A Study on Condition subsequent under Transfer of Property Act, 1882

5.6. Property Law

Submitted by

Yash Goyal

UID - SM0118062

5th Semester, 3rd Year

Faculty In Charge

Ms. Kasturi Gakul

National Law University and Judicial Academy Assam,

Guwahati

17th December, 2020.

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 TABLE OF CONTENTS

Content Page No.

INDEX OF AUTHORITITES……………….…………………………..…………………..iii

Table of case………………………………………………………………………………….iii

Table of Statutes………………………………………………………………………..…….iii

Table of Abbreviations………………………………………………………………...……..iii

[1.] Introduction………………………………………………………………...………….1-3

[1.1.] Overview……………………………………………………………………………….1

[1.2.] Literature Review……………………………………………………………...…….....2

[1.3.] Aims & Objective.………………………………………………………………..……2

[1.4.] Research Question………………………………………………………………….…..2

[1.5.] Research Methodology………………………………………………………...………3

[2.] Basic concept of transfer of property……………………………………..……...………4

[3.] Conditional transfer of a property…………………………….……………………...5-6

[4.] Conditions subsequent to transfer of property...…………………….………….......7-10

[4.1]Fulfillment of conditions subsequent to transfer of property………………………………….7

[4.2]Performance of condition subsequent to transfer of property……………………………...8-10

[5.] Conclusion……………………………………………………………………….……..11

BIBLIOGRAPHY………………………………………………………………………..…12

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 INDEX OF AUTHORITIES

Table of Cases:

1. Tincouri Dasee v. Krishna. 8

2. Krishna Chandra v. National Chemical and Salt Works 9
3. Hodgson v. Halford 9

Table Of Statutes

1882- The Transfer of Property Act.

Table Of Abbreviations

S.N. Abbreviation Full Form

1. AIR All India Report
2. Ch. Chapter
3. p. Page no.
4. s. Section
5. SC Supreme Court
6. v. Versus

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CHAPTER 1:

INTRODUCTION

[1.1.] Overview.

Transfer of property act 1882 deals with the transfer of property between living persons, i.e.
the transfer of property between living persons. It requires the transfer of both movable and
immovable property, but only the transfer of immovable property is subject to a large part of
the enactment. Transfer of property can either be absolute or conditional.

Section 25 of the Transfer of Property Act, 1882 provides for Conditional Transfer. It means
that any transfer that happens on the fulfillment of a condition that is imposed on the other
party for the transfer of property. It is covered from section 25 to section 34 under the
transfer of property act 1882.

A conditional transfer includes three types -

1) Condition subsequent - Condition which must be met after the transfer of property is done

2) Condition precedent - Condition should be fulfilled before the transfer of property

3) Condition collateral - Condition which needs to be fulfilled simultaneously with the

transfer of property

The paper will then include the fulfillment and performance of the conditions subsequent to
transfer of property with brief discussion from section 29 to section 34 which covers concept
of conditions subsequent

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[1.2.] LITERATURE REVIEW

R.K. Sinha1 (20th edition):

The book by R.K Sinha has a section which gives a descriptive and detailed analysis of the
definition and concept of transfer of property, the types of transfer of property and the
conditional transfer of property along with case laws explaining each such condition. This
book also gives a brief idea about the conditions subsequent to transfer of property with
illustrations .This book is most referred to while writing this research paper and was quite
helpful.

Poonam Pradhan Saxena2 (3rd edition):

This is the book by Poonam Pradhan Saxena which explains the bare act provisions of
conditional transfer and also explains it through case laws. This book also has section wise
explaination of the conditions subsequent to the transfer of property.

[1.3.] AIM(S) AND OBJECTIVE(S) :

Aims: The aim of this project is to give a descriptive analysis of the concept of conditions
subsequent to the transfer of property as defined under The Transfer of Property Act, 1882.

Objective:

 To discuss the concept of transfer of property and its types

 To understand the conditions under which conditional transfers are valid
 To analyse the concept of conditions subsequent and various sections related to it

[1.4.] RESEARCH QUESTIONS:

[1.] What is the basic concept of transfer of property and what are its types?

[2.] What is the concept of conditional transfers and what are its types and conditions under
which it can be valid?

[3.] What is the concept of conditions subsequent to transfer of property and various sections
related to it?

1
R.K. Sinha, Transfer of Property Act, Central Law Agency 35-47, 20th edition (2019)
2
Poonam Pradhan Saxena, Property Law, LexisNexis Butterworths, 3rd edition (2020)

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[1.5.] RESEARCH METHODOLOGY

Sources of Data collection: Secondary source of data collection was used which involves in
collection of data from books, articles, websites, etc. No surveys or case studies were
conducted.

Approach to Research: In this project doctrinal research was involved. Doctrinal Research
is a research in which secondary sources are used and materials are collected from libraries,
archives, etc. Books, journals, articles were used while making this project.

Types of Research: Explanatory type of research was used in this project, because the
project topic was not relatively new and unheard of and also because various concepts were
needed to be explained.

Mode of Citation: The researcher has followed a uniform mode of citation for the course of

this project. The mode of citation followed is the 20th Bluebook format of citation.

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CHAPTER 2:

1.BASIC CONCEPT OF TRANSFER OF PROPERTY

The Transfer of Property Act was one of the early laws of the nineteenth century. The
Transfer of Property Act was passed in 1882. Previously, the transfer of immovable property
was regulated by the principles of English law and equity. This Act deals with the transfer of
property between living persons, i.e. the transfer of property between living persons. It
requires the transfer of both movable and immovable property, but only the transfer of
immovable property is subject to a large part of the enactment.3

The Act plays an important role in the legislative book with the principal purpose of making
the transfer system of immovable property a public transfer system. Registration is thus
usually insisted on in order to complete the transfer, except in the case of transactions of
small value.

Section 5 of the Transfer of Property Act, 1882 describes the term transfer of properties.
According to this clause, the transfer of property is an act by which a living person transfers
property, in the present or in the future, to one or more other living persons or to himself or to
other living persons. The word "living person" shall mean a business or association or group
of individuals, whether incorporated or not, but nothing in this section shall affect any law
currently in force affecting or relating to a company, association or body of individuals.

It can be noticed that the transfer of a property can be of two kinds in general: absolute
transfer and conditional transfer.

An absolute transfer will mean obtaining full, immediate and unconditional title to the
transferred property by the transferor (one at the receiving end of the transfer). This will be a
present or a sale. Therefore a conditional transfer is such that certain conditions qualify, on
the fulfillment of which the transferee will vest in him only the land. In other words, if the
transfer of property to the transferor is dependent on the fulfillment or non-fulfillment of such
conditions, the transfer is called conditional transfer.

3
Ashish Agarwal, Conditional transfer of property (dec.10,2012), www.legalbites.com.

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CHAPTER 3

CONDITIONAL TRANSFER OF A PROPERTY

It is possible to transfer property either completely or conditionally. The sale of the property
will be unilateral and the transferor will obtain the interest without any subjection or
restriction, when the property is transferred absolutely. In comparison, when the property is
conditionally transferred, the transfer is subject to certain conditions or constraints and,
depending on the nature of its condition, the legal impact of the transfer could vary. A
transfer which is subject to conditions is called conditional transfers. It is covered from
section 25 to section 34 under the transfer of property act 1882.

For any kind of a conditional transfer to be valid, the condition that is imposed should not be:

 Prohibited by law,

 Should not be an act that involves fraudulent acts,

 Should not be any act that is impossible,

 Should not be an act that is termed as violative of public policy,

 Should not be immoral,

 Any act that incurs any harm to any person or his property.

Conditions can be of three kinds

1)Conditions subsequent - A subsequent condition is a condition that must be met after the
transfer of property has already taken place. Thus, if a subsequent condition in a transfer has

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been imposed, the interest of the transferee which has already been vested in him is affected
by the fulfillment or non-fulfillment of the condition specified.

Example - C transfers a farm to D provided that, if D shall not go to Spain within two years
after the date of transfer . So this condition is a condition subsequent

2)Conditions precedent - It is the condition preceding the transfer of land. It is prior to the
property's transfer. The condition is a precedent condition where the terms of a sale of
property signify the conditions to be met before a person can take an interest in the property.
The transfer is then contingent on the fulfillment of the condition precedent.

Example - A makes a gift of house to B if B marries C , the condition is a condition

precedent. Gift in favour of B will take effect only if B marries C; if he does not do so, the
house cannot be transferred in his favour.

3)Collateral conditions - When the condition is required to be fulfilled simultaneously with

the transfer then the condition is said to be collateral. A condition which is collateral is
required to be performed side by side the operation of the transfer.

Example

X leases property to Y as long as Y resides in the property of X. The condition imposed here
is collateral and so the transfer i.e. the lease will remain in operation only till the time B
fulfills the condition.

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CHAPTER 4:

CONDITIONS SUBSEQUENT

3.1 FULFILLMENT OF CONDITIONS SUBSEQUENT

ANY SUBSEQUENT DISPOSITION OF THE KIND ENVISAGED IN THE LAST PRECEDING SECTION

CAN NEVER TAKE PLACE UNLESS THE CONDITION IS STRICTLY FULFILLED.

ILLUSTRATION

X TRANSFERS RS 1500 TO Y , TO BE PAID TO HIM WHEN HE ATTAINS HIS MAJORITY OR

MARRYING, WITH A PROVISION THAT, IF Y DIES A MINOR OR MARRIES WITHOUT B’S CONSENT
THE RS 500/- WILL GO TO Z. Y MARRIES WHEN HE WAS ONLY 17 YEARS OLD AND WITHOUT

B’S CONSENT. THE TRANSFER TO Z WILL TAKE PLACE.

3.2 PERFORMANCE OF CONDITION SUBSEQUENT

VARIOUS SECTIONS RELATED TO PERFORMANCE OF CONDITION SUBSEQUENT UNDER

TRANSFER OF PROPERTY ACT 1882

SECTION 29

A CONDITION SUBSEQUENT WHICH OPERATES TO DIVEST AN INTEREST MUST BE PERFORMED

STRICTLY. SECTION 29 PROVIDES THAT A CONDITION SUBSEQUENT UPON THE FULFILLMENT

OF WHICH THE SECOND ( OR ULTERIOR ) TRANSFER IS TO TAKE PLACE, MUST BE STRICTLY

FULFILLED .

FOR EXAMPLE , X TRANSFERS A GARDEN TO Y WITH A CONDITION THAT IF IF Y CUTS DOWN A

PARTICULAR TREE, THE GARDEN SHALL BELONG TO Z. Y HAS A VESTED INTEREST IN THE

GARDEN. IF Y CUTS DOWN SEVERAL OTHER TREES AROUND THAT SPECIFIED TREE , HIS

INTEREST IS NOT DIVESTED. BUT AS SOON AS HE CUTS DOWN THE SPECIFIED TREE , HIS

INTEREST IN DIVESTED AND IT SHALL NOW BELONG TO Z. SINCE AN ALREADY VESTED

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INTEREST IS DIVESTED OR TAKEN AWAY BY SUCH CONDITIONS , SO THE WORDS OF THE

CONDITIONS SUBSEQUENT MUST BE CLEAR AND MUST ALSO BE STRICTLY FULFILLED.4

IGNORANCE, NEGLIGENCE OR ILLNESS CANNOT BE TAKEN AS PLEA FOR NON-COMPLIANCE OF

CONDITION SUBSEQUENT. WHERE NON-COMPLIANCE WITH CONDITION SUBSEQUENT WAS DUE

TO DURESS , IT WAS HELD THAT THERE WOULD BE NON - FORFEITURE AND THE INTEREST

WOULD VEST. 5

SECTION 30

ACCORDING TO SECTION 30 , PRIOR DISPOSITION IS NOT AFFECTED BY INVALIDITY OF

ULTERIOR DISPOSITION WHICH MEANS THAT IF THE ULTERIOR DISPOSITION IS NOT VALID , THE

PRIOR DISPOSITION IS NOT AFFECTED BY IT. IN A TRANSFER OF PROPERTY WHERE TWO

INTEREST ARE CREATED IN SUCH A MANNER THAT THE SECOND IS DEPENDANT ON THE FIRST

THEN, IF THE FIRST OR THE PRIOR INTEREST FAILS THEN THE SECOND AUTOMATICALLY FAILS

BUT THE VICE-VERSA IS NOT TRUE I.E. IF THE SECOND DISPOSITION IS INVALID AND FAILS ,
THE PRIOR TRANSFER IS NOT AFFECTED AND STANDS VALID.

ILLUSTRATION

A TRANSFERS A FARM TO B FOR HER LIFE AND IF SHE DOES NOT DESERT HER HUSBAND, THE

PROPERTY WILL BE TRANSFERRED TO C. B IS ENTITLED TO THE FARM DURING HER LIFE AS IF

NO CONDITION HAD BEEN INSERTED.

SECTION 31

SECTION 31 STATES THE CONDITION THAT TRANSFER SHALL CEASE TO HAVE EFFECT IN CASE

SPECIFIED UNCERTAIN EVENTS HAPPENS OR DOES NOT HAPPEN. IT DEALS WITH A CONDITION

SUBSEQUENT WHICH TERMINATES AN INTEREST . AFTER TERMINATION THE INTEREST

REVERTS BACK TO THE TRANSFEROR. DIFFERENCE BETWEEN A CONDITION SUBSEQUENT

UNDER THIS SECTION AND A CONDITIONAL LIMITATION IS THAT BOTH ARE CONDITIONS

SUBSEQUENT AND TERMINATE AN INTEREST BUT IN A CONDITION SUBSEQUENT (SEC 31) THE

INTEREST REVERTS BACK TO THE GRANTOR WHEREAS IN A CONDITIONAL LIMITATION (SEC 28)
THE INTEREST SO TERMINATED PASSES ON TO A THIRD PARTY.

4
R.K. Sinha, Transfer of Property Act, Central Law Agency 35-47, 20th edition (2019)
5
Tincouri Dasee v. Krishna , (1893) 20 Cal.15.

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SO, WHEN A CONDITION IS THAT THE INTEREST CREATED IN THE TRANSFER OF PROPERTY

SHALL CEASE TO EXIST UPON TRANSFEREE BECOMING INSOLVENT , THE CONDITION IS VOID

AND THE INTEREST OF THE TRANSFEREE SHALL NOT BE TERMINATED. FURTHER, SINCE THE

CONDITION UNDER THIS SECTION TERMINATES AN EXISTING INTEREST UPON THE HAPPENING

OR NON-HAPPENING OF AN EVENT, THE EVENT MUST BE DEFINITE AND SPECIFIC. WHERE A

LEASE- DEED PROVIDED THAT THE LEASE SHALL STAND CANCELLED WHEN LESSEE TAKES

UPON

“ ANY OTHER BUSINESS OR MANUFACTURE OF ANY OTHER KIND” WITHOUT THE WRITTEN

CONSENT OF THE LANDLORD , IT WAS HELD THAT THE CONDITION WAS VERY VAGUE AND THE

TRANSFEREE WAS NOT BOUND BY IT.6

SECTION 32

IN ORDER THAT A CONDITION THAT AN INTEREST SHALL CEASE TO EXIST MAY BE VALID, IT IS
NECESSARY THAT THE EVENT TO WHICH IT RELATES BE ONE WHICH COULD LEGALLY

CONSTITUTE THE CONDITION OF THE CREATION OF AN INTEREST7 .

THIS SECTION PROVIDES THAT A VOID CONDITION SUBSEQUENT DOES NOT DIVEST THE

INTEREST . HOWEVER A CONDITION SUBSEQUENT REQUIRING THAT THE TRANSFEREE SHALL

NOT BECOME A CHRISTIAN HAS BEEN HELD A VALID CONDITION.8

SECTION 33

WHERE, ON A TRANSFER OF PROPERTY, AN INTEREST THEREIN IS CREATED SUBJECT TO A

CONDITION THAT THE PERSON TAKING IT SHALL PERFORM A CERTAIN ACT, BUT NO TIME IS

SPECIFIED FOR THE PERFORMANCE OF THE ACT , THE CONDITION IS BROKEN WHEN HE

RENDERS IMPOSSIBLE, PERMANENTLY OR FOR AN INDEFINITE PERIOD, THE PERFORMANCE OF

THE ACT.9

WHEN SOME SPECIFIC EVENT OR A PARTICULAR TIME HAS BEEN FIXED FOR THE

PERFORMANCE OF THAT CONDITION, IT MUST BE PERFORMED WITHIN IT. WHEN THE TIME IS

NOT FIXED FOR THE PERFORMANCE OF THE CONDITION WHICH IS SUBSEQUENT , IT BECOMES

BROKEN NOT ONLY WHEN THE PERFORMANCE OF THAT CONDITION BECOMES IMPOSSIBLE BUT

6
Krishna Chandra v. National Chemical and Salt Works, AIR 1957 Orissa 35.
7
Supra.3
8
Hodgson v. Halford, (1879) 11 Ch.D.959
9
Supra.3

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ALSO WHEN THAT PERSON DOES SOMETHING BY WHICH ITS PERFORMANCE IS INDEFINITELY

POSTPONED.

ILLUSTRATION

A GIFT IS MADE TO X ON A CONDITION THAT UNLESS HE JOINS ARMY THE GIFT SHALL GO TO

Y. X JOINS CHURCH AND THEREBY RENDERS IT IMPOSSIBLE THAT HE MAY JOIN ARMY AND

FULFILL THE CONDITION. Y IS ENTITLED TO GET THE PROPERTY.

SECTION 34

SECTION 34 OF THE TRANSFER OF PROPERTY ACT, 1882 DESCRIBES ANY TRANSFER WHERE A
CONDITION, PERIOD FOR THE OCCURRENCE OR NON-OCCURRENCE OF AN ACT IS SPECIFIED

AND THE INTEREST OF THE PROPERTY IS TO GO TO ANOTHER PERSON ON THE FAILURE OF

SUCH CONDITION BUT IT HAS TO BE SEEN THAT WHAT CAUSED THE CONDITION TO BE MET

WAS POSTPONED. IF A PERSON WHO IS INTERESTED IN ITS NON-FULFILLMENT PREVENTS THE

PERFORMANCE OF THE SPECIFIED CONDITION THAT MAY BE EITHER SUBSEQUENT OR

PRECEDENT, THE DELAY IS CONDONED AND THE CONDITION IS DISCHARGED.

X TRANSFERS PROPERTY TO Y WITH THE PROVISION THAT THE PROPERTY WILL PASS TO Z IF
HE DOES NOT GO TO THE U.S. WITHIN 2 YEARS. LATER ON IF Z PRECLUDES Y FROM

FULFILLING THE CONDITION BY PLAYING A SCAM, THE DELAY IN SUCH PERFORMANCE IS

EXCUSED.

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CHAPTER 5:

CONCLUSION

The researcher would like to conclude by saying that transfer of property can either be
absolute transfer or conditional transfer. In day-to-day property transfer transactions,
conditional transfers are a very important factor. Awareness of provisions relating to this
definition is relevant. Section 25-34 of the Transfer of Property Act, 1882 provides for all
forms of conditional transfers. It is necessary to remember that the provision for any
transition should not be forbidden by law and can be preferably carried out.

For a conditional transfer to be valid, the condition should not be prohibited by law,should
not be an act that involves fraudulent acts,should not be any act that is impossible,should not
be an act that is termed as violative of public policy,should not be immoral, and should not
involve any act that incurs any harm to any person or his property

Conditional transfer mainly includes three types of conditions which are conditions precedent,
conditions subsequent and conditions collateral to transfer. The project has explained the
conditions which are subsequent to transfer of property I.e conditions which needs to be
fulfilled after the transfer is done

Therefore according to the findings of this paper the researcher believes that the concept of
conditional transfer forms an essential part in the Transfer of property and it also safeguards
the rights of person, punishes the person if there is a negligent act from their side or if there is
any wilful abstention.

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BIBLIOGRAPHY

Secondary Sources:

List of books:

 R.K. SINHA, THE TRANSFER OF PROPERTY ACT, 20TH EDITION, CENTRAL LAW AGENCY,
(2019).

 POONAM PRADHAN SAXENA, PROPERTY LAW, 3RD EDITION, LEXISNEXIS BUTTERWORTHS,

(2020)

Articles/ Blogs:

 Ravi Pandey, Conditional Transfers under Transfer of Property Act, 1882 iPleaders
(2020), https://blog.ipleaders.in/conditional-transfers-transfer-property-act/ (last visited
Dec 10, 2020).

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