1.

Relinquishment
The term ‘relinquishment’ refers to the abandoning and surrender of the rights, title & interest, by one co-owner of property for the
other co-owners. The consequences of relinquishment of one co-owner’s share in property are the enlargement of the shares of the
other co-owners. Many times it happens that a person dies intestate (without leaving a will or testamentary will) in such cases the
property of that person is inherited by his/her legal heir. Then it’s up to the heirs as what they want to do with the said property. If
the heir’s come to the conclusion of separation of property, then anyone of the co-owner (who is not willing to keep the property)
can relinquish his share through relinquishment deed in favour of the other owner. This process of transferring property from one
owner approving the other is known as “Relinquishment of Property”.

2. Actionable Claim (7 Marks)

Actionable claim is defined in Section 3 of the Transfer of Property Act, 1882 which was included in the Act by the Amending Act II
of 1990. Actionable claim is an intangible movable property, and its transfer is dealt with in Chapter VIII of the Act.
According to Section 3 of the Act, actionable claim means:-
 Claim to an unsecured debt
 Beneficial interest in a movable property
These both claims are recognized in the Courts of law as affording relief.
Note- There are other types of claims also that afford relief and are actionable in the Courts of law, such as secured debts and
tortuous suits like defamation or nuisance. But those are not categorized under the meaning of actionable claim. The term
actionable claim only covers the above mentioned two types of claims.
Examples of Actionable Claims
As per section 3 of the Transfer of Property Act, following could be the examples of Actionable Claims:-
 Right to claim arrears of rent
 Money payable under a contract for price or advance
 Right to claim benefit of contract
 Insurance claim except marine insurance
 Lottery ticket
 Right to credit in a provident fund
 Dividends on shares, debentures, negotiable instruments such as bills of exchange etc.
 Share in a partnership property
 A right under a license
 Rights shares or option to purchase shares
 Bank guarantee

3. Instrument
Instrument means legal document. Section 3 of TPA defined instrument as “An instrument is a non-testamentary instrument’.
Note:- Transfer of Property act doesn’t apply in testamentary instruments. It will apply only in non-testamentary instruments.
Non-testamentary Instrument
When transaction or transfer happens between two living person and there is no will then it will be called non-testamentary
instrument. Transfer of Property act will apply in case of Sale, Mortgage, Gift, Exchange, Charge etc.

4. Perpetuity
The term ‘perpetuity’ generally means ‘a state or quality of lasting forever’. In property law, a perpetuity may be understood to
mean a disposition which makes property inalienable i.e. untransferable for an indefinite period.
Perpetuity may arise under two circumstances:–
(1) Transferor of property is deprived of the power of alienation.
(2) Remote interest is created in the property but without the right of alienation to the transferee.
However, a condition restraining alienation is void under section 10 of ‘The Transfer of Property Act’ (TPA) and remote interest is
governed by section 14 of TPA which is popularly known as ‘rule against perpetuity’.

5. Rule against Perpetuity

Section 14 of the ‘The Transfer of Property Act, 1882’ (TPA) is basically known for ‘Rule against perpetuity’ as it limits the
maximum time period beyond which property cannot be transferred. Starting from the date that the transferor transfers the
property + lifetime of the last prior interest holder’s + gestation period of the unborn beneficiary + 18 years, (‘Age of majority of
persons domiciled in India’ under section 3 of The Majority Act, 1875). This period is called the perpetuity period and vesting of the
property in the transferee cannot be postponed beyond this limit.
Note:- The above transfer is contingent to many other conditions viz. sections 5, 10, 13, 15, 16, 18 & 20 of TPA. However, it is to
be borne in mind that Sec. 18 of TPA allows transfer in perpetuity for benefit of public & so provisions of section 14 & 16 do not
apply in such cases.

6. Unborn
Unborn may be defined as “a person not in existence has a specific reference to one who may be born in the future but does not
have a current existence”.
Note:- Even though a child in the womb is literally not a person in existence but has been so treated under both Hindu Law and
English Law
Status of Unborn Child
There is nothing in the law to prevent a man from owning property before he is born. His ownership is necessarily contingent,
indeed, for he may never be born at all; but it is none the less a real and present ownership. A child in its mother’s womb is for
many purposes regarded by a legal fiction as already born, in accordance with the maxim ‘Nasciturus pro iam nato habetur,
quotiens de commodis ipsius partus quaeritur’ which means ‘the unborn is deemed to have been born to the extent that his own
benefits are concerned’.

7. Condition Subsequent
Section 29 of the TPA defines ‘Condition Subsequent’ as ‘Any condition that is required to be fulfilled after the transfer of any
property’.
This condition is to be strictly complied with and the transfer will happen only after the completion of such condition.
For example:- ‘A’ transfers any property ‘X’ to ‘B’ on the condition that he has to score above 75 percent in his university exams. If
‘B’ fails to achieve 75 percent marks then the transfer will break down and the property will revert back to ‘A’. Although it is an
essential requirement that the condition needs to be lawful and if it is not a lawful condition then the condition will be held as void
and the transfer will not break down and will be finalized. For example:- ‘A’ transfers the property to ‘B’ on the condition that he
shall murder ‘C’. This condition is void and hence transfer will go through and the property will be kept by ‘B’.

8. Reversioners
The reversioner is a person who inherits the properties of a window held by her for life, during the life of Window this right remains
suspended but it reverts back to the reversioner on her death provided the reversioner survived.
Case Law:- In Amrit Narayan v. Gaya Singh (1917), the privy Council held that a Hindu reversioner has no right or interest in
Praesenti (at the present time) in the property which the female owner holds for her life until it vests in him or on her death he
should survived her, he has nothing to assign or even transmit to his heirs. His right becomes concrete only on her demise until
then it is mere a spes successionis.

9. Heir Apparent
The term heir apparent has been taken from the maxim ‘memo es heres viventis’ which states that ‘no one is the heir of a living
person’.
An heir apparent is not a legal heir but apparently an heir. When a deceased person whose property the heir apparent is going to
inherit, dies without making any will then the heir will inherit the property.
The possibility of an apparent heir to inherit the property of the propositus (the person from whom a line of descent is derived on a
genetic table) is only an expectation which may be unsuccessful by the activity of some person having the power to dispose of the
property.
For example:- ‘A’ is the owner of the property and ‘B’ is his son. ‘B’ is the heir of ‘A’. This type of property which ‘B’ hopes to get
after the death of the father, cannot be transferred during the life time of A.

10. Spes Succession (or Successionis) (7 Marks)

Spes successionis is a Latin maxim. It is a hope of succeeding to the corpus of a person after his death. This doctrine states about a
mere possibility or chance of a person to succeed to an estate of another person after his death. It is mainly an expectancy of
succession of an heir apparent or any other relation to succeed in principle’s property by way of succession or will respectively.
Such expectancy does not amount to an interest in property and cannot be made the subject matter of a transfer.
Spes successionis means expectation of succession. Expectation of succession is expecting or having a chance of getting property
through succession. Spes successionis is, therefore, not a present property or any right over property. It is merely a possibility of
getting certain property in future.

11. Tenant-at-Will
Tenants who have consent from their landlords but usually don't have leases, are basically known as ‘Tenants-at-will’. And such
tenancies are often referred to as at-will or month-to-month agreements, although there is no formal contract outlining the period
of time the tenancy takes place. This describes the arrangement between the landlord and the tenant when strict terms are not
available, are faulty in nature or have expired, such as those found within a lease agreement.

12. Tenancy-at-Will
Tenancy-at-will is a property tenancy where either the tenant, the owner or landlord may terminate at any time. This operates
without a contract or lease and does not typically define the length of a tenant's term or payment exchange.
Tenancy-at-will is also known as estate-at-will. The arrangement is usually advantageous for both tenants and owners, who may
want the versatility to quickly adjust rental circumstances without breaching a contract.
Tenancies-at-will takes effect if there is an oral agreement between the two parties instead of a written agreement, whether there
is a written agreement specifying that the tenancy is month-to-month with no defined period, or whether the tenancy is extended
after the original lease expires without signing a new one.
Note:- In general, tenancies-at-will include parties unrelated to one another.But in some cases,they occur b/w family members also

13. Movable Property (7 Marks)

The property which can be transferred from one place to another is known as movable property.
The term ‘movable property’ has not been clearly defined under the TPA but as per the Transfer of Property Act 1882, movable
Property is that property which is not immovable.
In general parlance, it means anything which is easily moveable from one place to another without changing its structure or
anything and without giving any harm to its surroundings can be said as moveable property. It is noted that moveable properties
do not mandatorily require registration under the Act for the purpose of transfer.
Examples of movable property are Machinery temporary fixed on land; Intellectual property right; Right to recover maintenance
allowance; Royalty; Copyright, Right of worship, Decree for sale of immovable property, Decree for areas of rent, standing timber,
growing crops, grass, government promissory notes, etc. etc.

14. Immovable Property. Are ‘right to worship’ & ‘right to recover maintenance allowance’ immovable property? (14
Marks)
Section 3 Para 2 of the TPA defines immovable property as “immovable property does not include standing Timber, growing crops
or grass”.
As we can see that it explains that timber, grass and growing crops are not considered immovable property. This definition is given
under the TPA is not exhaustive and does not give a complete meaning of the term immovable property. It only defined what is not
considered as immovable property.
To understand the definition of immovable property, the General Clause Act, 1897 is referred which defines Immovable Property
as– ‘Immovable Property shall include land, benefits to arise out of the land and things attached to the earth or permanently
fastened to anything attached to the earth’.
So we have to read the definition by combining the definitions of General Clauses Act and Transfer of Property Act which is
‘Immovable property includes land, benefits arise out of land and things attached to earth except for standing timber, growing
crops or grass’.
Case Law:- In Shanta Bai Vs State of Bombay (1958), a question was raised that if a tree is beneficial for both wood and timber,
like mango, will it be considered as movable or immovable property? It was held that the “real intention” of growing the tree will
determine it as moveable or immoveable property. If the tree is grown for fruits, it is considered as immovable property and if it is
grown for timber then it is considered as moveable property.
Are ‘right to worship’ & ‘right to recover maintenance allowance’ immovable property?
No, ‘right to worship’ & ‘right to recover maintenance allowance’ are not immovable property. These rights come under movable
properties.

15. Rule against Accumulation

Doctrine of accumulation is a way to restrain the enjoyment of property. According to Section 17(1), if the conditions of the
transfer of property direct the income that arises out of the property to be accumulated either wholly or in part for a period of time
that is longer than the lifetime of transferor or for a period of 18 years shall be considered to be void. These conditions are
alternative and not a combination, such as the lifetime of transferor and 18 years. This Section sets limits for the direction of
accumulation such as lifetime of transferor and as well as a time period of 18 years. This principle is derived from Theluson v.
Woodford. However, the registration of documents is compulsory as mentioned under Section 17.
The enactment of Section 10 to 17 of TPA is for free alienation and circulation of property. A direction for the accumulation with gift
is not considered to be profoundly wrong, it is said to be a failure in case it is offending an independent rule of Hindu Law. In
instances of religious endowment, direction of accumulation shall not be held illegal when the direction is not made for the
advantage either for the settlor or for the family members or when the object is reasonable without the opposition by public policy.

16. Vested Interest

The interest in a property which is created in favor of the person without specifying, the time or a specific connection is known as
Vested Interest in the property. In this, the interest in the property is vested in favor of the transferee, even though the right to
enjoy the property is delayed. The person having the vested interest does not get the possession of that property but has the
expectancy to receive it upon happening of a specified certain event.
Section 19 of TPA defines Vested Interest as- “Where, on a transfer of property, an interest therein is created in favour of a person
without specifying the time when it is to 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 a contrary intention appears from the terms of the transfer.”
For Example: – ‘X’ promises to transfer his property to ‘Y’ on him attaining the age of 22. ‘Y’ will have vested interest in X’s
property till the time he does not get the possession of it. If ‘Y’ dies at the age of 21, then the interest vested in ‘Y’ will pass on to
the legal heirs of ‘Y’ and they will be entitled to the property in the prescribed time period.

17. Contingent Interest

When interest is created in favour of a person to whom such property is transferred, and such interest depends upon the happening
of a specified uncertain event, it is called Continent Interest in the property. According to section 21 of Transfer of Property Act, the
person having the contingent interest does not get the possession of that property but has the expectancy to receive it upon
happening of that event but will not receive the property if the event does not happen as the condition is not fulfilled. Contingent
interest is entirely dependent on the condition imposed on the transfer.
For example, ‘A’ agrees to transfer the property to ‘B’ on the condition that he shall secure 90 % in his exams. This condition is
uncertain and the happening of the event or not happening is in doubt and therefore ‘B’ here acquires a contingent interest in the
property. He shall get the property only if he gets 90 % and when the condition is fulfilled.
However, when a person has a chance of owning a specific property and before the uncertain event occurs, interest in the property
is not a contingent interest if such person receives any income from such property.

18. Difference between Vested interest and Contingent interest (14 Marks)
Vested interest and Contingent interest can be differentiate on the basis of:-
(a) Section:- Vested interest is provided in Section 19 whereas Contingent interest is provided in Section 21 of the TPA
(b) Definition:- Vested interest is an interest which is created in favour of a person where time is not specified or a condition of the
happening of a specified certain event. The person having the vested interest does not get the possession of that property but has
the expectancy to receive it upon happening of a specified certain event. Whereas contingent interest is an interest which is created
in favour of a person on a condition of the happening of a specified uncertain event. The person having the contingent interest does
not get the possession of that property but has the expectancy to receive it upon happening of that event but will not receive the
property if the event does not happen as the condition is not fulfilled.
(c) Condition:- In vested interest, the condition involves a specified certain event. A certain event means an event that will
eventually happen. Whereas in contingent interest, the condition involves a specified uncertain event. There is a chance of the
happening or non-happening of that particular event.
(d) Fulfilment of conditions:- Vested Interest does not entirely depend on the condition as the condition involves a certain event. It
creates a present right that is in effect immediately, although the enjoyment is postponed to the time prescribed in the transfer.
Whereas contingent interest is entirely dependent on the condition imposed on the transfer. Interest is only transferred to the
transferee on the fulfilment of the condition imposed.
(e) Right of Ownership:- In case of vested interest, this right is created as soon as the interest is vested. Whereas in case of
contingent interest, there is mere chance to be having the ownership rights.
(f) Death of transferee:- In case of vested interest, death of the person who is having this interest will not have any effect over
that interest as after the deceased, the interest will vest in his legal heirs. Whereas in case of contingent interest, death of the
transferee before getting the possession of the property will result in the failure of continent interest and the property will remain
with the transferor.
(g) Transferable and heritable:- Vested interest is a Transferable and heritable right. Whereas Contingent interest is a Transferable
right, but whether it is heritable or not, it depends upon the nature of such any transfer and the condition.
(h) The present right of enjoyment:- In case of vested interest , there is present & immediate right even when its enjoyment is
postponed. Whereas in case of contingent interest, there is no present right of enjoyment, there is a mere expectancy of having
such a right.

19. Doctrine of Lis Pendens (7 Marks)

‘Lis pendens’ means ‘a suit under consideration of any court of law’. It is an action which is pending in any court. The doctrine is
enshrined under Section 52 of the Transfer of Property Act, 1882. This section is based on the maxim ‘ut lite pendente nihil
innovetur' which means that nothing new should be introduced into a pending litigation. Therefore, the property which is in dispute
should not either be sold or otherwise dealt in by any party to the dispute during the pendency of the suit or proceeding.
The essentials are as follows:
1. There must be a suit or proceedings pending in a court of competent jurisdiction :-For the purposes of this section, the
pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institution of
the proceeding in a Court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by a final
decree or order and complete satisfaction or discharge of such decree or order has been obtained, or has become unobtainable by
reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force.
2. Suit or proceedings must not be collusive :-In Nagubai Vs. B. Sham Rao (1956), Venkatarama Aiyyar, J., while
explaining the distinction between a collusive and a fraudulent proceeding, observed: In such (collusive) proceeding a claim put
forward is fictitious, the contest over it is unreal, and the decree passed therein is a mere mask having the similitude of a judicial

determination and worn by the parties with the object of confounding third parties. But when a proceeding is alleged to be
fraudulent, what is meant that the claim made therein is untrue, but the claimant has managed to obtain the verdict of the court in
his favour and against his opponent by practicing fraud on the court. While in a collusive proceeding the contest is a mere sham, in
a fraudulent suit it is real and earnest.
3. Moreover, the rule of lis pendens does not apply to a collusive suit or a suit in which the decree is obtained by fraud or collusion,
as held in the case of Awadesh Prasad v. Belarani.
4. The litigation must be one in which right to immovable property is directly and specifically in question;
5. There must be a transfer of property in dispute by any party to litigation :- Such transfer must affect the rights of other party
that may ultimately accrue under the terms of decree or order.

20. Onerous Gift

Section 127 of the TPA defines onerous gifts. This section regarding onerous gifts is based on the maxim- ‘Qui sentit commodum,
sentire debet et onus‘ which means ‘he who receives advantage must bear the burden also.’
The rule is that if a gift is in the form of single transfer to the same person of several things of which one is burdened by an
obligation, and the others not, the donee can take nothing by the gift unless he accepts fully.
The principle is that he who accepts the benefit of a transaction must also accept the burden of the same.
But where the gift of several properties is made in the form of two or more separate or independent transfer, the donee is at full
liberty to accept any of them and reject the rest.

21. Apportionment of Property

The legal term ‘apportionment’ means distribution or allotment in proper shares. The expression ‘apportionment’ means division of
a common fund between several claimants.
In law this term is used in various senses even various statutes define it in various ways and as per the laws regulating these
apportionment the process of determine the apportioned amount also changes.
Section 36 & 37 of the TPA lay down the rules regarding the principle of apportionment. It is classified into two types:-
(i) Apportionment of Property by time
(ii) Apportionment of Property by Estate

22. Apportionment by Time (7 Marks)

Section 36deals with the apportionment of time, which states- “In the absence of a contract or local usage to the contrary, all
rents, annuities, pensions, dividends and other periodical payments in the nature of income shall, upon the transfer of the interest
of the person entitled to receive such payments, be deemed, as between the transferor and transferee, to accrue due from day to
day and apportionable accordingly but to be payable on the days appointed for the payment thereof”.
This principle does not apply on tractions which take place by operation of law but to those transaction based on equity.
When a property generates certain kind of periodical income, apportionment of income between the transferor and transferee
arises. The general rule in regards to the transfer of income between the transferor and transferee is dealt in section 8 of the Act
and is inapplicable on transaction of periodical nature requiring apportionment.
Liability of the tenant:– section 6 of the Act specifies that the section is applicable for transaction held between transferor and
transferee and does not make tenant liable.
Concept of Transfer:– The Transfer of Property Act, 1882 says that when a property is lent to several owners, any of those
several owners on the basis of being the co-owner cannot ask for proportion of rent of evection in case of non-payment. The
apportionment created by the Apportionment Act 1870 statute is “apportionment in respect of time.” The cases to which it applies
are mainly cases of either:
 apportionment of rent due under leases where at a time between the dates fixed for payment the lessor or lessee dies, or some
other alteration in the position of parties occurs
 Apportionment of income between the representatives of a limited owner and the remainder-man when the limited interest
determines at a time between the dates when such income became due.

23. Apportionment of Property by Estate (7 Marks)

Apportionment in respect of estate may result either from the act of the parties or from the operation of law.
Section 37 deals with this kind of apportionment stating that “ When, in consequence of a transfer, property is being divided and
held in several shares, and thereupon the benefit of any obligation relating to the property as a whole passes from one to several
owners of the property, the corresponding duty shall, in the absence of a contract, to the contrary amongst the owners, be
performed in favour of each of such owners in proportion to the value of his share in the property, provided that the duty can be
severed and that the severance does not substantially increase the burden of the obligation the duty shall be performed for the
benefit of such one of the several owners as they shall jointly designate for that purpose:
Provided that no person on whom the burden of the obligation lies shall be answerable for failure to discharge it in manner
provided by this section, unless and until he has had reasonable notice of the severance. Nothing in this section applies to leases
for agricultural purposes unless and until the State Government by notification in the Official Gazette so directs”.
When the whole of a property is transferred to more than one person, any benefit arising out of obligation to the property is
transferred to the several owners.
Apportionment by estate simply means transferring of property to several person whereby distribution of benefits and obligation
arising out of property between those several owners takes place.
Section 37 i.e. apportionment by estate highlights a situation where income arising out of the property is apportionment between
owners on the basis of share in the property. How the payment is to be done whether separately to owner or to single has to be
contemplated. This section basically deals with apportionment in case tenancy be liable only singly.

24. Transfer by Unauthorised person who subsequently acquires Interest in Property (7 Marks)
A person, who has no right to transfer any immovable property, cannot transfer that property. Transfer by such person will be
called the transfer by an unauthorized person.
Section 43 of TPA talks about Transfer by unauthorized person. It means where someone fraudulently shows that he’s authorized
for the transfer of certain immovable property & declares to transfer such property for consideration, such transfer shall at the
choice of transferee.
For E.g- ‘X’, the son of ‘Y’. ‘X’ has separated from his father. ‘X’ sells 4 fields to ‘Z’ that ‘A’, ‘B’, ‘C’, ‘D’, representing that he is
authorized to transfer the same. From these fields ‘C’ does not belong to ‘X’, it has been retained by ‘Y’ on the partition. But on Y’s
dying ‘X’ as heir obtains ‘C’. ‘Z’, not having revoked the contract of sale, may require ‘X’ to deliver ‘C’ to him.
The general rule of ‘Nemo dat quod non-habet’ which means ‘no one can give to different person, what he himself doesn’t have the
rights’ has been relaxed through this section,

For the applying of this section following must be satisfied:-

 There must be a fraudulent representation of ownership by the transferor.
 Transfer must be by the incorrect owner.
 The transferee must act on it false representation in good faith.
 The transfer is for consideration.
 The property which someone professed to transfer subsequently acquires some interest in that property.
 The contract of transfer still subsists.
 Subsequently acquired interest doesn’t pass automatically to transferee but only if he claims right in such property.
The exception to the present section protects the rights of the record transferee in good faith and also the consideration who has
no notice of the choice in favour of the primary transferee.

25. Transfer by Co-Owner

When a property is owned by more than one person, such owners are called as co-owners.
Section 44 of the Act lays down that if one co-owner of the immovable property transfers his share in the property, the transferee
of such share acquires the rights of the transferor. That implies the transferee will be clothed with all the rights of the transferor.
Such rights include the right to joint possession and the right to partition to the extent enjoyed by the transferor.
The right of transfer will apply to all transferees including mortgagee, lessee etc. However in case of a dwelling house belonging to
an undivided family transferred by the transferee who is not a member of the family in that case he is not entitled to joint
possession or other common or part enjoyment of the house.
Case Law:- In the case of Durga v. Debidas (1974), the family members were separated and living in different places. They stayed
in that house for specific purposes. The Court held that using a property for a short period and for a specific purpose will not make
it a dwelling house. Dwelling house is one where there is ancestral dwelling in existence and the family members should have not
abandoned the house.

26. Oral Transfer

Section 9 of the TPA talks about oral transfer of property. It states that “A transfer of property may be made without writing in
every case in which a writing is not expressly required by law.”
This section essentially mandates that a transfer of property may be made without writing in every case in which writing in not
expressly mentioned/required by law but it is also essential to note here that the act is not exhaustive of such kinds of transfers.
Case Law:- In a very famous case of Sarandaya Pillay v Sankarlinga Pillai (1958), Ramaswami J., of Madras High Court observed
“the test, therefore in this country to determine whether a transaction (be it a transfer or not) can be made without writing is to
see if it is expressly required by law to be in writing. If the transaction is a transfer of property and there is no express provisions
of law requiring it to be in writing, section 9 will enable it to be made without writing and vice versa” through which an essential
inference can be drawn and it can be said that if the transaction is a transfer of property and there is no express provision of law
requiring it to be in writing then the general principle referred above will enable it to be validly made without writing.
The reasoning of Section 9 underlines the general principles that everything is to be taken permissible unless there is a prohibition
against it and has been inserted in the statute ‘ex abdundanti cautela’ which means ‘out of an abundance of caution’

27. Fraudulent Transfer & its Essentials

Section 53 of the Transfer of Property Act, 1882 talks about fraudulent transfers. Every owner of a property has the right to
transfer his property as he likes. But the transfer must be made with a bonafide intention. Where the transfer is made with a
fraudulent intention, it means intending to defeat the interest of the creditor or interest of any subsequent transferee. Where the
transfer is made with a fraudulent intention, the object of the transfer would be bad in the eyes of equity and justice, though it is
valid in law.

Essentials of Fraudulent Transfer

The three essentials of a fraudulent transfer are:-
1. Transfer of immovable property.
2. Made with intent to defeat or delay the creditors of the transfer.
3. Shall be voidable at the option of the creditor so defeated or delayed.
But the provisions of this sub-section shall not affect:-
(i) The rights of subsequent transferee in good faith, for consideration.
(ii) Any law for the time being in force relating to insolvency.

28. Conditional Transfer (7 Marks)

Section 25 of the Transfer of Property Act, 1882 provides for Conditional Transfer. It means that any transfer that happens on the
fulfilment of a condition that is imposed on the other party for the transfer of property. For example, A agrees to transfer his
property to B if he gets selected for a job. The requirement of A for B to get a job is called a condition.
For any kind of a conditional transfer to be valid, the condition that is imposed should not be:-
 Prohibited by law,
 Should not be an act that involves fraudulent acts,
 Should not be any act that is impossible,
 Should not be an act that is termed as violative of public policy,
 Should not be immoral,
 Any act that incurs any harm to any person or his property.
For example, X transfers a property ‘B’ to Y stating that he shall murder Z as a condition for the transfer. Such transfer is void as
the condition is prohibited by law.

29. Sale & its Essentials

Sale is defined as the transfer of ownership of a property in exchange for a price paid or promised or partly paid or part promised.
Sale simply means the purchase and sale of goods and services, the sale of immovable property is provided under Section 54 of
TPA.
The essentials of a sale under transfer of property act are given as follows:–
 Parties i.e., Seller, Buyer
 Competency
 Money consideration
 Conveyance
 Registration

30. Mortgage
Section 58 of TPA talks about Mortgage as ‘A mortgage is the transfer of an interest in immovable property for the purpose of
securing the payment of money advanced, an existing or future debt or the performance of an engagement which may give rise to
a pecuniary liability’.
So, acc. to definition, a mortgage is a transfer of an interest in immovable property & it is given as a security for a loan. The
ownership of an immovable property remains with the mortgagor itself but some interest in the property is transferred to the
mortgagee who has given a loan.
Essential conditions of a mortgage are:-
 There is a transfer of interest to the mortgagee.
 The interest created in specific immovable property.
 The mortgage should be supported by consideration.

31. Lease
Section 105 states the definition of a lease which states that it is a transfer of immovable property for a particular time period for a
consideration of which the transferee has accepted the terms surrounding the agreement.
So, lease is a transfer of an interest in the property for a stipulated period of time without transferring the ownership of that
property. In a lease, right of possession is transferred instead of the right of ownership. Transferor here is called the lessor and the
transferee i.e. the one enjoying the property for a period is called lessee. Lease is governed by the TPA and it is given from
Sections 105 to 117.

32. Gift
Section 122 of TPA defines a gift as the transfer of an existing moveable or immovable property. Such transfers must be made
voluntarily and without consideration. The transferor is known as the donor and the transferee is called the donee. The gift must be
accepted by the donee. This Section defines a gift as a gratuitous transfer of ownership in some property that is already existing.
The definition includes the transfer of both immovable and moveable property.

33. Attestation (or Attesting)

According to the Section 3 of Transfer of Property Act, Attestation means that a person has signed the document by way of
testimony of the fact that he saw it executed. It does not import anything more, and therefore it must be distinguished from cases
where a person signs a document merely as a witness to the execution but also with a view to giving consent to the transaction. A
person who is a party to the deed cannot under any circumstances be allowed to sign the instrument as an attesting witness.

34. Essential of a Valid Attestation

The essential conditions of a valid attestation are:-
1. There must be two attesting witnesses.
2. Each witness must:-
 See that the executant sign or affix his mark, or
 See some other people sign the instrument in the presence and under the direct of the executant, or
 Receive from the executant a personal acknowledgement of his signature or mark or the signature of such other person.
3. Each of the two attesting witnesses must have signed the instrument in the presence of the executant.
The mentioned three ingredients must be present for a valid attestation. However, it is not necessary that all the attesting
witnesses should be present and sign at the same time, nor need any of them be present when the executant executes the
instrument. In case the attesting witnesses are not present when the executant executes the instrument, it is essential that each
one of them must receive from the executant a personal acknowledgement of its signature or mark.

35. Attesting Witness

For the purpose of attesting, the signature put by the witness should essentially be ‘animus attestandi, that he has seen the
executant sign or has received from him a personal acknowledgement of his signature. If a person has put his signature on the
document for some other purpose, e.g., to clarify that he is a scribe or an identifier or a registering officer, he is not an attesting
witness. ‘Animus attestandi’ must be there for a valid attestation.

36. Part Performance

Doctrine of Part Performance is an equitable doctrine and it is incorporated to prevent fraud and from taking illegal advantage on
account of non-registration of the document. This Doctrine is based on the maxim, Equity look at as it is done which ought to have
been done.
Section 53-A of the TPA deals with definition of the doctrine of part performance. Basically the doctrine says that the transferor or
any person claiming under him, shall be debarred from enforcing against the transferee and the person claiming under him any
right, in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided
by the term of the contract.

37. Doctrine of Election

In general, election means that a person holds the right, power, or privilege of making choice. As same in the case of election
means in the transfer of property means that the persons whose instrument or property is there have the right to choose or power
to reject the offer which he will be getting. A person can choose or enjoy ant one right by electing that. In this, the base is the
person who is enjoying the right has also a burden of it because he cannot choose or elect both the rights.
Section 35 of TPA talks about Doctrine of Election as follows:-
Election when necessary.—
1. Where a person professes to transfer property which he has no right to transfer,
2. and as part of the same transaction confers any benefit on the owner of the property, such owner must elect either to confirm
such transfer or
3. if he dissents from it; and
4. in the latter case, he shall relinquish the benefit so conferred, and the benefit so relinquished shall revert to the transferor or
5. his representative as if it had not been disposed of,
6. Subject nevertheless,
7. Where the transfer is gratuitous, and the transferor has, before the election, died or otherwise become incapable of making a
fresh transfer, and
8. In all cases where the transfer is for consideration, to the charge of making good to the disappointed transferee the amount or
value of the property attempted to be transferred to him.

As the above section mention about the doctrine of election in TPA means the person has the right to choice by his own will but he
has to elect which right he wants to choose because they cannot choose both the rights and enjoy it they have an obligation to
elect one.

38. Priority
The concept of the doctrine of priority is regulated by the Transfer of Property Act, 1882 (TPA) under Section 48. This doctrine
helps the court in determining the correct party to whom the rights are to be given priority over the other in a case where the court
has conflicting interests. The need for this doctrine arises in a situation where the transferor of the property deals with the same
property with two different people subsequently. Hence, this resolves the problem of the courts to a large extent.

39. Universal Donee

A universal donee is a person who gets all the properties of the donor under a gift. Such properties include movables as well as
immovables. Section 128 of TPA lays down in this regard that the donee is liable for all the debts and liabilities of the donor due at
the time of the gift. This section incorporates an equitable principle that one who gets certain benefits under a transaction must
also bear the burden therein. However, the donee’s liabilities are limited to the extent of the property received by him as a gift. If
the liabilities and debts exceed the market value of the whole property, the universal donee is not liable for the excess part of it.
This provision protects the interests of the creditor and makes sure that they are able to chase the property of the donor if he owes
them.

40. Notice
According to Section 3 of Transfer of Property Act, “a person is said to have notice” of a fact when he actually knows that fact, or
when, but for willful abstention from an enquiry or search which he ought to have made, or gross negligence, he would have known
it.
A notice can be of following two types:-
(i) Express or Actual Notice
(ii) Constructive Notice

41. Express or Actual Notice & its Essentials

When a person receives the actual knowledge of a fact or a definite information regarding a legal dispute, it is called actual or
express notice. Vague rumour and hearsay are not regarded as an actual notice.
The following are the essential conditions to constitute an actual or express notice:-
 There must be a definite and direct information or actual knowledge of a fact.
 A person pertaining to the transaction can only have an actual knowledge.
 The actual knowledge must be linked with the transaction.
Illustration:- X sells his land to Y. X and Y have a contract. Y gives X 50% of the money and contracted to give the rest after
registration of the instrument. Now, X again sells the same land to Z. If Z knows about the previous contract between X and Y,
then Y can go against Z in the court.

42. Constructive Notice & its Essentials (7 Marks)

Constructive notice is the knowledge of those particulars facts which a court ascribes on a party. The legal presumption regarding
constructive notice is that a person should have known a fact as if he actually knows it. If the situations indicate that a man of
ordinary prudence ought to have known a precise fact pertaining to the transaction of transfer then that person will be deemed to
know it. This notice works like a provision of law.
The followings are the essential conditions for constructive notice:-
 The instrument has to be registered in consonance with the Registration Act, 1908.
 The instrument has to be duly entered or filed in books kept under section 51 of the Registration Act, 1908.
 The particulars pertaining to the transaction to which the instrument relates have to be correctly entered in the indexes kept
under section 55 of the Registration Act, 1908.
Legal Presumption of Constructive Notice:-
In the following circumstances the legal presumption of constructive notice arises:-
 Willful abstention from an inquiry or search
 Gross negligence
 Document compulsorily registrable
 Actual possession
 Notice to an agent

43. Ostensible Owner

Sec. 41 of TPA talks about ostensible owner as “when a person acts on the express or implied consent of a person who is vested in
a certain immovable property, that person is deemed the ‘ostensible owner’ of that property”.

Necessary conditions for the application of Section 41 of Transfer of Property Act

To make use of this Section, one must meet specific prerequisites. They’re as follows:-
 The most fundamental criterion is that the individual transferring the property must be the ostensible owner.
 The actual owner’s consent, which might be implied or expressed, is necessary.
 In exchange for the property, the ostensible owner must be compensated.
 The transferee must use reasonable caution over the transferor’s power over the property, and whether the transferee acted with
bona fide intention.
 This section, needless to say, does not apply not to the transfer of movable property, and only to that of immovable.

Unit 1
44. Transferable & Non-Transferable Properties. (OR Discuss the meaning of ‘property’ which can be transferred
under TPA)
Transferable property is any property which can be passed or moved from one person or organization to another and used by
them.
Under the Transfer of Property Act, the transferability of property is the general rule and non-transferability is an exception.
It is generally based on the maxim ‘alienation rei prae fertur jurisdiction accrescendi’ which states that ‘law leans in favour of
transferability, not accumulation’.

Section 6 of the Transfer of Property Act, 1882 discusses the property which may be transferred (i.e Transferable Property). The
section states that property of any kind may be transferred.
The word ‘property’ used in the definition means:- Tangible material things e.g. land and houses, Rights which are exercised over
any material things, e.g right to enjoy a property, Rights regarding repayment of debt etc.
However, Clauses (a) to (i) of Section 6 mention the properties which cannot be transferred & these are the exceptions to the
transferable property.
 Clause (a) describes spes successionis cannot be transferred. This clause states that the transfer of a bare chance of a
person to get a property is prohibited under this section. For example, Arun expecting that Chandini, his aunt, who had no issues,
would bequeath her house worth Rs. 50,000 transfers it to Bhushan. The transfer is invalid as it is a mere matter of chance of
receiving the property on the part of Arun. Thus, it is invalid.
 Clause (b) mentions that the right of re-entry cannot be transferred. The right to re-entry implies a right to resume
possession of the land which has been given to someone else for a certain time. The section mentions that the right of re-entry
cannot be transferred by itself apart from the land. For example, A grants a lease of a plot of land to B with the condition that if
shall build upon it,he would re-enter transfers to C his right of re-entering in case of breach of the covenant not to build.The
transfer is invalid
 Clause (c) mentions that easement cannot be transferred. An easement is a right to use or restrict the use of land of
another in some way. For example, the right of way or right of light cannot be transferred.
 Clause (d) mentions that an interest restricted in its enjoyment of himself cannot be transferred. For instance, if a
house is lent to a man for his personal use, he cannot transfer his right of enjoyment to another.
 Clause (dd) restricts the transfer of the right to maintenance. Such a right cannot be transferred as such right is for
the personal benefit of the concerned person.
 Clause (e) provides that mere right to sue cannot be transferred. The prohibition has been imposed as the right to sue
is a right which is personal and exclusive to the aggrieved party. For example, a person cannot transfer his right to sue for the
damages suffered by him due to breach of contract by the other party.
 Clause (f) forbids the transfer of public offices. The philosophy behind the prohibition is that such a transfer may be
opposed to public policy in general. A person is eligible to hold a public office on the grounds of his personal qualities, and such
qualities cannot be transferred. Thus, the transfer of public offices is prohibited under this section.
 Clause (g) of section 6 provides that pensions cannot be transferred. Pensions allowed to military and civil pensioners
of government and political pensions cannot be transferred. In simpler terms, a pension may be understood as any periodical
allowance which may be granted in regard to any right of office but only on account of the past services offered by the pensioner.
 Clause (h) of this section is titled as nature of nature. This clause prohibits transfer which will oppose the interest
affected thereby. The transfer is also forbidden if the object or consideration of the transfer is unlawful. Moreover, a transfer by a
person who is legally disqualified from being a transferee is also forbidden.
 Clause (i) of section 6 was inserted by the Amendment Act of 1885. The clause declares that certain interests are non-
transferable and inalienable. For example, a farmer of an estate, in respect of which default has been made in paying the revenue,
cannot assign his interest in the holding.
Conclusion:- Thus, section 6 containing clauses (a) to (i) specifically mentions that certain things cannot be transferred (i.e Non-
transferable Property). Such a transfer if undertaken would be invalid in the eyes of the law in India. But all the other things which
don’t come under these exceptions, are transferable property.

45. What is ‘Transfer of property’? Discuss the essentials of a Valid Transfer.

Section 5 of the Transfer of Property Act, 1882 defines the term ‘transfer of property’. According to this section, 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 and other living persons. The phrase “living person” includes a company or association or body of individuals, whether
incorporated or not, but nothing in this section shall affect any law for the time being in force relating to or by companies,
associations or bodies of individuals.
The expression ‘transfer of property’ implies various meanings. One sense maybe transfer of things such as the sale of a house.
Another sense maybe transfer of one or more of the rights in a thing such as mortgage of a house or transfer of a debt.
Thus, acc. to this section, transfer of property means an act which may take effect in the present or future. The property in
question must be in existence at the time the transfer takes place. Moreover, the conveyance of the property must be from one
living person to another.
Essentials of (Conditions for) a Valid Transfer of Property
Following are the essentials of a valid transfer:-
1. Transfer must be between two or more living Persons (Section 5)
2. Property must be Transferable (section 6)
3. Object of the transfer must be lawful
4. The transferee must not be legally disqualified to take the transfer
5. The transferor must be competent to transfer (Section 7)
6. It must be made in the prescribed manner or form (Section 9)
7. The transfer must not be opposed to the nature of the interest affected thereby i.e the rule against perpetuity (Section 14)

46. Who is Unborn? What are the Conditions under TPA which permits transfer for the benefit of Unborn person?
(Or Rule governing transfer for the benefit of an unborn child)
An unborn child is a child not in existence, not even in the mother’s womb. A child in a mother’s womb is considered to be a
competent transferee. Thus as per the general rule, a property can be transferred to the child in a mother’s womb.
But pertaining to Section 13 of Transfer of Property Act, 1882 the property cannot directly be transferred to an unborn child, but
can be transferred for the benefit of an unborn child.
Conditions required for the transfer of property to an unborn child (Or Rule governing transfer for the benefit of an
unborn child)
Section 13 of the Transfer of property act states the transfer of property to an unborn child 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 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 transfer in the property."
Thus, it is essential to fulfill the below mentioned conditions in order to transfer the property to an unborn child:-
 Absolute interest must be made in the favour of unborn child.
 Creation of prior life interest in favour of a person who has come into existence on the transfer date.
Essentials (Pre-requisites) for a valid transfer
 No Direct Transfer: A property can be transferred to an unborn child via trust but not directly. If the trust is not
present then in such a case the property rights are created in the name of a living person and later transferred to the minor.

 Prior Life Interest: Until the unborn does not come in this world, the property rights can be enjoyed by the trustee or
the person(s) in whose name the property is vested.
 Immediate transfer of rights: As soon as the unborn child takes birth, the property rights immediately get transferred
in his/her name, post which he or she will be the sole owner of the property.
Case Law:- The Supreme Court of India in various cases from time to time has interpreted the provisions of the Transfer of
Property Act,1882 in respect of the transfer of property done for the benefit of unborn persons. In the famous case of Girjesh Dutt
vs. Datadin (1934), the Apex Court made important observations. Facts of the case enumerate that “A” made a gift of her
properties to “B”, who was her nephew’s daughter. The gift made by A was made for the life of B and then to B’s daughter without
power of alienation and if there was no heir of B, whether male or female, then to A’s nephew. B died without having any children.
Thus considering the facts of the case, the court held that the gift in favour of unborn daughters was invalid under Section 13 as
the gift was a limited interest and also subject to the prior interest in favour of B.

Unit-3

47. “Once a Mortgage, Always a Mortgage”. Comment & Refer to case law.
The maxim ‘once a mortgage, always a mortgage’ sets out a legal principle applicable to all mortgage transactions. This maxim
denotes that a mortgage cannot be made irredeemable and any provision inserted to make it so irredeemable shall be void to that
extent and will operate bad in law. The mutual rights of mortgagor and the mortgagee provide for a peculiar position of the parties
to the transaction. The Right to Redemption which is available to the mortgagor, provides a right to claim back his property. It is
basic right of mortgagor under the mortgage transaction. The mortgage transaction is a secondary transaction to facilitate the
principal transaction. It is never intended to transfer the property. The maxim states that the original nature of mortgage
transaction never changes. It continues to be a mortgage. Once a mortgage transaction is created then it continues to be a
mortgage transaction. The right of redemption is available to him in future. His right of redemption is not defeated for technical
reasons. Hence it is regulated by the maxim ‘once a mortgage, always a mortgage’. Thus, stating that the true nature of mortgage
never changes.
A mortgage is always redeemable. And a mortgagor’s right to redeem shall neither be taken away nor be limited by any contract
between the parties. The phrase also means that a mortgage would remain a mortgage and it cannot by the unilateral act of
mortgagee be converted into a sale. For instance, if no period was fixed for redemption of a usufructuary mortgage when it was
created, mortgagee would not become owner simply for efflux of time due to non-redemption and mortgagor’s suit for redemption
would be proper.
There are four basic principles to which the law of mortgage is subject to in India which are as follows:-
 A mortgage in essence is a borrowing transaction and has to be viewed as such unless contrary is proved.
 A mortgagor is a person who is in need of money, while the mortgagee is a party who has the money and it is presumed that the
conditions that prevent the mortgagor to redeem his property or penalise him are inserted in the contract at the behest of the
mortgagee.
 Any condition that penalise the mortgagor in the event of non-payment of loan would be termed as a clog on his right of
redemption and would be void.
 Such condition can validly be ignored by the mortgagor and would not be enforced by any court. And a condition that the
property would be forfeited in the event of default in payment of money is a penalty.

The Supreme Court has observed in various instances that the doctrine of clog on the equity of redemption is a rule of justice,
equity and good conscience. It is a right of the mortgagor to get back the subject of the mortgage and to hold and enjoy the same
as he was entitled so to do before the mortgage. If he is prevented from doing so or is prevented from redeeming the mortgage,
such prevention is bad in law. If he is so prevented, the equity of redemption is affected by that, and has always been termed as a
clog. Such a clog is inequitable.
Case Law:- Vadilal Chhaganlal v. Gokaldas Mansukh (1953),
This case is of a long term mortgage of 99 years, where the mortgagee was allowed to construct any structure on the property at
any expense. It was observed by the Apex court that repayment of the principal money along with interest and the cost of
construction make the mortgage practically impossible as it is something beyond the ability of the mortgagor. Thus, it is quite clear
that the mortgagee had taken advantage of a helpless mortgagor to sign that agreement, hence, the conditions were held clog on
redemption. The same was held in the cases like Fateh Mohd. v. Ram Dayal (1927), Ganga Dhar Lal v. Shankar Lal (1958) & so on.

48. Define Mortgage & explain Various Kinds of Mortgage contemplated (observed) under Sec. 58 of TPA.
A mortgage is the transfer of an interest in specific immoveable property for the purpose of securing the payment of money
advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise
to a pecuniary liability. The transferor is called a mortgagor, the transferee a mortgagee; the principal money and interest of which
payment is secured for the time being are called the mortgage-money, and the instrument (if any) by which the transfer is effected
is called a mortgage-deed.
There are following 6 kinds of mortgage under Sec. 58 of TPA:-
1. Simple Mortgage [Sec. 58 (b)]
It has below characteristics:-
i) That the mortgagor must have bound himself personally to repay the loan
ii) That to secure the loan he has transferred to the mortgagee the right to have the specific immovable property sold in the event
of his having failed to repay
iii) That the possession of the property is not delivered to the lender.
2. Mortgage by Conditional Sale [Sec. 58 (c)]
It is defined as a situation, where the mortgagor ostensibly ( जाहिर तौर पर ) sells the mortgaged property –
i) on the condition that on default of payment of the mortgage money (loan) on a certain date, the sale shall become absolute; or
ii) on condition that on such payment being made, the sale shall become void; or
iii) on the condition that in such payment being made, the buyer shall transfer the property to the seller,
Provided that no such transaction shall be deemed to be a mortgage, unless the condition is embodied in the document which
affects or purports to affect the sale.
This kind of mortgage came into vogue in India during Muslim rule & was given legal recognition in the Bengal Regulation Act, 1978
3. Unsufructuary Mortgage [Sec. 58 (d)]
It has below characteristics:-
i) That the possession of the property is delivered to the mortgagee;
ii) That the mortgagee is to get rents and profits in lieu of the interest or principal or both;

iii) That no personal liability is incurred by the mortgagor and

iv) The mortgagee cannot foreclose or sue for sale.
v) That no time limit can be fixed expressly during which the mortgage is to subsist.
This is not prevalent in India
4. English Mortgage [Sec. 58 (e)]
It has below characteristics:-
i) That the mortgagor should bind himself to repay the mortgage money/loan on a certain day;
ii) That the mortgaged property should be transferred absolutely to the mortgagee
iii) That such absolute transfer should be made subject to a proviso that the mortgagee will recover the property to the mortgagor,
upon the payment by him of the mortgage money on the appointed day
The difference between the mortgage by conditional sale and English mortgage is that in English mortgage, the mortgagor binds
him personally to repay the money.
5. Mortgage by Deposit of Title Deeds [Sec. 58 (f)]
In England and popularly in India, this mortgage is called the equitable mortgage. Under the definition under Section 58 (f) of
Transfer of Property Act, 1882, the essential requisites of such mortgage are:-
i) a debt should be there
ii) deposit of the title deed with the lender (most essential)
iii) said deposit is with intention that the said title deed shall be security for the debt.
Section 96 of the Transfer of Property Act, 1882 places mortgages by deposit of title deeds on the same footings as simple
mortgages. As such, the security can, like a simple mortgage can be enforced by a suit for sale of mortgaged property, of course,
by the process of the law. And this kind of mortgage does not require registration and is at par with any other legal mortgage.
6. Anomalous Mortgage [Sec. 58 (g)]
A mortgage which is not a simple mortgage, a mortgage by conditional sale, an usufructuary or an English mortgage within the
meaning of Section 58 of Transfer of Property Act, is an Anomalous mortgage.

49. Rights & Liabilities (Duties) of the Seller before & after the sale

Duties of a seller before the sale of the property takes place

 To disclose all material defects to the potential buyers of the property, which they may not be aware of and may not be able to
recognise in the regular course of action. A material defect is an issue within a component or system of a residential property that
may have an adverse impact on the value of the concerned property, or that poses an unreasonable risk to the resident, such as
temporarily-hidden seepage issues of a significant nature, unstable foundation of the building, etc.
 To show to the buyer, on his/her request, all such documents of title which are relevant to the property, and which are in your
possession or in your power to access and show.
 To answer to the best of your knowledge all the genuine and applicable questions asked by the buyer regarding the property or
its title.
 To enter into a contract with the buyer which states that the interest in the property, which you intend to transfer to the buyer,
shall continue to remain so after the transfer. Also, the buyer would take over the authority to transfer the property to someone
else, as desired.
 To pay and clear all governmental charges (property tax) or other encumbrances accrued (home loan, among others) on the
property up to the date of sale.
 To take proper care of the property and all relevant documents of title between the date of the contract of sale and the delivery of
the possession of the property.
Duties of a seller after the sale of the property takes place
 To hand over the possession of the property to the buyer or any such person whom the buyer directs, post the completion of the
sale.
 To deliver all the documents of the title you possess or have the power to access, to the buyer, after receiving the total sale price
of the property.

Rights of a seller before the sale of the property takes place

To receive the profit and rent amounts arising out of the property
Rights of a seller after the sale of the property takes place
To charge or lien upon the property in such a situation where the ownership of the property is transferred to the buyer before the
payment of the full sale price for the property is made to the seller.

50. Rights & Liabilities (Duties) of the Purchaser (Buyer) before & after the sale
Buyer’s duties before Sale
 DUTY OF DISCLOSURE [Sec. 55 (5) (a)]:- The buyer must disclose all the material facts to the seller before the
execution of the sale, as may increase the value of the property, and of which the seller is unaware. Where the buyer is aware of
any material fact that increases the value of the property, he/she is bound to inform the seller of the same. In case the buyer is
aware that the seller has absolute rights over the property, but fails to inform the seller, the same would amount to fraud on the
part of the buyer.
 PAYMENT OF PRICE [Sec. 55 (5) (b)]:- After completion of the sale, the buyer is bound to pay the full amount to the
seller, but he/she is not bound to make the whole payment before the execution of the sale. Before the sale, the buyer must pay
part of the number of promises to make full payment when implementing the sale.
Buyer’s duties after Sale
 TO BEAR THE LOSS TO PROPERTY [Sec. 55 (5) (c)]:- This is the buyer’s duty to bear the property’s loss after the sale
because after becoming the property owner, the seller is not liable to pay for any loss over the property. The buyer can’t blame the
seller for any loss unless it is proved that the loss did occur because of the seller’s fault. And in case of fire, if the seller has
insurance over the property, the buyer is liable to restore the amount of insurance the seller has paid.
 TO PAY OUTGOINGS [Sec. 55 (5) (d)]:- After transfer of ownership, the buyer is the owner of the property and
entitled to pay all the taxes, rents, and revenues over the property. The seller is not liable for paying any taxes after the transfer of
ownership. The buyer must pay all the liabilities over the property due after the sale.

Buyer’s right before Sale

BUYER’S CHARGE [Sec. 55 (6) (b)]:- This right occurs when the sale doesn’t execute means the seller refuses to sell, and the
buyer already paid some amount in advance. This situation creates buyers’ charges, and the buyer is entitled to get his money
back with interest on it, and interest will be paid from the date of transfer of money from the date of delivery of possession. But if
due to the fault of the buyer sale doesn’t execute, then the buyer doesn’t have a charge on it and can’t claim his money back.

Buyer’s right after Sale

According to Section 55 (6) (a) of the Act, the buyer is entitled to get all the rights over the property inclusive of all rents, profits,
and also any other benefits over the property. The buyer becomes the property owner after completion of the sale or, in other
words, after the transfer of ownership, and he/she is entitled to all the benefits from the date of transfer of ownership.

51. Differentiate between Sale & Agreement

No                Sale Agreement to Sell  

1
Meaning: where the Property Meaning:  where the transfer of property in goods is to take
immediately transferred from seller place in future, from seller to buyer is called ‘Agreement to
to buyer, it is called ‘Sale’.    Sell’.  

2 Definition: Sale can be defined as Definition: in case where the seller agrees with the buyer to
“transfer of ownership in the goods transfer the title of ownership on a future date upon satisfying
by the seller to buyer in exchange of certain condition is called as ‘Agreement to Sale’.  
price paid or promised or partly paid
and partly promised.  

3 Example: ‘X’ sold 10 bags of Wheat Example:  ‘X’ agrees to sell 10 bags of wheat to ‘Y’ for
to ‘Y’ against payment of Rs. 3,000.  Rs.3,000 after getting  the stock.

4 In contract of sale property in goods In agreement to sell, property in goods does not transfer
transfers from seller to buyer immediately
immediately

  

5 Contract of sale is an executed Agreement to Sell is an executory contract

contract

6 It creates right in rem  It creates rights in personam

7 The seller can sue the buyer for case The seller can sue the buyer only for damages but not for the
of breach of contract. price.

8 Sale is liable for the Sale Tax. Agreement to sale is not liable for the Sale Tax.

9 Seller has no right of resale. Seller has right of resale.

 

10 If the goods are destroyed, the loss The loss fall on the seller even though the goods are in the
is borne by the buyer even though possession of the buyer.  
the goods are in the possession of
the seller.

Unit-4

52. Essentials of Lease, Modes of Creating Lease & Determination of Lease

Essentials of Lease
Following are the essentials of Lease:-
 Parties must be competent: The parties in a lease agreement should be competent to enter into a contract. Lesser should be
entitled to a property and have absolute rights over that property.
 Right of possession: Ownership rights are not transferred in a lease, only the possession of the property is transferred.
 Rent: Consideration for a lease can be taken in the form of a rent or premium.
 Acceptance: Lessee, who is to get the interest in the property after lease, has to accept the lease agreement along with the time
period and terms & conditions imposed on the transfer.
 Time Period: Lease always takes place for a particular time period which is to be specified in the lease agreement. It can be
relaxed at the option of the lessor.

Modes of Creating Lease

Section 107 states about lease how made. This section covers three aspects:-
1. When there is a lease of Immovable property for a term of 1 year or more – This can only be made by a registered deed.
2. All other leases of Immovable property – Can be either made by a registered deed or an oral agreement or settlement along
with the transfer of possession of that property.
3. When the lease is of multiple properties that require multiple deeds, it will be made by both the parties of the lease.
Case Law:- In the case of Punjab National Bank v. Ganga Narain Kapur (1994), Court held that if the lease is done through an oral
agreement, then the provisions of Section 106 will apply.

Determination of lease
Section 111 states about the determination of the lease, which lays down the ways in which lease is terminated:-
1. Lapse of time:- When the prescribed time of the lease expires, the lease is terminated.
2. Specified event:- When there is a condition on time of lease depending upon a happening of an event.
3. Interest:- Lessor’s interest to lease the property may cease, hence resulting in the termination of the lease.
4. Same owner:- When the interest of both lessor and lessee are transferred or vested in the same person.
5. Express Surrender:- This happens when the lessee ceases to have an interest in the property and comes into a mutual
agreement with the lessor.
6. Implied Surrender:- When the lessee enters into a contract with another for the lease of property, this is an implied surrender of
the existing lease.
7. Forfeiture:- There are three ways by which a lease can be terminated:
 When there is a breach of an express condition by the lessee. The lessor may get the possession of the property back.
 When lessee renounces his character or gives the title of the property to a third person.
 When the lessee is termed as insolvent by the banks, and if the conditions provide for it, the lease will stand terminated.
8. Expiry of Notice to Quit:- When the notice to quit by the lessor to the lessee expires, the lease will also expire.

53. Rights & Liabilities of a Lessee & Lessor

Rights of the lessor are

 A lessor has a right to recover the rent from the lease which was mentioned in the lease agreement.
 Lessor has a right to take back the possession of his property from the lessee if the lessee commits any breach of condition.
 Lessor has a right to recover the amount of damages from the lessee if there is any damage done to the property.
 Lessor has a right to take back the possession of his property from the lessee on the termination of the lease term prescribed in
the agreement.
Case Law:- Paritosh Ghosh vs. Ashim Kumar Gupta (2003)
In this case, the tenant made holes in walls for fixing air cooler, replace brass water caps by plastic caps, in violation of lease
agreement, the eviction of the tenant was held proper.
Liabilities of the lessor
 The lessor has to disclose any material defect relating to the property which the lessee does not know and cannot with ordinary
supervision find out.
 Lessor is bound by the request of the lessee to give him the right of possession over his property.
 Lessor can enter into a contract with the lessee if he agrees to abide by all terms and conditions prescribed in the agreement, he
can enjoy the property for the rest of the time period without any interference with an obligation to pay the rent later on.
Case Law:- Munne Dutte vs. William cumpbell (1869)
In this case the court held that in every case there is an implied contract that Lessor will give peaceful possession of the property
leased to the Lessee.

Rights of the lessee

 Lessee has the right to deduct any expenses he has made for repairs in the property from the rent if the lessor has failed to in
reasonable time.
 Lessee has a right to recover any such payment which a lessor is bound to make by can deducting it from the interest of the rent
or directly from the lessor. He has this right when the lessor has neglected to make that required payment.
 Lessee has a right to detach all things that he may have attached in the property or earth. His only obligation is that he has to
leave the property in the same condition as he received it.
 When a lease is of unspecified duration in the lease agreement, lessee or his legal representative have a right to collect all the
profits or benefits from the crops which were sown by the lessee at that property. They also have a right of free ingress and
egress from such property even if the lease ends.
 Lessee has a right to transfer absolutely the property or any part of his interest in that property by sub-leasing or through
mortgaging. Lessee is not independent of the terms and conditions mentioned in the lease agreement.
 During the period lease is in effect if any alteration is made then that alteration will come under that same lease.
 If a significant part of the property that has been leased is destroyed wholly or partly by fire, by flood, by war, by the violent acts
of the mob or by any other means resulting in its inefficiency of being a benefit for the lessee. If this happens, the lease is
voidable at his option.
There is a proviso to this section that states if the damage is done due to any act of the lessee himself, this remedy will not be
available for him.
Liabilities of the lessee
 Lessee is under an obligation to disclose all related material facts which are likely to increase the value of the property for which
the lessee has an interest in and the lessor is not aware of.
 Lessee is under an obligation to pay the rent or premium which is settled upon in the agreement to the lessor or his agent within
the prescribed time.
 Lessee is under an obligation to maintain the property in the condition that he initially got the property on commencement of the
lease and he has to return it in the same condition.
 If lessee gets to know about any proceedings relating to the property or any encroachment or any interference, then lessee is
under an obligation to give notice to the lessor.
 Lessee has a right to use all the assets and goods which are on the property as an owner would use which is preserving it to the
best of its nature. He is although under obligation to prevent any other person from using that asset or good for any other
purpose from what was prescribed in the lease agreement.
 The lessee cannot attach any permanent structure without the consent of the lessor except for the purpose of agriculture.
 Lessee is under an obligation to give the possession of the property back to the lessor after the expiry of the prescribed term of
the lease.

54. How License is different from Lease?

Following are the differences between Lease & License:-
1. A lease is a transfer of an interest in a specific immovable property, while licence is a bare permission, without any transfer of an
interest.
2. A lease creates an interest in favour of the lessee with respect of the property, but a licence does not create such an interest.
3. A lease is both transferable and heritable, a sub tenancy can be created by the tenant and on the death of the tenant, the
tenancy can be inherited by his/her legal heir, whereas, licence is neither transferable nor heritable.

4. A licence comes to an end with the death of either the grantor or the guarantee, since it is a personal contract, but a lease does
not comes to an end on either the death of the grantor or grantee.
5. A licence can be withdrawn at any time at the pleasure of the grantor but the lease can come to an end only in accordance with
the terms and condition stipulated in the contract of tenancy agreement.
6. A lease is unaffected by the transfer of the property by sale in favour of a third party. It continues and the purchaser has to wait
till the time period for which the tenancy was created is over before he can get the possession, whereas, in case of a licence, if the
property is sold to a third party, it comes to n end immediately.
7. A lessee has a right to protect the possession in his own right. Whereas, a licensee cannot defend his possession in his own
name as he does not have any proprietary right in the property.
8. A lessee in possession of the property is entitled to any improvements or accessions made to the property, while a licensee is
not.

55. How a gift is made?

Section 123 of the Transfer of Property Act, 1882 deals with the manner in which transfer can be made valid. According to the
section, a transfer may be effectuated by following conditions:-
 Transfer of movable property:- The transfer of the movable property can be made valid either by registered instrument signed
aforesaid by the delivery of the possession of the property.
 Transfer of an immovable property:- By a registered instrument signed by or on behalf of the donor, and attested by at least two
witnesses, irrespective of the value of the property.
Unlike the gift of movable property, an immovable property cannot be validly be gifted to any person by delivery of possession
alone.
Case Law:- In case of Wing Commander R.N Dawar V. Shri Ganga (1993), the court held that mere delivery of possession without
instrument cannot confer any title to the done.

56. What are the Essentials of Gift?

Essentials of valid gift are as follows:-
 The gift is transfer inter vivos (between living persons) of any movable or immovable property.
 The gift must be made voluntarily by the donor.
 The gift must not behold any consideration. [ii]
 The gift must be made by the donor to the donee.
 The gift of immovable property must be registered and the movable property can be made valid by delivery of possession or
registered deed.[iii]
 The gift must be accepted by the donee and the acceptance must be during the lifetime of the donee and the acceptance must be
given while the donee was still capable of giving.
 Any acceptance after the lifetime of the donee is void.

57. Can Gift be suspended or revoked? Explain the law relating to revocation of gifts (OR the Circumstances when a
gift may be suspended or revoked)
Section 126 of the Act provides the legal provisions which must be followed in case of a conditional gift. The donor may make a gift
subject to certain conditions of it being suspended or revoked and these conditions must adhere to the provisions of Section 126.
This Section lays down two modes of revocation/suspension of gifts and a gift may only be revoked on the following grounds:-
(1) Revocation by mutual agreement
Where the donor and the donee mutually agree that the gift shall be suspended or revoked upon the happening of an event not
dependent on the will of the donor, it is called a gift subject to a condition laid down by mutual agreement. It must consist of the
following essentials:-
 The condition must be expressly laid down
 The condition must be a part of the same transaction, it may be laid down either in the gift-deed itself or in a separate document
being a part of the same transaction.
 The condition, upon which a gift is to be revoked, must not depend solely on the will of the donor.
 Such condition must be valid under the provisions of law given for conditional transfers. For e.g:- A condition totally prohibiting
the alienation of a property is void under Section 10 of the TPA.
 The condition must be mutually agreed upon by the donor and the donee.
 Gift revocable at the will of the donor is void even if such condition is mutually agreed upon.
(2) Revocation by the rescission (cancellation) of the contract
Gift is a transfer, it is thus preceded by a contract for such transfer. This contract may either be expressed or implied. If the
preceding contract is rescinded then there is no question of the subsequent transfer to take place. Thus, under Section 126, a gift
can be revoked on any grounds on which its contract may be rescinded. For example, Section 19 of the Indian Contract Act makes
a contract voidable at the option of the party whose consent has been obtained forcefully, by coercion, undue influence,
misrepresentation or fraud. Thus, if a gift is not made voluntarily, i.e. the consent of the donor is obtained by fraud,
misrepresentation, undue influence or force, the gift may be rescinded by the donor.
The option of such revocation lies with the donor and cannot be transferred, but the legal heirs of the donor may sue for revocation
of such contract after the death of the donor.
The limitation for revoking a gift on the grounds of fraud, misrepresentation etc. is three years from the date on which such facts
come to the knowledge of the plaintiff (donor).
The right to revoke the gift on the above mentioned grounds is lost when the donor ratifies the gift either expressly or by his
conduct.
Note:- The last paragraph of Section 126 of the Act protects the right of a bonafide purchaser. A bonafide purchaser is a person
who has purchased the gifted property in good faith and with consideration. When such a purchaser is unfamiliar with the condition
attached to the property which was a subject of a conditional gift then no provision of revocation or suspension of such gift shall
apply.