THE TRANFER OF PROPERTY ACT,1882
Dr Shakuntala Misra National Rehabilitation University
THE TRANFER OF PROPERTY ACT,1882
Project on Section 5 of the Transfer of Property Act, 1882
Gaurav Pandey 2015/ B.Com LL.B. / 01 B.Com LL.B. (Hons.) III Year, V Semester Submitted on : 28/10/2017 Dr Shakuntala Misra National Rehabilitation University, Mohan Road, Lucknow,
THE TRANFER OF PROPERTY ACT,1882
TABLE OF CONTENTS Topic Covered
The Transfer of Property Act, 1882: Bare Provision
Page Number
1
1 ACKNOWLEGEMENT
4
TRANSFER OF PROPERTY: AN INTRODUCTION
5
LIVING PERSONS
7
IN PRESENT OR IN FUTURE
9
TO HIMSELF
10
FAMILY SETTLEMENT
11
COMPROMISE
11
PARTITION
12
SURRENDER
13
RELINQUISHMENT
14
CHARGE
14
Bibliography
13
ACKNOWLEGEMENT
I, GAURAV PANDEY, I feel myself highly elated, as it gives me tremendous pleasure to come out with work on the topic “ SECTION 5 OF TRANDER OF PROPERTY ACT ”,.
First of all I express my sincere gratitude to my Professor MRS. VIJETA DUA TANDAN who enlightened me with such a wonderful topic. Without Him, I think I would have accomplished only a fraction of what I eventually did. I thank her for putting her trust in me and giving me a project topic such as this and for having the faith in me to deliver. Her sincere and honest approach have always inspired me and pulled me back on track whenever I went off-track. Maam, thank you for an opportunity to help me grow. I also express my heartfelt gratitude to staff and help for the completion of this project. Next I express my humble gratitude to my parents for their constant motivation and selfless support. I would thank my brother for guiding me.
THANKS YOU.
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THE TRANSFER OF PROPRERTY ACT, 1882 Bare Provision of the Act
Of Transfers of Property by Act of Parties (A) Transfer of Property whether moveable or immovable 5. “Transfer of property ” Defined. – In the following sections “transfer of property” means an act by which a living person conveys property, in present or in future, to one or more other living persons, or to himself, or to himself 1 and one or more living persons; and “to transfer property” is to perform such act. In this section “living person” includes a company or association or body of individuals, whether incorporated or not, but nothing herein contained shall affect any law for the time being in force relating to transfer of property to or by companies, associations or bodies of individuals
2
.
TRANSFER OF PROPERTY: AN INTRODUCTION The word “transfer” is defined with the reference to the word “convey”. This word in English Law in its narrower and more usual sense refers to the transfer of an estate in land; but it is sometimes used in a much wider sense to include any form of assurance inter vivos. The word „conveys‟ in Section 5 of the Indian Act is used in the wider sense referred to above. Transferor must have an interest in the property. He cannot sever himself from it and yet convey it.3 A lease comes within the meaning of the word „transfer‟.4 The words „living person‟ exclude transfers by Wills and the Will only operates after the death of the testator.5
1 2
Ins. by Act 20 of 1929, sec. 6. Ibid.
3
See Mulla, The Transfer of Property Act, 9 th Ed., LexisNexis Butterworths, 2004, p. 73. 4 Kri shna Kumar Khemka v. Grindlays Bank PL C , AIR 1991 SC 899. 5 See topic Living Persons at p. 3.
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In Ma Kyin H one v. Ong Boon H ock ,6 a single Judge of the Rangoon High Court said that the word „transfer‟ is a word of very wide meaning and includes every transaction whereby 5a party divests himself or is divested of a portion of his interest, that portion subsequently vesting or being vested in another party. This meaning of „transfer‟ is supported by the aforesaid definition in the Act. The Legislature has not attempted to define the word „property‟, but it is used in this Act in its widest and most generic legal sense. 6 Section 6 says that „property of any kind may be transferred‟, etc. Thus an actionable claim is property;7 and so is a right to a reconveyance of land.8 Property is not only the thing which is the subject matter of ownership, but includes the dominium or the right or ownership or of partial ownership, and as Lord Langdale said it is the most comprehensive of all terms which can be used inasmuch as it is indicative and descriptive of every possible interest which the party can have. 9 It may be noted that property is essentially a bundle of rights and interests. When a property is transferred, there may be transfer of all the rights in that property or only some of it. All the rights in the property signify ownership or absolute interest. Only some rights or interests in a property would mean partial or limited interest. In Sunil Sidharthbai v. Commissioner of
I ncome Tax ,10 the Supreme Court rightly observed that in general, transfer of property means passing of a right in the property from one person to another. In one case there may be passing of entire bundle of rights from transferor to transferee, but in another case ther e may be transfer only some of such rights. This, if A makes a gift of his house to B, there is transfer of absolute interest of the house. It is a transfer of „property‟. On the other hand, if A transfers the right of enjoyment of his house to B for a certain period it is called a „lease‟. It is transfer of only partial interest in the house but it is also a transfer of „property‟.11
5
AIR 1937 Rang. 47.
6
Bansigopal v. V.K . B anerji , AIR 1949 All. 433. Rudra Perkash v. K rishna, (1887) 14 Cal. 241, 244. 8 Narasingarji v. Panaganti , AIR 1921 Mad. 498. 9 J ones v. Skinner , (1835) 5 LJ Ch. 87, 90. 7
10
AIR 1986 SC 368.
11
Sinha, Dr.R.K., The Transfer of Property Act, 11 th Ed., Central Law Agency, Allahabad, 2010, p. 53.
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LIVING PERSONS The words “living person” can only mean a human being, who is alive and conveys his property to another person. A person, who disposes of his property by will, does not convey it as a living person because the transfer takes effect after his death. There is no present transfer.12 The words are use d as the transfer under the Act must be a deed intra vivos and not by will. According to the Section, both the transferor and the transferee must be living, which includes under Section 13 a person not in existence at the date of the transfer 13. The explanation to the section further includes in the phrase a company or association or body or individuals whether incorporated or not. So does also “person” according to the General Clauses Act, 1897. 14 The expression „inter vivos‟ refers to transfer or conveyance of the property from one living person to another. Thus it is an act between two living persons who are parties to such transaction, which takes place between two. That also is the trust of Section 5 of the Transfer of Property Act. It is significantly more clear and explicit when it says that “transfer of property” means „an act by which is living person conveys property to one or more other living persons.‟ Where property was acquired by or transferred in favor of Secretary of unregistered Society or Club, Secretary of unregistered Club or Society has no legal status to hold or acquire the property in question because Secretary of unregistered Society or Club cannot come within the definition of “living person” within the meaning of Section 5 of the Act. 15 As such the application by members of club claiming right of pre-emption on ground of transfer of adjoining land was not maintainable. 16
12
Row, Sanjiva, The Transfer of P roperty Act, 4 th Ed., Vol. 1, The Law Book Company (P) Ltd., Allahabad, 1989.
p. 113. 13
Section 13 r eads “Transfer for benefit of unborn person. – Where, on transfer of property, an interest therein is created for the benefit of a person not in existence at the d ate of the transfer, subject to a prior interest created by the same transfer, the interest created for the benefit of such person shall not take effect, unless it extends to the whole of the remaining interest of the transferor in the pr operty.” 14 Vakil, Darashaw J., Commentaries on the Transfer of Property Act, 2 nd Ed., Wadhwa and Company Nagpur, New Delhi, 2004. p. 93. 15
Usha Rani K undu v. Agradut Sangha and other , AIR 2006 (NOC) 911 Cal.
16
Sohoni, Vishwas Shridhar, Transfer of Property Act, Pr emier Publishing Company, Allahabad, 2008. p. 66.
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A deity is not included in the definition of person in Section 5 of the Act. 17 If a deity is not a person, the provisions of the Act including Section 3 do not govern a transfer of property made in favor of a deity. 18 An idol is a juristic person capable of holding property, 19 but it is not a „living person.‟ An idol not being a living person, a dedication of land to an idol does not fall within the terms of Section 12220 and need not be made in writing or by a registered instrument under Section 12322 of the Act.21 It has also been said that an idol is only the symbol of the deity and that it would be contrary to the Hindu religion that a deity make an acceptance of worldly goods 22 as discussed in the case below. In Bhupati N ath v. R am Lal ,23 a full bench of the Calcutta High Court dealing with a Hindu will, held that the principle of Hindu Law which invalidates a gift other than to a sentiment being capable of accepting it does not apply to a bequest to the trustees for the establishment of an image and the worship of a Hindu deity after the ancestor‟s death nor does it ma ke such a bequest void. The Full Bench, after examining the Hindu texts and authorities observed that according to the strict Hindu juridical notion there can be no gift in favor of the Gods for in the case of deities there cannot be any acceptance and therefore necessarily any gift. Court has not been regarded as „living person‟ therefore; transfer made by the order to the Court is not a transfer of property within the meaning of Section 5 of the Transfer of Property 24
Act.
17
Ashrafi Devi v. Prem Chand , AIR 1971 All. 457 (464).
18
Ibid.
19
Pramatha Nath v. Jai I ndra Bahadur Singh , (1919) 46 IA 228; 42 All. 158; AIR 1919 PC 55.
20
Section 122 reads “Gift Defined. – Gift is the transfer of certain existing movable or immovable property made voluntarily and without consideration, by one person, called the donor, to another, and accepted by or on the behalf of the done.” “Acceptance when to be made. – Such acceptance must be made during the lifetime of the donor and while he is still capable of giv ing. If the done dies before acceptance, the gift is void.” 22 Section 123 reads “Transfer how effected. – For the purpose of making a gift of i mmovable property, the transfer must be effected by registered instrument signed by or on behalf of the donor, and attested by at least two witnesses. For the purpose of making a gift of movable property, the tr ansfer may be effected either by a registered instrument signed as aforesaid or by delivery. Such delivery may be made in the same way as goods sold may be delivered.” 21 Narasimha v. V enkatalingum, (1927) Mad. 687. 22 See Mulla, The Transfer of Pro perty Act, 9 th Ed., LexisNexis Butterworths, 2004, p. 81. 23 (1910) 37 Cal. 128. 24 Raghubar Singh v. Jai I ndir a Bahadur Singh , AIR 1919 PC 55.
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IN PRESENT OR IN FUTURE The words “In Present of in Future” mean that the conveyance may be one which takes effect immediately on execution or at some distant date, that is to say, the interest of the transferee arises immediately on the execution of the document of at the date fixed by the parties. In Re
Mahomed H asham & Co.,25Martin, J., in holding that Section 5 did not apply to the Presidency Town Insolvency Act, observed: “I am not absolutely sure what the words „in presenter in future‟ refer to. I should have thought grammatically they refer to property. In
Shumsuddin v. Abdul H usein ,26 Jenkins, CJ., remarked, “there is no definition in the Act of „convey‟ or of „property,‟ but It is to be noticed that a transfer means a conveyance of property not only in present but also in future. 27 A transfer of property may take place not only in present, but also in the future, 28 but the property must be in existence. The words „in present or in future‟ qualify the word „conveys‟, and not the word „property.‟ 29 A transfer of property that is not in existence operates as a contract to be performed in the future which may be specifically enforced as soon as the property comes into existence. 30 To sum it up a transfer of a property may be made so as to take place with immediate effect or to take place on a future date. The transferor can make arrangement that the property is vested or accrues to the transferee immediately after the completion of the transfer. He may also make such arrangements in which the vesting of the interest of the property is postponed to a future date. He is free to transfer a property also upon the fulfillment of certain conditions. 31 Some illustrations are given below:34
25
(1922) 24 Bom. LR 861. (1907) 31 Bom. 165. 27 Vakil, Darashaw J., Commentaries on the Transfer of Property Act, 2 nd Ed., Wadhwa and Company Nagpur, New Delhi, 2004. p. 95. 26
28
Sumsuddin v. Abdul H usein , (1907) 31 Bom. 165, 172. J ugalkishore v. Rao Cotton Co, AIR 1955 SC 376. 30 Mohendra v. Kali , (1903) Cal. 265, 274. 29
31
Sinha, Dr.R.K., The Transfer of Property Act, 11 th Ed., Central Law Agency, Allahabad, 2010, p. 52. 34 Ibid.
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•
A makes a gift of his property to B. He does not mention to when B shall get the property and also does not law down any condition. The transfer is present and B gets the property with immediate effect.
•
A transfers his property to B for life and then to C. The transfer in favor of B is present (although he gets only life-interest) but the transfer in favor of C is future transfer.
•
A makes a gift of his watch to B provided that B gets first division in the next examination. Here, although the gift has been declared today but it shall take effect only if B gets first division. Such transfers are called conditional transfers.
The conveyance may, therefore, be present, future or conditional.
TO HIMSELF A transfer of property under Section 5 of the Act requires two „living persons‟, the transferor and the transferee. One cannot transfer a property to himself. But, one can transfer a property to himself in some other capacity. The words „to himself‟ were added to this section by the Amending Act, 1929 to include in the transfer of property also a case where a person makes any settlement of his property in a trust and appoints himself as the sole trustee. 32 Here, the transferor and the transferee are physically the same person but as transferor he has the legal status of settlor whereas as transferee his legal status is that of trustee. Transfer of property as contemplated under this Act carries the same meaning throughout this enactment as it has been defined in Section 5. This definition has limited the scope of the term „transfer of property‟. Unless the above mentioned essential elements are present in transaction, it cannot be regarded as a transfer of property.33
32
Naranbhai v. Suleman, (1975) 16 Guj. LR 289.
33
Sinha, Dr.R.K., The Transfer of Property Act, 11 th Ed., Central Law Agency, Allahabad, 2010, p. 54.
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FAMILY SETTLEMENT Family settlement or family arrangement is not a transfer of propert y. In a joint family property all the members have their specific shares but they are not separated and are held conjointly by all of them. When a family settlement takes place, the already existing specific shares of the members of the family are defined and separated in order to avoid any possible disputes. Thus, in a family settlement there is a mutual agreement between the members of a family to hold their respective shares separately. It simply acknowledges and defines the title for each member.34 In Sadhu Madho Das v. Pandit Mukund Ram,35 the Supreme Court observed that family arrangement is based on the assumption that there is an antecedent title of some sort in the parties and the agreement acknowledges and defines what t hat title is.36 In Ramdeo F oods Products Pvt. Ltd. v. A rvindbhai R ambhai Patel , 37 a memorandum of understanding was executed to resolve the dispute between the members of a family. The Supreme Court held that such memorandum agreed between the family members can be treated as „family settlement‟ and the Court cannot interfere with this. The Court will not “easily disturb it.” Accordingly it was held as f amily settlement and not as a transfer of property. It is not necessary that a family settlement should be restricted to the members of the family upon a particular degree. Such settlements can take place not only among the heirs of a particular class, they can include persons outside the preview of succession.38 In a family settlement since there is no „creation of new title or interest in favor of any member,
there
is
no
conveyance,
therefore,
it
is
not
a
transfer
of
property.
COMPROMISE A compromise of doubtful rights is not a transfer but is based on the assumption that there was an antecedent title of some kind in the parties which the agreement acknowledged and
34
Tek Bahadur v. D evi Singh, AIR 1966 SC 292.
35
AIR 1955 SC 481 Sinha, Dr.R.K., The Transfer of Property Act, 11 th Ed., Central Law Agency, Allahabad, 2010, p. 55. 37 AIR 2006 SC 3304. 38 Zaheda Begum v. Lal Ahmed Khan, AIR 2010 AP 1. 36
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defined.39 The position would be different if such a compromise also transferred properties to a person who has neither a pre-existing title nor a claim to such a title. 40 In other words compromise is not a transfer of property. Compromise means agreement for the settlement of doubtful claims between the parties in respect of some property. Like family settlement, here too the titles or interests of the parties are antecedent or already existing; the compromise deed simply defines them.41 Since there is no conveyance in compromise it is not a transfer of property.
PARTITION A partition of property is not a transfer of property, but is analogous to an exchange 42. In other words partition means separating the parts of co-owned property. If in a property there are several co-owners having, under the law, their respective interests but the whole property is neither used nor enjoyed by them separately then, after the partition each member gets merely the separate right of enjoyment 43. Accordingly it has been held that partition is not really a process by which a joint enjoyment is transformed into an enjoyment severally, and no conveyance is involved in the process as the conferment of a new title is not necessary. 44 It simply effects a change in the mode of enjoyment of property but it is not an act of conveying property from one living person to another. 45 In Mohar Singh v. Devi Charan,46 the Supreme Court explained the legal nature of a partition in the following words: “Partition is not actually a transfer of property, but would only signify the surrender of a partition of a joint right, in exchange for a similar right from the other co-sharer or cosharers.”
39
Balkrishna v. R aghunath, AIR 1951 Nag. 171. Reddiar, MP v. A . Ammal, AIR 1971 Nag. 182. 41 Abbas Bandi Bibi v. Muhammad Raza, AIR 1929 Oudh 193. 40
42
Mulla, The Transfer of Pr operty Act, 9 th Ed., LexisNexis Butterworths, 2004, p. 76. 43 Sinha, Dr.R.K., The Transfer of Property Act, 11 th Ed., Central Law Agency, Allahabad, 2010, p. 56. 44 Chanaderwati v. Lakhmi Chand , AIR 1988 Delhi 13. 45 I ndoji J ethaji v. Kothapalli , (1919) 54 IC 146. 46 AIR 1988 SC 1365.
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