The
Transfer of Property Act, 1882
OBJECT
AND SCOPE:
1.
This Act applies only to transfer by living
persons. It does not regulate transfers by operation of law. Hence, transfer of
property by will wont fall under the purview of the Act.
2.
Act mainly deals with the transfer of immovable
properties.
3.
If there are any provisions under the Act which
are in contravention with the Muslim personal law, the latter will prevail.
However, such exemptions are given only in respect of those rules of Muslim law
which are in conflict with any of the Provisions of the Act dealing with the
transfers in general.
4.
The Act has amended and modified some of them so
as to make them suitable to socio-economic conditions of India.
General Principles Governing Transfer of Immovable Property
1.
Doctrine of Priority: it is
embodied under Section 48 of the Act.
Essentials
of the same are:
·
The transferor transfers the rights in
the same immovable property
·
At different times – one interest created should be prior in
time and another should be subsequent.
·
Such rights created cannot coexist or cannot be enjoyed in
full extent together
·
Then, each later right created is subject to the previously
created rights.
Provided
that there is no contract to the contrary or reservation binding the earlier
transferee.
Exceptions
to the rule of Priority are:
·
Where in prior transfer the procedure laid out
by the law which is compulsory is not followed.
·
Where the subsequent transfer or the second
transfer takes place by the virtue of the court
·
Estoppel
·
Salvage charges
·
Notice w.r.t Section 78
In the
case of ICICI Bank Ltd. v. SIDCO Leathers Ltd. And Ors. the
applicability of Section 48 in cases of Companies was
questioned. It was held that there doesn’t exist any provision in the Companies
Act which provides that the provisions of Section 48 of the Transfer of
Property Act would not be applicable in relation to the affairs of a company. Unless,
expressly or by necessary implication, such a provision contrary to or
inconsistent which shows a different intent can be found in Companies Act,
Section 48 of the Transfer of Properties Act, cannot be held to be
inapplicable.
2.
Ostensible Ownership: Comes
under Section 41.
Essentials
of Section 41:
·
Transfer of immovable property
·
Done by ostensible owner
·
The transfer is done for a consideration
·
The person interested in that property has
consented for the transfer
·
The transferee should’ve taken reasonable care
and acted in good faith
Such a
transfer is valid and not voidable or void.
Case: Ramcoomar
Koondoo and others v. Macqueen and another
3.
Rule of Estoppel: It signifies that when a
person makes a promise to another person, which is more than what he can
perform or which he is incapable of performing, then he cannot later on claim
incompetency as a legitimate excuse when he acquires the competency to fulfil
his promise.
Essentials:
·
The transferor makes a false representation that
he’s authorized to transfer a certain immovable property
·
This representation may be erroneous or
fraudulent
·
The transferor professes to transfer the
property
·
For consideration
·
The transferee enters unto a contract acting on
that representation
·
The transfer would operate on any such interest acquired, at
the option of the transferee.
·
Provided that, there is no subsequent bona fide transferee,
who has entered into the transfer without having any notice of the earlier
contract between the transferor and the prior transferee.
In the
case of Viraya v. Hanumanta[1],
A, B and C were coparceners and held
the family property jointly. A sold the property to alienee without the consent
of other coparceners. A failed to deliver the property to the alienee as the
joint family property cannot be transferred without the consent of all the
coparceners. Alienee filed a suit against A for the enforcement of the
contract.
During
the pendency of the suit, C died. A’s share in the joint property increased to
one half. It was held that alienee was entitled to the share (including the
increased share) of A in the property.
4.
Doctrine of lis pendens: It comes under section
52 of TOPA
‘Lis’
means an action or a suit and ‘Pendens’ means pending. Hence, Lis Pendens means
during the pendency of a suit. The doctrine of Lis Pendens may be defined
as the jurisdiction or the control that courts have during the pendency of
action over the property involved therein. The principle underlying the
object of this section is to maintain the status quo unaffected by the cat of
any party to the litigations pending its determination.
Essentials
of Lis pendens:
·
Litigation should be pending in a court of
competent jurisdiction.
·
The suit must be relating to the right in a
specific immovable property.
·
The suit should not be collusive.
·
Property should not be transferred or otherwise
dealt with.
·
By any party to the suit.
·
So as to affect the right of any party thereto.
·
Till the final disposal of the case.
ILLUSTRATION:
If A sells his property X to B, while the property is subject matter in a
pending suit between A and C, then the principle of Lis pendens will apply.
CASE:
The principle is explained in Bellamy v. Sabine[2], where
Turner, L.S said, it that doctrine rests upon this foundation that, it
would plainly be impossible that any action or suit could be brought to a
successful termination if alienations pendente lite were to allowed prevail.
In
the case of Govindapillai v. Alyyappan Krishnan[3]
it was held that the foundation for the doctrine of Lis pendens does not vest
upon notice, actual or constructive, it rests solely upon the necessity- the
necessity that neither party to litigation should alienate the property in
dispute as to affect his opponents.
5.
Fraudulent transfer: It comes under section 53
of TOPA.
Fraudulent
transfer signifies a transfer that takes place in order to Deceive or defraud
someone.
Essential
ingredients of this section are:
a.
There must be transfer of immovable property.
b.
Transfer must have been made to with the intent
to defeat or delay the creditors of the transferor.
c.
The transferor shall be voidable at the option
of the creditor whose interest have been defeated or delayed.
Exceptions:
A.
The rights of a transferee in good faith and for
consideration are unaffected.
B.
Any right created by law of insolvency remains
unaffected.
ILLUSTRATION:
A creditor obtained a decree against a widow who had a life interest in the
property gifted to her by her husband.
The widow in order to render the property out of reach of the creditor
surrendered her interest to her son. It was held that such a surrender was
voidable at the option of the creditor u/s 53.
CASE:
Patridge v. Gopp.[4], Lord
Keeper stated that “No man has so absolute power over his won property as he
can alienate the same when such alienation directly tends to delay, hinder or
defraud his creditors, unless it is made upon good consideration and bona fide.
6.
Part Performance: It comes under section 53A.
The
doctrine of part performance also known as ‘equity of part-performance” says
that if a person has taken possession of an immovable property on the basis of
a contract of sale and has either performed or is willing to perform his part
of the contract, then, he would not be ejected from the property on the ground
that the sale was unregistered and the legal title has not been transferred to
him.
Essential requirements u/s 53A:
a.
There must be a contract to transfer the
immovable property for consideration.
b.
The contract should be in writing and its terms
can be ascertained with reasonable certainty.
c.
The transferee should have taken possession of
the property in part performance of the contract or if he is already in
possession, should have continued, and should have done something in
furtherance of the contract.
d.
The transferee is ready and willing to perform
his part of the contract.
CASE:
In Dhannalal Ahirwar v. Satyanarayan,[5] the
parties entered into an oral contract for sale. No efforts were made to get the
sale deed executed. It was held that the requisite condition for attracting
Section 53A was not fulfilled. Hence, no benefit under the same section can be
provided.
In Md.
Musa v. Aghore Kumar Ganguly[6] the
court held that doctrine of part performance was applicable in India on the
principle of justice, equity and good conscience.
Section
53A incorporates three principles of equity as laid down in the case of Walsh
v. Lonsdale:[7]
i.
He who seeks equity must do equity.
ii.
Equity looks to the intent rather than to
perform.
iii.
Equity treats that as done which ought to have
been done.
Principle
enshrined u/s 53A is different under Indian and English law:
i.
Under English law, even oral agreement is
sufficient, while under the Indian law, a written agreement if mandatory.
ii.
Under English law, it can be used for enforcing
the right as well as defending the right. However under Indian law, it can only
be used to defend the right of transferee.
iii.
In English law, this doctrine gives rise to an
equity but in Indian law, it gives rise to a statutory right of defense.
7.
Actionable Claim: Comes under Section 3 of TOPA.
Acc. to
the Act, an actionable claim means a claim to any debt, other than a debt
secured by mortgage or immovable property or by hypothecation or pledge of
movable property, or to any beneficial interest in movable property not in the
possession, either actual or constructive, of the claimant, which the civil
courts recognize as affording grounds for relief, whether such debt or
beneficial interest be existent, accruing conditional or contingent.
ILLUSTRATION:
Sale of lottery tickets amounts to transfer of actionable claim.
CASE:
In LIS (Regd) Palakal Court v. State of Kerala,[8]
court said sale of lottery tickets did not involve sale of goods. Purchaser
gets a claim to a conditional interest in the prize money. Such money is not in
the purchaser’s possession. The right would, therefore, squarely falls within
the definition of an actionable claim.
SALE
Sale is
a transfer of ownership for money consideration. It implies and absolute
transfer of all rights of the property. The two elements essential for sale is transfer
of ownership and money consideration. Transfer of this ownership for money
consideration is sale. Falls u/s 54 of TOPA.
ESSENTIALS
OF SALE:
1.
Parties: Must be at least two parties. person
who transfers the property is called the ‘transferor” and the person purchasing
the property is the “transferee”.
2.
Subject Matter: Subject matter can only be
immovable property as TOPA only deals with the same.
3.
Money Consideration: At the time of contract for
sale, the price must be ascertained for which the property is going to be
transferred. The price may be paid during the execution of sale or later, but
it has to be paid. The value of consideration doesn’t matter.
4.
Conveyance: section 54 provides two modes of
transfer of immovable property- (i)Delivery of possession- Where the property
is tangible immovable property of the value of one hundred rupees and upwards
or in the case of a reversion or other intangible thing, transfer can be made
only by a registered instrument or by delivery of the property.
(ii)
Registration of sale deed- When the value of tangible immovable property is Rs.
100 or more, the sale of such a property requires registration of the deed.
Where the property intangible immovable property of any valuation, it will
require registration for completion of sale.
CASE
LAWS:
·
K RAMAKRISHNAN v. SIDDHAMMAL AIR 2002 Mad 241:
Where
the vendee was ready and willing to execute the sale deed but vendor could not
deliver vacant possession of the suit property, the vendee was held entitled to
refund of advance with reasonable interest.
·
SHAKEEL BANO v. MOHD BISMIL SIRAJ AIR 2006 MP
192:
For
constituting a valid sale, both the seller and purchaser must be competent on
the date of sale. The seller must be competent to co0ntract, i.e., he must be
of sound mind and must have attained the age of majority.
·
GANGOTRI BAI v. JEEVRAKHAN LAL AIR 2006 Chh 88:
The
person selling must be the owner of the property which he is going to sell.
·
V ETHIRAJ v. S SRIDEVI AIR 2014 Kant 58:
Where
the purchaser was aware that the seller was only half owner of the property as
indicated by the schedule in the suit, it was held that he could not claim that
he was a bona fide purchaser without notice of the proceedings relating to the
property. He was not entitled to claim absolute ownership of the entire
property.
SALE
FOR CONTRACT AND SALE OF CONTRACT:
A sale
of immovable property is the transfer of ownership whereas a contract for sale
is merely an agreement for the sale of property in future on terms agreed
between the parties. After sale, all the rights and liabilities of the owner
transfers into the transferee but in a contract of sale, no interest of the
transferee is as such created in the property. The ownership of the property
remains in the vendor.
RIGHTS
AND LIABILITIES OF BUYER AND SELLER:
This
falls u/s 55.
1.
Before Completion of Sale:
a.
Seller’s liabilities:
i.
To disclose material defects- s.55(1)(a)
ii.
To produce title-deeds for inspection-
s.55(1)(b)
iii.
To answer question as to title- s.55(1)(c)
iv.
To execute a proper conveyance- s.55(1)(d)
v.
To take care of property and title
deed-s.55(1)(e)
vi.
To pay public charge and rent accrued-s.55(1)(g)
b.
Seller’s Rights:
i.
To take rents and profits-s.55(4)(a)
c.
Buyer’s Liabilities:
i.
To disclose facts materially increasing value of
property-s.55(5)(a)
ii.
To pay the price-s.55(5)(b)
d.
Buyer’s Rights:
i.
To charge for price prepaid-s.55(6)(b)
2.
After Completion of Sale:
a.
Seller’s liabilities:
i.
To give possession-s.55(1)(f)
ii.
Implied covenant for title-s.55(2)
iii.
To deliver title deeds on receipt of
price-s.55(3)
b.
Seller’s Rights:
i.
Charges for price unpaid-s.55(4)(a)
c.
Buyer’s Liabilities:
i.
To bear loss to the property-s.55(5)(c)
ii.
To pay out goings public charges and
tents-s.55(d)
d.
Buyers Rights:
i.
Benefit of increment-s.55(b)(a)
MORTGAGE
(Section 58)
Mortgage
is the transfer of an interest in some immovable property. It is given by way
of security for a loan. A person who takes a loan and gives some security for
repayment of the loan in the form of transfer of some interest in any immovable
property, it is called mortgage of property.
Elements
of mortgage:
1.
There must be transfer of an interest
2.
The interest transferred must be in specific
immovable property
3.
The transfer must be made to secure a loan of
money, debt or performance of an engagement which may give rise to a pecuniary
liability.
CASE
LAWS:
·
Ram Prasad v. Kalyani Devi (AIT 1973 Raj 208):
o
A sum of Rs. 450 was served against shop without
any return document. The court held that this was no mortgage in the eyes of
law.
·
Baijnath Tiwari v. Kalyani Devi (ILR 18 Cal
557):
o
Description of property was misleading and
insufficient for the purpose of identification, registration was invalid.
TYPES
OF MORTGAGES:
1.
Simple Mortgage s. 58(b): where
without delivering possession of the mortgaged property, the mortgagor binds
himself personally to pay the mortgage money, and agrees, expressly or
impliedly, that, in the event of his failing to pay according to his contract,
the mortgagee shall have a right to cause the mortgaged property to be sold and
the proceeds of sale to be applied, so far as may be necessary. In payment of
the mortgage money the transaction is called a simple mortgage.
2.
Mortgage by conditional sale
s.58(c): Where the mortgagor ostensibly sells the mortgaged property-on
condition that on default of payment of the mortgage money on a certain date
the sale shall become absolute or, on condition that on such payment being made
the sale shall become void, or on condition that on such payment being made the
buyer shall transfer the property to the seller the transaction is called a
mortgage by conditional sale.
3.
Usufructuary mortgage s.58(d): Where
the mortgagor delivers possession or binds himself (expressly or by
implication) to deliver possession of the mortgaged property to the mortgagee
and authorizes him to retain such possession until payment of the mortgage
money and receive the rents and profits accruing from the property and to
appropriate the same in lieu of interest or in payment or mortgage money or
party in both, the transaction is called usufructuary mortgage.
4.
English Mortgage s.58(e): Where
the mortgagors binds himself to repay to mortgage-money on certain date, and
transfers the mortgaged property absolutely
to the mortgagee, but subject to a proviso that he will re-transfer it
to the mortgagors upon payment if the mortgage money as agreed, the transaction
is called an English mortgage.
5. Equitable
mortgage s.58(f): This is also known as mortgage by deposit
of title deeds. The essential requisites of such mortgage are:
i) a debt should be there
ii) deposit of the title deed with the lender (most essential)
iii) said deposit is with intention that the said title deed shall be security
for the debt.
6. Anomalous
mortgage s.58(g): A mortgage which is not a simple mortgage, a
mortgage by conditional sale, an usufructuary, an English mortgage or a
mortgage by deposit of title deeds within the meaning of Section 58 of Transfer
of Property Act is an Anomalous mortgage.
MORTGAGOR RIGHTS
·
Right to Redemption (section-60): This
right puts an end to mortgage by returning the property of mortgagor. The
right to redeem further grants three rights to the mortgagor:
i.
Right to end mortgage deal
ii.
Right to transfer mortgaged property to his name
iii.
To take back possession of property in case of
delivery of possession
·
Right
to Transfer to the third party. (S. 60A): According to this
section, the mortgagor may require the mortgagor to assign the mortgage-debt
and transfer the mortgaged property to a third person directed by him, instead
of re-transferring the property to him.
·
Right to inspection and production of
documents (S.60B): According to this section, the mortgagor, who
has handed over the title-deeds or other documents relating to the mortgaged
property to the mortgagee, is entitled to inspect those documents.
·
Right to redeem separately or
simultaneously: This section says that a mortgagor who has
executed two or more mortgages in favour of the same mortgagee shall be
entitled to redeem anyone such mortgage separately or any two or more of such
mortgages together.
·
Right to accession (S. 63): According
to section 63 –
a.
Where mortgaged property in possession of the
mortgagee has,
b.
During the continuance of the mortgage,
c.
Received any accession,
d.
The mortgagor shall upon redemption, be entitled
to such accession as against mortgagee,
e.
This is so in the absence of a contact to the
contrary.
·
Right to grant a lease (S.65A): A
mortgagor, who is in lawful possession of the mortgaged property, shall have
the power to make the lease the property which shall be binding on the
mortgagee.
·
Right in case of waste (S.66): According
to this section, a mortgagor in possession of the mortgaged property is not
liable to the mortgagee for allowing the property to deteriorate but he must
not do any act which is destructive or permanently injurious to the property,
if the security is insufficient or will be redder insufficient by such act.
MORTGAGORS LIABILITIES
·
Covenant
for the title (S. 65): The
mortgagor is deemed to contract with the mortgagee that the interest which the
mortgagor professes to transfer to the mortgagee subsists and that the
mortgagor has the power to transfer to the same. There is implied warranty of
title by the mortgagor in the property mortgaged to him.
·
Covenant for the defense of title (S.
65(b)): The mortgagor is deemed to
contract with the mortgagee that he will defend, of if the mortgagee be in
possession of the mortgaged property, enable him to defend, the mortgagor’s
title thereto.
·
Covenant for payment of public charges (S.
65(c)):
The mortgagor is deemed to contract with the
mortgagee that the mortgagor will so, long as the mortgagee is not in
possession of the mortgaged property, pay all the public charges accruing due
in respect of the property.
·
Covenant for payment of rents (S. 65(d)): Where the mortgaged property is a lease, the
mortgagor is deemed to contract with the mortgagee that the rent payable under
the lease, the conditions contained therein, and the contracts binding on the
lease, have been paid, performed and observed, down to the commencement fo the
mortgage; and will pay the rent reserved by the lease and perform the
conditions contained therein, and observe the contracts binding on the lesee,
and indemnifying the mortgagee against all claims, sustained by reason of the
non-payment of the said rent or the non-performance or non-observance of the
said conditions and contracts.
·
Covenant for the discharge of prior
mortgage (S. 65(e)): Where
the mortgage is a second or subsequent encumbrance on the property, the
mortgagor is deemed to have contract that the mortgagor will pay the interest
from time to time accruing due on each prior encumbrances as and when it
becomes due, and will at the proper time discharge the principal money due on
such prior encumbrances.
MORTGAGEE
RIGHTS:
·
Right to foreclosure of sale (S. 67): According to
this section, at any time after the mortgage money has become due and before a
decree has been made for the redemption of mortgaged-property or the mortgage
money has been paid or deposited, the mortgagee has a right to redeem the
property or a decree that the property be sold.
·
Right to sue for mortgage-money (S. 68): In the
following four cases the mortgagee has a right to sue for the mortgage-money –
- Where the
mortgagor binds himself to repay the same,
- Where the
mortgaged property is destroyed, wholly or partially without the fault of
any party.
- Where the
mortgagee is deprived of the whole or part of his security by wrongful act
or default of the mortgagor.
- Where the
mortgagee being entitled to possession, the mortgagor fails to deliver the
same.
·
Right to sell (S. 69): This section gives the mortgagee a right to sell without the
intervention of the court. When the mortgage-money is not repaid by the
mortgagor, he becomes entitled to sell the property to recover his debt.
·
Right to appoint Receiver: A mortgagee having the right to exercise a power of sale under
section 69 is entitled to appoint, in writing, a receiver of the income of the
mortgaged property.
·
Right to accession (S. 70): Accession are addition to the property. Section 70 says that if after
the date of the mortgage any accession is made to the mortgaged property, the
mortgagee shall be entitled to such accession for the purposes of security of
his mortgage-debt.
·
Right to proceeds of revenue sale or
compensation on acquisition (S. 73): According to this section, where
the mortgaged property or any interest in it is sold, owing to failure to pay –
i.
Arrears of
revenue, or
ii.
Other charges of
a public nature, or
iii.
Rent due in
respect of such property.
MORTGAGEE’S LIABILITIES:
·
Mortgagee bound to bring one suit on several
mortgages (S. 67A): Section 67A provides that
if a mortgage holds two or more mortgages of the same property or of different
properties from the same mortgagor, he must enforce all or more, in the absence
of a contract to the contrary.
·
Liabilities of mortgagee in possession (S. 76): The mortgagee is the person who gives a loan to the mortgagor on the
security of some property.
MARSHALLING
U/S 81 AND 82:
When the owner of two or
more properties mortgages them to one person and then mortgages one or more of
them (already mortgaged to the first mortgagor) to another person. The
subsequent mortgagee is entitled, unless there is contract to the contrary, to
have the prior mortgage-debt satisfied out of properties not mortgaged to him.
ESENTIALS OF MARSHALLING:
1.
The mortgagees may be two or more persons but the mortgagor
must be common that is there must be a common debtor.
2.
The right cannot be exercised to the prejudice of the prior
mortgagee.
3. The right cannot be
exercised to the prejudice of any other person having claim over the property.
LEASE
(Section 105 to 117)
A lease of immovable property is a
transfer of a right to enjoy such property, made for a certain time, express or
implied, or in perpetuity, in consideration of price or promised, or of money,
a share of crops, service or any other thing, of value, to be rendered
periodically or on specified occasion to the transferor by the transferee who
accepts the transfer on such terms. It is defined under section 105.
Essential
elements:
1.
The parties to lease-lessor and lessee
2.
The subject matter of lease- immovable property
3.
There must be a transfer of rights
4.
Duration of lease
5.
Consideration of lease-premium
6.
Acceptance of transfer by the lessee
7.
Lease must be made in the mode under section 107
CASE
LAWS:
·
B ARVIND KUMAR V. GOVT. ON INDIA (2007) 5 SCC
745:
There
must be two competent parties in a lease. A man could not grant a lease by
himself.
·
ANNICK CHAYMOTTI DEVYANI v. PREM MOHINI MEHRA
2003 (1) Ren CR 709 (Del):
Leased
premises is not only building or part of building but also the land and other
things appertaining to it and also furniture and other fixtures provided by the
landlord.
·
GIRDHARI SINGH v. MEGH LAL PANDEY (1918) 45 Cl
87:
The
essential characteristic of a lease is that the subject is one which is
occupied and enjoyed and the corpus of which does not in nature of things and
by reason of the user disappear.
·
GOODRIGHT D HALL v. RICHARDSON (1789) 3 Term Rep
462:
A lease
fir life is a lease for a certain time, for it terminates with the death of the
lessee. It is necessary for lease for a certain time that the lease deed should
be capable of being made certain on a future date. If in the fluxion of time a
day will arrive which will make it certain that is sufficient for such a lease.
·
CIT, ASSAM, TRIPURA AND MANIPUR v. PANBARI TEA
CO LTD. (1965) 3 SCR 811:
SC made
a distinction between rent and premium and observed; “when the interest of the
lessor is parted with for a price, the price paid is premium. But the
periodical payments for continuous enjoyment of the benefits under the lease
are in the nature of rent. The former is capital income while latter is a
revenue receipt”.
Lessor, lessee, premium, and rent are defined
under section 105. One who transfers the property i.e. transferor called
Lessor, one who accept it i.e. the transferee called lessee, the price is
called the premium and services and other things which is rendered is called
rent.
Under Section 106, if there is an absence of a
written contract or a local usage to the contrary then in the case, a lease of
immovable property for manufacturing and agriculture purpose will be valid till
the time until it was terminated by either of the party, by six months’ notice
and if there is a lease any other purpose except agriculture or manufacturing
then it will be terminated by 15 days’ notice.
RIGHTS AND LAIBILITIES:
RIGHTS OF LESSOR:
- A lessor will have a right recover
its rent from the property which is leased by him.
- Lessor having a right to take back
his property’s possession from the lessee, if any breach of condition is
done by lessee.
- If there is a damaged to the
property which is leased, then the lessor having a right to recover the
amount of damages from the lessee.
- On the termination of the contract
of the lease, the lessor having a right to take back his possession from
the lessee.
LIABILITIES
OF LESSOR:
4.
Section 108(a): The lessor
is bound to disclose all the material defect relating to the property which are
lease with the former intended use, of which the former is and later is not
aware.
5.
Section 108(b): Lessor
is bound to request the lessee, to put him in a possession of his property.
6.
Section 108(c): Lessor
can make a contract with the lessee that, if he pays the rent later on which is
reserved by the lease and performs all the terms and conditions mentioned under
the contract which binds the lessee, and then the lessee may hold the property
during the specified time without the interruption.
RIGHTS
OF LESSEE:
- Section 108(d): During
the continuing period of lease if any accession is made (alluvion for the
time being in force) then that accession or area will be taken under such
lease.
- Section
108(e): During the continuing period of
lease, if the material part of the property is destroyed wholly or partly
through by fire, or by flood, or by war or by the violent act of the mob
or by any other means and it becomes permanently unfit for the use for
which it is to be rendered, then it becomes void at the option of the
lessee.
- Section 108(f): During
the continuing period of lease, if the lessor avoids to make any repairs
to the property which he is obliged to do on a reasonable time even after
notice, and if such repairs is done by the lessee himself, then he has a
right to deduct such expenses from the rent or can recover from the
lessor.
- Section 108(g): If
the lessor avoids making any such payment which a lessor is bound to make
and if such payment is recoverable from the lessee or recovered against
the property, then the lessee have a right to recover it from the lessor
or can deduct it from the interest of the rent.
- Section 108(h): Lessee
having a right to remove all such things which he has attached himself to
the earth provided that lessee has to leave the property in such a state
in which he has received it.
- Section 108(i): When
a lease is of such duration which is not specified by any means, except
the fault of the lessee, he or his legal representative having a right to
collect all the crops which is planted, sown or growing by the lessee at
the lease property and they are free to ingress and egress from such
property.
- Section 108(j): Lessee
having a right to transfer the property absolutely or any part of his
interest by the way of sub-lease or through mortgage. But, by such reason
a lessee cannot by any means ceases himself from the liabilities which are
attached to the leased property.
LIABILITIES OF LESSEE:
- Section 108(k): Lessee
is under obligation to disclose all the material facts which likely to
increase the interest or the value which the lessee and the lessor is not
aware about.
- Section 108(l): Lessee
is under obligation to pay the premium or the rent to the lessor or his
agent on a reasonable time.
- Section 108(m): Lessee
is under obligation to keep the property in a proper condition and on the
termination of the lease restore all such good in such a way as it was at
the time when he was in possession.
- Section 108(n): if
lessee is aware about any proceedings against the property or any
encroachment or any interference is done, then lessee is under obligation
to give notice to the lessor.
- Section 108(o): Lessee
having a right to use the assets or goods which are placed in the property
as a ordinary prudence men and use it as it his own but, he is under
obligation that he should not use or allow any other person to use the
property in any other way or purpose other than the purpose for the
property is leased.
- Section 108(p): Lessee
cannot without the consent of the lessor taken out any structure
permanently of or on the property except in the case of agriculture
purpose.
- Section 108(q): On
the termination of the lease, lessee is bound to give the possession back
to the lessor.
DETREMINATION UNDER SECTION 111:
A lease
can be determined by:
- When the time of
the lease is expired.
- Where such time
is limited which is based on the happening of some event.
- When the
interest of the lessor gets terminated or his power disposed of towards
the property.
- Gets terminated
by the way of implied surrender.
- When the
expiration notice is given by one party to the another or where there is
an intention to quit the property leased.
- It gets
terminated when the interest of the lessee and lessor gets vested on the
one person at the same time.
- Gets terminated
by the way of forfeiture like if there is a breach of any condition on the
part of the lessee or like lessee given or setting the title in the name
of third person or by himself.
EXCHANGE
(Section 118 to 121)
Exchange
can be defined as when two persons mutually transfer the ownership of one thing
for the ownership of another and neither thing nor both things being money
only, the transaction is called an exchange.
In
exchange there is transfer of ownership of one thing for the ownership of some
other thing. Transfer of ownership for consideration of money is called sale
whereas without consideration, it is called gift. Therefore, where a property
is changed for another property, it is called exchange.
CHARACTERISTICS
OF EXCHANGE:
1.
Transfer of ownership: Absolute interest of
owner is transferred.
2.
Properties need not be immovable: Immovable
property may be exchanged with movable property or vice versa.
3.
Exchange includes barter: Transfer of ownership
in some immovable property in consideration of transfer of ownership in another
movable property is known barter.
4.
Mode of transfer: Section 118 provides that a
transfer of property in competition of an exchange can be made only in manner
prescribed for the transfer of such property by sale. Therefore, the
formalities u/s 54 are to be complied with.
CASE
LAWS:
·
NIVRUTTI KUSHABA BINNAR V. SAKHIBAI AIR 2009 Bom
93:
Where
the immovable property is of value less than Rs. 100, registration is optional
but in case the value of immovable properties is more than Rs 100, registration
of the document is compulsory.
·
SRIHARI JENA v. KHETRAMOHAN JENA AIR (2002) Ori
195:
It is
necessary that the deed of exchange must be valid contract. Where the deed was
executed to compromise criminal proceedings between the parties, it was held
that since the object of the contract of exchange was unlawful, the contract
and the exchange was void.
·
HARI SHANKAR MISHRA v. VICE CHAIRMAN KANPUR
DEVELOPMENT AUTHORITY AIR 2001 All 139:
When in
exchange of properties one party did not get possession of the property he was
entitled to receive in the exchange, he was held entitled to return of property
transferred by him.
RIGHT OF PARTY DEPRIVED OF THING RECEIVED IN EXCHAGE U/S 119:
This
section provides that for a contingency in which one of the parties to the
exchange is deprived of the property received by him due to some defect in the
title of the other party.
1.
If any party to an exchange,
2.
Is deprived of the thing
received by him in exchange by reason of any defect in the title of the other
party,
3.
Such other party is liable
to him
a.
For the loss caused by such
defect or
b.
For the return of the thing
transferred at the option of the person so deprived, if the thing is still in
the possession of such party
4.
However, this remedy is
subject to contrary intention appearing in the terms of exchange. The parties
may have agreed to the contrary in such a case this covenant cannot be implied.
The
party suffering loss due to the defective title of other party to the exchange
has been given two remedies u/s 119:
i.
He can recover for compensation the loss
suffered by him;
ii.
He can take back the thing transferred by him.
However,
the second remedy is available only in three situations:
i.
Where the property is still in the possession of
the other party, or
ii.
In the possession of his legal representative
iii.
A transferee from him without consideration.
RIGHTS
AND LIABILITIES OF THE PARTIES U/S 120:
The
rights and liabilities of the parties to the exchange are same as that of the
seller and buyer in case of a sale.
GIFT
(Section 122 to 129)
According
to section122, “Gift” is the transfer of certain existing movable or immovable
property made violently and without consideration, by one person, called Donor,
to another, called the Donee and accepted by and behalf of the Donee.
A gift
is a gratuitous transfer, i.e., without consideration.
Gift is
transfer of both existing movable and immovable property with the transfer of
ownership without consideration. A gift can only be made in favour of an
ascertainable person means it cannot be in favour of an idol or public. Under
the transfer of property act it is essential that gift must be accepted by the
done though it could not be necessary to be expressly accepted.
ESSENTIAL
OF GIFT:
1.
There must be a transfer if ownership of a
property.
2.
The property must be in existence.
3.
The transfer must be voluntarily made and
without consideration.
4.
The property must be accepted by on or behalf of
the person to whom it is transferred.
5.
The transfer must be effected in the manner
prescribed by law.
6.
The parties must be living
CASE
LAWS:
·
GANDEVELLA JAYARAM v. MOKKALA PADMAVATHAMMA AIR
2002 AP 75:
Where
the transfer of immovable property was by way of “pasupa kumkuma” which means a
gift, settlement or assignment of land of daughter, this amounts to a gift and
requires registration.
·
MUKHRAJ DEVI v. MANOJ KUMAR SINGH AIR 2002 Jhar
87:
Where a
gift deed was executed by an old illiterate lady and her thumb impression was
not identified by her thumb and moreover, none of the co-villagers or relatives
were attesting witness instead it was witnessed by a stranger, it was held that
the gift deed could not be said to be valid gift deed and therefore the claim
of ownership over the property by virtue of the gift deed was not tenable.
ONEROUS
GIFT:
Onerous
gift is defined under section 127 which states that when a gift is in a form of
single transfer and is to be made to the same person with several things where
one or two can be and others are not, created a burden on the donee that the
donee can take nothing until he has accepted it fully.
Onerous gift is based upon the maxim “Qui Sntit
Commodum Sentire Debet Et Onus”. It means that one who receives the advantage
must have to bear the burden.
TRANSFER HOW EFFCETED U/S123:
According
to section 123, Transfer of immovable property through gift will be effective only by a registered instrument which is signed by
or on behalf of the donor, and it should be attested by at least two witnesses.
But, if the instrument is not registered then the title of the immovable
property to the donee cannot pass.
However,
transfer of movable property will be effective either by the registered
instrument which is signed by or on behalf of the donor and attested by at
least two of the witnesses or merely delivery of possession is sufficient. And
such delivery will take place in the same way as the goods sold may be
delivered.
WHEN
GIFTS MAY BE SUSPENDED U/S 126:
Section 126 of Transfer of
Property Act states the ground of revocation and suspension of gifts:
- A gift can be
revoked if there is a failure of consideration and if it were a contract
then it might get rescinded.
- If the validity
of a gift is dependent on any specified event, and that of such specified
event is not depend on the will of the donor then the gift can be
suspended or revoked.
UNIVERSAL DONEE AS U/S 128:
Universal
donee is defined under the section 128 of Transfer of Property Act,1832 which
means that when the transfer is made, whole donor’s property of is being
transferred to the donee with all the debts due by and with the
liabilities of the donor at the time when the gift is made and the donee is
personally liable.
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