Introduction to the Act
Tanu Bhardwaj
Assistant Professor
Introduction
According to the Transfer of Property Act 1882, “Transfer of Property“
means an act by which a person conveys property to one or more
persons. The act of transfer may be done in the present or for the
future. The person may include an individual, company or association
or body of individuals, and any kind of property may be transferred,
including the transfer of immovable property.
The Transfer of property Act 1882 is one of the most important branch
of law of property. It consist of 137 sections and is divides into 8
chapters.
Concept of Property
The term property may be described as the sum-total of a man's
fortune which includes not only the objects of which he is the owner,
but also the value of any claims which he may have against other
persons. However, if we talk in limited sense, property covers only a
person's proprietary rights as opposed to his personal rights. In another
sense, property includes only those rights which are proprietary rights
in rem e.g. patent , copyright. However, a debt or benefit of a contract
is not included within the scope of the term 'property'.
• The Supreme Court of India in Guru Dutt Sharma V. State of Bihar,
defined property as a legal concept and observed that:
• It is a bundle of rights' and in the case of tangible property, it would
include the right of possession, the right to enjoy, the right to retain,
the right to alienate and the right to destroy.
Kinds of Property
• The objects which are capable of becoming property are those over
which a person exercises a right and with reference to which another
person owes a duty. These objects may be:
• Material objects e.g. physical things (res corporales) like house, horse,
car, chair, tree etc.
• Intellectual objects which are artificial things called res incorporales
like patent, trademark, copyright etc.
• So, the property is primarily of two kinds, namely corporeal and
incorporeal.
• Corporeal property is the right of ownership in material things
whereas incorporeal property is any other proprietary right in rem,
e.g. patent right, right of way. Corporeal property is always visible and
tangible while incorporeal property is not. Both are, however,
valuable rights in as much as they are legal rights recognised and
enforced by law. Corporeal property is of two kinds, namely, movable
and immovable.
Incorporeal property can divided into two kinds, namely:
• Jura in re propria over immaterial things e.g. patents, copyright,
trademark etc.
• Jura in re aliena (encumbrances), whether, over material or
immaterial things e.g. lease, mortgage and servitude.
Nature of property
In TPA 1882
1. Tangible material things i.e land and houses
2. Rights which are exercised over material things eg right to enjoy
any possession , right to sell
3. Right which are not exercised over any material things eg right to
repayment of a debt
• Meaning of Transfer of Property –
Section 5
“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.
"Living person" includes a company or association or body of
individuals whether incorporated or not.
• The term 'property' also includes goodwill of a business, which is an
intangible asset. It includes not only immovable and movable object,
but also patents, copyrights, shares, claims etc. According to Salmond,
ownership of corporeal property is general, permanent and
inheritable right of user of a thing.
Scheme of the Act
Transfer
By the Act of By the operation
Parties of law
Testamentary
Inter vivos
(takes effect
(takes effect
after death and
between 2 living
governed by the
persons and
Indian
governed
succession act
Transfer of
property
Special transfer
whether
of immoveable
movable or
immoveable
Mortgage and Actionable
Sales Leases Exchange Gifts
charge Claims
Section 54-57 Sec 105-117 Sec 1118-121 Sec 122-129
Sec 58-104 Sec 130-137
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Historical Background
Before the Transfer of Property Act came into existence in 1882 , the
transfer of immoveable properties in India were governed by the
principles of English law and equity.
In the absence of any statutory provisions , the court must fall back or
rely on English law on properties matter, sometimes forcing court to
decide the disputes according to their own notion of justice and fair
play, resulting in confused and conflict case laws.
to remedy these conflicts, law commission was introduced ,they draft
one bill which was introduced in legislative council in 1877.
Then Act effect on 17th February 1882
Scope
This act applies only to transfer by living person. It does not regulate
transfer by operation by law. In case of transfer by living person, both
are having at the time of transfer.
Movable Property
• The Transfer of Property Act, 1882 does not define movable property.
It is defined with the help of other statutes.
• As per General Clauses Act, 1897 movable property means “property
of ever description except immovable property”.
• The Registration Act defines "moveable property" to include property
of every description excluding immovable property but including
standing timber, growing crops and grass.
Immovable Property
• The term “immovable property” is also not defined under the Act.
However a negative reference is given in the Act which says that
immovable property does not include standing timber, growing crop
and grass.
• According to General Clauses Act ,1897 –
Immovable Property shall include land, benefits to arise out of land and
things attached to the earth, or permanently fastened to anything
attached to the earth.
• Examples –
• 1. Machine fixed on land temporary.
• 2. Government Promissory note
• 3. Intellectual Property Right
• 4. Standing timber and trees
• 5. Right to recover maintenance allowance.
• 6. Royalty
• 7. Right to worship
• 8. Copyright
• 9. A decree for sale on a mortgage deed.
• 10. Standing timber, growing crops and grass
• Examples –
• 1. Chattel embedded to earth
• 2. Easement
• 3. Right to ferry
• 4. Right to way
• 5. Right to enjoyment of property under lease
• 6. A right to fishery
• 7. A right to collect rent of immovable property
• 8. Interest in mortgage
• 9. Hereditary offices
• 10. Right to collect lac from trees
• 11. Reversion in property leased.
• 12. A factory
Essential elements of valid transfer
It is necessary to fulfill the following conditions to make a valid transfer
of an immovable property :
1. Property must be transferable.
2. Transferor and transferee must be competent.
3. Consideration and object of transfer must be lawful.
4. Transfer must take place as per method prescribed under the Act.
Who can transfer the property?
• Every person who is competent to contract and entitled to
transferable property, or
• authorized to dispose of property is competent to transfer such
property.
• Hence, every person competent to contract and having ownership
can transfer property.
• According to Indian Contract Act, a person is competent to contract
when he is a major
• and of sound mind and is not disqualified from contracting by any law
to which he is subject.
Properties which can be transferred
Every kind of property can be transferred. But this section has a few
exceptions. They are –
1. Chance of an heir apparent.
2. Right of re-entry.
3. Transfer of easement.
4. Restricted interest.
5. Right to future maintenance.
6. Right to sue.
7. Transfer to public office salary and pension.
What is alienation?
• Alienation means transferring of property. This transfer of property
can be through gifts, sales and mortgages. Under Hindu Law, no
person of the Joint Hindu family, not even the Karta, has the full
power to alienate the joint family property or his own interest in the
joint family property without the consent of all coparceners. In the
case of separate property, a Hindu can alienate that property whether
it comes under Dayabhaga or Mitakshara school. This power is
absolute.
Can alienation of property be
restrained?
• Section 10 lays down that where the transferee is absolutely
restrained from transferring his interest in his property to another
person because of a condition which came along when the property
was transferred to the transferee, then this condition will be made
void. The transfer, from the transferor to the transferee would remain
valid.
• For example, A transfers some property to B as a gift but with the
condition that while A is alive, B must not transfer the property to any
other person. This condition will be held void as it absolutely restrains
B from transferring his interest in the property to another person
• This is commonly known as the ‘rule against alienability’. The Transfer
of Property Act is based on the principle that there can be a free
transfer of property and has been specifically made with regard to
free transfer. If conditions restraining transfer are imposed, then the
free transfer would be restricted and there would be no use for the
Transfer of Property Act.
• However, only conditions mandating ‘absolute restriction’ are void.
There are conditions which call for partial restraint to be observed
with regard to the transfer of property. If we are to determine
whether a condition is absolute or partial, then one must look at the
substance of the condition, and not merely the words. Therefore,
restraints can be classified into two categories.
Types of restraints
• Absolute Restraints
• An absolute restraint is such a restraint which completely takes away
the right of the transferee to alienate or dispose of the property. The
transferee can now no longer transfer his interest in the property to
another person and he has no freedom to do what he wants with the
property in his capacity as the owner of the property.
• Section 10 stipulates that any condition imposed on the transferee
which would amount to an absolute restraint on the right of the
transferee to dispose of his interest in the property shall be void. The
property must be transferred to the transferee subject to the
condition.
• In Rosher v. Rosher (1884) 26 Ch D 801, A made a gift of a house to B,
and gave a condition that if B decides to sell the house during the
lifetime of A’s wife, she should have the option of purchasing it for Rs
10000, while the market value of the house was set at Rs 10,00,000.
This condition was held to be an absolute restraint and was declared
void.
Partial Restraints
• A partial restraint is a condition which partially takes away the right of
the transferee to dispose of his interest in the property. Here, the
right is not taken away substantially. Section 10 does not explicitly talk
about partial restraints. A condition imposing partial restriction is
valid.
• In Mata Prasad v. Nageshwar Sahai (1927) 47 All 484, there was a
dispute regarding succession between nephew and widow. A
compromise was formed that the widow had possession of the
property while the title for the same was given to the nephew with
the condition that he was restricted from alienating the property
during the widow’s lifetime. It was held that the compromise and the
condition were valid and prudent in the present case.