversion. In such a case candade cannot be made to elect, unless it is shown thaat Ananda attempted to dispose of not merely life interest which he was entitled to dispose of, but also something more than the life interest. The presumption in such case would that the transferor only intended to dispose of what belonged to him, though it is a rebuttable presumption.

Third and fourth rule of election under section 35


The section 184 and 185 of Indian succession Act reflects these rules. A person taking no benefit directly under the transaction but deriving it indirectly, need not elect. A person who in one capacity takes a benefit under the transaction may in another capacity dissent there from.

Exception to the said four rules


The exception to the said four rules is narrated in the second part of section 35. The exception corresponds with sections 186 of Indian succession act. Where a particular benefit is expressed to be conferred on the owner of the property which the transferor profess to transfer, if such owner claims the property, he must relinquish the particular benefit, but he is not bound to relinquish any benefit confered upon him in the same transaction.

To confirm to part with the object which he has to transfer. To dissent to part with the object he has to transfer. Consequences to part with the property would render a situation that he has to relinquish the benefit conferred on him. Illustration:- A is not the owner of the parker Pen. B is the owner of the parker pen. A profess to transfer the said parker pen to C under an instrument. Under the same instrument he transfers to B wrist watch. Option No.1.B has got an option to accept the wrist watch and part with the parker pen.. Option No.2.B has got an option to not to part with the parker pen. In case B opts for Option No.1, the B has to give away the pen to C and get satisfied with the wrist watch. In case B opts for option No.2, to not to give away the parker pen then he can not accept the wrist watch.

Course open to a refractory Donee.

Consequences in view of option no.2.


The benefits derived from the transferor to not to take effect. The benefit so relinquished shall revert to the transferor. In case it the transferor is either dead, or not available then the benefits should go to the heirs of the legal heirs of the transferor as if no transaction had taken place. Illustration:-A is not the owner of the parker Pen. B is the owner of the parker pen. A profess to transfer the said parker pen to C under an instrument. Under the same instrument he transfers to B wrist watch. . B opts for option No.2, to not to give away the parker pen then he can not accept the wrist watch. The wrist watch would pass on to A or his legal heirs

Disappointed transferee entitled to a charge of making good the amount or value of the property attempted to be transferred to him.
Transfer of property

gratuitous

Non gratuitous or for consideration.

Death of transferor Incapacity of before the transferor election before the election

Cooper Vs. Cooper 1874 H.L 53


A certain properties to trustees on the trust to sell it after the life time of the widow of A The sale proceeds shall be held by the trustees for the benefit of his children. The widow executed a deed directing the proceeds to be divided in to three parts equally for three sons x, y, and z. Subsequently she made a will and gave properties to her eldest son x and a legacy to her other sons y and z and to the sons of y. Y predeceased the testatrix widow of A

The legacy in favor of y became inoperative as will became operative long after the date of execution. X brought an action to compel Z and sons of Y to elect the claims under the deed of appointment and under the will. Questions which arose are: A. whether the widow of A was the owner of the property. B. whether the widow of A had power to dispose of the property by will. C. whether the question of Election could be exercised.

House of Lords held: The main principle was never disputed, that there was an obligation on him whom takes a benefit under a will or other document to give full effect to that instrument under which he takes a benefit; and if it is found that, that instrument purports to deal with some thing which is beyond the power of the donee or settlor to dispose of, but to which effect can be given by the concurrence of him who receives the benefit under the same instrument, the law will impose on him who takes the benefit the obligation of carrying the instrument in to full and complete force and effect.

In this case the court went on the principle that the author of an instrument intended to give effect to every part of it and this principle is described in cooper Vs. cooper that ordinary intent implied in every man who affects by a legal instrument to dispose of property, that he intends all that he has expressed The court held that widow of A was not the owner of he property, her attempt to dispose of the property is no proper. The question of exercising the option under the will would not arise

Mode of election.
The owner has to choose one out of two inconsistent rights. The choice may be either express or by implied conduct. Where it is by the express words then it would be conclusive. Where it is by the implied conduct then it would be understood by means of the conduct of the parties.

Apportionment.
Section 36 and 37 deals with the principle of apportionment. The rule laid down under these sections are almost similar to the principle laid down in section 8 of the act. What is apportionment? Apportionment means distribution of a fund among the claimants, when there are more number of claimants than one. The apportionment may be from the point of time or may be from the point of extent.

Apportionment
Apportion means to divide or partition or assign apportionment
Apportion

Time section 36

Apportionment
Apportionment from the point of time is reflected in section 36. Apportionment from the point of estate is reflected in section 37. Indian law is restricted in respect of transfers inter vivos. It is not applicable by the operation of law in view of specific provision contained in section 2(d). The provisions of section 36 is not applicable in case of a partition. The principle of section 36 applies in the absence of any agreement or local usage. It is mainly in respect of rents,annuities,pensions,dividends, and other periodical payments the provisions of section 36 applies. It is mainly in respect of shares in respect of a property regarding which the payment used to be made and the same is divided, then provisions of section 37 applies. There shall be a transfer of interest between transferor and transferee.

apportionment
Illustration: Ananda is the owner of a house in occupation of Raman. The said Raman is a tenant on a monthly rent of 15ooo/. The said rent should be paid on 5th day of every month as per the English calendar. On 20th of may 2007 Anand enters in to a contract to sell the house to rajoo. The parties enter in to a contract. The said contract would be silent about the payment of rent. In pursuant to the same on 10th June 2007 a sale deed is executed by Ananda in favour of rajoo. Raman continues to stay at the house. In this case the buyer would be entitled to receive rent from Raman from 10th of June onwards. Ananda would be entitled to 1/3 rent while rajoo to 2/3 rent. This is a case regarding the apportionment on the basis of time.

Apportionment
Illustration: Ananda is the owner of a house in occupation of Raman. The said Raman is a tenant on a monthly rent of 15ooo/. The said rent should be paid on 5th day of every month as per the English calendar. On 20th of may 2007 Anand enters in to a contract to sell half the portion of the house to rajoo. A sale deed is executed by Ananda in favour of rajoo. Raman continues to stay at the house in spite of the notice of sale. In this case the buyer would be entitled to receive rent from Raman in respect of portion bought by him. Ananda would be entitled to 1/2 rent while rajoo to 1/2 rent. This is a case regarding the apportionment on the basis of estate.

Conflict of rights
The conflict of rights would arise when two or more persons claim similar right in respect of an object or a thing.

In a society where there is a shortage of land and high demand for it, the moral values are being deteriorating day by day the people of unscrupulous nature try to over take one another. Conflict of rights do arise in the society when a person who had a limited right sells or mortgages the property, transfers the property in a fraudulent manner, gives an impression to others that he has the right in respect of the said property and passes on to another, does certain acts which he ought to have performed has not been performed in full, or does any thing when the subject matter of the property is in dispute and so on so forth.

Conflict of rights

Conflict of rights

priority

Limited power To transfer

Holding improvement out


Transfer of Rt under Insurance policy

Lis pendence Payment To Holders With defective title

Fradulent transfer

Rt of persons Power to revoke Holding maintenance

Limited power to transfer.


Section 38 of transfer of property act deals with this aspect. The scope of this section is very much limited and is not applicable to the situation where the section 41 dealing with ostensible owners applies. The scope of this section is very much limited and is not applicable to the situation where the section 64 of Trust Act applies. This section applies with transfers by Hindu widow, or a manage of a Hindu joint family or a guardian of a minor who is authorised to dispose of the property under certain circumstances. When such a person transfers the Immovable property for 1.consideration alleging that the circumstance exists to transfer. 2.The transferee if he has made reasonable enquiry regarding the existence of such a circumstance and has acted in a good faith.

Hanoomanpersaud Pandey Vs B.M.Koonwaeree 1856(6) Moors Appeal 393


A case decided prior to the transfer of property act was enacted. The privy council decided the matter with reference to principle of Hindu law.
Manager of an infant executed a mortgage. As per hindu law a manager of a minor had a limited qualified power regarding the disposal of the immovable property.

The manager could do so for the minors need or for the benefit of the estate. The privy council held that the lender is bound to inquire in to the necessity of loan and satisfy himself as to whether the there exists necessity. The principle laid down in the said ruling is embodied in this section.

The provision contemplated in section applies only in respect of transfers of immovable properties and not not of movable property. Mainly it applies in respect of :Hindu widow, or a limited manager under Hindu law. Manager of a Hindu joint family. A Hindu father. Defacto or dejure guardian of a Hindu minor. Executor under a will made by a Hindu not governed under Indian succession act. Mahant or a shebait. Guardian of a minor appointed by a court.

The section 38 not applicable in case of a gift. Hence a donee from a limited owner can not set up this plea.
Burden of proof on the transferee to show that he had exercised reasonable care as a prudent person.

Not applicable in respect of a transfer effected by law, but applies only in respect of the transfer made in pursuance to the contract of the parties. Should have acted in a good faith and not with malafides I.e any sort of collusion between the transferor and transferee.
Read AIR 1957 A.P.776, 1986(2) Cal.341, AIR 1971 SC 1028, AIR 1927 PC 121.,

RANI VS SHANTA BALA.air 1971 sc 1028


Sashi bhushan had a wife and a daughter. Sarala bala was the daughter. The parties were governed by dayabhaga school. Wife of Sashi bhushan predeceased him. Sashi bhushan died in 1920. So sarala inherited the father. Saralas husband Kunju died in 1937. Sarala and Kunju had two sons and 4 daughters. 2 daughters had got married during the life time of kunju. Kunju had not left behind any property other than a house. He was a man of humble walk of life. At the time of death of Kunju his sons govinda and Tulsi were minors.

RANI VS SHANTA BALA.air 1971 sc 1028


On 22.10.1941 sarala executed a deed to sell a portion of the property for rs.1100 in favour of chapalabala. In the agreement sarala had a recital that she had to sell the portion as she had a financial need. Few months later sarala did not execute the sale deed. Few days later sarala executed a sale deed for rs.1500/ She died during 1950. During 1953 govinda and tusasi filed a suit to the effect that sale deed executed by sarala does not bind them. Suit was resisted.

Trial court held that there was a legal necessity High court in appeal did not agree with the trial court. The matter went to supreme court. The supreme court held that the legal necessity does not mean actual compulsion. It means the pressure on the estate which in law may be regarded as serious and sufficient.

Object and scope of section 38


To protect the bonafide purchaser.who had no notice.

To protect other persons affected by transfer scope of the section is limited or restricted.

Difference between section 38 and 41


Section 38 is a deeming provision regarding the existence of a circumstance if a recital is made that the transferee has made enquiry. Section 41 a mere recital if is made that the transferee has made enquiry is not sufficient.

AIR 1949 All 501,. AIR 1983 Ker 178. AIR 1927 P.C. 121 AIR 1967S.C. 547 AIR 1924 All 939 AIR 1927 P.C 37 AIR 1985 Mad 372 AIR 1988 Ori 136. AIR 1971 S.C.776

Conclusion
The overall effect of section 38 of the Act could be summarized to the effect that a bonafide purchaser who has put forth efforts to know the details regarding the property at the time of the sale shall be protected. The degree of enquiry should not be of a very high degree or standard as the alienee would not be knowing all the facts. What the alienee has to show is that he made bonafide inquiry and ascertained the facts. If that is done the fiction as per law would go in favour of the transferee. The transferee alienee need not prove to the last straw that the condition which was needed had happened. In fact the sprit of section 38 recognizes the principle as laid down in Hanooman persads case. So what is needed is that of a reasonable precautions and not a precaution and not a precaution which would be taken by a person sitting on a clap ham omnibus.

Transfer where a third person is involved.


Third person shall have a right to  receive maintenance,
 Provisions for advancement,  Marriage,

From the profits of the immovable property.


Such property is transferred with notice to the transferee or where the transfer is gratuitous. The third party shall have a right to claim such a maintenance from such a transferee.  If the transfer is for consideration and without notice of the right then the transferee is not bound regarding such a right.  Earlier to 1929, the third party shall prove that the transfer was fraudulent but after 1929, that is not the situation.  Applies only in respect of immovable properties and not movables.

History of section 39.


Lakshman Ramachandra Joshi Vs Satyabhama Bai. 1877(2) Bom 494. A Hindu widow sued her husbands brother, a sole surviving member of the family to pay maintenance and the purchaser of the family property from the brother. The court held that if the transferor wanted to defraud the right of maintenance and the transferee was a party to such a fraud, he would not be protected if he knew that there was a claim of maintenance.

Provision for advancement.


provision of advancement has no reference to the common usage in India but has special reference to the English law. Advancement is a payment to persons who are presumably entitled to have a vested contingent interest in an estate or legacy before the time fixed by the will for their obtaining the absolute interest in a portion or whole of that to which they would be entitled. Purchase of a land by the father in the name of the daughter or some one is an advancement. This view at present in India can not be considered in view of Benami prohibition Act.

A has a sister in law B. B is the wife of As brother. B is a widow. As per Hindu law with reference to coparcenary property prior to 1956, B had a right to claim maintenance. A transferred the property X to B in lieu of her right to claim maintenance. A also agreed with B that if B is dispossessed of the X property, then he would transfer an equal extent of land either of K.L.M.N.O.P., as per the choice of B. A sold the lands K.L.M.N.O.P, to Z. No notice had been given to Z about the agreement between A and B. Can B claim maintenance from the income of K.L.M.N.O.P Answer:- No., as Z is a bonafide purchaser with out notice.

A has a sister in law B. B is the wife of As brother. B is a widow. As per Hindu law with reference to coparcenary property prior to 1956, B had a right to claim maintenance. A transferred the property X to B in lieu of her right to claim maintenance. A also agreed with B that if B is dispossessed of the X property, then he would transfer an equal extent of land either of K.L.M.N.O.P., as per the choice of B. A sold the lands K.L.M.N.O.P, to Z. Notice had been given to Z about the agreement between A and B. Can B claim maintenance from the income of K.L.M.N.O.P Answer:- yes., as Z had due notice.

A has a sister in law B. B is the wife of As brother. B is a widow. As per Hindu law with reference to co-parcenary property prior to 1956, B had a right to claim maintenance. A transferred the property X to B in lieu of her right to claim maintenance. A also agreed with B that if B is dispossessed of the X property, then he would transfer an equal extent of land either of K.L.M.N.O.P., as per the choice of B. A gifted the lands K.L.M.N.O.P, to Z. Can B claim maintenance from the income of K.L.M.N.O.P Answer:- yes., as Z is a gratuitous transferee.

Exception to the rule of section 39


Family debts takes priority over the claim for maintenance.
Ramaswamy sold family property to Krishna Ayer in order to liquidate the family debt. Krishna Ayer purchased it with due notice of claim of the widow of the brother of Ramaswamy for maintenance out of the property. The widow wanted to enforce the claim towards the maintenance against the property at the hands of Krishna Ayer, can she be permitted to do so? Answer No. the binding debts of the family takes priority over the claim of the widow to have maintenance.

Sidde Gowda Vs Lakkamma. AIR1981 Knt. 24


P was the wife of D. She filed a suit against her husband seeking maintenance and a charge being created on the family house of the husband regarding the maintenance amount. There after the institution of the suit D transferred the house to TPR. The said TPR had not paid any consideration to D in respect of the property. TPR contended that D had some other properties and the charge should be confined to such properties only. The court held that the maintenance could be charged upon house also. The husband having some other properties is immaterial.

Section 39 and its philosophy.


Section 28 of Hindu Adoptions and maintenance Act 1956 makes a similar provisions in respect of persons mentioned at section 2 of that Act The principle behind this section is to afford protection to an innocent transferee for consideration. The section also protects the interest of the person who has a third party claim.

Section 40
Burden of obligation imposing restriction of use of land. Obligation annexed to ownership but not amounting to interest or easement Then such an obligation may be enforced against the transferee if the (a) the transferee with notice thereof, (b) gratuitous transferee Exception; the clause would not apply in respect of a transferee who has paid the consideration and had no notice of the said right or obligation. Note: section 40 has no application to the Rights relating to easements.

Section 40
Consists of two parts. Part 1 applies in respect of negative aspects Part 2 applies in respect of positive aspects. The said section envisages that the right must be one of restrain of enjoyment. Applies in respect of the condition running with land Personal contracts even though it may have reference to the property binding between the parties there to and their privies though is the general rule it is not applicable in respect of transactions in pursuance to which the property goes to the other person.

Amaranth contracts to sell the land to Kamala with in 3 months from the date of agreement. The said agreement was entered in to on 20th of December 2007. On 4th of January 2008 he sells the said land to Bheema. Bheema before purchasing the property had caused a notice to public about the said sale transaction. Kamala had filed he statement with Bheema that she had an interest in respect of the property in pursuance to the agreement dated 20th December 2007. After sale transaction Kamala wanted to enforce he right against Amaranth and Bheema. Question. Could Kamala do so yes Question to what extent she could do so. As against Bheema to the similar to the extent as she could have as against Amaranth. .

Amarnath by deed of sale sold the property that is one of the shop among three to Bheema. The condition was that Bheema shall not construct Balcony to the shop. Amarnath also gives an undertaking that he would not construct balcony in respect of two shops which have been retained by him. Subsequently Amarnath sold one of the shop to Karupa. Karupa wanted to remodel the shop and tried to construct a balcony. Bheema sued Karupa and wanted for an injunction to restrain Karupa to not to construct the Balcony. Question What is the nature of right claimed by Bheema The nature of right is that of an easement. Could Bheema have any relief No. as the right is in the nature of an easement he can not have is what the court said. This falls under the second category

Holding out.
Section 41 and 43 of t.p.act covers the field of holding out. Ramanatha Ayer in the law lexicon defines holding out would mean, holding a women to be the wife of another would mean that the perpetrated husband by conduct leads the world to believe that parties are living and associating themselves together as husband and wife. What is holding out doctrine? Basically holding out means that a person gives to the world at large certain thing when in reality it is not so. On account of the conduct the people at large would believe the imaginary as the real, while real it self would not be known at all.

Holding out
Extend this principle in respect of the properties:The real owner of the property either expressly or impliedly by conduct and language conducts to lead the world at large to believe that another person is the owner of the property. In such a situation, the person who is exposed to the world at large would be known as ostensible owner. This part of the world is in fact partly defined in the section itself, as with the consent of, express or implied, the person interested in the property.

Section 41
This is based on the principle of equity. One should not be permitted to blow hot and cold from the same trumpet. When an ostensible owner transfers the property to a transferee for consideration, the transaction is not voidable at the instance of the real owner subsequently. The transaction is not voidable applies only in such cases where the transferee before the transfer in his favour has made proper inquiry, and has acted in a good faith. Ingredients of section 41 are that the transferee should have taken a reasonable care to ascertain that the transferor had power to make the transfer. He has acted in a good faith.

Lachman Vs Kalicharan.1873(19)W.R. 192


A during his life time held out his wife W to be the owner of a property x situated at Rampur, as a property purchased by her out of streedhan. In reality it was not so. The property was purchased out of the funds of A. After the death of A, the w sold the said property to C, who purchased believing that the said property was a streedhan property. After some time Z the son of A filed a suit against the purchasers contending that the property in reality belonged A and not for W. The sale deed executed by W is not a valid document. The same is liable to be set aside.

Lachman Vs Kalicharan.1873(19)W.R. 192


Sir Barnes peacock said:- it appears to their lordships that there was a misrepresentation by the father in following the property to be taken by wife under a deed of sale, representing the purchase money was her streedan and in all his acts, both public and private during the life time that his wife is the owner of the property. After that representation the heirs of the father cannot be permitted to say contrary

Nemoplus puris adalium transferee protest quam ipsa habit and Nemo dat qui non habit
The general rule is that no one can transfer a better title than what he has as stated in the Maxim nemoplus puris adalium transferee protest quam ipsa habit no man can transfer a right or title greater than what he himself has, and Nemo dat qui non habit he gives not who hath not. Section 41 is an exception to the said maxims.

Ram coomar Vs Maqueens 1872 I.A.supplement 40 (PC) Mac Donald purchased certain properties, but the sale deed was obtained in the name of his mistress Banoo. Banoo was a benamidar. X purchased the property from Banoo, under an impression that the property which he was going to purchase belonged to her. The purchaser took possession of the property from Banoo. At that time Mac Donald did not raise any objection. He remained silent. Some time later Mac Donald executed a will and bequeathed the property in favour of P. Soon after the death of Mac Donald P on the basis of the will of Mac Donald claimed the property. X resisted the suit by contending that he is a bonafide purchaser for value paid. The privy counsel held that Banoo who looked like a real owner is an ostensible owner. She made transfer for consideration. Purchaser purchased the property with due diligence. Mac Donald did not object. To protest the deal. So P can not be allowed to contest the deed.

Who can not be the ostensible owners.


An agent or a Manager. Menial servant in occupation of a property. Mortgagor with limited interest of ownership. Trustee or a manager of an idol since lord cannot give consent. Donor who has not retained the power to revoke. Guardian or a person having a fiduciary character. Action sale.

Kashmiri Singh Vs Panchayat samithi. 2004(6) scc 207 X a purchase knew that the land purchased by him stood in the name of Panchayat in the revenue records. He purchased the said land from the State Government as represented by the Tahasildar. A dispute arose in respect of the said land as the Panchayat contended that the property belonged to it. A writ petition was filed. W.P., was dismissed. An appeal was filed before the Supreme court. A plea was put forth that the provisions of section 41 would come to the rescue of the writ petitioner. Justice Ashok Bhan considerd the case and held that the transferee had not exercised due diligence to find out whether the land was a Government land or not. When the revenue records showed the name of panchayat. The Govt. did not held out the land as an ostensible owner.

Section 27 of sale of goods Act= section 41 of T.P.Act. Read other cases:- AIR 1963 S.C.1917 GURUBAKSHA SINGH VS NILLA SINGH., AIR 1965 S.C.295 Suraj Ratan Vs Azambad Tea. AIR 1982 S.C. 102 controller of estate Vs Alok mitra,. AIR 1991 Knt 273 S.M.SHAH VS syed Abdul Rasheed.

Section 43.
Second limb of principle of holding out. This involves the principle of feeding the grant by estoppels. This is based on the principle of equity. One who makes other to do a thing believing on the words can not be allowed to retrieve the words to the disadvantage of the another.

Ten commandments of section 43


Transferor makes a representation to the effect that he is competent to transfer a particular immovable property. The said representation was erroneous or fraudulent. Representation should not be true. Transferee believes or is made to believe the representation is true or correct and the transferor is competent to transfer. Transfer for consideration. Transferee acts on the representation and enters in to a contract. Transferor subsequently acquires competency to transfer the same property. The contract subsists. The property should continue with transferee. Transferee exercises option to signify that he would go ahead with the contract.

Rule of section 43 does not apply


If no representation by transferor. If no fraud or misrepresentation or erroneous representation. Transferee knows the defect. Transfer is prohibited in law. Transfer is without consideration. The transferor does not acquire the interest If contract is not subsisting.

Feeding the grant by estoppels.


Compel a person to perform when a performance becomes possible. This doctrine applies regarding sale, mortgage, lease, charge, exchange. This doctrine does not apply regarding court sale, part performance, forbidden by law, transfer by a lunatic or a minor, gift.

Spes succession in and section 6(a) and rule of section 43 Rule of substantive law. Rule of estoppel Fraud or misrepresentation Fraud or misrepresentation by transferor is not a must by transferor a must Prohibition applies to all kinds of transfers irrespective of consideration.. Transfer is void Applies for immovable and movables. Prohibition applies not to all kinds of transfers consideration is a must.. Transfer is voidable Applies for immovable

Jumma Masjid Mercara Vs K.Devaiah,AIR 1962 S.C 847

A Hindu joint family had 3 brothers and a sister. Brother No.1 and 2 had W1 and W2 as wives respectively, while brother no.3 had a son A, but not a wife. Sister had a daughter who in turn a son B and a daughter C. During 1900, A collective mortgage was executed by ABC and it was in favour of X and was entitled to enjoy property till 1920. Widows of brother no.1 and 2 had life interest, while ABC had a reversionary right after the death of w1 and w2.

While transferring the property ABC did not mention W2 was alive and transferred the property to X. Later X filed a suit for possession. W2 resisted the suit. Trial court and the court of the Judicial Commissioner said that the plaintiffs were not entitled to possession. When the r.s.a., was pending w2 died. W2 had executed a will in favour of Jamma Masjid. On the death of w2 ABC while claimed the property as reversiones Masjid claimed as a legatee. Masjid conteded that section 43(a) should be read subject to section 6(a). The court did not agree with the said view and laid down the rules which differentiated between section 6(a) and 43. Section 43 3mbodies a rule of estoppel and enacts that a person who makes a representation shall not be heard to allege to the contrary as against the person who acts on such representation.

Jumma Masjid Mercara Vs K.Devaiah,AIR 1962 S.C 847

It is immaterial whether the transferor acts bonafide or fraudulently in making representation. It is only material to find out as to whether the transferee has been misled. This ruling is affirmed in 1994(4) S.C.C 730.

Section 41 and 43
Section 41 provides that a transfer by a owner cannot be avoided on the ground that transferor was not authorised to make it. Transferee to whom the transferor has made fraudulent or erroneous representation to lay hold at his option of any interest which the transferor may acquire. Transferee has believed the representation made by the transferor and has acted on the said basis.

This rule is made subject to express provision that transferee shall take reasonable care to ascertain that the transferor had power to make transfer. To act in good faith

Acted in a good faith,

Illustrations section 43
Janhavi a Hindu was the wife of Muralidhara. Muralidhara had certain properties at city of jamatmal. Muralidhara was not to be seen since five years. Janhavi, in order to eke out her lively hood mortgaged the property to Mohan. As on the date of mortgage the transaction is invalid as the presumption under law cannot be drawn as to the death of Muralidhara. Mohan files a suit in respect of the said mortgaged property. The said suit was filed seven years after the disappearance of Muralidhara. As per law Muralidhara could be treated as dead. So janhavi would be treated as a widow of Muralidhara. Mortgage as on the date of suit is valid as the where about of Muralidhara was not known and Janhavi had acquired the right of her husband.

Illustrations section 43
Ramachandra, Arjuna, and Kiran were brothers being the sons of Kiraatharjuna. They had equal share in respect of the palaces situated at Sandur. Ramachandra, and Arjuna creates a lease in respect of that property in favour of Armuga, to the exclusion of , Kiran. Some time later Kiran dies bequeathing his right in favour of Ramachandra and Arjun. Armugas title as a lessee in respect of whole properties would be valid, as they get it perfected.

Section 43
section 43 not apply for a transfer not for consideration. Not to apply in respect of gift. Not to apply in respect of invalid transfer as forbidden by law. Not to apply in respect of invalid transfer as opposed to public policy. Not to apply in respect of invalid transfer as made by a minor or a lunatic. To have the benefit of this section two important conditions which shall exist are a. Contract of Transfer was made by a person having competency to enter in to a contract. b. The contract would be subsisting when the claim for the recovery was made.

Rule regarding priority.


Qui prior est tempore potior est jure. He has the better title who is first in the point of time. Transferor of same property having once conveyed cannot convey it once again. The rule of priority in section applies only in respect of immovable properties. The rights must have been created by same person and not by two different persons. However a legal representative or an agent cannot be considered as different persons and should be treated as same person The rights must have been created by transfer in respect of same immovable properties. The rights must have been created in different times. In the absence of any general contract or reservation, the previously created right will prevail over the later created right.

Priority.
A Executes a sale deed in favour of B on 1.1.1999 in respect of his house Roshanara. On 10.3.1999 A executes a sale deed in favour of C in respect of the same house Roshanara. The sale deed executed by A in favour of B is prior in the point of time. The sale deed executed by A in favour of B is in respect of the same immovable property. In view of the rule of priority the sale deed executed in favour of B would prevail over the sale deed executed in favour of C.

Priority and rule regarding registration


A Executes a sale deed in favour of B on 11.3.1999 in respect of his house Roshanara. The sale deed is registered in 11.3.1999 at 10.30 am. On 11.3.1999 A executes a sale deed and registers in favour of C in respect of the same house Roshanaraat 10.40 am. Question which of the sale deed among two would prevail? Answer:. The sale deed executed by A in favour of B is in respect of the same immovable property. The sale deed executed by A in favour of B is prior in the point of time and is registered earlier. In view of the rule of priority and read with section 47 of the Registration Act , the sale deed executed in favour of B would prevail over the sale deed executed in favour of C.

Priority and rule regarding registration.


A Executes a sale deed in favour of B on 1.1.1999 in respect of his house Roshanara. The sale deed is registered in 11.3.1999. On 10.3.1999 A executes a sale deed and registers in favour of C in respect of the same house Roshanara. Question which of the sale deed among two would prevail? Answer:. The sale deed executed by A in favour of B is in respect of the same immovable property. The sale deed executed by A in favour of B is prior in the point of time though is registered subsequently. In view of the rule of priority and read with section 47 of the Registration Act , the sale deed executed in favour of B would prevail over the sale deed executed in favour of C.

Priority and Mortgages.


Section 48 while deals in general regarding the principle of Priority, the Sections 78 and 79 are specifically with reference to that of Mortgages. Section 78 while dealing with the concept of postponement of prior mortgagee and Section 79 envisages with reference to mortgage to secure uncertain amount when maximum is expressed. Section 93 envisages that the concept of tacking is prohibited has got a bearing on the principle of priority.

Postponement of Prior Mortgage


Priority in respect of successive Mortgages while is spelled out in section 48 on the basis of qui prior est tempore potior est jure, the Section 78 contemplates that where a prior mortgage is there the prior mortgagee will have a right to claim over the right of the subsequent mortgagee. The prior mortgagee though has a priority over the claim of the subsequent mortgagee but however the element of fraud, misrepresentation or gross neglect as practiced by the prior mortgagee in inducing a person to advance money on the security of the mortgaged property the position of the prior mortgagee would be relegated to that of a subsequent mortgagee. The rule in section 78 is an exception to the general rule laid down in Section 48.

Murtazai Begum Vs Dildar. AIR 1930 Oudh 129


X mortgaged a share in village M to Y during 1917. The mortgage deed contained a clause that if X is dispossessed of any part of that share by other heirs, the mortgage shall operate as a mortgage of a share in the village N. During 1918, X mortgaged a share in village N to Z. During 1922 X was dispossessed of his part in the village by co-heirs. The contingent mortgage of village N did not vest till 1922. Question how to work out the rights of Y and Z. The court held that:- Zs mortgagee had priority over the mortgagee of Y.

Lloyds Bank Ltd Vs Guzdar & Co.AIR 1930 CAL 22


G deposited the title deeds with bank N to avail over draft. G approached the Bank manager to return the document to facilitate him to sell the property for a higher value, as the prospective buyers if they come to know that there is a liability then they may not pay the better price. The manager of the bank in normal course should not return the documents and should insist that the buyer should visit the bank and scrutinize them. Though a duty was there the manager returned the documents to G. G took those documents and borrowed the money from bank L by depositing the said documents by falsely representing that there is no encumbrance on the property. Question: What is the position of the Bank L vis a vis the Bank N.

Answer:- The mortgage of bank L had a priority on the


mortgage of Bank N in view of the fact that the Manager of Bank N had acted in a gross negligent manner.

Priority would not effect the liability of Mortgagor


Priority would not effect the liability of Mortgagor The Priority would work out about the rights of the successive mortgagee. The Priority would not work out about the rights of the subsequent purchasers. The Priority would be lost by the res judicata.

Priority as to subsequent advances


Section 79 deals with the subsequent advances when being made due to a subsequent mortgage. Section 79 acts an exception to the rule of priority. Note of caution to apply the rule are:Whether the subsequent mortgagee took with notice of the prior mortgage. Whether the prior mortgage fixes any specific maximum amount to be secured.

Priority and exceptions


Section 50 of the registration Act, where a subsequently registered deed will have a priority over a prior unregistered deed where the registration is optional. This rule is of course subject to the doctrine of Notice. This exception has lost much of its significance in view of the amendment to section 54 and 59 of transfer of property Act. Priority is forfeited by fraud misrepresentation or gross negligence..

Transfer of Right under Insurance policy.


Section 49 of Transfer of property act deals with this principle. Transfer of immovable property for consideration,. This would apply only in respect of lease, mortgage or exchange but not a gift. As on the date of transfer the said immovable property is insured as against the loss or damage by fire then the transferee can have the benefit. This section should be read along with section 135 of the T.P.Act. A purchaser can not claim money from the insurance company.

Rent paid to a defective holder.


A person who has to pay rent or profit has paid the same. The payment should be made with a good faith and intention, that is in other words in a bonafide manner. The payment should have been received by a person having defective title in respect of the said immovable property. It should appear later that the person who had received the amount had no title to receive it. The tenant/lessee if he satisfies the above requirements then he would be protected. This applies with reference to the rent and not the money paid in advance, as in the later case it would be treated as a loan. Section 50 of T.P.Act

Illustrations
A has a right to land and other property. He lets it to B and then transfers to C. B not knowing the transfer pays rent to A. A also accepts the same with out a demur. Here the B is protected. C can not claim the a said amount once again. A has a right to land and other property. He lets it to B and then transfers to C. B knowing the transfer pays rent to A. A also accepts the same with out a demur. Here the B is not protected. C can claim the a said amount once again as the action of B was not in good faith.

Illustrations
A has a right to land and other property. He lets it to B and then transfers to C. B pays rent to D an agent of A. D also accepts the same with out a demur. Here the B is protected. C can not claim the a said amount once again. A has a right to land and other property. He lets it to B and then transfers to C. B pays rent to D a total stranger .D also accepts the same with out a demur. Here the B is not protected. C can claim the a said amount once again.

Question
A leased his property to B, and there after mortgaged it to C. As per the terms of the mortgage C was entitled to recover the rent from B. C after the execution of deed informed that he was entitled to recover the rent from B in pursuance to the deed. In the meanwhile the property was sold to D in execution of a decree against the mortgagor.D gave notice to B that mortgage loan to C is paid and the rent should be paid to him. B without making any enquiry regarding the statement of D make payment to D. in reality the mortgage loan to C is not cleared. How do you resolve the dispute. answer:- the B had not acted in a good faith, so he is not entitled to any protection.

Improvements by bonafide holders


This rule has a great antiquity, recognized both in Roman Civil law and Common law of England. This rule is based more on equity. Transferee as a bonafide holder improves immovable property. Improvement is made in a good faith that he is absolutely entitled to do so. Subsequently he is evicted from the property by any person having better title.
If the above noted things are there then the transferee can ask the person who evicted him to pay the market value of the improvement. The transferee can also ask the person who evicted him to sell the property to him for the market value thereof . Section 51 of T.P.Act.

Valuation of the improvement.


The valuation shall be estimated at the time of eviction. The amount so estimated shall be paid or secured. If the transferee had planted or sown on the property any crop on the property when he has been evicted then the transferee could have a free ingress and egress to collect the said crops.

Harischandra Heggade Vs State of Karnataka 2004(9) SCC 780


Certain lands granted in favour of the members of Schedule caste and Schedule tribes by the Government had contained non alienable clause. One of the member of the schedule caste sold the land to a person not belonging to Schedule caste. The purchaser invested money and developed the land. During 1979 the state of Karnataka enacted a law to the effect that the lands granted to the members of Schedule caste and Schedule tribes shall not be alienated and any alienation shall be treated as null and void. The law also envisaged that the said land shall be restored to the original owner.

Harischandra Heggade Vs State of Karnataka Section 51 provides that a bonafide purchaser under defective title is entitled to get the value of the improvements made therein. This provision is applicable only when a transfer is inter vivo and not made by the operation of law. It has no application when there is a violation of law. It has no application when there is a violation of a grant and the restoration to the grantee, even if the transfer if the transfer is prior to the law coming in to force.

Kannan Vs Khatoon Bi. 2005(2) KCCR 821


The defendant made certain construction on the land belonging to the plaintiff. The plaintiff was declared to be the owner. The plaintiff had sought for a M.I, that the construction put up by the defendant should be removed. The court held that the order for demolition would be a sadistic approach and the same shall not be resorted to by invoking the 1st provision of section 51 but by invoking second provision the plaintiff shall be allowed to purchase the super structure for the market value on the date of execution. In the event of failure of the plaintiff buying the said superstructure then the defendant shall be given option tom buy the land for the market value on the date of execution.

Ramsden vs. Dyson


If a stranger begins to build on my land supposing it to be his own and I (the real owner) perceiving his mistake, abstain from setting him right, and leave him to persevere in his error, a court of equity will not allow me afterwards to. assert my title to the land, on which he has expended money on the supposition, that the land was his own. It considers that when I saw the mistake in which he had fallen, it was my duty to be active and to state his adverse title; and that it would be dishonest in me to remain willfully passive on such an occasion in order afterwards to profit by the mistake which I might have prevented.

R.S. MADANAPPA Vs. CHANDRAMMA AIR 1965 SC 1812


M spent money to improve the property of C knowing full well that the property does not belong to him and was of C. C filed a suit for declaration and possession. M contended that the improvements to the property were effected by him and that fact was known to C, but C did not raise any objection so the M can have the property as C is estopped from claiming it. The court Held that:- No man who knowing fully well that he has no title to property, spends money on improving it, can be permitted to claim payment for improvements which were not effected with the consent of the true owner. The court distinguished Ramsden vs. Dyson The doctrine of acquiescence cannot afford any help to the appellants for the simple reason that Maddanappa who knew the true state of affairs could not say that any mistaken belief was caused in his mind by reason of what the first defendant said or did.

Lis pendense.
Lis pendense means a suit under consideration of any court of law. Lis means a litigation. Ut lite pendente nihil innovetur = Nothing new to be introduced to a pending litigation or proceeding. Section 52 of Transfer of Property Act. This rule affects the purchaser, because the law does not allow the litigants during the pendency of a suit to do any thing which would defeat the final result. The main object of this rule is to protect the rights and interests of parties pending adjudication. This Rule is based on equity, good conscience and justice. This is not only based on rule of equity but is a rule of law.

Lis pendense.
Based not on doctrine of notice but based on doctrine of expediency.
Transfer should have been made by one of the party to the suit. If it is not done by one of the parties to the suit the doctrine is not applicable. Rule does not annul alienation but subservient to the decision of the court. This doctrine has a very long standing in England but gained much recognition during 1857 in Bellany Vs Sabine. The court in Bellany Vs Sabine observed that where a litigation is pending between parties as to the rights to a particular estate, the necessities of mankind require that the courts decisions shall be binding, not only on the litigants but also those who derive title under them by alienations made pending the suit where the alienee had or had not the notice. This doctrine was applied in India even before the T.P.Act was enacted. Transaction is not void but voidable,

Section 52
There shall be a suit pending in a competent jurisdiction having authority in India or established beyond the limits of India by the Central Government. The suit or proceedings shall not be collusive. The litigation shall be in respect of some immovable property. There shall be a transfer of or otherwise dealing with the property in dispute by any party to the litigation. Transfer must affect the rights of other party that may ultimately accrue under the terms of the decree. The object of this section is to maintain status quo. The impact of this rule is not violative of the rights under Article 19 or now the Article 300-A.

Section 52
1. 2. 3. 4. 5. 6. 7. Not applicable in respect of : Transfer executed before suit. Transfer effected by a non party to the suit. Transfer executed before suit but registered after suit. Transfer by operation of law. Transfer by or in execution a decree or order.(this view is having divergent opinions) Transfer with the permission of the Court. Collusive proceedings.

Lis pendense.
The stress is on pendente lite and it refers to both the parties to a litigation. The party can not alienate the subject matter of the litigation in any manner to undermine the effect of the decree which is going to be passed. Any alienation made during the pendency of a litigation would be hit by the principle of lis pendense.

Lis pendense
Lis pendense principle is reflected in section 52 of the transfer of property Act. The court shall have jurisdiction to try the suit or proceedings. An appeal is a continuation of original proceedings so the principle of lis pendense applies even in respect of transactions taken place during an appeal. However where the leave to appeal is pending the lis will not be there.

Object of lis pendense as stated by Supreme court

The doctrine of lis pendens was intended to strike at attempts by parties to a litigation to circumvent the jurisdiction of a court, in which a dispute on rights or interests in immovable property was pending by private dealings which might remove the subject matter of litigation from the ambit of the court's power to decide a pending dispute or frustrate its decree. Alienees acquiring any immovable property during a litigation over it were held to be bound, by an application of the doctrine, by the decree passed in the suit even though they might not have been impleaded in it.

Object of lis pendense as stated by Supreme court

The act of taking illegal possession of immovable property or continuance of wrongful possession, even if the wrong ,doer be a party to the pending suit, was not a "dealing with" the property otherwise than by its transfer so as to be covered by' s. 52 of the Transfer of Property Act. The prohibition which prevents the immovable property being "transferred or otherwise dealt with" by a party is apparently directed against some action which would have an immediate effect, similar to or comparable with that of transfer, but for the principle of lis pendense. AIR 1973 SC 2537 RAJENDER SINGH VS SHANATA Devi.

Section 52
Transfer of property pending suit relating there to. The necessary ingredients needed to attract the principle of lis pendense. 1. Pendency of a case 2. In any Court having authority within the limits of India. 3. Court established beyond such limits by the Central Government. 4. Suit or proceeding not collusive and 5. In which any right to immoveable property is directly and specifically in question.

lis pendense
Illustrations: A mortgaged the property to B. B instituted a suit and obtained a decree of foreclosure. Before the decree was made absolute, the A sold the property to C. The decree for foreclosure was made absolute and was held that C was not entitled to redeem. Question whether the lis pendense applies or not? Answer: If C had purchased the property before institution of the suit then the principle of lis pendense would not have applied. But, the sale transaction took place during the pendency of the suit. Hence the C was bound by the judgment and decree. Principle of lis pendense applies.
Purushotam Vs Chabeda lal ILR 29 All 76

A mortgaged the property to B. B sued A on the mortgage and obtained a decree for sale of the property. While the decree was in execution, A leased the property to C for a period of 10 years. B there after brought the property to sale and purchased it for himself. Question:- Whether the Cs lease hold right would be effected by the principle of lis pendense. Answer:- as the C had the lease during the subsistence of a proceeding the C was bound by the final decision. The execution of a decree is a continuation of the original proceedings. B could evict C
Nisar Hussein Gs Sunder lal ILR 50 All 202.

A mortgaged the property to B. B sued A on the mortgage and obtained a preliminary decree for sale of the property. A there after entered in to a usufructuory mortgage of the same property with C. B obtained a final decree for sale and in execution the property was sold and purchased by D. What would be the position of the usufructuory mortgage of the property with C. Answer: the usufructuory mortgage of the property with C is done during the subsistence of the proceedings and is hit by the principle of lis pendense. Therefore the same is not valid. D could recover the possession from C and so also all the rents collected by C from the date of purchase by D.
Nagendra Vs Sarat Kamani. AIR 1922 CAL 235.

A make a gift of his property to B. C files a suit against A and seeks the possession of the property. When the suit is pending adjudication B transfers the land to D and A dies due to heart attack. C obtains a decree for possession against the legal representative of A. whether the title is effected by the rule of lis pendense as to the subject of a decree passed in favour of C ? Answer: No, because; (1) the gift of the property to B was made much prior to the institution of the suit by C against A. (2) B was not a party to the suit at the time of transfer of property by him to D.
 Bala ramachandra Vs dallu. AIR 192 BOM 176

A was allotted a plot of land by the development authority. One of the condition was that A shall construct a house with in a span of two years and shall give a declaration to the effect. A did not comply with the said terms. Hence the allotment made in favour of A was cancelled. The authority resumed the land on 26th day of October 1984. The proceedings instituted by A against the authority ultimately terminated in an appeal on 19th April 1985. The plot was there after allotted to a third party on 29th January 1986. Whether the principle of lis pendense applies? The doctrine of lis pendense has no application in this case as the allotment of the land was effected long after the final disposal of the appeal.
Amrit lal Jalan Vs Haryana urban development Authority. AIR 1999 P & H 140.

Introduction of lis pendense in India. Fiayaz Hussain Khan Vs Prag Narain ILR 1907 All 339 (P.C) Applied the principles of English law prior to 1929. A a mortgagee sued to enforce his mortgage. Even before the service of summons on the other side, the mortgagee executed a puisne mortgage in favour of B. The prior mortgagee continued the suit. Later he brought the said property for sale without making puisne mortgagee a party to the suit. Question:-whether the subsequent transferee would be effected by the rule of lis pendense. Held:- the subsequent mortgagee was effected by the principle of lis pendense.

Immovable vis a vis movable property


The provisions contained in section 52 of transfer of property is not applicable with reference to the movable properties. Section 37 to 52 specifically applies only to immovable properties and not for the movable properties. In vasantha Vishwanathan Vs Elayalwar 2001(8) scc 133, the supreme court specifically held that the principle of section 52 T.P.Act not applicable to the movable properties. The provisions of section 52 are not applicable to the standing timber as it is not an immovable property.

Principle of Lis pendense not applicable


Suit in which the movable property is in question. Suit for maintenance by a Hindu wife where the relief is sought for as of a personal nature, but not where it is sought for as a charge on a specific immovable property A suit to recover money regarding which no specific immovable property is concerned. Transaction is not between the parties to the suit or proceedings but with strangers to it. Suit for mere rent

Principle of Lis pendense applicable


where maintenance is sought for as a charge on a specific immovable property. Where it is in respect of partition of immovable properties. Transaction is between the parties to the suit or proceedings including the legal representatives. Suit on mortgages. Suit on pre-emption where a specific immovable property is involved. Where it is in respect of easement where the suit relates to an easement right. Court sales though it is of an involuntary nature.

Bombay amendment Act 4/1939.


The law as it stands now is not having any provision order to ensure that a purchaser will be informed by the seller about the pendency of a litigation in the Court, a safe guard is needed. Bombay amendment of 1939 has made specific provision that the provision of section 52 shall apply only if a general notice regarding the pendency of the suit or proceeding is registered under section 18 of the Registration Act 1908 giving description of the immovable property and the court in which the matter is pending, the date of filing of the suit, and such other particulars as prescribed. The said amendment is now extends to the present State of Gujarat and Maharastra. But in respect of the area which is out side the Greater Bombay in Maharastra a specific notification is needed.

Law commission of India and recommendations


Law commission of India in its 157th report recommended that the section 52 of T.P.act be amended on the model of Bombay Act. The said amendment is not yet been approved by the Parliament. Law commission of India in its 178th report has in fact recommended that the provisions of Indian Penal Code be amended to introduce Section 424 B to make it an offence when any person knowingly executes any instrument which is or purports to be a transfer of immovable property or any interest therein *****fails to refer to the pendency of suit or proceeding and executes such instrument and punishable with an imprisonment of three years.

Commencement of suit
A suit is commenced by filing a plaint or presentation of the plaint under section 15 of the code of civil procedure. Appeal and execution are considered as the continuation of a suit.

Fraudulent transfers
Fraud goes to the root of the matter and law does not encourage fraudulent transactions. Law favours honesty and discourages fraud. Transfer of an immovable property made to defeat or delay the claim of the creditors of the transferor. The transfers are voidable at the option of the Creditor so defeated or delayed. Preference to one creditor the transaction is not voidable but against a group of creditors but the Calcutta High court has held in U.O.I. Vs. R.P.Debi that if there is only a single creditor then transfer to delay or defeat could be invoked.

Transfer of immovable property made with out consideration with an intent to defraud a subsequent transferee. The transfers are voidable at the option of the subsequent transferee. Section 53 of the transfer of property act envisages this principle. This section was amended by the amending Act of 1929

It is based more on equity, justice and Good conscience. Fraud is a fact to be proved and can not be presumed.

Section 53 prior to and after 1929


Every transfer of immovable property made with an intent to defraud prior or subsequent transferee thereof for consideration or co owner or other persons having an interest in such property or to defeat or delay the creditors of the transferor is voidable at the instance of the person defrauded or delayed. Every transfer of immovable property made with an intent to defeat or delay the creditors of the transferor is voidable at the option of any creditor so defeated or delayed. Nothing in this sub section shall impair the rights of transferee in good faith for consideration. Nothing in this sub section shall affect any law for the time being in force relating to insolvency.
.

When the effect of any transfer of immovable property is to defraud or delay, any such person and such transfer is made gratuitously or for grossly in adequate consideration, the transfer may be presumed to have been made with such an intent. Nothing contained in this section shall impair the rights of any transferee in good faith and consideration.

A suit instituted by a creditor which term includes Dhr whether he has or has not applied for execution of his decree) to avoid a transfer on the ground that it has been made with intent to defeat or delay the creditors of the transfer or shall be instituted on behalf of, or for the benefit of all the creditors. 2. Every transfer of i. p made with out consideration with an intent to defraud a subsequent transferee shall be voidable at the option of such transferee. For the purpose of this sub section, no transfer made with out consideration shall be deemed to have been made with an intent to defraud by the reason only that a subsequent transfer for consideration was made.

Transfer
The transfer referred to in section would be with reference to the transfers binding between the parties but voidable in the circumstances narrated in section 53. The transfer would be valid until it is set aside. The document made to delay or defeat the claims of the creditors would be binding on the executant and other persons claiming under him. The said transfers shall not be confused with that of benami transactions. The principle of the section 53 applies even in respect of an award or decree though for the purpose of section 2(d) the decree is not a transfer.

E a man of extravagant and dissolute habits was persuaded to reform himself and to have a settlement of the properties on his wife and children. After some time E got himself relapsed with old habits and ran in to debts. Question :- whether the settlement is hit by the provisions of section 53. Answer:- the term creditor includes the subsequent creditor but the settlement was held not to be voidable by the subsequent creditors as the settlement was done with a good faith.
Ebrambim bai vs Ful bai. 1902 ILR 26 Bom 577

A obtained a decree against B for the possession and mesne profits estimated to Rs.10000/- B a month later, executed a deed of trust settling all properties of which he was then possessed on his wife and children. Question: Question :- whether the settlement is hit by the provisions of section 53. Answer:- the settlement was held to be voidable as the settlement was not done with a good faith. Nauramman lal vs Stephan. AIR 1922 Pat 572

Transferees right not effected


Where the transfer is done in good faith for consideration. Where the transfer is in respect of any movable property.

Problems.
A obtained a decree against B. B in order to defeat the claim of A, decree holder transferred the property of an immovable nature to C by way of gift. A obtained a decree against B. B in the meanwhile sold the property for a consideration to C who purchased the property in good faith. Can A succeed against B. A obtained a decree against B. in order to defeat the decree holders claim B transferred the property to his wife in satisfaction of debt due to her. Can the Decree holder impeach the transfer.

Part performance
Doctrine of part performance is also known as equity of part performance. If a person takes possession of an immovable property on the basis of a contract of sale and has either performed or is willing to perform his part of contract then he can not be ejected from the property on the ground that the sale was unregistered and the legal title has not been transferred to him. The principle of part performance dates back to 1677. To mitigate the hardship caused on account of section 4 of the statute of frauds the concept of part performance emerged as a remedy at the hands of the equity courts. This doctrine traces its origin to Maddison vs Alderson 1883 A.C 467.in this case Lord Selbourne said that in a suit of part performance, the defendant is really charged upon the equity resulting from the acts done in execution of a contract and not upon the contract itself. If such equities were excluded then the injustice which the Statute could not have thought of would follow.

Part performance
Indian counter part in Kurri Veera Reddi vs Kurri Bapi Reddi 1906 Mad 336 Madras High court held that the principle of Part performance does not apply in India, but the Privy council in 1914 in Md.Musa Vs Aghore Kumar Ganguly applied the principle of equity, good conscience and justice to mitigate the hard ship caused to the parties. In that case the court held that the compromise deed though is unregistered but it was I writing and therefore it can not be repudiated. Arif Vs Jadunath the Privy Council however took a different turn by stating that the principle of part performance do not apply to India as the provisions of Indian Registration Act can not be bye passed. Again in 1919 in Mian Pir Baux Vs Sardar Mohammed the privy council held that the principle of part performance can not be applied in India as there is an express statutory provision. These controversies necessitated to amend T.P.Act I 1929 to introduce section 53 A.

Part performance as reflected in section 53 A


There shall be a contract to transfer an immovable property for considertion. The said contract shall be in writing. The terms of the contract shall be clear and reasonably ascertainable with certainty. the transferee should have taken possession of the immovable property in part performance of the contract or that he is already in possession of it and should have continued and done some thing in furtherance of the contract. Transferee shall be ready and willing to perform his part of obligation in the contract. This is based more on the principle that he who seeks equity shall do equity. Equity looks at intent than form.

Nature of transferees right


Does not convey any title or interest in respect of property to the transferee. It could be used as a defense and not to create a new right. In India it is a part of passive equity and not contra. Hence it is said that the part performance is only a shield and not a sword. To defend possession would denote that the party who seeks the aid of it could either be a plaintiff or defendant and not necessarily a defendant. If a partly could show that his possession is at stake then he could have the benefit of part performance.

Walsh vs Lonsdale
This is a case of 1882. L agreed in writing to grant lease for seven years a mill to W. The rent agreed was payable once in a quarter, but one year rent payable in advance if demanded. W got the possession of the property without any lease deed being executed and the quarterly rent being paid. L demanded from W one year rent, but W refused to pay the said amount. W filed a suit for injunction and damages for illegal distress on the ground that he was a tenant on year to year basis and not liable to pay any advance. The court did not agree with W, and on the other hand held that the suit needs to be held in favour of L, that a tenant who entered the possession and enjoyed the possession is prevented by equity from taking advantage of the lease deed being not executed. In view of Arif and Mian case as decided by the P.C. the ruling of Walsh is not applicable in India.

Difference between Indian and English law


Written agreement is a must in India Oral agreement is sufficient in England

Only as a shield and not Both as a shield and as a sword.i.e. to defend sword. i.e. to defend and not to enforce a and to enforce a right right Statutory right of defense. Equity right of defense.

Problem no.1.
A and B agreed that property x as owned by A should be leased to B. B was already in possession. On the basis of the agreement B built a house. Subsequently A sued B and sought for an order of eviction. Question: whether the principle of part performance could be applied? Answer: what is needed is not a formal lease deed but even an agreement is sufficient. The said agreement shall be in a position to convey the actual intent which the parties had intended. If the agreement had not been reduced in to writing then section 53A would not come to the rescue of the defendant.

Amendment of 2001 with reference to section 53A


The transfer of property Act and the Registration Act were amended in 2001 Unregistered document is now withdrawn for the purpose of section 53A. This came in to effect from 24.9.2001 The amending act omitted the words contracts though required to be registered has not been registered. Similarly the amending act amended section 17 and 49 of the registration Act. Section 17(1A) of the Registration Act envisages that the document containing a a contract to transfer for consideration any i.p for the purposes of section 53A shall be registered and if they have been effected after 24.9.2001and if the document is not registered then the document shall have no effect for the purposes of section 53A. Section 32A requires that every person presenting the document shall affix his pass port size photo and finger print to the document.

Whether the stamp duty is to be paid for such an agreement.


Yes. It depends on the stamp act of every state as the imposition and collection of the stamp duty is a State subject.

Part performance amount and income tax act.


The amount received as advance in connection with sale in pursuance to an agreement under section 53A would be considered as an income. Whether the said course of action is proper is a big question.

Part performance and adverse possession


Plea of adverse possession and part performance are of inconsistent nature and a person in possession of a property in pursuance to a part performance can not be permitted to have the plea of perfecting the title due to the adverse possession as he traces the possession of the land lawfully under an agreement.

sale
Sale is a transfer of ownership for consideration.  The consideration may be  paid or  promised or  Part paid and part promised.  Sale may be in respect of a  Tangible immovable property  Intangible immovable property. The person who sells is a seller while the person who buys is a buyer.  The essential elements of a sale are The parties. Subject matter Transfer or conveyance as contemplated under section 55 Price or Consideration.

Mode of transfer by sale


By registered instruments. Under the provisions of the Indian Registration Act. The Said Act does not make any distinction between tangible and intangible properties but makes registration optional only in respect of a transaction where the consideration is less than Rs.100/ By delivery of possession. In case of tangible property worth less than Rs.100/ by delivery of possession the sale could be done.

Sale and contract for Sale


Contract for sale is not a sale. Contract for sale does not confer any title or create any interest in the property. Contract for sale is also know as agreement for sale. It should not be understood as agreement of sale. Contract for sale is a mere document creating right to obtain a sale deed. Unless part performance is there the contract for sale does not require registration. Sale transfers the title or ownership. Sale creates interest.

Sale
Price present Sale is a transfer of property for consideration Section 54
Covers immovable properties and if it is in respect of movables then sale of goods act applies.

Gift
No price/compensation

Exchange
Compensation. Exchange is a transfer of property for mutual transfer of ownership of one thing for the ownership of another. Section 118 Covers both movable and immovable properties .

Gift is a transfer of property for no consideration. Section 122


Covers immovable properties and if it is in respect of movables then sale of goods act applies

Sale liabilities and rights of seller Before completion of sale.


To disclose material defects take profits and 55(1)(a) rents To55(4)(a). produce title deeds for inspection. 55(1)(b) answer reasonable questions as to title. 55(1)(c) Execute conveyance. 55(1)(d) Take care of the property & title deeds 55(1)(e) Pay public charges and accured rent. 55(1)(g)

Sale liabilities and rights of seller after completion of sale.


Give possession of property. 55(1)(f) Implied covenant to title 55(2) Deliver title deeds on receipt of price. 55(3) Charges for the unpaid price. 55(4)(a)

Sale:- liabilities and rights of buyer Before completion of sale.


Liabilities Disclose facts which materially increases the value of the property 55(5)(a) To pay price. 55(5)(a) Rights. Charge for the prepaid price. 55(6)(b)

Inspect the title deeds in a reasonable manner. To ask reasonable questions relating to the title of the property. Inspect the property.

Sale:- liabilities and rights of buyer after completion of sale. Liabilities


To bear loss of property 55(5)( c) To pay outgoings public rents and charges. 55(5)(d)
Rights

Benefits of increments. 55(6)( a) To take possession.

To take documents of title deed. To obtain deed of conveyance.

sale
Movable Immovable
Registration not compulsory

Tangible Intangible Less than Rs.100/= Rs.100/= & More than

Registration compulsory

Gift
Immediate effect Requires registration either during the life time of the donor or thereafter. Non registered gift deed cannot be enforced Irrevocable when once a gift is given

Will
Not with an Immediate effect Requires no registration either during the life time of the testator or thereafter. Non registered will can be enforced revocable during the life time of testator

Gift.

Movable property Immovable property Delivery Of property Delivery And acceptance compulsory

Registration not compulsory

Registration compulsory

Gift
By a minor By a Person Of unsound mind To a minor To a Person Of unsound mind

Could be Accepted through a guardian

Can not be made

Valid requirements of a gift are;  Absence of consideration/compensation.  There shall be a donor.  There shall be a donee.  Voluntary  there shall be a subject matter.  There shall be a transfer,  There shall be an acceptance.  Bilateral transaction. If any of them are not present then there can not be Gift.

Gift under Mohammedan law Varies from T.P.Act. T.P.Act not applicable to a gift. Gift is known as Hiba Requirements under Mohammedan law Declaration. Acceptance. Delivery. Writing not essential. If in writing no registration is need. If in writing no attestation is needed.

Gift under Hindu law does not Vary from T.P.Act. T.P.Act applicable to a gift. Gift is known as Dana. Requirements under Hindu law Declaration. Acceptance. Delivery. Writing essential. Registration is need Attestation is needed Hindu can gift the joint family property after meeting the family needs and not otherwise. However he can gift his self acquired property with out any restriction.

Gift
Valid gifts Void gifts Onerous gifts

Gifts as per section 122


Gifts for unlawful purpose, Forbidden by law, In competency to contract Donee dies before acceptance, Property not in existence.

Gifts as per section 127

Onerous gifts
     The necessary elements are; gift must be in the form of a single transfer to the same person. several properties. among them one is burdened with liability while others are not. Donee has to accept , and he can not accept benefits and reject the liabilities. here the principle resembles that of an election to some extent though not in full.
A has shares in company X and company Y. among the said companies the financial stability of Y company is not so sound when compared to X. heavy calls are expected in respect of Y company. A gives to B all his shares of both the companies. B refuses to accept the shares of Y company while accepts the shares of X company. Could he do so.

No  However if the gift is in the form of two or more separate transfer to same person of several things the donee could accept one of them and refuse to accept the other, although the former may be beneficial and later as not beneficial.

Universal Donee.
While section 127 is based on Qui sensit commodum debet et sentire onus, the section 128 is based on the principle that if the donor has given to the donee all his properties then the donee would take not only the benefits but also the liabilities. The donee can not say he wants all the benefits and not the liabilities. This is based more on the principle of approbation and reprobation. This is more based on the principle that one who wants to have benefit shall be ready to have the liabilities also.

Mortgage
What is a mortgage Parties to a mortgage. Types of mortgage. Mortgage in Indian scenario. How to create a mortgage. Rights and liabilities of mortgagor Rights and liabilities of mortgagee What is redemption. What is a foreclosure. Limitation regarding mortgage.

What is a mortgage
Section 58 of transfer of property act defines as to what a mortgage is. Basically mortgage is a transaction where the immovable property would be given as a security to raise the loan or for the borrow of the money. If a movable property is given as a security to borrow money then the same would not fall under the category of mortgage and on the other hand would fall under the category of pledge. Mortgage is transfer of interest being creation of a security in respect of the property. It is not a sale where the property is transferred lock stock and barrel to the transferee. The mortgage differs basically from a lease, as in case of lease the interest transferred is that of enjoyment of the property as against a rent or premium.

Parties to a mortgage.
Mortgagor is a person who gives the property as a security. That is transferor is known as a mortgagor. Mortgagee is a person who advances the money to take the property as a security. That is a transferee is a mortgagee. The property which is given as a security is mortgage property. The money paid by the transferee to transferor, that is from the mortgagee to the mortgagor, is the mortgage money. Once a mortgage always a mortgage.

Mortgage

Mortgagee.
Mortgagor

Mortgage property

Mortgage money Security.

Types of Mortgage.
Simple mortgage Equitable mortgage or mortgage by deposit of title deeds. Usfructiory mortgage. Mortgage with conditional sale Possessoiry mortgage. Anomalous mortgage. New dimension is with reference to that of reversionary mortgage.

Lease and mortgage.


Transfer of right to enjoy . A mortgage is the an immovable property transfer of an interest for certain time, express in specific immovable or implied or in perpetuity property for the purpose securing the in consideration of a of price paid or promised, or payment of money or to be of a money, a share of advanced crops, service or other advanced by way of thing of value, to be loan, an existing or future rendered periodically or on debt, or the performance of specified occasions to the an engagement which may transferor by the transferee give rise to a pecuniary who accepts such transfer liability. on such terms.

Lease
Essential elements of a lease are: The parties. Subject matter i.e a specified immovable property. The demise or a partial transfer, (word demise is not used in T.P.Act but is barrowed from English law which is based on the Latin phrase demitto) Term or period. The consideration or rent.

Whether a lease could be granted by a person for himself. No . Every tenancy is based on an agreement between two persons and contains covenants between two persons and contains covenants expressed or implied by one person with another. Now if a person cannot agree with himself and cannot covenant with himself. I do not see how he can grant a tenancy for himself. The tenancy must stand or fall with the agreement on which it is founded and with the covenants contained in it: and as they fall so does the tenancy. Lord Denning. Nemo protest esse tenens at dominus

Indian Scenario
Not different from what Lord Denning said. Section 2 of contract Act regarding a contract. Section 108Need to have parties lessor and lessee. Section 111(d) rule of merger.

Who can enter a lease.


A person capable of entering in to a contract can enter in to a lease. An unregistered association is not a legal entity and therefore can not enter in to a lease. Minor or a lunatic can not enter in to a lease as the leasee has to perform certain obligations.

A lease cannot be there for


Illegal purpose. A purpose against the public policy. Where the law specifically prohibits.

Types of leases.
.
agricultural

Lease

Manufacturing

general Periodic Or temporary perpetual

Commercial monthly Yearly.

Non-commercial

How to make a lease.


The lease is made by a contract.  The lease from year to year, or  any term exceeding a year, or  reserving the right to receive the rent on an yearly basis shall be done by a registered instrument.  In all other case the lease may be done either by a registered document or delivery of possession.  The government may from time to time issue notification regarding lease be made by an unregistered document or by delivery possession in respect of property other than year to year lease or where the right to receive the rent on an yearly basis is there.  Contract for lease is not a lease deed.  Contract for lease is not an agreement of lease.  A lease compulsorily be registerable if not registered can not create a lease but if the lessor accepts the rent from the lessee who is possession of the property then by implication the lease is created but the same can not be used for part performance after 2001 in view of the amendment to section 53A.  A year to year lease in the absence of registration would have to be treated as a month to month lease. However there is a view that there can not be a lease and at the most it would only be a license.

Monthly tenancy
A tenancy from month to month. It may be for a specific period of months or may not be so. The characteristic feature is payment of rent from month to month. Subject to be terminated with fifteen days notice. If it is not for the purposes of agricultural or manufacturing purposes then the tenancy by default is by month to month, if there is no other agreement. It may be as per English calendar or any other calendar as fixed between the parties. Word month shall be understood as given in the general clauses Act as the T.P.Act has not defined it.

Manufacturing purposes
This phrase is used in a general and popular manner and not with any technical definition. If the main or substantial purpose is for Manufacture then it is to be treated as the Manufacturing purpose. If the work is not for manufacturing purpose but if it is only of an incidental nature to the manufacture then the lease is not for a manufacturing purpose. The tests for manufacturing purposes are 1.certain commodity must be produced. 2 process of production involve labour or machinery. 3 end product which comes out after manufacture shall be a complete one and shall have a different name and should be put in to different use. That is the commodity should be so transformed to loose its original character.

Quit notice
Yearly tenancy ie agricultural or manufacture purpose shall be terminable with a notice of six months. Monthly tenancy shall be terminable with a notice of fifteen days. Notice shall be in writing. Notice shall be signed by or on behalf of person giving it. Should have sent by post to the party who is intended to be bound by it, or Tendered or delivered personally to such party or to one of his family member or servants at the residence if tender or delivery is not possible., or By affixture on the conspicuous part of the property. The period shall commence from the date of receipt of notice. The notice is not invalid merely on the ground that the period mentioned in the notice falls short of the period specified in sub section 1 of section 106.

Rights and obligations of the lessor and lessee.


1. As per agreement or contract. 2. As per local usage. 3. As per the provisions of section 108

Obligations and Rights of lessor u/s 108.


Lessor is bound to disclose to the lessee any material defect in the property with reference to the intended use. Lessor is bound to put lessee on request in to the possession of the property. Any accession made to the property subject to the law relating alluvion rights.

To receive rent or premium.

Lessor shall be deemed to Inspect the property with contract with lessee that so due notice. long the later pays the rent, the lessee shall hold the possession of the property.

Obligations and Rights of lessee u/s 108


1 Accretions 2 Destructions 3 Repairs. 4.Payments made on behalf of lessor. 5.Fixtures. 6.Crops. 7.Assignment. 8.Lessees duty to disclose 9.obligation to pay rent. 10.user 11.errection of the building. 12.Restoration of possession.

Accretions
This principle is applicable more in respect of agricultural lands and the property situated by the side of river, sea and so on. The land gradually or imperceptibly accreted would form a part of the lease. It may be due to the natural means or may even due to an artificial means. Natural means may be due to floods, and other vagaries of nature. Artificial means may be due to acquiring title, encroachment, grant to the owner of the land. The lessee holds the leasehold property during the term with a proportionate increment in rent. This right is available for a lessee and not a licensee.

Destructions
If due to fire, tempest, or flood, or violence of any army or of a mob or irresistible force any part of the leasehold property is wholly destroyed or rendered substantially and permanently unfit for the purposes for which it was let the lease shall be at the option of the lessee shall be void. If the said injury or damage has occurred on account of the conduct of lessee then he shall not be entitled to the benefit. The destruction of the premises is due to the act of lessor then it can not be said to be due to the act of God. If the property is not destroyed or substantially or permanently unfit, then this clause under section 108 clause (e) will not come in to play. The clause (e) gives an option to the lessee to avoid the lease by notice. Generally this clause applies to the situations such as lease in respect of coffee plants, godowns, buildings. This clause does not apply in respect of situations where a building is let out and the same is damaged due to an earthquake as the building becomes unfit for human habitation.

Repairs.
This is subject to contractual aspect in case of a contract. This is subject to statute in case of a statutory tenant. The lessor in the absence of a contract or statute is not under an obligation to carry out the repair. In fact clause (m) of section 108, imposes an obligation on the lessee to keep the premises in a proper condition and return it to the lessor in the same condition in which it was given. In case of an express covenant in the lease deed to carry on the repair by the lessor and if the lessor fails to carry out the repair, then the lessee cannot terminate the lease but on the other hand insist the lessor to carryout the repair. In case if the lessor in spite of notice fails to carry out the repair then the lessee could get the repair work carried out at his expense and claim the same from lessor either by deducting the same in rent or premium or may institute a separate case. A covenant by tenant that he would pay rent without any deductions does not exclude the lessees right to claim reimbursement of the amount spent by him on account of the failure of the lessor to carryout the repair.

Payments made on behalf of lessor.


If the lessee makes any payment the lessor is bound to make, and which is recoverable as if like the charge on the property and if lessee makes such payment then the lessee is entitled to deduct the amount out of rent or recover the same. Section 69 of the Indian contract Act also envisages this aspect. The payment under this clause is mainly towards the Governmental dues, municipal taxes, etc. The word neglect would mean that of payment of tax which the lessor was bound to make. If the lessor was not bound to make the payment then the clause would not apply.

Fixtures.
This is a lessees right to take away the fixtures which he had fixed at the premises for the better enjoyment. The lessee while doing so shall not cause any damage to the property which had been leased to him. If the contract between the lessor and lessee envisages that the lessee shall not be entitled to take the fixtures with him then he can not take away the said fixtures. If any condition is imposed to allow the fixtures to the lessor, then the said conditions shall be construed strictly. What is a fixture depends on the situation and a hard and fast rule can not be drawn in this aspect. The fixtures if are of such nature that they can not be removed and if the contract has provided any term to the effect that the lessor has to make good of the value, then the lessee would be entitled to the value. However the lessee can not compel the lessor to pay the value if the said fixture is not fixed as per the request of the lessor.

Crops.
This clause applies in respect of lease of uncertain duration terminated by any means except the fault of lessee or the legal representatives of a lessee. The lessee is entitled to all crops grown by him. He can take the crops and utilize. The clause is subject to the agreement if any between the lessor and lessee. The right given under this clause is almost similar to the right conferred under section 51 to a bona fide transferee.

Assignment.
Subject to the contract the lessee is bound to disclose to the lessor any fact as to the nature of the interest which the lessee is about to take and which the lessor is not aware. Subject to the contract the lessee is bound to disclose to the lessor any fact as to the extent of the interest which the lessee is about to take and which the lessor is not aware. If the contract forbids any assignment being made about the nature or extent of interest then the lessee can not make such an assignment. The assignment may be in the form of sub lease, mortgage or sale. If the contract prohibits the assignment in any form then the lessee can not make any assignment. If an assignment is made then the lessor could get rid of the lessee by determining the lease.

The lessee after the assignment would not get himself absolved of his liability with reference to the lease transactions unless the lessor has otherwise agreed upon. The assignee would be liable to pay and answerable to the lessor and he can not put forth a plea that he is not having any contract with the lessor.

Lessees duty to disclose


While under clause (a) of section 108 the lessor is under an obligation to disclose to the less the defects of which he is aware of the use of property, the lessee is under a corresponding duty to a limited extent to inform the lessor of the fact which the lessor is not aware but the lessee is aware, and that fact has an effect of materially increasing the value of the property.

obligation to pay rent.


It is one of the primary duty of a lessee or a tenant to pay the rent at the stipulated point of time. If the rent is not paid then the lessee or the land lord will get a right to get the tenant or lessee to be evicted. When a payment is made the lessee is entitled to have the receipt Mode of payment shall be as stipulated in the agreement. In the absence of any such stipulation, the payment shall be made by cash. The liability to pay rent continues till such time the lessee vacates the property or is evicted by the lessor/land lord.

User
The lessee shall use the property as a reasonable prudent person. The lessee shall use the premises for the purpose it was leased. Use and its purpose depends on the facts of the case. There can not be a hard and fast rule to have any specific meaning. Change of user needs to be looked in to in the background of the property and premises. User includes non user.

Change of use as held by courts.


A premises let out to run a tea stall being used for a lathe work shop. The open space let out for agricultural proposes being used to put up a building. Establishment of an office in a portion of the premises let out for residential purposes. Shop let out to be used as a kirana shop is used as a hotel. Shop let out to be used to sell soft drinks and dry fruits being used to prepare pakodas. Premises let out to be used as a house is concerved to be used as a commercial place. Residential premises used as a boarding home for students or guests.

Erection of the building.


In the absence of the contract the tenant if he puts up any construction then he would be liable to be evicted. The tenant/lessee would forfeit his right to continue the tenancy/lease. The requirement is that of a permanent structure. To put up such a structure the tenant/lessee shall not have obtained the consent of the lessor. If the lessor or his authorized representative has given permission then the tenant/lessee would not be said to have violated the lease agreement. The permission may be express or implied. What is a permanent structure is a question of fact and varies from case to case. Similar provisions are there in respective rent control acts of the States.

Permanent structure as held by courts


One thing should be noted that though philosophically it is said that nothing under sun is permanent and every thing is to under go a change but the same is to be considered with certain broad spectrum relating to the use and manner of fixture. The courts have taken divergent views about the meaning of what is a permanent structure. There is no specific definition. What is the yardstick to be applied in this context is as to the nature of the addition and how it is intended to be put.

Restoration of possession.
On expiration of the lease period the lessee is bound to put the lessor or his legal representative in to the possession of the property leased out. Lessor cannot impose any terms and conditions to the lessee when the possession is handed over. If the lessee has abandoned the property without validly delivering the possession then the lessor can claim not only damages but also the rent till such time the possession is recovered as per law. Restoration to one of the co-owner in the absence of the contract is a restoration.

Rights of lessors transferee


Governed under the provisions of section 109 of T.P.Act. This section is based on the principle laid down in Wordsley Brewery Co Vs Hal ford. This section was introduced in to the frame work of the Act by the amendment effected in 1929 Transfer may be in respect of  Property leased in full.  Property leased in part.  Interest in respect of property leased. The transferee in the absence of any contract  All rights.  Regarding the liabilities, unless if the lessee elects, then the transferee would be liable to all liabilities which the lessor was.

Rights of lessors transferee


 Limitation to the above rule; o The transferee would not be entitled to any arrears of rent prior to the date of transfer. o If the lessee not having any reason to know that a transfer had been effected pays the rent to the lessor then he shall not be liable to pay the rent to the transferee again.  Tripartite settlement to have effect. the lessor, lessee and transferee could hold a joint meeting if they hold a joint meeting and determines as to the rights and liabilities then it will have effect. The said meeting may decide the rent payable by the rent payable by the lessee.  Failure of the settlement: In the event of failure then the matter is to be decided by the court

Rights of lessors transferee.


.The said transferee subject to the contract would be entitled to all incidents of lessor. Attornment: Attornment is a process in which the relationship of landlord and tenant would be acknowledged with reference to the new land lord. This process would avoid the scope for further litigation to dispute about the ownership of the transferee in future. Apportionment. Principle as envisaged under section 37 would apply. Statutory transfers.

How to compute the dates in case of a lease.


Reckoning the date is an important factor in a lease. The date is important for the purposes of payment of rent, termination, payment of dues. Section 110 of the T.P.Act envisages about this. The rule envisaged is almost similar to the provisions of section 9(1) of the General clauses Act. Where the specific day is mentioned, then the said day shall be excluded. Where the specific day is not mentioned, then the time so limited begins from the making of the lease.

How to compute the dates in case of a lease


Rule where the time is limited Where the time is limited in respect of an year or years, the rule is that if there is no agreement then the lease shall be the whole anniversary of the day from which such time begins. Where the time is limited is expressed to be terminable before the expiration of the time and if the lease deed is silent as to who has to terminate then such an option to terminate could be exercised at the instance of the lessee and not the lessor. This is known as the option to break rule.

Rule of Option to break


As per this rule there shall be a clause in the agreement that the lease is renewable after a specified period. The said renewability if is at the option of either party then the both the parties could exercise the option. In the event if the clause relating to the renewability is silent as to who has to exercise then by default the right vests with the lessee and not the lessor. The condition of option shall be construed strictly and not in a lenient manner. While exercising the option by lessee he shall not be a defaulter and has complied with the terms of the lease strictly. If he is a defaulter in payment of rent or any of the clauses of the lease deed then he can not avail the benefit. This is based on the principle that he who seeks equity shall do equity and the rule of equity will not come to the rescue of a wrong doer.

Rule of Option to break


1. Illustration:A has entered in to a lease transaction with B in respect of a shop premises that the lease is for 15 years, and the same is to be renewed at the option at the end of 5, and 10th year at the option of either parties then any of the party may exercise the option to determine the lease. A has entered in to a lease transaction with B in respect of a shop premises that the lease is for 15 years, and the same is to be renewed at as the parties thick fit at the end of 5, and10th year then it could be done only by the mutual consent of both the parties and the option to be exercised by both parties to determine the lease.

2.

3. A has entered in to a lease transaction with B in respect of a shop premises that the lease is for 15 years, and the same is to be renewed at the end of 5, and 10th , year at the option then the option could be exercised only by a lessee and not the lessor to determine the lease.

Determination of lease.
The tenancy is basically a contract. Under this the right of enjoyment of an immovable property is given by one person to another. The determination of lease speaks about the manner in which the contract of lease comes to an end, and how the lessor or the land lord would get back the property which had been given for the purposes of enjoyment. The said determination may be as per contract or other wise. They could be categorized broadly as under. Efflux of time. On happening of a condition. Express surrender. Merger. Mutual agreement. Implied surrender. Forfeiture. On expiration of notice of termination. As contemplated in section 111 of T.P.Act.

Efflux of time
Essential elements which are needed to bring about an end by efflux of time; 1. Definite period is fixed. 2. Efflux or expiry of the said period. 3. Lease is not renewed. Illustration: A enters in to a lease for 20 years with B, on 20.08.1978 the said lease is determined on expiry of 20 years. A enters in to a lease for 20 years with B, on 20.08.1978 the lease deed is renewed for a period of 20 years. There fore the lease can not be said to have determined on expiry of 20 years on 20.8.1998, A enters in to a lease for 20 years with B, on 20.08.1978. There fore the lease can not be said to have determined on 20.07.1998

On happening of a condition.
Instead of any specific period is fixed as to the lease period if happening of an event is stipulated then on happening of the said event the lease expires. Example. A enters in to a lease with B in respect of a shop that B could enjoy the tenancy so long he is alive and there after his death the lessor shall get the possession back. The lease is to the life time of B. on the happening of the event of death of B the lease comes to an end. The death is a condition precedent to determine the lease. A enters in to a lease with B in respect of a shop that B and his heirs could enjoy the tenancy so long he is doing business as a paint dealer, and if not the lessor shall get the possession back. The lease is till such time the B and his heirs does the business as a paint dealer. on the happening of the event of ceasing to be a paint dealer the lease comes to an end. The dealership in paint is a condition precedent to determine the lease.

Express surrender
The lessee by letter or any other mode of communication if he intimates that he intends to give up the lease and deliver the possession of the leasehold property then it would mean that the lease would be surrendered by express action. The express surrender would take effect forthwith. A surrender of lease hold right in favour of the lessor may even by means of an agreement. On surrendering the leasehold right the lessee need not pay the rent in future.

Implied surrender.
Implied surrender may be on account of the conduct of the parties or due to the operation of law. The same by the conduct of parties would mean that the lessee has relinquished the possession. The implied possession by relinquishment would mean that the lessee yielding up of possession and the lessor taking the possession. The operation of law invariably would mean that when the lessee even during the subsistence of the lease enters in to a fresh lease with the lessor. In such an event the lease is surrendered impliedly.

Merger
This takes place due to the lower rights getting merged with a higher rights. If the contract or agreement specifically provides while entering to a mortgage then right of would be as it is till the mortgage expires and there after it revives. If no such agreement is there as a general rule the right of the lessee would merge with the right of a mortgagee in possession. When a lessee purchases the leasehold property the right of a tenancy gets merged with that of a buyer. The doctrine of merger is statutorily recognized in India.

Forfeiture.
Clause g of section 111 deals with that of forfeiture. When the lessee breaks any of the express terms or conditions, which gives a right of re-entry to the lessor. Lessor renounces the character and setting up the title in a third party or claiming the title for himself. When the lessee has been adjudicated as an insolvent.

On expiration of notice of termination as contemplated in section 111 of T.P.Act


When a notice is issued asking the person in possession of the property to vacate and the period of the said notice has come to an end. A valid termination shall be there as contemplated under section 106. If a lessee continues to be in possession of the property after termination of the lease his possession ipso facto would not become a possession as that of an adverse possession.

Lease and License


There must be a transfer of There need not be a the right of possession transfer of the right of possession. Such right must be an Personal right and not an interest in property. interest in property. Permissive right to as per Permissive use at the will the contract of both the of the transferor. parties. To be determined as per the To be determined not as T.P.Act notice is a must. per the T.P.Act notice is not a must. Covered under section 105 Covered under section 52 of transfer of property act. of Easement act

Mortgage.
A mortgage is the transfer of an interest in specific immovable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability. The one who creates a mortgage is known as mortgagor, while the one in whose favour it is made is a mortgagee. The property is the mortgaged property. The money is known as mortgage money.

Mortgage and sale


Mortgage is a transfer of interest in property as a security. Section 58 Sale is a transfer of property for consideration Section 54

Ownership in respect of the Ownership in respect of the property not transferred. property transferred. Documentation, Attestation Documentation, Attestation and registration a must and registration is not a irrespective of value. must less than Rs.100/
By discharging the debt the owner i.e the mortgagor gets the cloud of debt cleared

Question of discharge does not arise.

Age old phenomena. Existed in ancient India as adhi. No distinction between movable and immovable. In Mohammedan law the concept of mortgage was there and it was known as bye-bil-wafa. This could be translated as a sale with promise Mortgage was considered as a pledge in ancient system of law. Roman law the earliest type was known as fiducia which was a conditional conveyance. The property would have been forfeited for non payment of the debt irrespective of value. This was followed by pignus. In this there was a transfer not of ownership but of possession with out the concept of forfeiture for non payment of debt. Hypothecea is a last stage in the development regarding mortgages in Roman law. Vivum vadium=creditor taking profits towards principle and interest, mortuum vadium= creditor taking profits towards interest only. The present day mortgage is more a contribution of the development of equity.

Mortgage.

Mortgage.
The concept of mortgage when compared to the earlier time is not so rigid and could be said more liberal. It is more soft towards the mortgagor. Modern economic market is more based on the mortgages and hypothecations. Mortgages while are in respect of the immovable properties the hypothecations are with reference to the movable properties and stock in trade. The hypothecations coupled with the delivery of possession of the movable property with the creditor but no right to enjoy the property given as security with creditor are also referred to as pledges.

Gopal Vs Parsotam says justice Mohammed


Mortgage as understood in this country cannot be defined better than by the definition adopted by the Legislature in section 58 of the Transfer of Property Act. That definition has not in any way altered the law, but on the contrary, has only formulated in clear language the notions of mortgage as understood by the writers of the text books on Indian mortgages. Every word of the definition is borne out by the decisions of Indian Courts of Justice.
(1883) ILR 5 All 121@ 137

Mortgage.
Mortgage is a transfer of interest in specific immovable property as a security for the repayment of debt. Such an interest is in itself an immovable property. Depending on the nature of interest the mortgages are classified broadly in to 6 groups under T.P.Act. Simple mortgage. Mortgage by conditional sale. Usfructuary Mortgage. English Mortgage. Mortgage by deposit of title deed. Anomalous Mortgage.

Simple mortgage
Simple mortgage consists of (a) a personal obligation either express or implied to pay the mortgage money. (b) transfer of right to cause the property to be sold. The right transferred to the mortgagee is not the ownership. No possession is given to the mortgagee. Binds the mortgagor or his legal representatives personally to pay the loan amount.

Mortgage by conditional sale


This is a type of mortgage where there would be a condition of sale if the mortgage money is not paid, and if the same is paid then the mortgage would be void. This type of mortgage was popular in India even earlier to the enactment of transfer of property act. The condition shall be there in the deed itself and not in a separate deed. If the condition is incorporated in a separate agreement then it is not a conditional sale but a sale absolute, and the existence of the agreement to be treated as an independent document or a contract.

Usfructuary Mortgage
Mortgagee is placed in possession of the property with a right to enjoy. The mortgagee would be entitled to enjoy the rent and profits until the debt is repaid. Appropriation of rents and profits, as per the agreement between the parties. The profits and rents may be adjusted towards the interest, or principle, or principle and interest. No specific time limit will be there as the mortgagee retains the property till the debt is repaid. No personal liability as the creditor will have the property with him as a security.

English Mortgage
Mortgagor binds himself to repay the mortgage money on a certain date. The mortgagor transfers the property absolutely to the mortgagee with a reservation The reservation would be in the form of retransfer of the property to the mortgagor upon payment of the mortgage money. The English mortgage differs from usfructuary mortgage The English mortgage differs from conditional sale. The English mortgage differs from simple mortgage

English mortgage and simple mortgage.


Property is given absolutely Right to sale is transferred to the transferee Mortgagee has an Mortgagee has no immediate right to enter the immediate right to enter the property, property,

Right to sell without the intervention of court.

No Right to sell without the intervention of court.

English mortgage and usfructiory mortgage.


Personal liability is not there to repay the loan Personal liability is not there to repay the loan

Absolutely transferred to Absolutely not the mortgagee transferred to the mortgagee, and the transferee has right to enjoy Sue for sale with out the Cannot Sue for sale. intervention of court with out the intervention of court nothing could be done.

English mortgage and conditional sale


Personal liability to pay Property is absolutely conveyed. Mortgagee has a right for an immediate possession sale is converted in to a mortgage Remedy for sale No Personal liability to pay Property is not absolutely conveyed Mortgagee has no such right for an immediate possession mortgage is converted in to a sale Remedy for foreclousure

Mortgage by deposit of title deed.


Equitable mortgage of English law is of a wider amplitude than the concept of Mortgage by deposit of title deed . In England it is more an equitable remedy, but in India it is both an equitable and legal remedy. Most popular type in modern days, banking transactions are the one governed under this category. There shall be a debt There shall be a deposit of title deed with creditor or his agent. The deposit shall be with an intent to create security. Possession of the property would remain with the mortgagor. Registration is not needed. In Karnataka stamp duty shall be paid.

Anomalous Mortgage
Anomalous Mortgage is a mortgage which is not covered under any of the other type of mortgages such as Simple mortgage, Mortgage by conditional sale, Usfructuary Mortgage, English Mortgage, Mortgage by deposit of title deed. There is no specific definition for this. Under this category other type of mortgages such as balloon mortgage, reversionary mortgage and what is not specifically defined could be brought under.

Whether mortgage needs registration and attestation.


mortgage needs registration where it is in respect of a property worth more than rs.100 mortgage needs no registration where it is in respect of a property worth not more than rs.100 and an equitable mortgage. mortgage needs attestation where it is in respect of a property worth more than rs.100/=

Rights and liabilities of the mortgagor


Rights: Right to redeem. Right to inspect the documents at reasonable time. Right to redeem separately or simultaneously. Right to recover possession in case of usfructiory mortgage. Right to have accounts in case of usfructiory mortgages. Right relating to the accessions made to the property when the same is in possession of the mortgagee. Right to create a subsequent mortgage, subject to the contract. Right to create a lease, subject to the contract.

Rights and liabilities of the mortgagor


Liabilities: In the absence of the contract to pay the municipal taxes. To transfer to the mortgagee when there is a duty cast on the mortgagor that he shall transfer the property to mortgagee. To defend the title. To pay the interest and principle amount as per the agreement. Not to cause waste to the property. Repay the debt amount.

Rights and liabilities of the mortgagee


Rights: Foreclosure. For recovery of the money paid. To bring the property for sale. To sue for mortgage money. Renewal of mortgaged lease, in case of mortgage with possession. In case of mortgage with possession to enter in to a new lease. In case of mortgage with possession, to spend money for preservation of the mortgaged property from being destroyed, support the title of the mortgagor, to establish his own title,

Redeem, Redemption, and Right to Redeem. To free the mortgaged property by payment of the amount due or by fulfilling some obligations. Redemption of mortgage would mean paying off the principal sum, and interest due on a mortgage and there by redeeming the charge. Redemption value would mean the amount which has to be paid redeeming a security.

Right to redeem is basically a right to get back the property given as a security. When the principal money has become due the right to redeem begins. When the mortgage money is paid to the mortgagee, the mortgagor should be put in possession of the property by the mortgagee. All the documents which the mortgagee had taken from the mortgagor should be returned with due endorsement where ever it is needed. To pay the cost incurred by the mortgagor to get the property retransferred to him or any other third party. Partial redemption is not permissible.

Clog on Redemption
 Right of redemption and right of foreclosure exists in a co-extensive manner.  Any right of redemption is a valuable right and it can not be taken away or impaired.  Even where a mortgagor fails to pay the amount on the date specified the mortgagor would not loose the right in respect of the property.  Any provision inserted to prevent, evade, or hamper the right of redemption is known as clog and the clog of such nature is void.  Pollock criticizes the doctrine of clog as a rule of anachronistic principle and shall be done away with as it is not suitable for the modern setup.  Pollock advocates that it be molded to the modern conditions by limiting it cases where there is some thing oppressive or unconscionable in the bargain.  In India we have not accepted the view of Pollock in toto but the said view finds recognition in some areas like companies Act with reference to the debenture.  The supreme court has held that even in England the position now is not to make mortgage an irredeemable, and the same applies to India.

REGISTRATION ACT. 1908, CAME INTO FORCE WITH EFFECT FROM 01-01-1909 IMPORTANT PROVISIONS OF REGISTRATION SECTION 17 : REGISTERABLE DOCUMENTS All the documents (except testamentary documents) related to immovable properties exceeding value ofRs.100/- are compulsorily registerable; The important documents which come across; i) Sale Deed/s, ii) Gift Deed/s, iii) Exchange Deed/s iv) Release Deed/s v) Partition Deed/s vi) Mortgage Deed/s vii) Lease Deed/s (if the period of lease is year and above) viii) Agreements in respect of immovable properties;

AGREEMENT OF SALE In the Sale Agreement/s there is no conveyance of the property and the contents of the sale agreement/s are the intentions of the parties and therefore the Agreement of Sale is not compulsorily registerable; However, if the possession of property agreed to be conveyed is delivered to the intending purchaser/s, as part performance of the Agreement, then, the said Sale Agreement should be compulsorily registerable; Un-registered sale deed/s, gift deed/s are un-enforceable and not admissible in evidence. But the said documents can be looked into for collateral purpose such as to prove the possession; In a Retirement Deed/s and Dissolution Deed/s, if an immovable properties of retiring partner is allotted to the other partners, then, the said documents shall be compulsorily registerable; Memorandum of Deposit of Title Deed/s is compulsorily registerable. But, a letter acknowledging delivery of documents as collateral security is not compulsorily registerable; Sale Certificate issued by the Court are not compulsorily registerable;

SECTION 18 : OPTIONAL DOCUMENTS Leases of an immovable properties for any term not exceeding one year; Transfer or Assignment of Decree of a less than Rs.100/-; Assignment / Extinguish of Right in movable properties; Declaration and Extinguition of Right over an immovable property which is less than Rs. 100/-.-

SECTION 23 : TIME FOR PRESENTATION The documents will be accepted for registration, within four months from the date of its execution. Thereafter, penalties will be imposed calculating on every day's delay to a maximum extent of ten times the amount of proper registration fee.;

SECTION 27 : REGISTRATION OF WILLS A Will may be at any time be presented for registration or deposited (no time limit is prescribed from date of execution);

SECTION 28 : PLACE OF REGISTRATION Every document mentioned in SECTION 17 in so far, as such documents affects immovable properties shall be presented for registration in the office of the Sub Registrar, within whose Sub District/s, the whole or some portion of the property to which such documents relates is situated; In the case of Willis and Power of Attorneys, the said documents can be executed and registered at the discretion of the Executant; In the regard to partition deed/s, the documents can be registered in anyone of the jurisdiction of the properties involved in the partition deed;

SECTION 30 : REGISTRATION OF DOCUMENTS BY REGIS1RAR District Registrar/s is entitled to register the documents in respect of the properties situated within his jurisdiction and transfer the entries to the concerned Sub Registrar; NOW THE STATE GOVERNMENTS ARE CONSIDERING TO MAKE PROVISION FOR THE REGISTRATION OF DOCUMENTS WITHIN THEIR STATE IN ANY SUB REGISTRAR'S OFFICE AND THEY ARE WORKING OUT IN SAID DIRECTIONS;

SECTION 31 : PRIVATE ATTENDANCE If the Executant of the document is unable to appear before the Sub Registrar, then, he/she can request the Sub Registrar with Medical Certificate for private attendance. On an application, the Sub Registrar will make necessary arrangements for private attendance. After collecting additional charges;

SECTION 32 : WI-IO CAN PRESENT THE DOCUMENTS FOR REGISTRATION Person/s executing documents; Representative/s; Power of Attorney Holder/s;

SECTION 33 : POWER OF ATTORNEY SHOULD BE PROPERLY ATTESTED AND REGISTERED IN RESPECT OF IMMOVABLE PROPERTIES Power of Attorney should be properly stamped and attested; It is better that the Power of Attorney in respect of the transactions with regard to immovable properties should be compulsorily registerable. In view of the same, the Central Government has made an amendment and it is before the President of India for her assent,

SECTION 38 : PERSONAL EXEMPTION FROM APPEARANCE AT REGISTRATION OFFICE A person who is unable to appear before registration office; A person in jail; A Person exempt by law ITom personal appearance;

SECTION 40 : PERSONS ENTITLED TO PRESENT WILLS & AUTHORITIES TO ADOPT The Testator or the Executor of the Will (after the death of Testator) are entitled to present the Will for purpose of registration;

SECTION 42 : DEPOSIT OF WILLS The Testator of the Will is entitled to deposit the Willis with District Registrar. On the death of Testator, the deposited document will be registered and the certified copy of the said document will be handed over to the beneficiary of the Will;

SECTION 49 : EFFECT OF NON REGISTRATION OF DOCUMENTS REQUIRED TO BE REGISTERED No documents required by Section 17 of the Registration Act. Shall Effect any immovable property comprised therein or Confer any power to adopt or Be received as evidence of any transaction affecting such property or conferring such power unless it has been registered

SECTION 51 : REGISTER BOOKS TO BE KEPT IN THE OFFICE OF SUB REGISTRAR BOOK - I In this book all the registered transactions in respect of immovable properties shall be entered; BOOK - II In certain cases, the Sub Registrar refuses to register the documents, when presented by the parties. The Sub Registrar, shall make an order showing the reason/s for refusal to register the document. The said order is appealable to the concerned Authorities, appointed by the Government; BOOK - III All the registered Testamentary instruments such as Will/s shall be entered in the said Book; BOOK -IV All the registered Power of Attorney, Trust Deed/s and Release Deed/s for cash consideration (without involvement of immovable properties), Indemnity Bond/s and Declaration/s will be registered in this Book;

SECTION 71 : REFUSAL TO REGISTER The Sub Registrar is empowered to refuse to register the documents, if the documents are not in accordance with Registration Act.;

SECTION 72 : APPEAL PROVISION Order passed under Section 71 is an appealable order and the appeal can be filed before the District Registrar under Section 72. The order of the District Registrar is final;

SECTION 78 : FEES FOR REGISTRATION, SEARCHES & COPIES The Sub Registrar is entitled to collect the fees for registration, encumbrance certificates and for the certified copies as may be fixed by respective State Governments; IMPORTING DOCUMENTS THAT ARE BEING REGISTERED UNDER THE REGISTRATION ACT. 1908 [A] AGREEMENTS i) Sale Agreement/s ii) Joint Development Agreement/s [B] CONVEYANCE DEEDS
i) ii) iii) Sale Deed/s Exchange Deed/s Gift Deed/s Section 54 of TP Act.; Section 118 of TP Act.; Section 122 of TP Act.;

[C] i) ii) iii) iv) v) vi) [D] [E] [F] [G] [H]

MORTGAGES Simple Mortgage Deed Mortgage by Conditional Sale Deed Usufructary Mortgage English Mortgage Equitable Mortgage (DTD) Self Redeeming Mortgage LEASE DEEDS PARTITION DEEDS RELEASE DEEDS POWER OF ATTORNEYS TRUST DEEDS i) Public Trust (for the benefit of general public) Ii) Family Trust (for benefit of individual persons) Section 58 (b) TP Act. Section 58 (c) TP Act. Section 58 (d) TP Act. Section 58 (e) TP Act. Section 58 (f) TP Act.

[I] WILLS There is no stamp duty payable for the will. However, if the Testator decide to cancel the will, then, he has to pay nominal stamp duty and fixed registration charges; [J] ADOPTION DEEDS [K] BONDS

INSURANCE ACT. 1938 Earlier Life Insurance Corporation of India was sanctioning housing loans to its policy holders; Presently, the LIC Housing Finance Limited has come into existence and sanctioning of housing loans is vested with said statutory body. Hence there is no registration of documents by LIC of India. However, the LIC has valuable immovable properties and the properties are allowed to be used by the occupants by entering into following documents, under Indian Registration Act. on payment of necessary stamp duty and registration charges; i) Registered lease deeds; ii) License Agreements;

SECTION 38 : ASSIGN1v1ENT OF POLICIES The stamp duty is payable for assignment of Insurance Policies by the Policy Holders in favour of Transferees. In such cases, stamp duty is liable to be paid under provisions of Indian Stamp Act. (20 paise for every Rs.1000/-);