UNIT 2 - General Principles of Transfer
UNIT 2 - General Principles of Transfer
TRANSFER OF PROPERTY
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.
Section 6
It specifically speaks about, what may be transferred. Property of any kind may be transferred. however,
section 6 sub-clauses (a) to (i) specifically mention that certain things cannot be transferred. Such a
transfer if undertaken would be invalid in the eyes of the law in India.
Clause (a) of Section 6 of the Transfer of Property Act excludes the mere chance of an heir apparent
succeeding to an estate from the category of transferable property. Spes successionis refers to the
expectation of an heir to succeed to the property of a deceased person.
Under the Act, spes successionis is not considered property that can be transferred, as it is contingent
on the death of a person. The right of succession only arises after the death of the person, and until
then, it remains a mere expectancy.
Sub-Section (b) – 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 he shall build upon
it, he would re-enter — A transfers to C his right of re-entering in case of breach of the covenant not to
build. The transfer is invalid.
Clause (c) - easement cannot be transferred. An easement is a right to use or restrict the use of land of
another in some way.
Example, 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) - 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) – Nature of Interest. Any transfer which is for an unlawful object or consideration is not
permissible under this section. And it is also in consonance with section 23 of the Indian Contract Act,
which provides that consideration or object is unlawful if
Is Fraudulent
It is opposed to public policy
It is forbidden by law.
Is of such a nature that it defeats the provisions of any law.
Transfer of Person Legally Disqualified– A transfer to a person to be legally disqualified to be a
transferee is not permitted. Under section 7 of the said act, the transferee is required to be competent
to the contract and also should not have been disqualified legally.
Clause (i) – Statutory prohibitions on transfer of interest. This section makes it clear that a tenant
having an un-transferable right of occupancy cannot in any way transfer his interest, and this was held
in the case of Shanti Prasad v. Bachchi Devi.
Section 7 enumerates the concept of competency of persons who may be allowed to transfer property.
According to this section, a person is allowed to transfer property if he satisfies two conditions.
The first condition is that the person must be competent to enter into contracts with other persons.
Section 11 of the Indian Contract Act, which specifies the category of persons who may be competent
to transfer.
The second condition is that the person who is willing to transfer property must have title to the property
or authority to transfer it if he is not the real owner of the property.
OPERATION OF TRANSFER
Section 8 of the Transfer of Property Act expresses the concept of operation of the transfer. It states
that the courts must, in the absence of a contrary intention, hold that the transferor indented to transfer
all his interests and legal incidents in the property.
ORAL TRANSFER
Section 9 of the transfer of property act, 1882 elaborates the concept of oral transfer. It mentions that
property may be transferred orally in cases wherein it has not been expressly mentioned that the
property must be by law transferred in writing.
Section 10 of the Transfer of Property Act,1882 lays down the condition restraining the alienation of
the property. According to this section, where the transferee is absolutely restrained from transferring
his interest in his property to another person because of a condition which came along when the
property was transferred to the transferee, then this condition will be made void but the transfer
would remain valid.
Alienation means transfer of the property. Right of disposal is one of the essential features of the
ownership rights. Section 10 incorporates that any restriction on the right of disposal would be against
the essential feature of ownership rights. Accordingly, section provides that if a transfer is subject to a
condition by which the transferee (who now becomes the owner) is absolutely restrained from
disposing of or parting with his interest in the property, the condition is void. In such cases since the
transferee becomes the owner of the property, any restriction limiting his right of disposing the property
would not be binding on him and he would be free to transfer it to anybody by any means.
For the application of this section, the restraint must be an absolute restraint. It must be a restraint that
is imposed while the property is being transferred to the transferee. When there exists a condition
restricting transfers, in terms of section 10, an absolute restraint is void whereas partial restraints are
not. Section 10 would not be attracted only when the restriction as to alienation is only partial. A
stipulation taking away the whole power of alienation substantially is a question of substance and not
of form.
Absolute Restraint
Restraint on alienation is absolute if it totally takes away or curtail right of disposals. This section
applies to a case where property is transferred subject to a condition or limitation absolutely restraining
from parting with his interest in the property. For making such a condition invalid the restraint must be
an absolute restraint.
Illustrations:
A sells his house to B with a Condition that B cannot transfer the house to anyone except C.
The condition here is void because C may be chosen as a person who may never purchase the
property.
A husband settles his properties on his wives subject to a condition that they cannot transfer the
property without his consent. The condition is void as it takes away the power of alienation of
the wives absolutely.
Partial Restraint
Where the restraint does not take away the power of alienation of the transferee substantially but only
limits it to some extent, the restraint is partial. A partial restraint is valid and enforceable.
In Renand v. Tourangeaon it was held that a condition that transferee shall not transfer the property
for a period of twenty years is an absolute restriction and thus void. If it were a condition that transferee
shall not transfer the property for a period of 3 years, it would be a partial restraint and thus valid.
The Supreme Court in Zoroastrian Society’s Case, considered whether the restriction to transfer
property in a co-operative society only to a person possessing a certain qualification or to the society
or with the prior consent of the society, to a person qualified to be a member of the society (a member
of the Parsi zoroastrian faith in that case) amounts to a restraint offending Section 10 of the Act. The
Court held that it did not amount to such a restraint; and that it was at best a partial restraint on alienation
and not an absolute restraint. Fixed price for pur chase under the pre-emption clause would be a
reasonable price entailing only a partial restraint on alienation and not an absolute restraint within the
meaning of section 10.
Exceptions
Section 10 makes two exceptions to the general rule that conditions absolutely restraining alienation
are void. The first exception is for lease and the second is regarding a property which is transferred to
a married woman.
Lease is a transfer of a limited interest where the lessor (transferor) reserves the ownership and transfers
only the right of enjoyment to the lessee (transferee). A lessor can impose a condition that the lessee
will not assign his interest or sublease the property to any other person. Such a condition will be a valid
condition. Such condition, although it is a restraint on the lessee (transferee) against alienation, is valid
and he can not transfer his interest without the consent of the lessor.
In Raghuram Rao v. Eric P. Mathias, the Supreme Court held, in case of perpetual leases, too, any
condition restraining the lessee from alienating leasehold property is not illegal or void. The Court
observed that: In view of the specific exception carved out in case of lease, there is no substance in the
contention that any condition restraining the lessee from alienating leasehold property is not illegal or
void. Thus a condition in a perpetual lease that lessee‘s right is not transferrable , is a valid condition.
A condition in the lease that the lessee shall not sublet or assign his interest to anyone during the tenure
of the lease is valid was held in the case of Raja JagatRanvir v Bagriden.
In the case of A. Rama Rao v A. Thimappa, A condition in the lease deed that the lessee would
compulsorily have to surrender the lease in the event the lessor needs to sell the property was held to
be valid.
2. Married Women
Where a property is transferred to a married woman who is not a Hindu, Muslim or Buddhist, the
transferor can validly impose a condition restraining alienation. Such Condition will not be void under
Section 10. Reason behind such a restraint is to safeguard the interest of the married woman who could
be easily exploited by their unscrupulous husbands.
Where land is transferred by one to another, the transferor should not impose conditions as to how and
in what manner the transferee should enjoy the property.
For Example, Bheem sells his house to Charu and adds a condition that Charu only should reside in
that house, the condition is invalid.
If the condition which is imposed by transferor is for the benefit of another property which he retains
then such a condition is valid.
For Example, Chandru has 2 properties, property X and Property Y. Chandru sells property Y to
Munna and puts a condition that Munna should not construct on property Y more than one storey so
that Chandru’s property X which he retains should have good light and free air.
If a property is transferred to any person adding a condition that if such person becomes
Insolvent he ceases to hold that property. Such a condition is not recognized as valid in law.
This is subject to the exception that if a landlord leases his property he can impose a condition
on the lessee that if the lessee becomes insolvent the lease should come to an end.
TRANSFER FOR BENEFIT OF UNBORN PERSON [Section 13]
Where on a transfer of property, an interest is created for the benefit of a person not in existence at the
date of transfer, subject to a prior interest created by the same transfer, the interest created for the benefit
of such person shall not take effect unless it extends to the whole of the remaining interest of the transfer
in the property. Thus, if a property is given to an unborn person, two conditions should be satisfied:
Example –
A transfers property of which he is the owner to B in trust for A and his intended wife successively for
their lives, and after the death of the survivor, for the eldest son of the intended marriage for life, and
after his death for A’s second son. The interest so created for the benefit of the eldest son does not take
effect, because it does not extend to the whole of A’s remaining interest in the property.
Section 14 of Transfer of Property Act, 1882 deals with the Rule against Perpetuity, also known as Rule
against remoteness of vesting. Perpetuity means “indefinite period” which means this rule is against
the transfer which makes a property inalienable for an indefinite period. Rule against perpetuity is the
rule against the creation of a future remote interest.
Section 14 of TPA – “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.”
In India, section 14 of TPA provides that vesting can be deferred up to life or lives of the last person
plus the minority of the ultimate beneficiary. Minority in India ends at the age of 18 years. After the
existing life or lives, vesting cannot be deferred in India beyond 18 years in any circumstances.
Under English Law, vesting of interest could also be deferred up to life or lives of last person plus a
period of 21 years regardless of the age of minority of final beneficiary and a transfer shall not be void
even though vesting has been deferred beyond 21 years however it shall go effect as if the age of 21
had been substituted for the requirement within the instrument, that may be any fixed period longer
than 21 years.
It may arise by taking away from the transferee his power of alienation (this condition has been
void under section 10 of the Transfer of Property Act).
Secondly, it may arise by creating future remote interest (which has been prohibited under
section 14 of the Transfer of Property Act).
Period of Perpetuity
The period of perpetuity starts from the date when transferor transfers the property, then it covers the
lifetime of the last prior interest holder’s, then the gestation period of the unborn beneficiary, then 18
years.
Starts from the date when transferor transfers the property + lifetime of the last prior interest holder’s
+ the gestation period of unborn beneficiary + 18 years (Age of majority of persons domiciled in India
under section 13 of the Majority Act, 1875).
The period of gestation means the period during which the child remains in mother’s womb after being
conceived i.e., normally 9 months or 280 days plus the minority of the ultimate beneficiary.
This period is called the perpetuity period and the vesting of the property in the transferee cannot be
postponed beyond this period.
Minority in Rule of Perpetuity
Minority in India terminates at the age of 18 years or when the minor is under the supervision of court
at the age of 21 years. But in the case of Saundara Rajan vs. Natarajan, AIR 1925 P.C. 244, the privy
council held that since at the date of the transferor it is not known whether or not a guardian would be
appointed by court for the minor in future, for purposes of section 14, the normal period of minority
would be of 18 years. So, the vesting of the interest in the property can be postponed only up to the life
of the previous interest holder and the minority i.e. 18 years of the beneficiary.
Section 18 of Transfer of Property Act – Section 18 of TPA provides protection from rule against
perpetuity when the transfer is in favor of public i.e. religion, knowledge, healthcare, safety or any
other object beneficial to mankind.
In Nafar Chandra vs. Kailash, (1921) the shebiats of a temple agreed to appoint the family of pujaris
from generation to generation and make provisions for expenses and remuneration of the office. The
court held that this agreement is valid and not affected by the rule against perpetuity.
Personal Agreements – The rule of perpetuity does not apply to the personal agreements that do not
create interest in property.
Contract of pre-emption – This rule does not applies to the contract where there is an option of
purchasing a land by family members.
Vested Interests – This rule does not affect the vested interest as for this an interest has to be existed.
Renewal of lease agreements – This rule also does not affect the agreements of renewal of lease.
Where by reason of any rules or the rules contained in Sections 13 and 14, interest created for the benefit
of a person or 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 or upon failure of such prior interests also fail.
Example, property is transferred to A for life then to his unborn son B for life and then to C, who is
living at the date of transfer, absolutely. Here B is given only a life interest. So the transfer to B is
invalid under Section 13. The subsequent transfer to C absolutely is also invalid, because according to
Section 16, if a prior transfer fails, the subsequent transfer will also fail.
ACCUMULATION OF INCOME [Section 17]
Section 17 does not allow accumulation of income from the land for an unlimited period without
the income-being enjoyed by owner of the property. The law allows accumulation of income for a
certain period only. The period for which such accumulation is valid is –
the life of the transferor, or
eighteen years from the date of transfer.
Any direction to accumulate the income beyond the period mentioned above is void except where it is for
the payment of the debts of the transferor or any other person taking any interest under the
transferor,
portions for children or any other person taking any interest in the property under the
transfer, and
for the preservation and maintenance of the property transferred.
Vested Interest
An interest is said to be vested when it is not subject to any condition, precedent, i.e., when
it is to take effect on the happening of an event which is certain. A vested interest is transferable
and heritable. The word “vested” is used in two different senses. It may mean “vested in
possession” or “vested in interest”.
For Example, a gift to Raju on the death of Shyam creates a vested interest in Raju even during the life
time of Shyam for there is nothing more certain than death
“vested in possession” – A right is said to be “vested in possession” when it is a right to present
possession ofproperty.
For Example, if a land is given to Raju for life with a remainder to Shyam, Raju’s right is vested in
possession.
“vested in interest” – A right is said to be “vested in interest” when it is not a right to present
possession but a present right to future possession.
For Example, if a land is given to A for life with a remainder to B, A’s right is vested in possession,
B’s right is vested in interest.
Contingent Interest
An estate is contingent when the right to enjoyment depends upon the happening of an event which may
or may not happen.
Example, a gift to Salman on the marriage of Aishwarya creates a contingent interest.
Ground of
Vested Interest Contingent interest
Difference
Section 19 of the Transfer Section 21 of the Transfer of
Section
of Property Act, 1882. Property Act, 1882.
When an interest is created on the transfer of property but is made to depend on the fulfillment
of a condition by the transferee, the transfer is known as a conditional transfer.
Such a transfer may be subject to a condition precedent or a condition subsequent.
Essential conditions
a) the condition must not be impossible to fulfil.
b) the condition must not be forbidden by law.
c) it should not be of such a nature that if permitted it would defeat the provisions of any law.
d) it should not be fraudulent.
e) the condition should not be such as to cause injury to the person or property of another.
f) the condition should not be immoral or opposed to public policy.
In the case of condition precedent, the In the case of subsequent, it need not be so,
condition precedent must be valid in and the invalidity of the conditions can be
law. ignored.
Election may be defined as “the choosing between two rights where there is a clear intention
that both were not intended to be enjoyed.
The foundation of doctrine of election is that a person taking the benefit of an instrument must
also bear the burden.
The doctrine is based on the principle that “a donee shall not be allowed to approbate and
reprobate and that if he approbates, he shall do all in his power to confirm the instrument which
he approbates”
Illustration: Suppose, a property is given to you and in the same deed of gift you are asked to transfer
something belonging to you to another person. If you want to take the property you should transfer your
property to someone else, otherwise you cannot take the property which is transferred to you by
someone
If the transferor dies before the person upon whom the benefit is conferred and he rejects the
transfer, then the representatives of the transferor will have to satisfy the disappointed person
out of the property which was the subject of transfer.
Illustration: Akshay transfers his property worth `1,000 and by the same instrument asks Binod to
transfer his property worth `500 to Chinmay. Here, if Binod does not accept, he will not take Akshay’s
property and the property will revert to Akshay. If Akshay is alive, it is for him to give some property
to Chinmay. But if Akshay dies before Binod has made his election then the heirs of Akshay have to
compensate Chinmay from Akshay’s property to the extent of `500.
The question of Election arises only when a transfer is made by the same document. If the
transferor makes a gift of property by one deed and by another asks the donee to part with his
own property then there is no question of election.
Illustration: Arjun transfers his land to Bilal by a document. Arjun by another document transfers
Bilal’s property to Neha. In this case Bilal can retain the property given to him and refuse to transfer
his property to Neha as the two transfers do not form part of the same document
The doctrine of election is applicable if the benefit is given directly. A person taking no benefit
directly under a transaction but deriving a benefit under it indirectly need not elect.
Illustration: A transfers his property to B’s son and by the same instrument transfer B’s property to C.
In this case B need not to elect and can keep his property. His son can have his gift.
The word 'ostensible' can be explained as something that appears to be true but is not actually true. The
ostensible owner of a property is thus cannot be a real owner of a property. He can merely represent
himself as the real owner to the third parties or to the public at large. The ostensible owner of a property
possesses all the rights of ownership in a property but without being the real owner of the same. These
rights are acquired by him through the explicit or implied consent of the real owner. He is the full but
unqualified owner and the real owner remains the qualified owner of the property.
The doctrine of transferring a property by ostensible owner can be seen as an exception to the
maxim "nemo dat quod non habet" i.e. no one has the power to confer a higher right on the property
that is possessed by himself.
Section 41 of the Transfer of Property Act states that when a person is acting on the express/implied
consent of a person who is interested in an immovable property, the person who is acting on such
consent is considered to be the ostensible owner of the property. He is in the possession of all the indicia
of ownership like the right to possession, title, documents, goodwill etc. He has the power to transfer
the property for a consideration to the transferee. The transferee should act in good faith and should
believe that the ostensible owner is the actual owner of such property.
Essential Requirements:
The transferor is the ostensible owner
He is so by the consent express or implied, of the real owner
The transfer is for consideration
The transferee has acted in good faith taking reasonable care to ascertain that the transferor had
power to transfer
Transfer of property ownership might be involuntary or voluntary. It is a voluntary transfer when the
owner of the property transfers it willingly. It might be accomplished in the following ways:
When a court seizes a person’s property, it is known as involuntary transfer or involuntary alienation.
This approach may also alienate the joint family’s assets or a co-undivided partner’s participation in
the estate. The provision under Section 41 of the Act only pertains to voluntary transfers. It is not
applicable upon coercive, involuntary, or legally compelled transfers, such as judge-ordered auction
sales.
Burden of proof
The burden of proof for the transferee seeking immunity under this provision is on the transferee to
show that he or she was an ostensible owner. He must establish that the transferor is the property’s
ostensible owner or that the transaction is a Benami transaction. He must also show that he took
reasonable precautions to protect his interests. The burden of proof transfers to the other side if the
other party claims to have evidence leading to a starting point of inquiry that, if pursued or studied,
would have led to the disclosure of truth. If a person claims ownership of property that has been
transferred to another person, he must prove it.
The true owner cannot assert his ownership rights against the benami owner under any circumstances.
The Benami Transaction (Prohibition) Amendment Act, 2016 prohibits the transfer by an ostensible
owner and has made it illegal and unlawful with certain exceptions.
In the case of Thakur Krishna vs. Kanhayalal, it was held by the court that any property that is held
or owned in the name of benami owner is liable to be acquired by the competent authority of the
government without paying any kind of remuneration. Although the Benami Transaction (Prohibition)
Amendment Act, 2016 has provided certain exception to the said rule which are as follows:
The property held by a Karta or any member of an HUF and such property is held for the
benefit or gain of the other members of such HUF and the same is purchased by a known
source of the HUF will not amount to a Benami transaction under the Act.
A person who purchases property in the name of his spouse or any child is not subject to the
benami transaction restriction. However, the individual's known ancestors must pay the
consideration.
The property that is held by a person in the capacity of a trustee for the benefit of another
person will not amount to a benami transaction / property.
When the property of a person is jointly held by the brother, sister, lineal descendent or
antecedent and the consideration for the same is paid by a person who is a known individual
to the owner.
The Supreme Court noted in Jayadayal Poddar v. Bibi Hazara (1974) that whether a person is an
ostensible owner is a subjective matter that depends on specific facts and circumstances. When
determining whether a person is an ostensible owner or not, the following factors must be
considered:
Case Laws:
Ramcoomar Koondoo v. John and Maria McQueen was the first lawsuit to employ the
notion of ostensible owners.
In this case, the plaintiff’s estate was inherited by will, but she later discovered that the estate
had previously been purchased in her name by someone else, who then sold the estate to a third
party in good faith. The estate’s entire transaction was a “Benami” deal, which meant that no
one else knew about it save the person who sold it. The plaintiff filed a claim against the third
party to collect the estate. It was decided that the plaintiff could not reclaim possession of the
estate from the third party since the transfer was legal.
Shafiquallah v. Samiulah
When a property owner died, his illegitimate sons took ownership of the property, even though
they were not legally entitled to it. To reclaim the property, the owner’s legal heirs launched a
lawsuit against the illegitimate sons. The illegitimate sons, on the other hand, sold the property
to a third party while pretending to be the legal owners. The court ruled that the illegitimate
sons did not have the express or implied approval of the true owner
Nirvas Purve v. Mst. Tetri Pasin
While on pilgrimage, a husband registered his land in the revenue records under his wife’s
name. He then permitted her to take out a mortgage on the property. When the husband moved
out, the wife sold the property to a third party, who paid off the mortgage. The court ruled that
the spouse could not reclaim or redeem the land from the buyer if the buyer acted in good faith
and took reasonable steps to verify the land’s ownership.
The doctrine of feeding the grant by estoppel has been integrated under section 43 of the Transfer of
Property Act, 1882. The doctrine under examination in this note is a blend of two principles of law;
estoppel and equity, both of which are aimed at protecting the bona fide transferees in case of
misrepresentation on part of the transferors regarding the title of the property in question.
This Section shall not impair the right of transferees in good faith for consideration without
notice of the existence of the said option.
Essential Conditions:
Illustration:
A, a Hindu, who has separated from his father B, sells to C three fields, X, Y and Z, representing that
A is authorised to transfer the same. Of these fields, Z does not belong to A, it having been retained
by B on the partition, but on B’s dying, A as heir obtains Z. C, not having rescinded the contract of
sale may require A to deliver Z to him.
This doctrine has been explained in the landmark judgment of Jumma Masjid Mercara v
Kodimaniandrav as, “Whenever a person transfers property to which he has no title on a representation
that he has a present and transferable interest therein, and acting on that representation, the transferee
takes a transfer for consideration. When these conditions are satisfied, the section enacts that if the
transferor subsequently acquires the property, the transferee becomes entitled to it, if the transfer has
not meantime been thrown up or cancelled and is subsisting.”
Exceptions:
If both the transferor and the transferee know about the true situation and collude to enter into a
transaction which is invalid in law, knowledge of the transferee becomes material and Sec. 43 cannot
be availed by him.
The proviso to section 43 of the Act limits the scope of applicability of the section in situations where
the transferor has transferred the property to another bonafide purchaser for consideration. The
purchaser should have acted in good faith while purchasing the property with no knowledge about the
previous transaction, only then can this exception be applied.
Section 51 of the Property act lays down “when the transferee of immovable property makes any
improvement on the property, believing in good faith that he is absolutely entitled thereto, and he is
subsequently evicted therefrom by any person having a better title, the transferee has a right to require
the person causing the eviction either to have the value of the improvement estimated and paid or
secured to the transferee, or to sell his interest in the property to the transferee at the then market value
thereof, irrespective of the value of such improvement.
The amount to be paid or secured in respect of such improvement shall be the estimated value thereof
at the time of the eviction.
When, under the circumstances aforesaid, the transferee has planted or sown on the property crops
which are growing when he is evicted therefrom, he is entitled to such crops and to free ingress and
egress to gather and carry them”.
Essential Requisites:
The subject of transaction between the transferor and the transferee must be immovable
property.
The transfer of property must be in absolute favour of the transferee.
The transferee in good faith must consider himself competent enough to make the
improvements.
The transferee has sown plants, crops or made any other additions to the land.
The transferee is evicted by someone who holds a better title.
The right of transferee to be compensated for the improvements by seeking the amount spent
or the interest in the property.
In Harilal Ranchhod v Gordhan Keshav (1927), the property belonging to the minor was sold by his
guardian to Ram without seeking the permission of the court. Ram paid the consideration and in good
faith renovated the house, considering himself as the owner of the property. The minor, on attaining
majority evicted Ram. The court favoured the minor but at the same time also instructed the minor to
compensate Ram.
Improvements
Improvements by defective title holders does not mean ordinary changes to an old property or other
operational changes. Improvements mean changes that enhance the value of the property and add to its
value as a marketable subject. Thus, improvements are not ascertained merely on the basis of the money
spent by the person making the improvements to the property.
The value of the improvements made by the person has to be ascertained at the time of eviction, though
the amount spent on the improvements is not decisive of the market value of the property at which it is
to be sold.
Illustrations:
X is the legal guardian of Y, a minor. X alienated Y’s property in favour of Z and Z considering
himself the absolute owner made improvements to the property. Y on attaining majority
demanded Z’s eviction. Z can avail the protection under this doctrine and can demand either
compensation from the real owner or an interest in the property.
A land had been empty and barren since 10years, X without any authorization built a colony
over it. The government demanded eviction on the ground that X had trespassed. X cannot avail
the benefit of this doctrine under such circumstances
X rented his property to Y for a subsequent amount per month. He later on mortgaged it to Z,
Y not knowing the same continued to pay the rent to X. X cannot be asked to pay the rent again
to Z as he acted in good faith and is protected under this doctrine.
Illustration: A and B are litigating in a Court of law over property X and during the pendency of the
suit A transfers the property X to C. The suit ends in B’s favour. Here C who obtained the property
during the time of litigation cannot claim the property. He is bound by the decree of the Court wherein B
has been given the property.
Essentials:
There must be a suit or proceeding in a court of competent jurisdiction
The suit or proceeding must not be collusive
The litigation must be one which right to immovable property is directly and specifically in
question
There must be transfer or dealing with the property in dispute by any party to the litigation
Such transfer must effect the rights of the other party that may ultimately accrue under the
terms of the decree or the order
Exceptions:
In the case of R. Viswanatha Pillai v. S. Sankaranarayana Pillai the Supreme Court held that
the doctrine of lis pendens applies only to immovable property and not to movable property.
Therefore, the doctrine cannot be invoked to protect the rights of a purchaser of movable
property during the pendency of a suit.
In the case of Hardev Singh v. Gurmail Singh, the Court ruled that Section 52 of the Transfer
of Property Act, would not make void or unlawful any sale of the contested properties, but only
puts the purchaser beyond the binding limits of the judgment on the disposition of the conflict.
Where a person transfers his property so that his creditors shall not have anything out of the
property, the transfer is called a fraudulent transfer.
A debtor in order to defeat or delay the rights of a creditor, may transfer his property to some
person, who may be his relative or a friend.
Such transfer will be voidable at the option of the creditor.
The transfer is valid so long as the creditor does not challenge it in a Court of law and gets a
declaration that the transfer is invalid.
Once the creditor sues the debtor and says that the debtor has the intention to deceive him, the
transfer can be declared invalid by the Court
Mere preference of one creditor over the others is not fraudulent under the Section, even if the
whole property is so transferred and nothing is left for the other creditors.
The doctrine of part performance is inserted by the Transfer of Property (Amendment) Act, 1929 and is
based on the equitable doctrineof part performance in English law which is known as equity of part
performance. After the Mohammed Musa V. Aghore Kumar Ganguli (1914) 42 Cal. 801, the privy
council held that equity of part performance could be applied to Indian cases.
Meaning:
The doctrine of part performance is a equitable doctrine. It means the transferee performed the contract
partly by taking of the possession or any part thereof, readyto perform the contract wholly but the
transferor refused to perform the contract. Therefore, the readiness and willingness to perform the contract
is necessary for the applicability of this doctrine. In such circumstances, the part performance by the
transferee is assumed to be done which ought to have been done.
If a person has taken possession of a property and has performed acts in furtherance of a contract for
the transfer of that property, they may be protected and allowed to enforce their rights to the property.
Essentials:
There must be the valid contract between the parties to the contract totransfer any immovable
property.
In English Law, the part performance of the contract is not required to be writing or signed by the
transferor. It is an equitable right and can be used to enforce the right and to defend the possession of the
transferee which created title in the transferee.
In Indian Law, the doctrine of part performance deals with Sec.53A of the Transfer of Property Act, 1882.
For the applicability of part performance, the contract is required to be in writing and signed by the parties.
It is a statutory right and is used only todefend the possession of the transferee. It does not create title to the
transferee.
Case Laws: