TRANSFER OF PROPERTY ACT, 1882

Lecture-1

Historical background

The word property had its origin in the Middle England between
1275-1325, by the term “Properte” meaning possession, attribute
or what is one’s own.

There was no codified law with regard to the Transfer of Property

till the year 1882. It was only in the year 1882 that India got a
compact law with regard to property transfers.

Prior to 1882 the property transfers in India were governed by the

principles of English law and equity. In the absence of any specific
statutory provisions the courts had to fall back upon English law
on real properties and sometimes forcing the courts to decide the
disputes according to their own notions of justice and fair play,
resulting in confused and conflicting case laws.

A law commission was appointed in England to remedy these

confusions and conflicting case laws by preparing a Code of
Substantive Law of Transfer of Properties in India. A draft Bill was
prepared by this commission and was sent to India by the
Secretary of State for India. The Bill was introduced in the
Legislative Council in 1877. The bill was then referred to a select
committee and it was sent to the Local Governments for their
comments. The Bill was redrafted on many points and referred to
a Third Commission. The Bill pertaining to Transfer of Property Act
was prepared not less than seven times before the final Bill was
passed and it came into force with effect from 17 th February, 1882
as “THE TRANSFER OF PROPERTY ACT, 1882”.

Overall analysis of the Act

This act consists of eight chapters which are as follows: 1

1. Chapter-1 Preliminary [Sections- 1-4].
2. Chapter-2 Transfers of Property by Act of Parties [Sections 5-
53A].
 3. Chapter-3 Sale of Immovable Property [Sections 54-57].
4. Chapter-4 Mortgages of Immovable Property and Charges
[Sections 58-104].
5. Chapter-5 Leases of Immovable Property [Sections 105-117].
6. Chapter-6 Exchanges [Sections 118-121].
7. Chapter-7 Gifts [Sections 122-129].
8. Chapter-8 Transfers of Actionable Claims [Sections 130- 137].

Kinds of Transfer of Property:

1. Sale
2. Mortgage
3. Lease
4. Exchange; and
5. Gift

Lecture-2
Sections 3 to 53A deal with the concept of transfer of property.

This Act shall extend1 to the whole of India except the territories
which immediately before the 1st day of November 1956 were
comprised in the Part B States or in the States of Bombay, Punjab
and Delhi. But this Act can be made applicable in these States
either in whole or in part with a notification in the concerned
government Gazette.

Similarly the State Governments can also exempt any part of the
territories administered by it either retrospectively or
prospectively from all or any of the following provisions such as
section 54 paragraph 2 and 3, section 59, 107 and 123. These
sections shall not be extended or be extended to any district or a
tract of the country that is excluded by the operation of the Indian
Registration Act 1908.

This Act shall come into force on first day of July, 1882.

2
Before going further into the Act we must deal with the
interpretation2 of certain terms which are used in the Act. They
are

1 Section-1 Short Title and Extent.

2 Section-3 Interpretation Clause.
 1. Immovable property- means anything that is attached to
or embedded in the earth and is not able to move from one
place to another. But it does not include standing timber/
trees, growing crops or grass because when they are
severed they become movable and also because of the fact
that the growing crops, grass etc. are seasonal. Normally
trees are immovable but when they are used for fuel
purposes they become movable.
2. Instrument- means a gift, lease, exchange or a sale deed
through which the property is transferred.
3. Attested- means authenticating a document. Such
attestation shall always have to be by two or more witnesses
who have seen the executant (a person who executes the
document) or any other person in the presence and by the
direction of the executant sign or affix his mark to the
instrument or receives personal acknowledgement of the
executant or such other person regarding such signature or
mark. Both the attestation witnesses must sign the
instrument in front of the executant. But it is not necessary
that both the witnesses must be present at the same time,
one witness can succeed the other.
In Lalita Ben v. Pragyan Ben3, in this case a Will was
attested by only one witness. The executor of the Will was
unknown and the Will was produced from the custody of one
of the attesting witness. The question in this case was
whether a will can be said to be duly attested? The court
held that it is not duly attested because there was nothing
on record to show that both the attesting witnesses either
attested the Will in the presence of each other or the
testator had acknowledged his signature in presence of the
other attesting witness.
In P. Narayanamma v. P.V. Reddy4, the question was that

3
of the acceptability of evidence of attestor of will. In this
case, the Will was written, contents of Will were read over by
the writer of the Will, it was executed by the testator and
then the writer himself as an attestor signed the document.
3AIR, 2009 SC 1389.
4 AIR 2007 A.P 137.
 The court explained that neither Section 3 of T.P. Act nor
section 68 of Evidence Act stipulates any qualification or
disqualification of attesting witness. It would have made a
significant difference had the attestor signed the document
soon after he read it without waiting for the executant to
sign.
In Abdul Jabbar v. Venkatshastri and Sons5, the question
before the Supreme Court was whether the attestation of a
security bond by the Sub-Registrar was a valid attestation. In
this case the identification of the parties, registration of bond
and attestation were all done by the Sub-Registrar. The
Madras High Court has held it to be attestation and this was
confirmed by the Supreme Court. The view of the Court was
that a valid attestation requires two witnesses and signature
of the executor as required under the Transfer of Property
Act and animus attestandi.
4. Registered- means registered in any part of the territories
to which this Act extends under the law for the time being in
force regulating the registration of documents. For instance
registration of the transferred property under the Indian
Registration Act, 1908.
5. Attached to the earth- means something which is firmly
fixed or embedded in the earth such as trees, shrubs, walls
buildings etc for their permanent beneficial enjoyment.
6. Actionable Claim- means a claim over any debt which is
not secured by any mortgage, hypothecation or pledge and
which is not in the possession of the claimant. Such claim
may be existing, accruing, conditional or contingent and the
civil court must recognise such debt as an affording ground
for relief. For instance ‘A’ has taken an amount of Rs. 3000/-
from ‘B’ and puts a condition that he would return the
amount provided that he will not meet anymore with his best

4
friend or that he must have children which is contingent, ‘B’
being unmarried at that time. Thus in both the conditions
there is no reasonability that for getting back Rs. 3000/- he
has to befriend his best friend or to have children. It is a

5 AIR 1969 SC 1147.

 affording ground which the civil court must recognise and
order for the return of Rs. 3000/-.
7. Notice- means information about a matter. When a person
actually has information about a matter or when a person
willfully abstains from any enquiry or search which he ought
to have made or make a gross negligence in knowing a
matter which he could otherwise have known, then such
person shall be deemed to have known the matter. For
instance ‘A’ purchases a property ‘X’ which was under
litigation which latter on surfaces on the property. Here ‘A’
cannot take plea that there was no notice of litigation to him
because he did not make any enquiry about the property
with the resident neighbours which he either willfully or due
to gross negligence abstained from enquiring otherwise he
could have known about the litigation.
Explanation 1 explains that where any immovable property
is required under the law to be registered by registered
instrument then any person who is acquiring such property
or any part or share or interest in such property then from
that date or where any property is situated in different sub-
districts or where the instrument has been registered under
sub-section (2) of Section 30 of the Indian Registration Act,
1908, from such earliest date on which a memorandum has
been filed by the sub-registrar the person is said to have
notice of such registered instrument.
Provided that the instrument must have been completely
registered under the manner prescribed under the Indian
Registration Act, 1908 and has been duly entered in the
boxes and indexes under section 51 and 55 of that Act.
Explanation 2 explains that the person acquiring any
immovable property or any share or interest in such property
then he shall be deemed to have information or notice of the

5
prima facie title of the person who is in the possession of the
property for the time being.
Explanation 3 is based on the maxim qui facit per alium
facit per se (he who acts through another is deemed to act
in person) explains that notice to an agent, acting on behalf
 of the principal in the course of the business, shall be
deemed to be a notice to the principal. But the proviso says
that if the agent fraudulently conceals the information then
the principal cannot be charged with notice.

It is provided under Section 46 that matters of contract under

this Act shall be dealt with under the Indian Contract Act and
section 54 paragraphs 2 and 3 and sections 59, 107 and 123 shall
be read as supplemental to the Indian Registration Act.

It is to be noted here that a transfer of property has to be

between two living persons for a valid transfer as provided in
Section 5 of this Act. It reads as follows:

“Transfer of property means an act by which a living

person conveys property, in present or in future to one or
more other living persons, or to himself, or to himself and
one or more other living person and to transfer property
is to perform such act.

In this section ‘living person’ includes a company or

association or body of individuals, whether incorporated
or not but nothing herein contained shall affect any law
for the time being in force relating to transfer of property
to or by the companies, associations or bodies of
individuals.”

The essentials of the section 5 are:

1. Transfer has to be inter vivos i.e. between two living

persons. Person again is divided into two parts that i.e. (a)
biological person and (b) juristic person (a group of
individuals or a company or an association etc).
2. Transfer can be made in present time or to a future
date.
3. Transfer can be made to one or more person.
4. Transfer can also be made to self.
6

6 Enactments relating to Contracts to be taken as part of the Contract Act and supplemental to the Registration Act.
In transfer of property the interest in the property is transferred
and transfer means contract plus conveyance. Interest means the
right to enjoy or dispose of the property in whatever manner he/
she likes. When a person transfers a property the interest of a
person in the property is transferred absolutely and he cannot
claim it back. But such is not the case in lease. It is for a limited
period as may be mentioned in the lease deed. Other types of
transfer other than sale, gift, lease, mortgage and exchange such
as partition, family settlement, compromise, relinquishment,
abandonment etc. Now the question arises as to whether they
can be considered as transfer or not. There are several judgments
wherein it was held that partition, family settlement or
arrangement, abandonment, compromise etc are not transfer
because in all these types of property transfer there is no
conveyance of property as is required by Section-5 of the Act.

In V. N. Sarin v. Ajit Kumar Popai7, it was held by the Supreme

Court that the partition of Joint Hindu Family property amongst
the coparceners would not amount as transfer. If an act is not
transfer or conveyance then it will not be attracted under the Act.

In a leading decision of S. K. Sattar v. Gundappa 8, , the

Supreme Court held that the family arrangement is a transaction
between members of the same family for the benefit of the family
so as to preserve the family property, the peace and security of
family, avoidance of family dispute and litigation and for saving
the honour of the family.

In Aralappa v. Jagannath9, the question was whether any

person can file the suit for declaration of his share without
claiming possession on basis of partition deed? The court held
that such suit for declaration alone is not maintainable because
partition does not create any interest in joint family property. It is
already there. Mere declaration is not maintainable.
7
7 AIR 1966 SC 432.
8 AIR 1997 S.C
9 AIR 2007 Kar. 91
Given the definition of transfer of property now the question
arises as what can be transferred and what cannot be
transferred?

General rule of law is to promote free alienation and circulation of

property and is based on the maxim “alienation rei praefertur
juri accrescendi” which means that law leans in favour of
transferability and not accumulation.

Section 6 provides that a property of any kind can be transferred

and stipulates therein a list of things that cannot be transferred.
They are as follows:

a. A chance of an heir apparent (a son or daughter of a person

who inherits the property after death) or a relation
succeeding the estate or obtaining the legacy (property
received under a will) on the death of a kinsman or any other
mere possibility of like nature cannot be transferred. This is
otherwise called spes succession. Heir apparent means a
son or daughter in waiting to succeed the property after the
death of the father/mother and legacy means a person to
obtain the property under a will. Under a Will a transfer does
not become operational immediately on the execution of the
will rather it becomes operational after the death of the
person. Thus in both the cases (heir apparent and kinsman
obtaining legacy) property passes after the death of the
owner of the property but not during his/her lifetime.
Example:
‘M’ is an heir apparent or a relation and ‘Z’ is a father or kin
of ‘M’ who is seriously ill and chances of coming back to
normal life are less and anything may happen at any time. In
this situation ‘M’ being a son or daughter of ‘Z’ has a right to
succeed to the property or estate of ‘Z’. Similarly ‘Z’ being a

8
kin of ‘M’ and having no children then ‘M’ has a chance to
get the legacy of ‘Z’. In both the situations and of the like
nature the “chance” of succeeding or obtaining the property
cannot be transferred. But if ‘Z’ bounces back to normal life
 then ‘M’ cannot get the property of ‘Z’ during his lifetime
either as a heir apparent or as a kinsman.
In Hameed v. Jameela10, the question was whether
Mohammedan heir succeeding to an estate could be a
subject matter of transfer under sale. The court held that
Chapter II of T.P. Act does not affect any rule of
Mohammedan Law but even in Mohammedan Law Transfer
of Spes Successionis is prohibited. Mohammedan Law and
Section 6(a) of T.P. Act are identical on Spes Succession. Heir
apparent cannot sell his interest in both.
b. A mere right of re-entry for breach of a condition subsequent
cannot be transferred to anyone except the owner of the
property. The term re-entry means to enter again. Re-entry is
a concept related with lease. Lease is transfer of right to
enjoy the immovable property for a specific period and it is
under a contract which is either conditional or unconditional.
Lease under the conditional contract having a condition
subsequent and mentioned therein that in the event of
breach of such condition the owner reserves the right to re-
enter the property. Such right to re-enter the property cannot
be transferred to anyone else other than the owner himself.
For instance ‘A’ the owner of the house leases out to ‘B’ for
office and puts a condition subsequent that he shall use the
house for office purpose only and shall not use it for any
other purpose without the permission of ‘A’. But ‘B’ instead
of using the house as an office used it as a godown of his
business without the prior permission of ‘A’. Here ‘B’ has
breached a condition subsequent and forfeits the right to
lease as a condition subsequent on breach of it ‘A’ has a
right to re-enter the house.
c. Easement cannot be transferred apart from dominant
heritage. Dominant heritage means a whole chunk of
property and easement means anything upon which the
9
enjoyment of the dominant heritage depends such as right of
way or passage or drainage etc. But when at the time of
transfer of a part property easement falls on the transferred

10 AIR 2010 Ker. 44

 property, it still can be used by the owner of the existing
property and transferee cannot object to it as the transferor
right to enjoy his property gets hampered.
A M

xxx
xx

X Y
Dominant heritage Leased out land to B
Drainage-Easement/ Serviant Heritage

In the above picture ‘A’ is the owner of the properties ‘X’ and
‘Y’. ‘M’ is a public road and the shaded portion is the
drainage on the property ‘Y’. ‘A’ leases out the property ‘Y’
to ‘B’ the lessee and retains the property ‘X’. ‘X’ property of
‘A’ has a drain passage through the leased out property of
‘Y’. ‘A’ puts a condition in the lease deed that ‘B’ will not
meddle with the drain passage. Here though the drain is in
the leased out land ‘Y’ he cannot block it as it will directly
affect the enjoyment of the ‘X’ property of ‘A’. If ‘B’ does so
then it is bad in the eye of law.
In the above example the property over which ‘A’ is having
the ownership is known as dominant heritage and the drain/
easement in the leased out property is known as serviant
heritage. When dominant heritage is transferred serviant
heritage is automatically transferred. But only serviant
heritage apart from the dominant heritage cannot be
transferred.
d. All interest in the property restricted in its enjoyment to the
owner personally cannot be transferred by him. Normally
10
there is no restriction on transfer of interest or property. But
there are persons whose interest in the property can be
restricted. For instance a public servant cannot transfer his
office for some period or a Mahant of a temple cannot
transfer the temples property which is
 under his custody. Similarly a servant cannot sell of the
property of the master who is temporarily under the care of
the property.
dd. A right to future maintenance cannot be transferred
whether arising, secured
or determined. Maintenance of a person means to help a
person economically, mentally and socially who is unable
to maintain himself or herself such as minors, mentally
deranged and old and infirm till they are alive. It is
associated with the longevity of a person. If a person dies
then there will be no maintenance. Future maintenance
means maintenance of above mentioned persons in future
such as minor on becoming major is unemployed, or old
persons on reaching superannuation will be having no source
of income and are entitled to future maintenance. If such
right of future maintenance is transferred then such person
cannot exist and will die and is against the right to life of a
person which is against public policy.
e. A mere right to sue cannot be transferred. Mere right to sue
means having a right to sue but when that right will become
operational is uncertain or is remote in nature. But on the
contrary a right to sue is transferable because it is certain
as to when to sue. For instance ‘A’ has land which is in the
possession of ‘X’. Now ‘A’ can either sue or transfer his right
to another person to sue on his behalf for that land. But ‘A’
having no property but having only a right to sue if he
acquires a property is something which is remote in nature
because it is uncertain whether and when ‘A’ will have
property. Such an uncertain right which has no interest
cannot be transferred because transfer of property means
transfer of interest.
f. A public office cannot be transferred nor can the salary of
11
the public officer can be transferred, whether before or after
it has become payable. Because public office is a public
property and public officer is the custodian of the property
who has a limited interest as held in clause (d). Thus having
a limited interest the salary so received is a part and parcel
 of the public property of which he is a custodian. Thus the
salary of a public officer cannot be transferred.
g. Pensions and stipends cannot be transferred as they are
purely personal in nature and does not have a transferable
interest. Even if they are transferred they are bad in the eye
of law.
h. No transfer can be made of any property in so far as it is
opposed to the nature of public interest or if the transfer is
made for an unlawful object or consideration within the
meaning of section-23 of the Indian Contract Act, 1872 or to
a person legally disqualified to be a transferee. For
instance a State as a public trustee of the natural
surroundings cannot transfer them even for a price because
the State as a trustee has a limited interest and is against
the interest of the public. Under Section 23 of the Contract
Act a consideration or object of an agreement is lawful
unless; (a) it is forbidden by law, or (b) it is of such a nature
that if permitted it would defeat the provisions of law, or (c)
it is fraudulent, or (d) it involves and implies injury to the
person or property of another, or (e) the Court regards it as
immoral, or opposed to public policy. Or if a property is
transferred to person who is a hardened criminal who will
possibly carry out illegal activities on that property is a bad
transfer and such transfers cannot be made. Or transfer in
favour of a minor or a person incompetent to contract etc
are disqualified persons who cannot become transferees.
i. A person having an untransferable right of occupancy as a
tenant, farmer of an estate in respect of which default has
been made in paying revenue and a lessee of an estate
under the management of the court of wards, cannot
transfer/assign his interest in the property as such tenants,
farmers and lessee’s etc. Because as a tenant a person has a
limited right to enjoy the property, there is no absolute
12
transfer of interest so a tenant has to enjoy the property for
some time and has to return it back to the owner. Further a
farmer in respect of an estate whose revenue is in default
cannot transfer because it is against the nature of interest
 that one cannot transfer his property if there arrears in land
revenue because the person to whom the property with
arrears is transferred will suffer unnecessarily for the default
of the transferor to pay the arrears. Similarly a lessee of an
estate under the management of Court of Wards cannot
transfer his interest therein because by such transfer the
interest of the minor whose property is under the lease will
get affected which is bad in the eye of law. All these three
transfers have been prohibited as they are against public
policy.
Lecture-3
Transfer of property is an absolute transfer of interest which
a person voluntarily and with full knowledge that he is thereby
transferring his interest in the property transfers the property.
Thus for this act of transfer there are some
qualifications/competencies which a person should have. The
competence or a qualification required by a person to transfer a
property is provided under section 7 of the Act.
Essentials of Section 7 are:
1. Person must be competent to contract.
2. Person must be entitled to transferable property.
3. Person who is authorized to dispose of the property not his
own.
4. Such a person can transfer the property either wholly or in
part; and
5. Either absolutely or conditionally under the law for the time
being in force.
Thus the first and foremost thing in the competency is that a
person must be competent to contract. So who are the persons
competent to contract? Section 11 of the Contract Act 1872
provides the answer to this question. According to this section
following persons are competent or qualified to contract:-
a) A person who is a major.
b) A person who is of sound mind.
13
c) A person must not have been disqualified by law to contract.
Thus to transfer a property a person must be of sound mind,
should not be minor on the date of making the transfer and
should not have been disqualified by law to which he is subject.
Any transfer made by person who is minor on the date of transfer
is void ab initio but a transfer by an insane person is voidable i.e.
it can be made valid subsequently if such person becomes sane.
On the contrary such transfer can be made by a guardian of such
minor or insane person and such transfer must be for the benefit
of the minor or such insane person. An important and landmark
case on the minor’s contract is Mohribibee v. Dharmodas Ghose
wherein it was held that minor’s contract is void.
Another qualification to transfer the property is that such person
must be authorized to dispose of the property not his own. For
instance a servant authorized by the master to transfer the
property on his behalf.
When such a person transfers property he/she forthwith passes all
the interest in the property which he/she is capable of passing in
the property as the owners of the property as well as the legal
incidents therein. In other words we can say a person passes his
absolute right in the property. When such absolute right passes
from the transferor to the transferee, he/she (transferee) shall
enjoy the property in the same way as transferor would have
enjoyed had the transfer not been made. For instance ‘A’ is the
owner of a property ‘C’. As an owner he/she can sell, lease,
mortgage or destroy or dispose such property in whatever
manner he/she can because they are having an unrestricted right
or absolute right. When ‘A’ transfers such property to ‘Z’ he is
passing on all his right, absolute right over the property.

Section 8 of the Act provides for the same as has been described
in the above example. It provides that a transfer of property
passes forthwith to the transferee all the interest which the
transferor is then capable of passing in the property and the legal
incidents thereof.
Legal incidents mentioned in this section means that
1. When a land is transferred then the easements, rents and
14
profits that accrue after the transfer also get transferred.
2. If the property is machinery attached to the earth then all
the movable parts;
 3. If the property is a house then the easements, rents accruing
after the transfer, doors, locks, keys, windows and all other
things provided for the permanent use therewith.
4. If the property is a debt or other actionable claim, the
securities thereof, but when such securities are for other
debts or actionable claims then such debt or actionable
claim cannot be transferred as it may affect other creditors
or claimants. For instance ‘A’ is a doctor and has constructed
a hospital taking a loan of Rs. 12 crore and has given his
house as security worth Rs. 20 crore. After some time ‘A’
being unable to administer the hospital decided to sell the
debt property i.e. hospital to ‘B’. Now according to the
requirement of the section as ‘A’ is transferring his debt
property he also have to transfer the security worth Rs. 20
crore. This is so because if security is not transferred then ‘B’
will have to suffer for the mistake of ‘A’ as his (B’s) property
may be taken over by the bank if ‘B’ is unable to repay the
debt.
5. If the property is money or other property yielding income,
then the interest or income which accrues after the transfer
takes effect.
In case of transfer of land it can be assumed that all things
attached to the earth such as trees, shrubs, etc gets transferred
alongwith the land but in the vise versa case it cannot be so
assumed. [Vishwa Nath v. Ramraj, AIR 1991 All 193]
In Ramchandra v. Kalyan Singh11there was an agreement to
sell an open land. In the decree for specific performance trees
planted on the land were objected to be transferred by the
transferor on the ground that standing trees cannot be given in
execution proceeding. It was held that this objection is not
tenable in terms of Section 8 of the T.P. Act and the trees will also
pass to the transferee which is capable of passing with the land.
Generally when any property is transferred it is effected in two
15
ways, i.e. either through registration or orally. Now the question
arises can property be transferred orally without registration? The
answer to this question is yes, the property can be transferred
11 AIR 2006 All. 184
orally where it is not expressly required by law as is provided by
section 9 which reads as follows:
“A transfer of property may be made without writing in
every case in which writing is not expressly required by
law”.
It can be deciphered from the above definition that law provides
as to when registration and writing is required and when property
can be transferred orally.
Cases in which property can be transferred orally or through
registration are as follows:
1. Gift of immovable property cannot be transferred orally it
has to be through writing and registration.
2. Sale of immovable property exceeding Rs. 100 has to be
through registered instrument but for less Rs. 100
registration is optional and can be transferred orally.
3. Sale of intangible immovable property exceeding Rs.100 or
sale of reversion or any intangible thing has to be through
registered instrument. But for sale of tangible immovable
property less than Rs. 100 it can be effected either through
registered instrument or through delivery of property.
4. Lease of immovable from year to year or exceeding one year
or to be paid annually has to be through registered
instrument. But for lease less than one year no registration is
required and it can be transferred orally.
5. Simple mortgage irrespective of the amount secured has to
be through registered instrument. But in case of simple
mortgages which are in the possession of the mortgagor and
not with the creditor can be transferred orally. Other kinds of
mortgages except the mortgage by deposit of title deeds
amount to registration. But in case of mortgage by deposit of
title deeds no registration is required.
6. Exchange of immovable property exceeding Rs. 100
amounts to registration.
16
7. Transfer of actionable claim is to be made through writing
but registration is not required.

Lecture 4
In the previous few lectures we have discussed about the effect of
transfer, competency of the person to transfer, what gets
transferred and how such transfer is effected. By this time we
have understood that transfer of property is an absolute transfer
from the transferor to the transferee. But the question is can a
transferor while transferring the property put any condition in the
alienation or enjoyment of the property upon the transferee?
Sections 10 and 11 provide that there can be no such restrictions
either in the enjoyment or alienation of the property. Section 10
reads as follows:
“Where property is transferred subject to a condition or
limitation absolutely restraining the transferee or any
person claiming under him from parting with or disposing
of his interest in the property, the condition or limitation
is void, except in the case of a lease where the condition
is for the benefit of the lessor or those claiming under
him:
Provided that property may be transferred to or for the
benefit of the woman (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 therein”.
Generally when a transfer is made it is an absolute transfer i.e.
the transferee will have all the rights which the transferor had or
would have had, had the transfer not taken place. The transferee
will have the right to dispose of the property to any one, at any
time and in any manner he likes there should not be any
restriction on this absolute right of the transferee. If at all any
such restriction is put then such restriction is bad in the eye of
law.
But there are two exceptions to such rule provided under
section 10:
17
Firstly, such restriction can be put in case of lease if such
restriction is for the benefit of the lessor or those claiming under
him.
Secondly, when a woman, who is not a Hindu,
Mohammadan, or Buddhist to whom a property is transferred,
cannot transfer her property during her marriage. This is a
restraint absolutely, but it is for the benefit of the woman who is
married and becomes victim of the husband and his family
member’s guilty intentions who can either by harshness or by
flattering and coaxing with ulterior motive take away her property
meant for the benefit of that woman. In India there are many
special and local laws for the protection of the woman relating to
Hindu or Muslim religion but there are other religions that are
existent in India in minority who get the property after marriage
and having absolute right to transfer or make a charge over the
property they become victims of their own right. Thus to protect
the woman of other religions other than those mentioned in the
section if any condition is put restraining them from further
alienating the property is not void and does not attract the
provision of Section 10.
Other than these two situations if any restriction is made
restraining the transferee in the alienation of the property such
restraint is void.
In Achammal v. Raja Manickam12, the question was whether
property devised by will to adopted son could be subjected to any
condition or limitation after interest is vested on an adopted son.
The Court held that no restraint can be imposed on alienation; no
interest can be created which is repugnant to interest so created
in that property. The legatee gets the property as if there was no
such direction in the will. Section 138 of the Succession Act, 1925
declares any such direction as void. It is same in section 10 and
11.
Restrictions as implied under Section 10 are not applicable if they
are partial. The test to see whether any restriction is partial or
absolute is based on what remains after the condition is enforced.
If the condition is absolute and it is totally retraining the transfer
the property then it is invalid but if the condition is such that even
18
after the enforcement of the condition the right to further transfer
the property is not affected. For instance in case of a joint family
the members of such joint family agreed in a family arrangement
that they will not sell the property to any outsider but they will
12 AIR 2010 Mad. 34
distribute the property within themselves. This is a restraint but
not hit by section 10 as the property is not remaining stagnant it
is subject to further transfer if not outside the family then it is in
circulation atleast within the family.

On the other hand Section 11 provides that on absolutely

transferring the property if any condition is put or direction is
given to enjoy the property in a certain manner then any person
to whom such property is transferred can enjoy the property as if
no such restriction is put. But there is an exception to this rule.
Restriction in respect of one piece of immovable property can be
put by the transferor for the beneficial enjoyment of the other
piece of the immovable property and in such case protection of
section 11 cannot be claimed by the transferee.
For instance “A” is an owner of a large piece of a land.
He transfers his front portion of the land to “B” absolutely but
puts a condition that he shall not raise any structure or construct
any building on the eastern side of the land which will be used as
a common passage by both “A” and “B”. This though qualifies for
a restriction in the enjoyment of the transferee “B” but is valid as
it is required for the beneficial enjoyment of the property by “A”.

There is a difference to be marked in both the sections. Under

section 10 there is a prohibition on restriction in the alienation of
the property but under section 11 there is a prohibition on the
restriction in the enjoyment of the property.

But can the above mentioned prohibition be imposed on the right

of an insolvent person to enjoy the property or endeavoring to
alienate after absolute transfer? Section 12 provides for
condition making interest determinable on insolvency or
attempted alienation which reads as follows:
“Where a property is transferred subject to a condition or
limitation making any interest therein, reserved or given
19
to for the benefit of any person, to cease on his becoming
insolvent or endeavouring to transfer or dispose of the
same, such condition or limitation is void”.
The law on absolute transfer is clear as is mentioned in the
previous two sections that no restriction or prohibition shall be
imposed on the right to alienate the property or on the
enjoyment. Thus it is also not valid to put such a restriction or
prohibition while transferring a property absolutely that such a
transferee in the event of becoming insolvent or attempting to
alienate the property such property will revert back to the
transferor. Such a restriction is bad in the eye of law. In the event
of the transferor becoming an insolvent and is in debt then any
such above mentioned restriction will not bar the right to
distribute the property towards the adjustment of the debt. So like
section 10 and 11, section 12 provides that no transfer should be
made with a condition that on becoming insolvent or attempting
to alienate the property the ownership of the transferee will cease
and the property will revert back to the transferor.

Section 13 provides for the transfer for the benefit of an unborn

person which reads as follows:
“Where, on a transfer of property an interest therein is
created for the benefit of a person not in existence at the
date of the transfer, subject to a prior interest created by
the same transfer, the interest created for the benefit of
such person shall not take effect, unless it extends to the
whole of the remaining interest of the transferor in the
property”.

As a general rule mentioned in section 5 of this Act property can

be transferred between living persons i.e. inter vivo. Thus
according to this section property cannot be transferred in favour
of a person who is not living on the date of the transfer. But
section 13 stands as an exception to this rule by providing for
transfer of property in favour of an unborn child. According to this
20
section property in favour of an unborn child can be transferred
by creating a chain transfer in the form of;
1. Prior interest; and
2. Interest in favour of an unborn person must be an absolute
one not a conditional one (whole/total interest in the
 property of the transferor must be transferred and not the
limited property). Unless whole/total interest of the
transferor in the property is not transferred such transfer in
favour of an unborn person is not valid.
By creating prior interest means, the property before being
actually transferred in favour of a person who is not in this world
at the date of transfer (unborn child), till that time it is held by
some other person for the whole life. That “other person” is a
prior interest.

A P Q R S……. X’s unborn child

Land

In the above picture A is the owner of a piece land which he

transfers it in favour of his grandson i.e. the unborn child of X. X is
unmarried by the time of such transfer. So A appoints P, Q, R, S, T
etc as prior interest. In case of death of any prior life interest
other person can be appointed as life interest. There is no limit on
the appointment of life interest but the condition under section 13
is that the child must take birth before the cessation of last life
interest.
In Sridhar v. N. Ravanna13, the suit property was bequeathed
by gift to one Mr. ‘R’ and then to devolve upon his male child. ‘R’
had only life interest but he transferred the gift property by sale
after the birth of his male child, i.e. the plaintiff. It was held that
the sale was bad in law and the plaintiff was entitled to receive
consideration.
Computation of the period of life interest
The date of transfer of property in favour of an unborn person till
the birth of the child + the minority period i.e. 18 years from the
21
date of his birth= property held by the life interest. For instance
the property is transferred in favour of an unborn person in the
January 2014 and the person took birth in September 2014.
He/she attains 18 years in 2032. The life interest by the time of
13 AIR, 2012 Kar. 72
transfer in January 2014 was 25 years and by the time of such
child attaining 18 years the life interest would be 43 years i.e.
25+18=43 by 2032. Thus for 43 years life interest would be in the
charge of the property. If the first person appointed in 2014 dies
then some other person will be appointed to be in charge of the
property. Thus like that any number of people can be appointed as
life interest.
Such person in charge of the property will only enjoy the property
and will not be in absolute possession.
After the birth of the child, the interest in property is vested but
the enjoyment is made contingent till attaining the age of
majority i.e. 18 years.
This sends a message that free transfer should be the motto of
law. For the advancement and welfare of the society and for the
betterment of the people transfer should be free and there should
not be any unreasonable restriction. But reasonable restriction
can be imposed to prevent jeopardizing of transfer of property. For
example SC’s and ST’s cannot sell their land to the general caste
people. This is done to prevent the upper class taking advantage
of the weaker sections of the society. If they want to do so then
they have to take permission of the District Magistrate.

Property should not be made ownerless and inalienable for pretty

long period or in perpetuity. Perpetuity means for indefinite
period. It is against the public policy. Ordinarily the law of transfer
is that every owner of the property must have the right of
alienation and the property must have an owner. If a transfer is
made making no person the full owner and transfers the property
without vesting the ownership rights on the transferee and defers
the vesting of the ownership in perpetuity then such conditional
transfer is against public policy and shall be inoperative. The
underlined principle is that the liberty of alienation shall
not be exercised to its destruction. Section 14 provides for
rule against perpetuity which reads as follows:
22
“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, if he attains full
age, the interest created is to belong”.

Section 14 is an extension of section 13 which deals with transfer

in favour of an unborn person. To simply put it section 14 provides
that no contingent and executory interest can be validly created
unless it rests within the maximum period of life time of one or
more person living at the date of such transfer and during the
period of minority. Perpetual transfer means the conveyance
once made continues to regulate the fate of that property. Owners
of that property do not have liberty to re-direct the course of
succession of that property.
The expression “shall be in existence” means the person shall
take birth. On the birth of the child he gets the vested interest
irrespective of the fact that as to when the actual possession shall
dwell upon him. It may be postponed till the time he becomes
major. The rule against perpetuity does not require that the
property shall vest on the birth of the beneficiary but what it does
require is that the vesting shall not be delayed beyond the period
of life interest and the period of minority. Thus it is to be noted
that the age of majority for the purpose of rule against perpetuity
in all cases is 18 years and it cannot in case be contested that
where a guardian is appointed for the infant by the court, the age
of majority will be 21 years.
Computation of the period of perpetuity:
Life of the preceding interest + period of gestation of the ultimate
beneficiary + period of minority is the latest period upto which
the vesting of property can be deferred or postponed= The
maximum permissible remoteness of vesting if the ultimate
beneficiary is not in womb. But if the ultimate beneficiary is in
womb at the time of transfer then the computation will be same
as is mentioned under section 13.
Exceptions
23
This rule against perpetuity has certain exceptions which are
follows:
 1. This rule is not applicable to the transfers that are made for
the benefit of the public.
2. A lease with a covenant for the renewal does not offend the
rule against perpetuity.
3. Does not apply to personal agreements.
4. Does not apply to the mortgagor’s right of redemption.
5. Does not apply to the vested interests.

The above two sections i.e. sections 13 and 14 are to be read

along with sections 15 and 16. Section 15 provides transfer to a
class some of whom come under restriction of sections 13 and 14.
Section 15 reads as follows:
“If on a transfer of property, an interest therein is created
for the benefit of a class of persons with regard to some
of whom such interest fails by reason of any of the rules
contained in sections 13 and 14, such interest fails in
regard to those persons only and not in regard to the
whole class”.

Essentials of section 15:-

1. There must be a class of persons;
2. Interest is created for that class of persons;
3. Interest fails in favour of some persons of the class for
conditions under section 13 and 14;
4. Interest fails in favour those persons only;
5. Interest does not fail in favour of the rest.
In simple words it provides that if the transfer is made for the
benefit of a class of unborn persons, then if such transfer fails
under the rule provided under section 13 and 14, then the
transfer in respect of those persons will fail but the whole transfer
will not be void. The transfer with regard to other transferee’s is
valid and takes effect.
This section was amended in the year 1929 and prior to the
amendment it was just opposite to what the present section
24
provides. It provided that when an interest was created in favour
of a class of persons and it failed with regard to some of them
because of the rules contained under section 13 and 14 then such
interest shall fail in respect of the whole class. This principle was
based on Leake v. Robinson case. In this case Sir William Grant
had made the observation that if a bequest in question was made
to a class of persons but because of certain rules forbidding the
bequest in favour of some persons of the class failed then the
bequest will fail in favour of all such persons of the class and not
against those only who were hit by the rules 14.
The principle laid down in Leake v. Robinson is no longer
applicable in India.
In Raj Bajrang Bahadur Singh v. Thakurain Bhaktaraj
Kuer15, the Supreme Court has rightly laid down that “it is true
that no interest could be created directly in favour of an unborn
person, but when the gift is made to a class or series of persons,
some of whom are in existence and some are not, it does not fail
in its entirety, it is valid with regard to the persons who are in
existence at the time of the testators death and is invalid as to
the rest”16.

Section 16 provides for the effect on transfer after the failure of

prior interest. It reads as follows:
“Where, by any rules contained in sections 13 and 14, an
interest created for the benefit of a person or of a class of
persons fails in regard to such person or the whole of such
class, any interest created in the same transaction and
intended to take effect after or upon such prior interest
also fails”.

Essentials of Section of 16:

1. A prior interest is created for the benefit of person or of a
class of persons.
2. By the same transaction interest is also created for benefit of
person or of a class of persons subject to such prior interest.
25
14 Page-48, Chapter-II “Of Transfers of Property by Act of Parties”; Book-“Transfer of Property Act and
Easement Act” by Prof.
Ashok Kumar Shrivastava.
15 AIR 1953 S.C. 7
16 Page-121, Chapter-II “Of Transfers of Property by Act of Parties”; Book-“Transfer of Property Act” by
Dr. G.P.Tripathi.
 3. Such prior interest fails for the violation of the rules
contained in section 13 and 14.
4. Then the interest created for the benefit of a person or a
class of persons which is dependent on such prior interest
also fails.

It explains that if in a transfer of property prior interest fails under

section 13 and 14 then the subsequent interest which is
dependent also fails. A valid transfer which is subsequent to and
dependent upon void transfer is itself rendered void.
For instance ‘A’ transfers the property in favour of ‘B’, ‘C’, and
then to ‘D’ absolutely. B is the person living at the time of transfer
but ‘C’ and ‘D’ are unborn persons. Generally in terms of section
13 when a property in favour of an unborn person is transferred
then it is first held by the life interests and then by the person
absolutely in whose favour it is actually transferred. And the life
interest so appointed must be living at the date of such transfer.
But in the above example when ‘A’ transferred property in favour
of ‘B’ and ‘C’ and then to ‘D’, ‘B’ being alive ‘C’ was not born by
that time of transfer. Thus this transfer is in violation of section
13. Thus according to section 16 the prior interest being failed the
subsequent interest also fails which means that transfer in favour
of ‘C’ being a failure one because of non-existence the
subsequent transfer in favour of ‘D’ also fails though ‘D’ has
absolute interest. This is so because section 13 and 14
contemplates a continuation of holding of the property by the
living person for life until the birth of the person in whose favour
the property is transferred and for whom the property is held by
the life interest. In that case if there is a break in the continuation
of the holding of the property then the interest in whose favour
the property is transferred also fails.

Exceptions
1. Rule under section is not applicable in case of
26
alternative vesting:
In case of transfer of interest wherein a transfer is made to a
person or a class of persons and upon the failure of which, in
 the same transaction the property is vested on the other
person then the subsequent vesting is valid and is not affected
by the failure of the prior interest. For example, ‘A’ transfers
property in favour of his son ‘X’ for life who is alive at the date
of transfer and to his granddaughter ‘C’ for life and thereafter
absolutely to ‘C’s’ children, if ‘C’ dies issueless then to ‘C’s’
brother ‘D’. In this case ‘C’ is minor at the date of transfer and
is hit by Sections 13 and 14 because a minor cannot be
appointed as a life interest under Section 13 and is hit by
perpetuity as such minor may or may not become major and
as such the life interest in favour of the minor fails. As the prior
interest failed the, subsequent interest which is dependent on
the subsequent interest also fails. But the alternative vesting in
favour of ‘D’ made by the transferor in the same transaction is
valid. In case of alternative vesting, though it is valid, but it is
contingent on the happening of an uncertain event that is
death of ‘C’ without any issues.
2. Independent interest:
Where a transfer is made independently without any
connection with the transfer through prior interest then the
failure of the prior interest transfer will not affect the
independent interest. For instance, considering the above
example in point 1, if ‘A’ transfers property on one hand
through prior interest and on the other transfer the property
separately to take effect on ‘D’ then in case of the failure of
the transfer through prior interest will not effect in any way the
separate transfer in favour of ‘D’. In independent transfers the
interest is vested and there is no question of contingency.
3. Public benefit:
Where a property is conveyed for public benefit then the
failure of prior interest will not affect the transfer. For
example, ‘X’ transfers a plot for hospital near his house within
27
premises of his property alongwith the house to ‘M’ for life and
then to ‘N’ for life and then to vest absolutely on ‘S’ daughter
of ‘N’. ‘N’ is an unborn person at the date transfer and as the
property cannot be transferred to an unborn person for life, the
transfer failed under section-13 also failing the subsequent
 transfer in favour of ‘S’. Though the whole transfer failed the
transfer the subsequent transferee/ the ultimate beneficiary
has a duty to construct a hospital on that plot irrespective of
the fact that he did not get the interest in the house.

Thus sections 15 and 16 are by the way explanations to section

13 and 14 but does not have independent existence.

In the transfers of property any restriction in the alienation or

enjoyment is void. Thus no one can put any restriction on the
enjoyment or alienation of the property neither can anyone direct
to accumulate the benefit of any person. But section 17 is like an
exception to this rule of accumulation. Accumulation means to get
something over a period of time. This direction for accumulation is
with a limitation. It cannot be granted for indefinite period.
Section 17 reads as follows:
“(1) When the terms of a transfer of property direct that
the income arising from the property shall be accumulated
either wholly or in part during a period longer than—
a) the life of the transferor, or
b) a period of eighteen years from the date of transfer,
such direction shall, save as herein after provided, be void
to the extent to which the period during which the
accumulation is directed exceeds the longer of the
aforesaid periods, and at the end of such last mentioned
period the property and the income thereof shall be
disposed of as if the period during which the accumulation
has been directed to be made had been elapsed.
(2) This section shall not affect any direction for
accumulation for the purpose of—
i. the payment of debts of the transferor or any other
person taking any interest under the transferor; or
ii. the provision of portions for children or remoter issue
of the transferor or of any other person taking any
28
interest under the transfer; or
iii. the preservation or maintenance of the property
transferred, and such direction shall be made
accordingly.”
Section- 17 is an exception to the principle laid down under
section 11 of the Act. The principle of Section 17 is based on
English case of Theluson v. Woodford, wherein it was held that
the direction for accumulation, of income during the lives of three
sons of ‘T’, who bequeathed the property, and to all their male
descendents who might be living at his death and after the death
of the last survivor of them to divided among the then eldest
male descendents of three sons, was valid as it did not
contravene the rule against perpetuity although the income may
be placed beyond the reasonable period of time. This decision led
to the passing of the Accumulation Act, 1800 popularly known as
Theluson Act which did away with the rule and provided for
restraint upon the accumulation i.e. during the life the prior
interest and up to 21 years. This provision has been adopted in
India with a little amendment i.e. instead of 21 years, in India it is
18 years.
Section-17 (1) provides for a restriction that while transferring a
property one can validly direct for the accumulation of the income
arising out of the property for some person but such direction for
accumulation shall not exceed the life of the transferor as
provided in clause (a); or beyond the period of eighteen years
from the date of transfer as provided in clause (b). Thus the
direction for accumulation shall be either within the life of the
transferor or within eighteen years from the date of transfer. Any
direction for accumulation beyond the aforesaid periods shall
render the property and income to be disposed of as if such
accumulation period has elapsed. Sub section (2) provides for an
exception that direction for accumulation beyond the aforesaid
period can be made if;
29
a) the debts of the transferor are to be paid or for the benefit
of a person claiming interest under the transferor; or
b) for the benefit of the children, or remoter issues of children
or for any person claiming interest under the transferor; or
c) for the preservation and maintenance of the property.
But any such direction has to be made accordingly during the
transfer.
For any of the above mentioned reasons direction can be made
beyond the aforementioned periods and it will not render the
direction invalid.

Lecture 5
In the last few lectures we have dealt with as to whether any
restriction can be put on the interest in property transferred, can
property be transferred to a person not living at the date of
transfer etc, in this ongoing lecture we will be dealing with the
kinds of interest, when such interest is to devolve etc. Sections 19
-34 deal with the kinds of interest.
Section 19 of Act provides for the vested interest. Section 19
reads as follows;
Where on a transfer of property, an interest therein is
created in favour of a person without specifying the time
when it is take effect or in terms specifying that it is to
take effect forthwith or on the happening of an event
which must happen, such interest is vested, unless
contrary intention appears from the terms of the transfer.
A vested interest is not defeated by the death of the
transferee before he obtains possession.
Explanation- An intention that an interest shall not be
vested is not to be inferred from merely from a provision
whereby the enjoyment thereof is postponed, or whereby
a prior interest in the same property is given or reserved
to some other person, or whereby income arising from the
property is directed to be accumulated until the time of
enjoyment arrives, or from a provision that if a particular
event shall happen the interest shall pass to another
person.
30
The term vesting means to devolve upon someone, or to fall upon
someone, or to come within the ambit of one’s right. When a
property is transferred, it is done with an intention that someone
will get a right in the property either absolutely or conditionally.
How that right will devolve is a question which has been clarified
by the Section 19. Under Section 19 the interest is said to be
vested if the transfer was made;
a) Without specifying the time when such transfer is to
take effect.
Thus where in an instrument of transfer when the transferor
does not mention the time as to when it will take effect then
the law says that the transferee will have right over the
property with immediate effect. For example; where ‘A’
transfers a grapevine to his nephew ‘Z’ on his birthday
without specifying the time when it is to take effect then ‘Z’
is having right over the property immediately from the date
of transfer.
b) Specifying that it is to take effect forthwith.
Where the terms of the transfer direct that the interest in the
property shall commence immediately then without any
dispute the transfer will take effect. For instance;
considering the above example if ‘A’ transfers the grapevine
to ‘Z’ specifying that ‘Z’ shall have interest in the grapevine
with immediate effect then without any dispute ‘Z’ will take
the interest.
c) Specifying that it is to take effect on the happening of
an event which must happen.
Where at the time of transfer the transferor puts a condition
that on the happening of an event the interest must accrue
then the event specified must happen. This is known as
condition precedent. For example, ‘A’ puts a condition that
‘Z’ who is in the tenth standard must pass in the
examination before his interest in the grapevine is to accrue.
Thus the accrual of interest of ‘Z’ in the grapevine is
preceded with a condition that he must pass the tenth
standard exam which must happen.
Thus whether an interest is vested or otherwise, depends on the
31
intention of the person creating the interest. Such interest must,
however, be gathered from the language employed by the grantor
in the grant, giving the plain and natural meaning to the words
used by him.
In the vested interest the title is immediately and automatically
transferred but the possession and enjoyment thereof may be
deferred. Thus in the vested interest even if the transferee dies
before obtaining the physical possession of the property, it will
not affect the title so vested and any person claiming under him
cannot be denied his/her right in the interest only because of the
reason that the transferee under whom he/she claims the interest
have died without taking the physical possession of the property.
Transfers land to
A B but after death of

In the above example ‘A’ transferred a land to ‘B’ with a condition

that he will get the possession after the death of ‘C’. Here though
the possession is postponed till the death of ‘C’ but ‘B’ has a
vested interest in the land. Thus even if the ‘B’ pre-deceases ‘C’
legal heirs of ‘B’ will get the property.

In Rajes Kant Roy v. Santi Devi17 , the Supreme Court held that
sons got a vested interest, though the enjoyment was temporarily
postponed. In this case, father settled the property on his two
minor sons. The settlement provided that the sons would obtain
absolute interest in the property upon the death of the transferor
and after discharging all the encumbrances.

Exceptions

Nothing in the terms of transfer shall mean that the interest is not
vested where the terms direct that;

1. The enjoyment is postponed; or

2. A prior interest is created for the benefit of an unborn
person; or

32
3. Income be accumulated till the arrival of the time of
enjoyment; or
4. Conditional limitation.

17 1957 S.C.R 77
 Under Section 13 property transfer in favour of an unborn
person is dealt, which provides that the property in favour of an
unborn person can be made by creating a prior interest and by
transferring the reminder interest in the property to the unborn
person and the unborn person must take birth prior to the
cessation of life interest. But the question is as to when the
property will vest in such person who took birth i.e. immediately
after birth or after attaining 18 years of age? In such case vesting
will be immediately after the birth. Section- 20 of the Act provides
for the similar rule. Section-20 provides that where an interest is
created for the benefit of an unborn person who was not living at
the date of transfer then he/she acquires the vested interest in
the property though he may not be immediately entitled to enjoy
the property.

Section-21- Contingent interest

Where, on a transfer of property, an interest therein is

created in favour of a person to take effect only on the
happening of a specified uncertain event, or if a specified
uncertain event shall not happen, such person thereby
acquires a contingent interest in the property. Such
interest becomes a vested interest, in the former case, on
the happening of the event, in the latter, when the
happening of the event becomes impossible.

Exception

Where, under a transfer of property, a person becomes

entitled to an interest therein upon attaining a particular
age, and the transferor also gives to him absolutely the
income to arise from such interest before he reaches that
age, or directs the income or so much thereof as may be

33
necessary to be applied for his benefit, such interest is
not contingent.

This section provides for contingent interest. Contingent means

happening or non-happening of unforeseen. Similarly in the
transfer of property when an interest is transferred subject to the
happening or non-happening of an event then the person in
whose favour such kind of uncertain interest is transferred will
have a contingent interest.

According to the rule laid down in the Section an interest is said to

be contingent on two occasions;

1. On the happening of a specified uncertain event;

2. On the non-happening of a specified uncertain event;

And such interest becomes vested in the first case if such

uncertain event happens and in the second case when the
uncertain event does not happen.

Illustrations

1. ‘A’ makes a gift of five star hotel to his nephew ‘Q’ who is to
get interest in the property once he becomes a successful
actor. Thus ‘Q’s interest in the five star hotel is contingent on
his becoming a successful actor.
2. ‘A’ makes a gift of a farm house to ‘Q’ which is to accrue
once he sets up a business of two crore within six months.
Here the accrual of interest is contingent on the setting up of
a business within six months.

In the above two illustrations interest in both the cases is

contingent. In the first case when ‘Q’ becomes a successful actor,
where the uncertain event becomes certain, then the interest
which was contingent converts into vested. In the second case
when ‘Q’ cannot set up a business worth crore which is impossible
within a time period of six months then owing to the impossibility
of the uncertain event the interest which was contingent becomes
vested.

The exception to the section provides that when a person under

the transfer of property is required to enjoy the property only
34
after attaining a particular age but if prior to reaching that age
the transferor is giving the income in the property absolutely to
such person or directs for the application of the income for the
benefit of such person then the interest of the person in the
property is not contingent but a vested one because the
transferor on one hand is making the enjoyment contingent till
the attainment of a particular age and on the other hand giving or
directing all the benefits of the property to be given prior to the
attainment of that age, then the person, as he is getting the
benefit his interest no more remains contingent rather it becomes
vested.

In Abdul Sakur v. Abubakar Raji Abba18, ‘X’ promised to give

at the time of his death to A, B and C, Rs. 1000 each to be paid to
them on the occasion of their marriage. The question was what
was the nature of the gift to A, B, and C? It was held that the
nature of gift was contingent upon their marriage taking place. A
and C married before the death of ‘X’ and the contingency
contemplated did not happen. But ‘B’ married after the death,
and on such marriage, the gift became a vested one.

Distinction between the vested and contingent interest.

1. The interest is vested where the property is transferred without

specifying the time when it is to take effect, or specifying that
it is to take effect forthwith, or on the happening of an event
which must happen. But the interest is contingent when the
interest created is dependent on the happening or non-
happening of a specified uncertain event.
2. Vested interest creates a immediate right and is not dependent
on the fulfillment of any condition. Whereas the contingent
interest is solely dependent on the fulfillment of the condition.
3. Vested interest is not defeated by the death of the transferee
before obtaining the possession. But the contingent interest
fails if the transferee dies before fulfillment of the condition.
4. Vested interest is both transferable and heritable. But the
contingent interest is only transferable but not heritable.
5. Vested interest passes to the descendants of the transferee
35
even if the transferee dies without taking the possession. But
contingent interest is incapable of descending to the heirs.
6. Vested interest is perfect. Whereas the contingent interest is
imperfect.
18 1930 Bom. 191
7. Vested interest does not become contingent. Whereas the
contingent interest becomes vested.

Section 22 – provides for transfer to a class of persons who shall

attain a particular age. It reads as follows;

Where, on a transfer of property, an interest therein is

created in favour of such members only of a class as shall
attain a particular age, such interest does not vest in any
member of the class who has not attained that age.

Essentials

1. Interest is created in favour of a class;

2. Who shall attain a particular age;
3. Member of such class shall attain such particular age to get
the interest;
4. Interest fails in favour of such member of class who do not
such age.

Thus under section 22, the reason of non vesting of property in a

class who have not attained the specified age is because of not
fulfilling the condition as was directed by the transferor. In this
section it is not clear as to who are the transferees in the class.
Thus transferees must be recognised/ascertained in the class. For
this purpose the members of a class must attain the age of 18
years. Thus any member of the class who attains the 18 years will
get the property and the rest who have not attained that property
will not get the property.

For instance Shyamsundar transfers property in favour of his

friend Raghav’s children, who are to get the property upon
attaining the age of 18 years or 21 years. Then any persons who
attains that age shall get the property and the rest who have not
attained that age will not get the property.

36
The exception mentioned under section 21 is not applicable
to this section because under the exception to section 21 the
transferor on one hand is making the interest contingent by
providing that such interest is to take effect on attaining a
particular age and on the other hand gives the benefit or directs
to apply the income for the benefit of that person which is
converting the contingent interest into vested interest but under
section 22 there is no conveyance of benefit or direction for the
application of interest to the class of persons who shall attain a
particular age.

Section 23 deals with transfer contingent on the happening of

specified uncertain event. This section reads as follows;

Where, on a transfer of property, an interest therein is to

accrue to a specified person if a specified uncertain event
shall happen, and no time is mentioned for the occurrence
of that event, the interest fails unless such event happens
before, or at the same time as the intermediate precedent
interest ceases to exist.

Essentials

1. An interest is created in favour of a specified person;

2. Such interest is to accrue on such person on the happening
of an uncertain event;
3. But no time is mentioned for the occurrence of that event;
4. Then such event must happen either before or at the same
time;
5. As the intermediate or precedent interest ceases to exist
otherwise the interest fails in favour of such specified
person.

Generally when a property is transferred with a condition

then the transferor must specify the time when it is to take effect
but when no time is mentioned then the law fixes the time, which
is, either before or at the same time as the intermediate or
precedent interest ceases to exist. The reason or so fixing the

37
time is that law is that law leans in favour of early vesting and
against indefinite postponement thereof. For instance, where ‘A’
transfers the property to ‘B’ which is to accrue on him once ‘B’
marries ‘Q’ but no time is mentioned as to when such marriage is
to be solemnized. Thus the interest of ‘B’ in the property is
contingent on his marrying ‘Q’ and as no time is mentioned then
such marriage must be solemnized either during the life time of
the ‘A’ or at the time when ‘A’ is dying.

Section 24 deals the transfers to such of certain persons as shall

survive at some period not specified. The section reads as follows;

Where, on a transfer of property, an interest therein is to

accrue to such of certain persons as shall be surviving at
some period, but the exact period is not specified then,
the interest shall go to such of them as shall be alive
when the intermediate or precedent interest ceases to
exist, unless a contrary intention appears from terms of
the transfer.

Essentials

1. Interest is created on certain persons;

2. Such interest is to accrue on such persons who will be alive
at some period;
3. No time is mentioned for the survival;
4. Interest will go to such person who shall be alive;
5. At the time when the intermediate or precedent interest
ceases.

For instance, ‘A’ transfers a property to ‘B’, ‘C’ and ‘D’ or to the
survivor of them but no time is mentioned as to when they should
survive i.e. whether they should be alive either during the life
time of the transferor or after his death. Then when no time is
mentioned then they should be alive either during the life time of
the transferor or at the time of his death.

Lecture- 6

CONDITIONAL TRANSFERS

Property may be transferred in two ways;

1. Absolutely; and
2. Conditionally.
38
In absolute transfers there is no condition, the transfer is plain
and direct. But in conditional transfer, transfer depends on the
fulfillment of a condition.

Conditional transfers are of two types;

a) Condition precedent; and

b) Condition subsequent.
means that the interest will accrue after the fulfillment of the
condition. If condition is not fulfilled then the interest in the
transferee will not accrue. For example, Gopabandhu father
of Shyam transfer the property to him but requires him that he
must marry after the death of Gopabandhu when the property
is devolve upon him. Thus here the devolving of property upon
Shyam is dependent upon the fulfillment of the condition i.e.
marriage after the death of his father. This being the condition
if at any time Shyam marries during the lifetime of
Gopabandhu then Shyam will not get the property due to the
failure of the condition precedent. Sections 25 to 28 deal
with condition precedent.

means that the condition has to be fulfilled after the accrual of

interest. In case if the condition is not fulfilled then the interest
will divest or return back either to the transferor or to someone
else as may be required by the transferor. For example
Gyanendra Verma a businessman transfers his crores of
property to his son Rohit Verma a diamond merchant and puts
a condition therein that he (son) have to gift him(father) a
Harley Davidson on his birthday if he fails then he will take
back the property. Somehow Rohit, owing to his business
tension forgot his father’s birthday as well as his gift. Thus as
the subsequent condition is not fulfilled then the property
which was transferred will be taken back by the father. On the

39
other hand if the father put a condition that on the failure of
Rohit gifting him the Harley Davidson the property will go to
his daughter Vaishali then on the failure of the condition
subsequent the property will go to Vaishali as required by the
transferor. Sections 29 to 33 deal with condition subsequent.
Section 25 deals with conditional transfer, which reads as
follows:

“An interest created on a transfer of property and

dependent upon a condition fails if the fulfillment of the
condition is impossible, or is forbidden by law, or is of
such a nature that, if permitted would defeat the
provisions of any law, or is fraudulent, or involves or
implies injury to the person or property of another, or the
court regards it is immoral or opposed to public policy”.

Essentials

1. An interest created.
2. Depends on a condition.
3. But the condition must not be;
a. Impossible; or
b. Forbidden by law; or
c. Of such a nature that if permitted, would defeat the
provisions of any law; or
d. Fraudulent; or
e. Involving or implying injury to the person or property of
another; or
f. Regarded by court as immoral or opposed to public
policy.

Impossibility

Under the conditional transfers if the condition is impossible then

the fulfillment of interest which is created on such impossible
condition will fail. For instance ‘A’ transfers a property to ‘B’ with
a condition that he should pull the ship without any help on to the
shore. It is humanely impossible for a person to pull the ship
onshore single handedly. Thus the condition being impossible the
interest created on such impossible condition is also void.

Forbidden by law 40
If any act is forbidden by law and such act, as a condition is put
for getting the interest in the property then such interest in the
transfer will fail, such condition being forbidden by law. For
instance, if ‘A’ transfers a property to ‘B’ with a condition that ‘B’
must make a murder ‘C’. Thus taking the life of someone is an act
which is forbidden by law and thus the interest in the property
which is dependent on such condition fails.

Would defeat the provisions of law

The transfer of property which is dependent on the condition

which if permitted would defeat the provisions of law then any
interest which is dependent on such condition will fail. For
instance, ‘A’ transfer’s property to ‘B’ with a condition that ‘B’
must give his minor daughter in marriage to ‘A’s son. Law
provides for the marriageable age of girls i.e. 18 years. Thus
giving a girl in marriage before 18 years would defeat the
provisions of law so cannot be allowed. Thus the transfer which is
dependent on such condition will fail.

Fraudulent

The transfer of property which is dependent on a condition the

fulfillment of which will lead to fraud is unlawful and void. For
instance, ‘A’ transfers Rs. 1,00,000/- to ‘B’ an agent of ‘C’ with a
condition that ‘B’ must sell the property of ‘C’ misrepresenting
that he is the owner of the property then such condition being
fraudulent the transfer which is dependent on such condition will
also fail.

Involves or implies injury to the person or property

Further if a condition is such which involves or implies injury to

the person or property then any transfer which is dependent on
such condition will fail. For instance, ‘A’ transfers his estate to
‘B’ with a condition that he must bulldoze the house of ‘C’ near
the main road. Thus this condition if fulfilled would involve or

41
imply injury to the property of ‘C’. Thus as the condition is void
then the transfer which is dependent on such condition fails.

Court regards it as immoral or opposed to public policy

If the condition is such which is immoral or opposed to public
policy in the opinion of the court then the transfer which is
dependent on such condition will fail. For instance ‘A’ transfers
her estate to ‘B’ her nephew with a condition that he should
desert his wife. Deserting a wife is immoral so the condition being
such, transfer which is dependent on such condition also fails.

Thus this Section contemplates that the condition which the

transferor puts should not fall within any of the above mentioned
instances.

Section 26 deals with fulfillment of a condition precedent which

reads as follows:

“Where the terms of a transfer of property impose a

condition to be fulfilled before a person can take an
interest in the property, the condition shall be deemed to
have been fulfilled if it has been substantially complied
with”.

Essentials

1. There is a transfer of property.

2. With a condition precedent to be fulfilled to take interest in
the property.
3. The condition shall be deemed to be fulfilled.
4. But the aforementioned condition need not be fulfilled
completely it is sufficient if it is fulfilled substantially.

Generally under conditional transfers when a condition is put then

the transfer fails unless the condition is fulfilled, but what this
section does contemplate is that in condition precedent it is
sufficient if the condition is substantially fulfilled. Thus this
section enunciates the doctrine of Cy pres. Cy pres means
substantial compliance. Thus according to this section if the

42
interest in a transfer is dependent on a condition precedent and if
that condition is substantially fulfilled then such condition is
deemed or presumed to be complied with. For instance ‘G’
transfers a property to ‘L’ with a condition that he must go to
England for ten days before he is to take interest in the property.
Now if ‘L’ goes to England and returns back on the third or the
fifth day then the condition shall be deemed to have been
substantially complied and ‘L’ takes interest in the property.

The test that whether the condition is substantially fulfilled or not

depends on two things i.e. firstly whether in case where it is
possible for the transferee to fully perform the condition, he has
endeavoured to perform his best to do so, and secondly, whether
the intention of the transferor in imposing the condition as
ascertained from the terms of the transfer and the surrounding
circumstances can be said to have been in substance can said to
have been, in substance, satisfied by what has actually been
done by way of compliance with the condition.

Illustrations to the section mention the same thing, in the

illustration (a) ‘A’ transferred Rs. 5000/- to ‘B’ with a condition
that he shall marry with the consent of ‘C’, ‘D’ and ‘E’. But ‘E’ dies
and ‘B’ marries with the consent of ‘C’ and ‘D’. Here ‘B’ is deemed
to have fulfilled the condition substantially by marrying with the
consent of ‘C’ and ‘D’. Though the condition was that ‘B’ shall
marry with the consent of C, D, and E where upon he will get Rs.
5000/-, does not as such invalidate the transfer of Rs. 5000/-
when E died prior to marriage and B marries with the consent of C
and D who are alive because, firstly, applying the doctrine of Cy
pres B has substantially fulfilled the condition by taking the
consent of C and D, secondly, as E died prior to marriage it is not
possible on the part of B to take the consent of E. But in the
illustration (b) the transfer of Rs. 5000/- by A to B failed because
B married without the consent of neither C, D, nor E. Thus the
doctrine of Cy pres or substantial has not been fulfilled.

Section 27 deals with the conditional transfers to one person

coupled with transfer to another on the failure of prior disposition.
It reads as follows:

“Where on a transfer of property, an interest therein is

43
created in favour of one person, and by the same
transaction an ulterior disposition of the same interest is
made in favour of another, if the prior disposition under
the transfer shall fail, the ulterior disposition shall take
effect upon the failure of the prior disposition., although
the failure may not have occurred in the manner
contemplated by the transferor.

But, where the intention of the parties to the

transaction is that the ulterior disposition shall take effect
only in the event of the prior disposition failing in a
particular manner, the ulterior disposition shall not take
effect unless the prior disposition fails in that manner.”

Essentials

1. A prior interest is created by a transfer of property.

2. By the same transaction ulterior interest is also created.
3. Ulterior interest accrual is dependent of the failure of the
prior interest.
4. Such failure need not take place as required by the
transferor.
5. If the parties to the transaction intend the failure of event in
a particular manner then it must fail in that manner.

This section provides for the doctrine of Acceleration.

Acceleration means to speed up further. Thus this section
contemplates a situation where the interest in the property gets
accelerated to another person (ulterior disposition) on the failure
of the interest of the first person (prior disposition). For the
application of this section it is necessary that both the interests
i.e. prior and ulterior must be through the same transaction
otherwise this section will not applicable. This doctrine of
Acceleration is based on the Halsbury’s Law of England which
provides that on the failure of the prior interest the subsequent
interest would take effect before it would normally have come into
existence.

44
This section mentions two types of failure of event, firstly, the
failure without any specific mode and secondly, the failure with a
specific mode or as intended by the parties. In the former even if
the event fails as required by the transferor or not the ulterior
interest takes effect but in the latter if the failure does not take
effect as desired by the transferor then the ulterior interest does
not take effect.

For instance (i) ‘A’ transferred a property to ‘B’ with a condition

that he may execute a lease within three years and if he fails to
do so then the property will go to ‘C’, but there is a contemplation
of the transferor that it would be better if he executes a lease
after A’s death but B died within the lifetime of the A and the
transfer in favour of C takes effect. Here it so happened because
there is no compulsion on the part of the transferee that he must
perform the condition as thought/ contemplated by the transferor.
Thus in the event of failure of the condition in another way other
than as contemplated/ thought by the transferor it will not
invalidate the ulterior transferor.

(ii) But where A transfers property to be B his wife with a

condition that the property would go to C if she (B) dies during his
(A) lifetime. This being the intention of the parties to the transfer
if both A and B perish together then transfer in favour of C would
fail because when both perish together it is not possible to know
who died first as the condition for ulterior is that the wife (B)
would die during the lifetime of (A). Thus the failure of the
condition not being in the manner as intended by the parties the
ulterior interest does not take effect.

The object of the rule is thus to give effect to the intention of the
transferor. If the prior disposition is void ab initio then the
subsequent disposition will fail on principle contained under
section 16.

In Okhoymoney v. Nilomoney19, a testator directed that if his

pregnant wife should bring forth a son, his property should go to

45
the son and if a daughter takes birth she should only have a right
to maintenance and that if the son born dies before attaining age,
the property should go over to the testators brother N and
consequently the wife gave birth to a daughter, held that the gift

19 (1882) 15 Cal. 282.

over in favour of N takes effect on failure of the gift to the son,
even though such failure was not precisely as expressed by the
terms of the transfer.

Section 28 of the Act provides for ulterior transfers conditional

on happening or non happening of specified event. This section
reads as follows:

“On a transfer of property an interest therein may be

created to accrue to any person with the condition
superadded that in case a specified uncertain event shall
happen such interest shall pass to another person, or that
in case a specified uncertain event shall not happen such
interest shall pass to another person. In each case the
dispositions are subject to the rules contained section 10,
12, 21, 22, 23, 24, 25 and 27.”

Essentials

1. Interest is to accrue on a person in a transfer of property;

2. With a condition superadded;

3. In case of a happening or non-happening of a specified

uncertain event;

4. The prior interest shall pass to another person or ulterior

interest;

5. Any such disposition shall not affect the provisions of section

10, 12, 21, 22, 23, 24, 25 and 27.

Conditional limitation is different from condition subsequent. In

the former, interest gets divested whereas in the latter, interest of
the transferee ceases. This section implies a situation where on
the happening or non-happening of a specified event the prior
interest will be divested to another person.
46
This section contemplates a situation where an ulterior interest is
created on the happening or non-happening of prior interest due
to breach of a valid condition subsequent. For instance ‘A’
transfers a property to ‘B’ with a condition subsequent that ‘B’
must join the Indian Army, if he does not join Indian Army and join
any other services then the property will go to ‘C’. ‘B’ joined the
Civil services. The interest of ‘B’ in the property is dependent on
the fulfillment of the condition subsequent that is joining the
Indian Army which he must join but as he joined the Civil services
his interest in the property ceases and interest in favour of ‘C’
takes effect. Similarly considering the same example if ‘A’ would
have asked ‘B’ to join the Indian Army and in the non-happening
of which the property would pass to ‘C’ in this situation if ‘B’
would not join the Indian Army then, making the condition non-
happening i.e. not joining the Indian Army which he should have
joined as per the condition, the interest in favour of ‘C’ takes
effect.

Section 29 provides for fulfillment of condition subsequent. It

provides as follows;

“An ulterior disposition of the kind contemplated by the

last preceding section cannot take effect unless the
condition is strictly fulfilled.”

This section explains that in the previous sections dealing with the
condition subsequent which are valid must be strictly fulfilled to
take interest in the property. In other words it provides for strictly
compliance of the condition subsequent unlike the condition
precedent where substantial fulfillment of the condition is
sufficient. In the non-fulfillment of condition subsequent the
defenses like illness, ignorance of ulterior condition or want of
knowledge cannot be taken. But if under duress (fear) if the
condition subsequent is not fulfilled or not allowed to be fulfilled
then it would qualify as a ground for non-fulfillment of condition
subsequent and the interest therein would not divest.
47
Section 30 further explains section 29 which provides for strict
compliance of condition subsequent by providing that if the
ulterior disposition is based on an invalid condition then the prior
disposition will not be affected thereby.

This section deals with the effect of the invalidity of the ulterior
disposition on the prior disposition. This section contemplates that
the failure of ulterior disposition due to invalid condition will not
invalidate the prior disposition.

For instance if ‘A’ transfers a property to ‘B’ with a condition that

if he would not kill ‘C’ then the property will go to ‘D’. Here as the
ulterior disposition to ‘D’ is based on an invalid condition i.e. to
kill ‘C’, prior disposition in favour of ‘B’ will not be affected and
will take effect without fulfillment of the condition it being invalid.

Section 35 provides for doctrine of election where the property

of a owner is transferred by a stranger. It deals with the effect of
such void transfers and provides for the exceptions to it. Election
means to choose between two alternatives. This section is an
exception to Section-7 which provides that the persons who
competent to contract, or authorized to transfer the property not
his own, or entitled to transferable property are competent to
transfer. Thus if a person, who is not having any right/authority
over the property, sells that property then such transfer is void.

The framers of this statute foreseeing such situations

incorporated this section which gives an option to the owner
whether to validate or invalidate such transfer.

Section 35 contemplates that, when a person who is a stranger to

the property or having no authority over the property transfers
the property to third person or the transferee and by the same
transaction confers some benefit on the owner in lieu of his
property then there is a duty on the owner of the property to elect

48
i.e. whether to retain the property or to accept the benefit, if he
retains the property then he has to forfeit the benefit or if he
accepts the benefit then he has to forfeit the claim over the
property.
The principle embodied under the doctrine of election is that a
person cannot approbate and reprobate at the same time which
means that, under the doctrine if he accepts one thing then he
has to accept it wholly and relinquish the other i.e. either the
property or the benefit, if he retains the property then he has to
relinquish the benefit and if he has accepts the benefit then he
has to relinquish the claim over the property. The Privy Council in
Rungama v. Atchama, I.A. 1, stated that a party shall not at the
same time affirm and disaffirm in the same transaction i.e. affirm
it as far as it is for his benefit and disaffirm it as far as it is to his
prejudice.

Transfers
(Disappointed donee)

A of B to C
(Refractory
Property (house) on
donee)
worth Rs. 1 lakh

confers benefit of Rs. 2 lakhs

In the above example, ‘A’ is a stranger/transferor who transfers

the house worth Rs. 1 Lakh of ‘B’ the owner of the house to ‘C’,
the transferee and in the same transaction confers benefit f Rs. 2
lakh on the owner ‘B’. Here ‘B’ as per the section has the duty of
election wherein he is having two options i.e. (i) to retain the
property or, (ii) to accept the benefit.

If under point (i) the owner retains the property then three things
happen;

1. The owner has to relinquish the benefit of Rs. 2 lakh which

will go back to the stranger/transferor.
2. The property reverts back from the transferee ‘C’ to the 49
owner ‘B’. When the property reverts back then ‘C’ becomes
“Disappointed Donee” and ‘B’ becomes “Refractory
Donee”.
 3. When ‘C’ becomes disappointed then he must be
compensated. This compensation will given by the
stranger/transferor or his legal representatives. When the
stranger/transferor ‘A’ is alive and capable of making a fresh
transfer then compensation in terms of amount is not
necessary but if before election the stranger/transferor dies
then his/her legal representatives will have to compensate in
terms of amount to the disappointed transferee ‘C’, which is
equivalent to the amount of the property so reverted back to
the owner ‘B’ i.e. Rs. 1 lakh.

If under point (ii) the owner accepts the benefit then the transfer
so made by the stranger/transferor will be become valid.

The question may now arise, as to why the stranger/transferor is

transferring the property. Literally, the statute does not require
the belief of the transferor. In Thelusson v. Woodford, 13 Ves
709, it is held that it is immaterial whether he does or does not
believe the property to be his own. All that matters is that the
stranger/transferor has purported to confer benefits and burden
on the owner.

Section 35(2) will apply in all cases whether the transfer or

proposal to transfer is under any misconception as to title of the
transferor over affected properties or is motivated by any known
or unknown device or design.

Clause (3) provides that a person who is not taking benefit

directly is not bound by the equity of election.

Clause (4) provides that when a person is acting in a dual

capacity, then, such person can in one capacity take a benefit and
in the other capacity dissent thereform.

50
(Life interest/transferor)
A C
Rs. 1 Lakh

B (Owner/ultimate beneficiary)
 Rs. 1 Lakh
B1 (Legal Representatives)
Rs. 1 Lakh
In the above example, property has been bequeathed upon ‘A’ for
life and after his death upon ‘A’ for life and after his death upon
‘B’ as an ultimate beneficiary and thereafter to his legal
representatives ‘A’ as a life interest (having no authority to
transfer), transferred the property to ‘C’ (the transferee) and by
the same transaction conferred a benefit of Rs. 2 Lakh upon the
ultimate beneficiary and his legal representatives amounting Rs. 1
Lakh respective. Shortly after such transfer ‘B’ died without
making an election. Now ‘B1’ the legal representative of ‘B’ takes
out the administration pending in favour of his/her father ‘B’ and
as an individual accepts Rs. 1 Lakh conferred on him and as an
administrator retains the property bequeathed through Will and
relinquishes the legacy of Rs. 1 Lakh conferred on ‘B’.

Exceptions

Clause 5:- provides that where some additional or extra benefit

are conferred on the owner other than the benefit in lieu of his
property, and under the duty of election if the owner is retaining
the property then he has to relinquish only that benefit, which has
been conferred in lieu of his property which has been transferred,
but need not relinquish other benefits which have been conferred
upon him separately. For instance if ‘A’ transfers his farm house
51
to ‘B’ as gift and thereafter confers his house as a benefit on ‘B’ in
lieu of the property of ‘B’ which has been transferred. Then if ‘B’
decides to retain the property then he has to relinquish only that
benefit which has been conferred upon him in lieu of his property
which has been transferred but not the property which ‘B’ has
received as gift.

Clause 6:- provides that, the owner having knowledge of election

but accepts the benefit, then the election shall be presumed
against him.

Clause 7:- provides that such presumption of election shall be

made if the owner enjoys the property for two years without any
express act dissent.

Clause 8:- provides that when the owner by his act, rendered the
restoration of status quo of property so transferred to him
impossible then the election shall be presumed to have been
done.

Clause 9:- provides that, if the owner does not signify any
intention of either to consent or dissent, to the stranger/transferor
or his legal representatives, then they will remind the owner of his
duty to elect, even then also the owner does not comply with
such requisition, then the election shall be presumed.

Clause 10:- provides that in case of disability of the owner at the

time of election, then the election shall be postponed till the
cessation of disability or till the time election is done by a
competent authority.

Lecture 7

APPORTIONMNET 52
Apportionment means division of common fund or estate between
two persons or claimants. Transfer of Property Act, 1882 deals
with apportionment under sections 36 and 37. Section 36 deals
with apportionment by time whereas section37 deals with
apportionment by estate.

Section 36 Apportionment of periodical payments

Generally when a property is transferred, then after the transfer
whatever profits that arise out of the property will automatically
get transferred to the transferee. But section 36 is in a way an
exception to the last clause of section 8, which provides that “if a
property is a money yielding income then the interest or income
thereof arising after the transfer will go to the transferee”. This
section provides that where there is no contract or local usage,
then all the periodical payments such as rents, annuities,
pensions, dividends and other periodical payments in the nature
of income shall b divided between the transferor and transferee to
be payable on the days appointed thereof.
For instance ‘A’ has leased his property, the rent of which at a
rate of Rs. 10,000/- is to be paid annually. ‘A’ has subsequently
transferred the property to ‘B’ in the month of June. Here the
lessee stills remains liable to pay the rent. But such liability will be
as decided by the transferor and transferee from day to day. The
lessee this according the section shall have to pay Rs. 5000/- to
the transferor as accounted till June and rest Rs. 5000/- shall be
paid to the transferee in the month of December. In Satyendra
Nath v. Nilkantha20 it has been held that the apportionment

53
contemplated is one following upon the transfer of interest of the
person entitled to receive the rent and not upon the transfer of
interest of the person bound to pay it.

20 21 Cal. 388
Section 37 deals with apportionment by estate. This section
provides that when in consequence of a transfer, a property is
divided and held in shares, and thereupon, benefit of any
obligation relating to that property as a whole passes from one to
several owners, then such obligation shall be performed in favour
of each of such owner in proportion to the value of share such
owner in the property. But the person who is to perform the
obligation must have the notice of such severance which must be
given either by the transferor or by the transferees. If the
obligation cannot be severed then the obligation shall be
performed against such one person as all the owners jointly
designate. The severance of ownership under this section shall
not increase the burden substantially. If such severance increases
the burden substantially then the person who is to perform the
obligation need not perform more than he is liable to perform.
If the property is a agricultural land then the nothing in this
section will apply and if the agricultural land is transferred is to
several owners then the tenant in such a case will pay rent to
such one of several owners as all of them may designate. In such
a case the obligation of the tenant is discharged if he pays rent to
any one of the several owners but if such tenant has consented to
a different agreement then this proviso will not be applicable.
Section- 38 provides for limited power of transfer or transfer by
person authorized only under certain circumstances to transfer.

54
This section applies to transfers made by a person under certain
circumstances which must have a valid reason to make such
transfer and the person who is purchasing the property must
ascertain himself of the existence of the circumstances and must
act in good faith, then only the transfer shall be deemed to have
been valid. Under Section 38, the duty is on the purchaser to
prove the existence of justifying circumstances and that he acted
in good faith before the court. This is so because, the transferee
will get title in the property by that purchase, otherwise if the
transfer is made without any such necessity and the transferee
purchased that property without inquiring into the circumstances
then the transfer will be voidable at the option of reversioner or
the beneficiaries.
This section has an application in Hindu Law. This principle in this
section is incorporated after the decision of Hanooman Pandey
case decided by the Privy Council, wherein it was held that, the
lender is bound to inquire into the purpose for which loan is
granted, but his obligation does not extend to as regards the
actual application of the amount.
Section 39 provides for entitlement of third person for
maintenance out of the transferred property. Sometimes it so
happens that the owner maintains his dependents out of the
profits or usufructs of the property. When such property is
transferred then the persons who are entitled to such
maintenance can enforce maintenance against such transferee
under two circumstances:
1. When such transferee has notice of such liability of
maintenance; and

55
2. When such transferee is gratuitous (without consideration).
But no such claim or enforcement can be made by any such
person entitled to maintenance against a transferee who has
taken the property for consideration and without notice of such
liability.
Covenants running with the land
Covenant means a written document; it may be a sale deed, gift
deed, lease deed etc. When a property is transferred then no
restriction can be put in the right of such transferee to further
alienate the property but such restriction can be put for the
beneficial enjoyment of one piece of immovable property to which
the property sold is attached. This provision has been
incorporated in section 11 and the exception attached thereto.
When a covenant binds only the parties thereto then it is known
as positive covenant, but when such covenant binds the
subsequent transferees also that is known as negative covenant.
Sometimes there may be contractual covenants.
Section 40 of the Transfer of Property Act, 1882 precisely deals
with the negative covenants and contractual covenants.
The principle incorporated in this section is based on the rule laid
down in Tulk v. Moxhay21wherein it was held by Lord Cottonham
L.J that “The question is not whether the covenant runs with the
land, but whether a party shall be permitted to use land in a
manner inconsistent with the contract entered into by his vendor
and with the notice of which he purchased……if the purchaser
buys the property without the notice of such covenant then such
covenant is not binding upon him and therefore cannot be

56
enforced against him”.
This section is divided into two parts first part deals with
negative covenants and the second part deals with the

21 (1848) 2 Phill 774.

contractual covenants. First part provides that when for the
beneficial enjoyment of one part of the property if the transferor
makes a covenant with the transferee to restrain from using the
other piece of property and the transferee agrees to that
covenant then it shall be binding not only such transferee but also
on the subsequent transferee’s to whom such property is
transferred. In other words when any such negative covenant is
made between the transferor and transferee then if any person
who purchases the property from the transferee will also gets
bound by such covenant.
A

X Y
M N
In the above diagram A is the owner of two properties X and Y and
sells the property X to M and makes a covenant that M will not
build any structure on the property Y. M agrees to such covenant.
Now when M sells that property to another person N then he is
also bound by the covenant to the same extent as M. In other
words N can also be restrained as M from raising any structure on
the property Y.
Second part of the section provides that in a contract when any
third person is entitled to any benefit then any such transferee

57
(third person) can enforce the contract against the subsequent
transferee.
In both the parts two things are important for enforcement of
such right or obligation;
 1. Such transferee must have notice of such right or obligation;
and
2. Transferee must be gratuitous (without consideration).
If a transferee has purchased the property for consideration and
without notice of such obligation then such right or obligation
cannot be enforced against him.

Transfer of Property Act provides for a common rule of nemo

dat quod non habet which means “no can pass better title or right
in the property more than what he/she himself/ herself possesses.
But there is an exception to this rule which provides that a
property can also be transferred by an ostensible owner. The
principle governing ostensible transfer is subject to Benami
Transactions (Prohibition) Act, 1988. This Act, of 1988 provides
that when a property is transferred benami then the person in
whose name the property is held shall become the real owner and
neither any suit or claim shall be maintained nor can any defence
be brought by the real owner neither against the benamidar or
against any other person who purchased the property form the
benamidar. The transfers by an ostensible owner have been
provided under Section 41 of the Act. Ostensible owner means a
person who has all the indicia of ownership but not a real owner.
The section reads as follows:
“Where, with the consent, express or implied, of the

58
persons interested in immoveable property, a person is
the ostensible owner of such property and transfers the
same or consideration, the transfer shall not be voidable
on the ground that the transferor was not authorized to
make it:
Provided that the transferee, after taking reasonable
care to ascertain that the transferor had power to make
the transfer, has acted in good faith.”
Essentials
1. Transfer must be made by an ostensible owner.
2. Such ostensible owner has transferred with consent either
express or implied of the real owner.
3. The transfer has been made for a consideration.
4. The transferee has purchased the property after taking
reasonable care and in good faith.

1. Transfer must be made by an ostensible owner:

As aforesaid ostensible owner means not the real owner but
looks like an owner. Ostensible owner does not include
agents, guardians, karta etc who are so appointed with some
purpose by the authority of the real owner 22. To determine as
to who is the ostensible owner is a matter of facts and
circumstances which is to be decided by taking into account
the different considerations such as source of purchase
money, nature of possession after the purchase, motive for
giving benami colour to the transaction, relation between the
parties, conduct of the parties in dealing with the property,

59
custody of the title deeds etc [Jaydayal Poddar v. Bibi
Hazara].
2. Express of implied consent:

22 P-88, The Transfer of Property Act and Easements Act by Prof. Ashok Kumar Shrivastava.
 Ostensible owner must transfer the property with the
consent either express or implied of the real owner. Express
consent is said to be given when the real owner allows the
ostensible owner to transfer the property by words of mouth
or by writing. In the case of Nirus Purve v. Mt. Tetri
Pasin23 husband registered his land in the name of his wife
in the revenue records and went on a pilgrimage. Before he
went on a pilgrimage he allowed her to mortgage the land.
After his departure, she sold the land and the vendee paid
off the mortgage. The husband on his return could neither
recover the land nor redeem the mortgage. In case of
implied consent the real owner has the knowledge of the
dealing of property by the ostensible owner but does not
stop him from dealing with that property.
3. Transfer for a consideration:
This section has an application only when an ostensible
transfer has been made by an ostensible owner for a
consideration. In other words the transfer made by an
ostensible owner cannot be made voidable by the real owner
if such transfer has been made for consideration and the
transferee is also protected thereby. But no such protection
shall be accorded if such transfer is gratuitous or without
consideration.
4. Transferee must take reasonable care and must act in

60
good faith:
Reasonable care and good faith are both complementary to
each other. Reasonable care requires only that much of care,

23 (1916) 20 C.W.N 103

 which is expected from a person of an ordinary prudence
and good faith means that the transferee has acted honestly
and in real belief that the ostensible owner is the real owner.
Satisfaction of the purchaser on the basis of revenue records
regarding the ownership of the ostensible owner is not
sufficient all the time sometimes he has also to make inquiry
into title of the possessor from the sub-registrar office.
According to Section 6(a) of the Act a person who is a spes
successionis/ or a heir apparent cannot transfer his right in the
property because he is not having any interest in the property.
Transfer of proerpty contemplates a situation where such person
transfers property by fraud. In that situation the person who so
represented will be stopped from going back on his promise of
giving the property. Then when such person gets title in the
property subsequently he has to give that title to the transferee.
This principle is known as feeding the estoppel by grant which is
incorporated in section 43. Section 43 reads as follows:
“ Where a person fraudulently or erroneously represents
that he is authorized to transfer certain immovable
property and professes to transfer such property for
consideration, such transfer shall, at the option of the
transferee, operate on any interest which the transferor
may acquire in such property at any time during which the
contract of transfer subsists.

61
Nothing in this section shall impair the right of
transferees in good faith for consideration without notice
of the existence of the said option.”
This section provides that where any person who is not having
any right over the property as in the case of a heir apparent who
is a mere heir in waiting without any right over the property and
where any such person misrepresents himself fraudulently or
erroneously that he is the real owner and grants/transfers the
right in the property for consideration then such grant/transfer
creates an estoppel on the transferor from going back on his
words to give the property and when such person gets title in the
property he has to feed the grant by giving his title in the
property.
A person if, alienated the property to which he has no present
title, may subsequently become entitled to, he must honour his
commitment. Since he cannot derogate from his own grant, his
subsequently acquired interest, feeds the estoppel, raised by the
prior grant and perfects the title of the alienee 24.
In Rajpakse v. Fernando25, the common rule of estoppel has
been explained in the following words;
“Where a grantor has purported to grant an interest in land
which he did not, at the time, possess, but subsequently acquires,
the benefit of his subsequent acquisition goes automatically to
the earlier grantee, or as it is usually expressed, feeds the
estoppel by grant”.
Essentials
1. Fraudulent and erroneous representation:

62
First and foremost thing for the application of this section is
that there must be a representation which is fraudulent and
erroneous and it must be of such a nature that the
24 Section 43 “Feeding the estoppel by grant”, Pg- 207-208- book “Transfer of Property Act” by Dr. G.P.Tripathy.
25 AIR 1920 P.C. 216.
 transferee must believe it to be true. But when that fact of
such fraudulent representation is known to the transferee
then he cannot claim the protection of Section 43. This
section has not only mentioned about fraudulent
representation but also about erroneous representation.
Fraudulent means deceitful, wrongful, dishonest or false
statement by words of mouth or sign which is intended to
induce others to believe it to be true whereas erroneous
representation means recklessness or carelessness which
causes error on the part of the person making statement.
Sometimes when there is no fraud or erroneousness then
section 43 will not apply also when the transferee has notice
of such fraud or erroneousness then also section 43 will not
apply. Explaining the former proposition (no fraud or
erroneousness) there is a case namely Narayan Chand
Shaha v. Dipali Mukherji26, in this case son transferred the
property still in the name of father. This fact was known to
the transferee. Father died and son become co-owner of that
property. Now the question arose before the court was that
can the buyer claim the protection of section 43? The court
said that there was ne evidence on record to show that son
made statement that property belonged absolutely to him.
There was no representation regarding authority to sell. Such
purchase of property is a collusive conduct. There is no

63
estoppel when the truth is known to the transferee.
There are two equities equity of estoppel and equity of
personal obligation. Under the situation above mentioned

26 AIR 2002 Cal. 229

 where there is no fraud or erroneousness then the equity of
estoppel will not apply but though there is no such
representation but contract has been made and the other
person has purchased the property believing the transferor
to be the real owner then also the transferor has to give his
title subsequently acquired to the transferee under the
equity of personal obligation.
2. Subsequent acquisition of title:
For application of this section it is necessary that the
transferor must acquire the title in the property
subsequently. In the absence of any such acquisition the
section cannot be invoked. In B.S.D. Mohamandal,
Kanpur v. Prem Kumar27 three daughters inherited their
father’s property as a limited estate and divided the property
into three shares, each being in exclusive possession of her
respective share. A, one of the daughters sold her share in
possession to B. Subsequently her other sister died and A
survived as the last limited owner and got exclusive
possession of the entire estate. The court held that B was
entitled to the property under section 43.
3. Option of the transferee:
Under this section the transfer is voidable at the option of
the transferee which means that the transferee can either
claim his right or claim damages. The word “option” shows

64
that law has only specified one of the various remedies open
to the transferee. He can if he wants repudiate the contract

27 AIR 1985 SC 1103.

 or he may elect to ask for damages. Demand for title must
immediately be made by the transferee.
4. Transferee for value and without notice:
Under section 43 if the transferee causes delay in
demanding the property and the transferor, after getting
interest in the property if he subsequently transfers the
property to another persons for consideration and such
subsequent transferee purchases the property without notice
of the earlier transfer then such subsequent transferee will
have a title over the property.
5. Transfer for a consideration:
This section has its application in case of non-gratuitous
transfers. Thus a gift of a property to the transferee by the
transferor, who has no interest therein, cannot claim the title
in the property if the transferor subsequently acquires
interest in the property after making the gift.

Transfer by Co-owners
In the earlier sections we have studied of transfers by one owner
of immovable property but sometimes properties may be held by
one or more owners as co-owner’s. If one of such co-owner’s
transfer the property then what will be its effect is the crux of this
section. Section 44 provides for transfer by one of the co-owner
which reads as follows:

65
“Where one of two or more co-owners of immovable
property legally competent in that behalf transfers his
share of such property or any interest therein, the
transferee acquires as to such share or interest, and so
far as is necessary to give effect to the transfer, the
transferor’s right to joint possession or other common or
part enjoyment, and to enforce a partition of the same,
but subject to the conditions and liabilities affecting at
the date of the transfer, the share or interest so
transferred.
Where the transferee of a share of a dwelling- house
belonging to an undivided family is not a member of the
family, nothing in this section shall be deemed to entitle
him to joint possession or other common or part
enjoyment of the house.
Essentials
1. Transfer must be by one of the co-owners of their
interest in the immovable property.
This section requires that the property must be held by the
persons as co-owners and one of such co-owner must
transfer the property. Such transfer must be of an
immovable property. In Moheshnarayan v. Nawabat
Pathak28 it was held that co-owners have a right to joint
possession which can be enforced without bringing a
partition suit. Every co-owner is entitled to a reasonable
enjoyment of the joint property provided he does not
interfere with a similar user by the co-sharers.
2. Transferee takes interest in the property to the extent

66
the transferor had in the property.
The effect of transfer of a share by one of the co-owner will
be the substitution of the transferee of that that share with

28 32 C 837
 the transferor, making the transferee a co-owner like the
transferor prior to such transfer. In other words the
transferee will be replaced by the transferor.
3. The transferee will have both the rights and liabilities
of the transferor by such transfer.
The transferee as he is substituted by the transferor by the
transfer and becomes a co-owner he (transferee) shall not
only enjoy the benefits of the property but also will be liable
to the responsibilities to the same extent as the transferor
(co-owner) would have been liable had he been in the
possession of the property. For instance, A, B, C and D are
co-owners of a property with a share of ½ each. C’s share of
property is mortgaged. Subsequently C transferred his
property to a person M, now M will be one of the co-owner
along with A, B and D i.e. A, B, M and D, here C is replaced
by M.
4. The transferee of a dwelling house of an undivided
Hindu family cannot enforce jont possession
In order to attract second part of section 44, the subject
matter of the transfer has to be a dwelling house belonging
to an undivided family. The share of the transferor in the
dwelling house is a joint one then the transferee cannot
enforce his right of joint possession. If he wants to claim
possession then he has to do so through a suit for partition.

67
If the possession of the stranger is creating inconvenience to
the other co-owners then they can restrict him from
purchasing the property, they can even exercise the right of
pre-emption (prior right to purchase) and purchase the share
 of the stranger at the then value of the share. But such right
of pre-emption cannot be claimed by the transferor/co-owner
but can be claimed by other co-owners.
In P.C. Mallik v. Renuka Jena29, the question was whether
a sharer in a joint property can claim liberty to re-purchase
the share sold to a stranger? The court held that there is no
law which stipulates that a co-sharer must sell his share only
to another co-sharer. Thus, strangers and outsiders can
purchase share of a co-sharer even in a dwelling house but
he gets no right to jont possession or common enjoyment of
the portion of the house so purchased. He has to file a suit
for demarcation of his hare and also delivery of possession.
The co-owners wanting to repurchase the share can do so
under section 4 of the Partition Act but not under section 44
of TP Act.
But nothing will impair the right of the transferee if he
purchased the share from the person who has separated
from his/her joint family taking his/her shares independently.
Section 45 provides for joint transfers. This section deals with
the interest of the transferees. This section deals with the
quantum and not with the quality of interest of the joint
transferees. It does not touch the question whether in such cases
the transferees take the property as joint tenants or tenants in
common. This section has no application in case of contract

68
between the parties.
Essentials of section 45

29 AIR 2007 Ori. 65

1. Immovable property has been transferred for consideration
for two or more persons. It implies that the property has
been transferred in favour of two or more persons jointly for
consideration.
2. Such consideration if, for such joint purchasers, has been
paid out of common fund belonging to them then they will be
entitled to equal interest/ share in the property purchased.
For instance, A and B are two brothers having two accounts
in the bank one is joint account and another is separate
accounts in their respective names. Both of them purchased
a property and paid the consideration for that transfer out of
their joint account or common account. Then as they have
paid the consideration out of common fund or joint account,
both the brothers will have equal interest in the property
purchased.
3. But where the consideration has been paid out of separate
funds belonging to them then the transferees will be entitled
to the share or interest in the property proportionate to the
amount of consideration advanced by them. For instance
considering the same abovementioned example if A and B
paid the consideration out of their separate accounts then
their share or interest in property will be equal to the amount
of consideration advanced.
4. Further more where it is not known what is their

69
share/interest of the transferee’s in the common fund or how
much amount they have paid as consideration then their
share or interest in the property purchased will be presumed
 to be equal. For instance again considering the same above
example;
i) If A and B have paid the amount of consideration out of
the common fund in lumpsome without determinging
their share; or
ii) If A and B have paid from their separate accounts and
subsequently lost their withdrawal receipts of the bank
creating a confusion as to how much amount have been
withdrawn from their respective accounts for
consideration;
Then in such case last paragraph of this section 45 provides
for a presumption that they have equal share in the property
purchased. But all the above mentioned presumptions and
distribution of share/ interest are subject to contract
between the parties. Where there is a contract between the
parties that after the purchase of property in the transfer
both of them will take such share as designated by them in
the contract then the rules contained in the section will not
apply and they will be bound by the contract.
Section 46 deals with distinct interests. This section is opposite
of section 45. This section deals with the right of transferor’s
whereas section 45 deals with the right of the transferee’s.
Essentials of section 46
1. Persons having distinct interest in the property have

70
transferred the property. Distinct interest is the necessity for
the applicability of this section. Persons having distinct
interest in the same property are known as tenants-in-
common. Tenants-in-common is different from joint tenants.
 Tenants-in-common means persons having joint possession
but distinct titles or separate title whereas joint tenants
imply both joint title and joint possession.
2. Such transfer persons with distinct interest must be for a
consideration.
3. The transferor’s share in the consideration shall be as
follows:-
a) Where they (transferor’s) held the interest equally in the
property prior to transfer, then they will be entitled to
equal share in the property proportionate to their equal
interest.
A B C A B C

½ ½ ½ ½ ½ ½
Land in Delhi Land in Mumbai
In the above example, A, B and C were in possession of
the land in Delhi
in equal shares of ½ each. Now when they transferred
the property in
exchange for the land in Mumbai then all the three will
be entitled to
equal shares in the land in Mumbai with equal shares of
½ each as they

71
were having in the land in Delhi.
b) Where they held unequal interest in the property prior to
transfer then they will be entitled to the share
proportionately to the unequal interest.
 A B A B
¼ ¼
¼ ¼
½ C ½ C
Land in Delhi Land in Mumbai
In the above example A, B and C who are in possession of
land in Delhi with A having ½ share and B and C having ¼
share each. They have exchanged their land for land in
Mumbai. In land in Mumbai they will be having the same
unequal shares as they were having in the land in Delhi.
But their shares will be subject to the contract to the contract to
the contrary. If they make a contract that even if they are having
equal shares they will take it unequally or having unequal shares
they will take equally then they will be bound by the contract and
they cannot take the protection of section 46.
Section 47 deals with transfer by co-owners in common
property.
Essentials
1. Presence of several co-owners;
2. Such co-owners shall transfer a share of the property;
3. There is no specification as to how much share each owner
has contributed;

72
4. Where there is no such specification then the transfer shall
take place from each share equally from all the co-owners
when they have equal shares;
 5. When they have unequal shares then according to their
respective shares.
The illustration attached to the section is sufficient enough to
explain the provision. According to the illustration A, B, and C are
owners of mauza Sultanpur, out of which A is having a share of
eight anna and B and C having four anna each. They have
transferred two anna share of the mauza to D without specifying
as to from whose share the two anna share is to be transferred
then to give effect to the transfer one anna share is taken from
the A and half-an-anna share is taken from both B and C.
The owner of the property sometimes may create different
interests on the same immovable property and when all the
interests cannot exist together then the law says that the one
who will be prior in time will be preferred. This is known as
doctrine of priority. Section 48 provides for this doctrine of priority.
The principle of the rule is based on maxim qui prior est tempore
est jure which means that one which is prior in time is better in
law.
Section 48 essentials
1. Transferor creates different rights in and over the same
property.
2. Such rights created cannot exist or exercised together.
3.

73