SUBJECT – LAW OF PROPERTY

TOPIC – LAWS RELATING TO APPORTION IN TRANSFER OF

PROPERTY ACT, 1882: A CRITICAL STUDY WITH REFERENCE TO CASE
LAWS.

Supervised By: MISS RITUPARNA DEY

NAME: Azal Ali Rizvi

ROLL NO.: (Admit card No.) -

(Class Roll. No.) - 06
COURSE: BBA/LL.B; Semester- 8TH
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 ACKNOWLEDGEMENT
With profound gratitude and sense of indebtedness I place on record my sincerest thanks to Miss
Rituparna Dey , Indian institute of legal studies, for his/her invaluable guidance, sound advice
and affectionate attitude during the course of my studies.
I have no hesitation in saying that she molded raw clay into whatever I am through her incessant
efforts and keen interest shown throughout my academic pursuit. It is due to her patient guidance
that I have been able to complete the task.
I would also thank the Indian institute of legal studies library for the wealth of information
therein. I also express my regards to the library staff for cooperating and making available the
books for this project research paper.
Finally, I thank my beloved parents for supporting me morally and guiding me throughout the
project work.

Date: Name: Azal Ali Rizvi.

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 TABLE OF CONTENT
ACKNOWLEDGEMENT…………………………………………………………………02

RESEARCH METHODOLOGY

A) Aims and objectives

B) Statement of problem
C) Research questions
D) Mode of citation…………………………………………………………………….04-05

Chapter 1) Introduction…………………………………………………………………….05-06

Chapter 2) Apportionment…………………………………………………………………07-08

Chapter 3) Apportionment of periodical payments ………………………………………09-10

Chapter 4) Apportionment of benefit of obligation on severance……………………...…11

Chapter 5) Apportionment by Estate………………………………………………….......12

Chapter 6) Exceptions to the rule of apportionment by estate………………………..….13

Chapter 7) Conclusion…………………………………………………………………..….14

BIBLIOGRAPHY

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 RESEARCH METHODOLOGY

A) AIMS AND OBJECTIVE: The aims and objective of this project is to understand the
subject matter properly and to understand the concept of project topic, the main purpose
of this project is to know the purpose of the property act. The object of the introduction
of transfer of property act, 1882.

B) STATEMENT OF PROBLEM:
C) RESEARCH QUESTIONS: 1) what is apportionment?
2) What are the rules that govern the apportionment of the
periodical income between transferor and transferee?
3) What is apportionment by time and estate?
4) What are the exceptions to the rule of apportionment by
estate?
D) MODE OF CITATION: A uniform mode of citation is adopted throughout the project.

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 INTRODUCTION
Property Law – The Transfer of Property Act came into existence in 1882. Before that, the
transfer of immovable property was governed by principles of English law and equity. The
preamble of Act sets out the objectives of the legislation. Scope of this Act is limited. It applies
only to transfer by the act of parties and not by operation of law. Also this Act deals with a
transfer of property inter vivos, i.e., a transfer between living persons. It contains transfer of both
movable and immovable property but a major portion of the enactment is applicable to the
transfers of immovable properties only. The Act is not exhaustive.

Section 5 defines the transfer of property

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 and one or
more other 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.

Apportionment means distribution of a common fund between two or more claimants. In a

transfer of property, the transferee gets the property with all its incidental benefits, produce or
income. Where the property yields some periodical income, there must be specific mention of
what portion of its income remains with transferor and what goes to transferee and from which
particular date.

In the absence of any specific mention by a contract to the contrary or local custom, the
distribution or apportionment of the periodical income between transferor and transferee is
governed by rules of

1) Apportionment by time and

2) Apportionment by estate.

Section 36 provides that in a transfer of property all rents, annuities, dividends and other
periodical payments in the nature of income shall be deemed to accrue from day to day and be
apportionable accordingly. Thus, as between transferor and transferee, the periodical income
which the property yields, is to be distributed between transferor and transferee at fixed date on
the basis of its accrual on each date.

37. Apportionment of benefit of obligation on severance.—When, in consequence of a

transfer, property is 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
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property, provided that the duty can be severed and that the severance does not substantially
increase the burden of the obligation; but if the duty cannot be severed, or if the severance would
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.

Illustration
(a) A sells to B, C and D a house situated in a village and leased to E at an annual rent of Rs. 30
and delivery of one fat sheep, B having provided half the purchase-money and C and D one
quarter each. E, having notice of this, must pay Rs. 15 to B, Rs. 7.50 to C, and Rs. 7.50 to D and
must deliver the sheep according to the joint direction of B, C and D.
(b) In the same case, each house in the village being bound to provide ten days’ lab our each year
on a dyke to prevent inundation. E had agreed as a term of his lease to perform this work for A.
B, C and D severally require E to perform the ten days’ work due on account of the house of
each. E is not bound to do more than ten days’ work in all, according to such directions as B,
C and D may join in giving.

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 APPORTIONMENT
Apportionment is a conveyancing term for the division of any outgoing costs on a property, due
at the completion date, between the seller and the buyer.
If a seller has paid a year’s rent in advance, then on completion of a sale the amount will be
apportioned so that the buyer will have to reimburse the seller for the proportion of the rent
calculated from the day after completion until the end of the year. But if the rent is outstanding
the buyer can deduct the proportion which the seller owes for the period from the beginning of
the year to the completion date.
This ensures that the buyer only pays outgoings due from the date when he or she becomes the
owner of the property.
Apportionments are now most commonly found on the sales of leasehold properties, where it is
necessary to apportion ground rent, service charges, insurance premiums and any other payments
which may be due under the lease. On freehold properties outgoings such as Council tax are
apportioned by the council, so will not be handled by Conveyancing Solicitors.
If a property is sold subject to a tenancy, then rent paid by the tenant will be similarly
apportioned as the buyer is entitled to receive rent from the date of completion.
Any apportionments should be set out in a completion statement from the seller's solicitor to the
buyer's conveyance, and both parties should be informed of the relevant amounts.
Section 37 in the Transfer of Property Act, 1882
37. Apportionment of benefit of obligation on severance.—When, in consequence of a transfer,
property is 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; but if the duty cannot be severed, or if the severance would
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. Illustration

A) A sells to B, C and D a house situated in a village and leased to E at an annual rent of Rs.
30 and delivery of one fat sheep, B having provided half the purchase-money and C and
D one quarter each. E, having notice of this, must pay Rs. 15 to B, Rs. 7.50 to C, and Rs.
7.50 to D and must deliver the sheep according to the joint direction of B, C and D.
B) In the same case, each house in the village being bound to provide ten days’ labour each
year on a dyke to prevent inundation. E had agreed as a term of his lease to perform this
work for A. B, C and D severally require E to perform the ten days’ work due on account
of the house of each. E is not bound to do more than ten days’ work in all, according to
such directions as B, C and D may join in giving.

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Apportionment of benefit of obligation on severance.—When, in consequence of a transfer,
property is 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; but if the duty cannot be severed, or if the severance would
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:
1) 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.
2) Nothing in this section applies to leases for agricultural purposes unless and until the
State Government by notification in the Official Gazette so directs.

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 SECTION 36 – APPORTIONMENT OF PERIODICAL PAYMENTS ON
DETERMINATION OF INTEREST OF PERSON ENTITLED: TRANSFER OF
PROPERTY ACT 1882

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 the transferee, to accrue due from day to day, and to be apportion able accordingly, but to be
payable on the days appointed for the payment thereof.

APPORTIONMENT BY TIME:

At common law, there was no apportionment of rent in respect of time. Such apportionment was,
however, in certain cases allowed in England by the Distress for Rent Act 1737, and the
Apportionment Act 1834, and is now allowed generally. Under that statute all
rents, annuities, dividends and other periodical payments in the nature of income are to be
considered as accruing from day to day and to be apportion able in respect of time accordingly. It
is provided, however, that the apportioned part of such rents, etc., shall only be payable or
recoverable in the case of a continuing payment, when the entire portion of which it forms part
itself becomes payable, and, in the case of a payment determined by re-entry, death or otherwise,
only when the next entire portion would have been payable if it had not so determined. Persons
entitled to apportioned parts of rent have the same remedies for recovering them when payable as
they would have had in respect of the entire rent; but a lessee is not to be liable for any
apportioned part specifically. The rent is recoverable by the heir or other person who would, but
for the apportionment, be entitled to the entire rent, and he holds it subject to distribution. The
Apportionment Act 1870 extends to payments not made under any instrument in writing, but not
to annual sums made payable in policies of insurance. Apportionment under the act can be
excluded by express stipulation.
The apportionment created by this statute is "apportionment in respect of time." The cases to
which it applies are mainly cases of either:

1. apportionment of rent due under leases where at a time between the dates fixed for
payment the lesser or lessee dies, or some other alteration in the position of parties
occurs; or
2. Apportionment of income between the representatives of a limited owner and the
remainder-man when the limited interest determines at a time between the date when
such income became due.

Apportionment means distribution of a common fund between two or more claimants. In a

transfer of property, the transferee gets the property with all its incidental benefits, produce or
income. Where the property yields some periodical income, there must be specific mention of
what portion of its income remains with transferor and what goes to transferee and from which
particular date. In the absence of any specific mention by a contract to the contrary or local
custom, the distribution or apportionment of the periodical income between transferor and
transferee is governed by rules of –

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 a) Apportionment by time and
b) Apportionment by estate. This section deals with the rules for apportionment by
time.

Section 36 provides that in a transfer of property all rents, annuities, dividends and other
periodical payments in the nature of income shall be deemed to accrue from day to day and be
apportionable accordingly. Thus, as between transferor and transferee, the periodical income
which the property yields, is to be distributed between transferor and transferee at fixed date on
the basis of its accrual on each date. For instance, A’s house is on rent of Rs 300/-payable at the
end of each month. A sells this house to B on 15th April. Thus B became owner of the house with
effect from April 15. A as the seller is entitled to get Rs. 140/- as rent for 14 days and B the
purchaser shall get Rs 160-/-as rent for 16 days out of Rs.300/- which is rent for the whole
month.

However, this section deals only with the division of periodical income between transferor and
transferee; it does not provide for liability of the lessee or tenant. Thus, in the above illustration,
the tenant would be liable to pay the whole rent viz, Rs 300/- only at the end of the month1.
Further section 36 is applicable only to transfer inter vivos i.e. between two living persons.
Transfers made otherwise e.g. by operation of law, are outside the scope of this section.

1
Lalla ganga ram v. mewa ram, AIR 1922 ALL.275.

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 SECTION 37-APPORTIONMENT OF BENEFIT OF OBLIGATION ON
SEVERANCE

When, in consequence of a transfer, property is 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 favor 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; but if the duty cannot be severed, or if the
severance would 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 the 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.

Illustrations

(a) A sells to B, C and D a house situated in a village and leased to E at an annual rent of Rs. 30
and delivery of one fat sheep, B having provided half the purchase-money and C and D one
quarter each. E, having notice of this, must pay Rs. 15 to B, Rs. 7.50 to C, and Rs. 7.50 to D and
must deliver the sheep according to the joint direction of B, C and D.

(b) In the same case, each house in the village being bound to provide ten days' labor each year
on a dyke to prevent inundation. E had agreed as a term of his lease to perform this work for A,
B, C and D severally require E to perform the ten days' work due on account of the house of
each. E is not bound to do more than ten days' work in all, according to such directions as B,
C and D may join in giving2.

2
https://www.advocatekhoj.com/library/bareacts/transferofproperty/37.php?Title=Transfer%20of%

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 APPORTIONMENT BY ESTATE

Section 36 incorporates apportionment by time and this section deals with apportionment by
estate. Section 37 provides that where an estate is transferred in such a manner that after the
transfer, it is to be divided in several shares then, the obligation of the benefit of property must
be performed in favour of each sharer (owner) in proportion to the value of each share. For
example, A sells his house to B and C. Both B and C contribute to the price of the house in 1/3
and 2/3 shares. The house is on monthly rent of Rs. 300/-. The tenant is under an obligation to
pay, as rent, Rs 100/- to B and Rs.200/-to C. However, this rule is subject to following
conditions:

1) The person under obligation to pay the benefits in proportion to respective shares must
have reasonable notice of the fact that on transfer the estate (property) was divided into B
and C in 1/3 and 2/3 shares respectively if he has no notice of this division of ownership.
This notice may be given by transferor or the transferees.
2) The obligation must be capable of being performed in parts in fovour of each owner. That
is to say, the property is capable of being severed or separated. A sells to B, C and D a
house situate in a village and leased (rented) to E at a rent of Rs 30/per year and delivery
of one fat sheep. B has provided half of purchase money and C and D one –fourth each. E
having notice of this fact must pay Rs 15/- to B and Rs. 7.50 to C and Rs. 7.50 to D and
must deliver the sheep according to the joint direction of B, C, and D because sheep is
not capable of division. Where the obligation cannot be severed, it must be performed for
the benefit of any one so such owner with the approval of others.
3) The severance must not substantially increase the burden of obligation. Apportionment
by estate, in essence, means that the obligation which existed as ‘whole’ before the
transfer shall be severed upon division of ownership of property. This simply severs or
separates an obligation; it cannot put any additional obligation. Thus, under section 37
the burden of obligation must not be increased.

Illustration (b) to section 37 explains this condition. In the above example, if E (tenant) was
required to do ten days labor for the house sold then after severance E has obligation of
performing only ten days labor in all on the direction of B, C and D. he is not bound to do more
than ten days labor3.

3
https://www.google.com/search?q=Exceptions+to+the+rule+of+apportionment+by+estate+tpa&rlz=1C1ASUC_enI
N789IN789&oq=ex&aqs=chrome.0.69i59j69i57j0l4.

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 EXCEPTION TO THE RULE OF APPORTIONMENT BY ESTATE

The rule of apportionment by estate does not apply in the following cases:-

a) Transfer by operation of law- transfer by operation of law or involuntary transfer e.g.

succession, are exempted from this rule. Thus, after the death of a creditor his legal heirs
are only jointly entitled to enforce the claim which such creditor, had he been alive, could
have enforced singly.4
b) Agricultural tenancies- the rule is not applicable to agricultural tenancies because on
transfer, the division of obligation to pay to several owners may cause much
inconvenience and harassment, to agriculturists.

4
Ahansa v. abdul kader, (1902) 25 Mad. 26; kandhaya lal v. chandar, (1885) 7 All.313.

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CONCLUSION

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 BIBLIOGRAPHY
-BOOKS REFERRED-
• DR. SIR HARI SINGH GOUR, THE TRANSFER OF PROPERTY ACT (11th ed.
2008)
• M.R. MALIK, GOYLE'S A COMMENTARY ON THE TRANSFER OF PROPERTY
ACT (2nd Ed.)
• MULLA, THE TRANSFER OF PROPERTY ACT 1882 (10th ed. 2010)
• R.K.SINHA, THE TRANSFER OF PROPERTY ACT (11th ed. 2010)
• VERA P. SARTHI, G.C.V SUBBA RAO'S LAW OF TRANSFER OF PROPERTY
(EASMENTS, TRUSTS AND WILLS) (Reprint ed. 2005)
-WEBSITES ACCESSED-
• www.indlaw.com
• www.manupatra.com

-LEGISLATIONS REFERRED-
• The Transfer of Property Act, 1882
• Indian Registration Act, 1908.

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