PROPERTY LAW

I INTERNAL ASSESSMENT

ANALYSIS OF THE NATURE AND SCOPE OF THE TRANSFER

OF PROPERTY ACT, 1882

NAME: SRISHTI VALLABHA KUMAR SUBMITTED TO:

CLASS: YEAR III, B.A., LL.B. (Hons.) DR. SANTOSH H. AGHAV
DIVISION: C
PRN: 16010125231

INTRODUCTION
The Merriam-Webster English Dictionary defines the term property as ‘something owned or
possessed’ and transfer as ‘to make over the possession or control of’. A common man, from
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these two descriptions, would infer that the meaning of ‘transfer of property’ would be to
hand over the possession and/or control of something he owns or possesses, to another
person. The transfer of properties in India is governed by the Transfer of Property Act, 1882
(hereinafter referred to as “the Act”).

HISTORICAL DEVELOPMENT

Customary laws governed the transfer of property before the advent of British Rule. Disputes
were resolved by the traditional judicial system of panchayats, which proved to be effective
as the people presiding over such matters were well-informed about the disputes, the laws
involved, and familiar with the litigants. The efficacy of this system was put to doubt when
the Britishers established informal courts in India. The impartial judges who decided the
disputes were unfamiliar with the litigants as also the social system of India. Identifying the
need for a concrete and ascertainable law relating to property, these courts began applying the
already existing English Law to the Indian scenario with such modifications as was necessary
to suit the prevailing conditions.1

However, social and cultural differences between England and India made such an
application inappropriate, even with the changes. What further highlighted the need for
concretization of laws was the varied and liberal application of the principles of justice,
equity and good conscience by the judges of the high courts, in the absence of clear and
unambiguous laws, giving rise to completely opposite principles. Even the Privy Council
noticed such fallacies and urged the legislative authorities to take steps in this direction.2

The First Law Commission3 was appointed by the British Queen to primarily codify civil
laws which included the ones related to transfer of property. A Draft Bill was prepared in
1870 and presented in the Legislative Assembly after modifications made by the then
Secretary General of State for India. It was then referred to the select committee, was revised
and then presented to the public for scrutiny. Based on the suggestions, it was redrafted and
referred to the Second Law Commission. It was finally passed on 17 th February 1882 and was
brought into force on 1st July 1882.

1
Saxena, Dr. Poonam Pradhan, Property Law, page 1 (2nd ed. 2011) .
2
Mulla, The Transfer of Property, page xi (9th ed.) .
3
The First Law Commission consisted of Lord Romilly MR; Sir Edward Ryan, Chief Justice of Bengal; Lord
Sherbrooke; Sir Robert Lush and Sir John Macleod.

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The basic content of the Bill was based on English law of real property but since it was meant
for India, the portions that had a historical context of English law were expunged and the
remaining provisions were revamped to suit Indian conditions.

Soon after the coming into force of the Act, various conflicting case laws developed.
Understanding the need to further elucidate the laws, no less than twelve Amendments were
made to the Act to obliterate any remaining ambiguities in the same. Seeing that this was of
no use for conflicts continued to arise in its interpretation, it was understood the main fault
lay in the inept drafting as well as the substance of the law. Therefore, the legislative of the
country prepared a Bill consolidating the necessary changes and introduced it to the select
committee. The amending act was finally passed in 1929 along with alterations to several
other enactments to ensure co-existence of conflicting provisions and remove confusion.

NATURE OF THE ACT

The Act bears the following characteristics:

1. The act only defines certain expressions used in the context of transfer of properties
and amends the rules, that then existed, to govern the same. It does not purport to
introduce any new principles of law.4
2. A harmony has been brought among the Acts governing transfer of property inter
vivos and those applicable in case of devolution, through intestate or testamentary
succession etc. This tries to remove any confusion and conflicts among various
parallel enactments.
3. The Act is not exhaustive but is rather descriptive; it is not a complete code. 5 It only
deals with certain aspects of transfer of property and does not cover the entire law.
4. Legislative competence – Transfer of property, with the exception of agricultural
lands, is a subject specified in the Concurrent List (List III) under the Seventh
Schedule of the Constitution of India, by virtue of entry 6. States alone have law
making powers in cases of agricultural lands by virtue of entry 18 of the same list.
5. The whole of India comes under the purview of the Act.
6. Any provision in the Second Chapter of the Act affects any rule of Mohammedan
Law.
7. The Act is a general law and not specific in nature.

4
Tajjo Bibi v. Bhagwan, (1899) 16 All 295.
5
Venkatalingam v. Parthasarthy, AIR 1942 Mad 558.

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SCOPE OF THE ACT

The Preamble of the Act sets out its purpose as ‘to define and amend (certain) parts of the law
relating to transfer of property by acts of parties’ 6. The words ‘by acts of parties’ shows that
the law applies only to transfers made by acts of parties and does not govern those transfers
that are an effect of operation of the law. Thus, it does not govern transfers by way of court
auction,7 or those made by intestate8 or testamentary succession9.

Special laws oust the application of the Act. If the Parliament has made any special laws to
regulate certain kinds of transfers, the Act will cease to apply in these situations. For
example, the Securitisation and Reconstruction of Financial Assets and Enforcement of
Security Interests Act, 2002, to secure bank loans from companies.10

LEGAL INTERPRETATION OF ‘PROPERTY’

Property can be classified into several categories as shown below.

Property

Tangible & Real & Corporeal & Movable &

Intangible Personal Incorporeal Immovable

For the purposes of the Act, the last categorization i.e., movable and immovable property is
what is relevant. The term property has not been defined anywhere in the Act 11, but it has
always been given the widest meaning and interpreted in the widest and most generic sense 12.

6
See the Preamble, The Transfer of Property Act, 1882.
7
Dinendronath Sanyal v. Ramcoomar Ghose, (1881) ILR 7 Cal 107.
8
Kishori Lal v. Krishna Kamini, (1910) ILR Cal 377.
9
Rajaparthasarthi v. Raja Venkatadasi, AIR 1922 Mad 457.
10
Mardia Chemicals Ltd. v. Union of India, (2004) 4 SCC 311.
11
See The Transfer of Property Act, 1882.
12
Mata Din v. Kazim Hussain, (1891) ILR 14 Cal 241.

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Property thereby indicates every possible interest a person may have 13, either in physical
objects or interests, rights and/or benefits derived out of such physical objects14.

The word immovable means anything that is fixed, motionless and not capable of being
moved. Movable means that which can change positions. Although consisting of two separate
meanings, there is an overlap of the two definitions. For example, a fan or light bulb that is
fixed to the wall would be considered immovable but its nature changes once it is dismantled
or the fixture is removed. ‘Immovable property’ is defined under Section 3 of the Act as
follows:

“3. Interpretation clause – In this Act, unless there is something repugnant in

the subject or context,-

" immovable property" does not include standing timber, growing crops or
grass;”

The Act under this section provides a negative definition to the term ‘immovable property’.
The expression ‘things attached to earth’ has been explained in the aforementioned section as
things rooted in the earth (e.g.: trees, shrubs, etc.), things such as walls, buildings that are
embedded in the earth and those that are permanently attached to things that are embedded in
the earth for permanent enjoyment. Thus, it can be inferred that immovable property includes
land and the benefits derived from it, things rooted and embedded in the earth and that which
is attached to those embedded in the earth. But timber, growing crops and grass are excluded
from the purview of this definition.15

TRANSFER OF PROPERTY

MEANING OF TRANSFER OF PROPERTY

Section 5 of the Act defines transfer of property as follows:

“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 and one or
more other living persons; and "to transfer property" is to perform such act.

13
Jones v. Skinner, (1835) LJ Ch 87, 90.
14
Ramshankerlal v. Ganesh Proshad, (1907) ILR 29 All 385.
15
Supra, note 1, page 11.

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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.”

Property can be transferred from one person to another through several modes such as a will
or testament, gift, court sale, relinquishment etc. But not all such transfers attract the
application of the Act. The definition provided in Section 5 clearly mentions that this is an
act of a living person whereby he conveys the existing property to one or more living
persons. Transfers that take place in ways other than the ones covered in this Section are
governed by other enactments.

1. Act of a living person – The Act governs only those transfers made inter vivos or
between living persons. The term living person includes a company, or association, or
a body of individuals, whether incorporated or not. 16 One point to be noted is that the
Act does not affect the laws in force relating to the transfer of properties to or by
corporations, association or a body of individuals or under a special statute.17
2. Conveyance of property – Conveying the property involves creating a new title or
interest in favor of the transferee. The transferee acquires the title to or interest in the
property through an instrument of transfer. Such a transfer can be made by means of a
sale, mortgage, lease, exchange, or gift.
In Harish Chandra v. Chandra Shekhar18, it was held that a release-deed is a
conveyance, hence a transfer of property. If the release deed states that the releaser
was the owner and it shows an intention to transfer his title and its operative word
sufficiently conveyed the title it would amount to transfer.
The term ‘in present or in future’ relates not to the property but to the conveyance of
the same. It means that the property intended to be transferred must be in existence
but the conveyance may take place at a later date. Thus, ‘sale’ and ‘agreement to sale’
come under the ambit of transfer as the former is an executed contract and the latter,
an executory contract.19

16
Naranbhai v. Suleman, (1975) 16 Guj LR 289.
17
Supra, note 10.
18
AIR 1977 All 44
19
Dharma Naika v. Rama Naika, (2008) 14 SCC 517: AIR 2008 SC 1276

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WHAT MAY BE TRANSFERRED

Section 6 of the Act describes what can be transferred and also lays down exceptions to this
rule.

“6. What may be transferred – Property of any kind may be transferred,

except as otherwise provided by this Act or by any other law for the time
being in force, -

(a) The chance of an heir-apparent succeeding to an estate, the chance of a

relation obtaining a legacy on the death of a kinsman, or any other mere
possibility of a like nature, cannot be transferred.

(b) A mere right of re-entry for breach of a condition subsequent cannot be

transferred to anyone except the owner of the property affected thereby.

(c) An easement cannot be transferred apart from the dominant heritage.

(d) An interest in property restricted in its enjoyment to the owner personally

cannot be transferred by him.

(dd) A right to future maintenance, in whatsoever manner arising, secured or

determined, cannot be transferred.

(e) A mere right to sue cannot be transferred.

(f) A public office cannot be transferred, nor can the salary of a public officer,
whether before or after it has become payable.

(g) Stipends allowed to military, naval, air-force and civil pensioners of the
government and political pensions cannot be transferred.

(h) No transfer can be made (1) insofar as it is opposed to the nature of the
interest affected thereby, or (2) for an unlawful object or consideration within
the meaning of section 23 of the Indian Contract Act, 1872 (9 of 1872), or (3)
to a person legally disqualified to be transferee.

(i) Nothing in this section shall be deemed to authorise a tenant having an

untransferable right of occupancy, the farmer of an estate in respect of which
default has been made in paying revenue, or the lessee of an estate, under the

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management of a Court of Wards, to assign his interest as such tenant, farmer

or lessee.”

There are different kinds of transferable property as described hereunder:

1. Watery Land – Water is movable property, hence any consideration paid to draw a
certain amount of water from a land will be treated as right in movable property. 20
Sludge in a sedimentation tank, although similar to earth or land, is not a part of the
land. If a huge quantity of sludge is retrieved from the land, it still does not lose the
character of sludge and become part of the land unless it has been allowed to remain
there for such a long time that it becomes a part of the land.21
2. Constructed/ Non – Constructed – Land is immovable property. In the legal context, it
includes the ground, soil or earth, meadows, pastures, woods, waters, marshes’ houses
and other buildings upon it’ and mines and minerals underneath it22. Things attached
to earth become a part of the earth and hence are called immovable property. Land
without any construction or with anything embedded to it will constitute immovable
property and can be transferred.
3. Agricultural/ Non – Agricultural Land – Pastures, woods, farms, mines and minerals
are all part of land and hence immovable property and they can be transferred under
provisions of this Act.

The general principle is that all kinds of property and interests in property are transferable
and this rule is based on the maxim alienation rei prefertur juri accrescendi, which means
law favours alienation to accumulation. Save for certain exceptions as provided under Section
6, irrespective of their nature23, all kinds of property may be transferred.

1. Chance of an heir apparent – The maxim nemo est heres viventis means that a living
person does not have any heir. Who the heir is will and can only be determined at the
time of death of a person and not beforehand. Therefore, the chance of an heir
apparent succeeding to the property of an intestate (a person who dies without leaving
behind a will) or anything of similar nature cannot be transferred.24

20
Chief Controlling Revenue Authority v. AB Project, AIR 1979 All 355.
21
Jnanchand v. Jugal Kishore, AIR 1960 Cal 331.
22
Laybourn v. Gridley, (1892) 2 Ch 53.
23
See Flowchart above.
24
Meek v. Kettlewell, (1843) 1 Ph 342.

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This chance of an heir apparent succeeding to the property of an intestate is referred

to as spes successionis. Mere speculation holds no value in the eyes of the law. Thus,
the mere transfer of a chance of inheritance is void ab initio.
2. Right of re-entry – A mere right of re-entry for breach of a condition subsequent
cannot be transferred to anyone except the owner of the property. 25 This right is
personal in nature and any transfer of such a right will render it void.
3. Easement – An easement is a right to use or restrict the use of land of another in some
way.26 An easement cannot be transferred apart from dominant heritage 27 to which, by
nature of right, it is attached. 28 This prohibition does not apply when new easements
are created.
4. Restricted Interests – An interest in a property, the enjoyment of which is restricted to
the owner personally, cannot be transferred by him. Personal rights are untransferable
by virtue of their character and hence any transfer of the owner’s interests would be
void.
5. Mere right to sue – A mere right to sue, for example, in respect of damages for breach
of contract, cannot be transferred. The object of such a prohibition is to prevent
gambling in litigation. Moreover, the right to sue another person is a personal right
and hence untransferable.
6. Public Office – The prohibition on transfer of public office was based on public
policy. The rationale behind such a rule was that the public office was held for
qualities personal to the officer and such a position could not be transferred to another
who does not possess the same characteristics. It would be detrimental to public
interest if a public officer is permitted to be alienated. The salary of a public officer
cannot be transferred whether before or after it becomes payable.29
7. Pensions, Stipends – Stipends allowed to military, naval and air force personnel and
civil pensioners of the government and other kinds of pensions cannot be transferred.
What is made non-transferable is the stipend of the civil pensioner and not the pension
itself.30

25
See The Transfer of Property Act, 1882, s. 6(b)
26
See Sec. 3, Indian Easements Act, 1882.
27
Supra, note 25, s. 6(c).
28
Sital v. Delanney, (1916) 20 Cal WN 1158.
29
Supra, note 25, s. 6(f).
30
Suraj Devi v. Sita Devi, AIR 1996 Raj 6.

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8. Nature of Interest – If a transfer is opposed by the nature of interest thereby affected,

such a transfer cannot be made.31 Therefore, things dedicated to public or religious
uses,32 regalia, heirlooms etc., cannot be transferred.
9. Untransferable Interests – No transfer which is made for an unlawful object or
consideration is permitted. The object behind such a provision is to maintain public
policy. For example, transferring a property so that it can be pawned in a gambling
game as collateral is not permitted as gambling is an illegal contract.
A vendor cannot pass a title to the property better than he himself has in the property,
to the vendee.33

ANALYSIS AND CONCLUSION

The Transfer of Property Act, 1882 is not an exhaustive act and neither a complete code like
the Indian Evidence Act, 1872 which is a self-contained statute. This Act only defines and
amends the existing rules and regulations. It does not cover all kinds of transfers of property.
Although the legislators have tried to harmoniously construct the statutes to ensure there is no
confusion or conflict, varied interpretations of the differing laws will lead to opposite
principles being laid down by judges. Also, where the provisions of the Act are not applicable
to a case, the Courts have the freedom to apply the rules of English Law, on the basis of
justice, equity and good conscience. Doing this would only be a repetition of history where
the English laws were not adaptive enough of the Indian scenario. Thus, there is a need to
make this law self-contained and whole so that it can stand independently.

31
Supra, note 25, s. 6(h).
32
Raja Verma Valia v. Kettayath, (1875) 7 Mad HC 210.
33
Lajpat Rai v. Smt. Vidya Rani, 1998 (1) C.L.J. 566 (S.C.).

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