Transfer of Property Act

In this session we explore notions of joint ownership (co-ownership S. 44-47) and how
the statute deals with conflict of rights (S. 38-43 & S. 48-53). And the basic framework
of sales and agreements to sell (S. 40 & 54-57). We close with a discussion on the
concept of mortgage and its consequences.

Joint Ownership

A) The basic principle of co-ownership under our law is that a co-owner is deemed to be
“interested in each and every single inch of the property.”

B) If you want exclusive possession, you must get the property partitioned: a) The law
assumes that possession of one co-owner is for benefit of all b) If you as a co-sharer
want possession of your land that you own with your brother, you cannot file a suit
for possession. it is not maintainable unless property is demarcated and partitioned
after which each can claim possession of their respective shares (2004 CLC 1455).

C) In Punjab partition suits are governed by the Punjab Land Revenue Act 1967 and the
Punjab Partition of Immovable Property Act 2012 - rural and urban respectively.

D) A co-owner in an undivided property does not require consent of other co-owners to

sell his property (CLC 2019 1739)

E) So when a co-owner transfers his share in a common/joint property, he only transfers

such interest to the vendee that he in fact owns (recall S. 8):

“The vendee of a co-sharer who owns an undivided Khata in common

with another, is clothed with the same rights as the vendor has in the property
... if the vendor was in exclusive possession of a certain portion of the joint
land and transfers its possession to this vendee, so long as there is no
partition between the co-sharers, the vendee must be regarded as stepping
into the shoes of his transferor qua his ownership rights in the joint property,
to the extent of the area purchased by him” ... “alienation of specific plots
transferred to the vendee would only entitle the latter to retain possession of
them till such time as an actual partition by metes and bounds takes place
between the co-sharers”.
PLD 1959 SC 9

S. 8 Exceptions

Exceptions to S. 8 are the bona fide purchaser for consideration without notice, and the
following sections detail the operation of this exception deploying equitable principles
across these sections:

 S. 41 S. 52 S. 53

Transfer by ostensible Transfer of property Fraudulent transfer:

owner. Where, with the pending suit relating
consent, express or thereto. During the (1) Every transfer of
implied, of the persons pendency in any Court ... immoveable property made
interested in immoveable any suit or proceeding with intent to defeat or
property, a person is the which is not collusive and in delay the creditors of the
ostensible owner of such which any right to transferor shall be voidable
property and transfers the immoveable property is at the option of any
same for consideration, the directly and specifically in creditor so defeated or
transfer shall not be question, the property delayed. Nothing in this
voidable on the ground that cannot be transferred or subsection shall impair the
the transferor was not otherwise dealt with by any rights of a transferee in
authorized to make it: party to the suit or good faith and for
provided that the proceeding so as to affect consideration ...
transferee, after taking the rights of any other
reasonable care to party thereto under any (2) Every transfer of
ascertain that the decree or order which may immoveable property made
transferor has had power to be made therein, except without consideration with
make the transfer, has under the authority of the intent to defraud a
acted in good faith. Court and on such terms as subsequent transferee shall
it may impose be voidable at the option of
such transferee.
A vendor lacking authority A vendor can never transfer
to transfer can create good property to defeat creditors
title if buyer acts a) in good except where the buyer is
faith + b) for consideration for good faith and for
+ c) after taking reasonable consideration then transfer
care will operate to create good
title

Consider the following cases for the operation of these principles

Saifullah Khan Bangash v Naseem Khan (2007 CLC 84)

Ghulam Rasool v Noor Muhammad(2017 SCMR 81)

M. Iqbal v Khair Din (2014 SCMR 33)

 Sales and Agreements to Sell

S. 54.

Sale defined: Sale is a transfer of ownership in exchange for a price

paid or promised or part paid and part promised.

Sale how made: Such transfer, in the case of tangible immovable

property of the value of one hundred rupees and upwards, or in the case
of a reversion or other intangible thing, can be made only by a
registered instrument.

In the case of tangible immovable property, of a value less than one

hundred rupees, such transfer may be made either by a registered
instrument or by delivery of the property.

Delivery of tangible immovable property takes place when the seller

places the buyer, or such person as he directs in possession of the
property.

Contract for sale: A contract for the sale of immovable property is a

contract that a sale of such property shall take place on terms settled
between the parties.

It does not, of itself, create any interest in or charge on such

property.

A) Sale and a contract or agreement to sell create/confer different rights, remedies,

and have different formalities. The former is a property right and must be registered,
the latter a contractual right, not compulsorily registered, remedy is specific
performance. A property right is a right in rem (against the world) a contractual right is
a right in persona (with regards to the parties) but may have wider implications in
remedy terms.

B) Sale deed is a conveyance (a bay-nama) transferring title to buyer, that is the

title that the seller held, to take effect this must be registered in accordance with the
Registration Act (S. 17 & 49).

C) A contract to sell, an agreement to sell or an Iqrar Nama, can be of many types:

including foe example in property development between vendor-vendee specifying
deposit (biyana) and instalments over a specified time. The important point of
consideration is the remedy for breach, its enforceability, circumstances and method.1

1 for example: buyer fails to pay remaining amount = forfeiture/penalty clause; buyer
enters into a separate bayana = assignment and sale deed executed in favour of subsequent
transferee; seller refuses to execute sale deed = specific performance; seller refuses to accept
balance amount = specific performance and stay against alienation; seller transfers to 3rd party
= specific performance

Molvi Ali Hosain v Rajkumar (AIR 1943 Cal 417)

M Jamil v M Arif (2021 SCMR 1108)

Mortgages (Chapter IV, S. 58 - 104)

Keenan, S. (2023): ‘Ownership Without Control: Mortgage Finance and the Changing
Formations of Property’ in Graham, N. et al, The Routledge Handbook of Property, Law
& Society (Routledge: Oxon)