Concept of Transfer of Property

Transfer of property is an “ act by which a living person can conveys property”. The transfer of property act 1882 is an the Indian legislation that governs and regulates the transfer of property in the Indian subcontinent. The act covers movable, immovable, tangible and intangible property. The Act deals with Sale, Mortgage , Lease, Exchange, and gift.

Introduction to Concept of Transfer of Property

Transfer of property is an “ act by which a living person can conveys property, in present or in future, to one or more other living persons, or to himself, or to himself and one or more or other living persons, and to transfer property is to perform such act.”

The transfer of property act 1882 is an the Indian legislation that governs and regulates the transfer of property in the Indian subcontinent. It was enacted on the 17th of February 1882 and officially came into force on the 1st of July 1882. The act covers movable and immovable, tangible and intangible assets (copyrights, trademarks and patents). The Act deals with the following kinds of transfers:

(1) Sale,

(2) Mortgage,

(3) Lease

(4) Exchange, and

(5) Gift.

Essentials of a valid transfer 

1.It must be inter-vivos

Section 5 of the act stipulates that the transfer must be inter vivos. That is to say that the transfer must be made between living persons. Both the transferrer and the transferee must be living at the time of transfer. Living persons also include company, corporate or association.

2. The property must be transferable

Sections 6 lays down that the following transfers invalid.

• 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. Thus if A is an heir to the estate of B ,then, the estate thus becomes incapable of transfer.
• A mere right of a re-entry for breach of a condition subsequent cannot be transferred to anyone except the owner of the property affected thereby. X grants the lease of a plot to Y for a period of 5 years. On the expiry of 5 years, X grants the right of re-entry along with the property to Z. The transfer is valid.
• An easement cannot be transferred apart from the dominant heritage.” Dominant Heritage means inheriting a right over another’s property without owning it. Thus if M owns a piece of land and N has right of way over it. N has dominant heritage over M’s land and his land can’t be transferred apart from the dominant heritage.
• An interest in property restricted in its enjoyment to the owner personally cannot be transferred by him. If A is a tenant at B’s house, he cannot transfer to C his right of enjoyment over B’s house.
• A right to future maintenance, in whatsoever manner arising secured or determined, cannot be transferred. If A is entitled to future maintenance by B, she/he cannot transfer this entitlement ot another, C.
• A mere right to sue cannot be transferred. If H has the right to sue G over a contract, he may not transfer his right to sue to anybody else.
• A public office cannot be transferred, nor can the salary of a public officer, whether before or after it has become payable.
• Stipends allowed to military, naval, air force and civil pensioners of the government and political pensions cannot be transferred, pension means a periodical allowances or stipend granted not in respect of any right of office but on account of part services of particular merits. Section 60 of CPC also exempts a pension from attachment in execution of degree against the pension holder.
• No transfer can be made (1) in so far as it opposed to the nature of the interest affected thereby, or (2) for an in so far unlawful object or consideration within the meaning of Section 23 of the Indian Contract Act, 1872, or (3) to a person legally disqualified to be a transferee.
• Nothing in this section shall be deemed to authorise a tenant having an un transferable right of occupancy, the farmer of an estate in respect of which default has been made in paying revenue, on the lessee of an estate, under the management of a court of wards to assign his interest such as such tenant farmer or lessee.

3. No transfer can be made

• (1) in so far 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; 7[(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 management of a Court of Wards, to assign his interest as such tenant, farmer or lessee.]

4.Section 7 deals with persons competent to transfer:

Every person competent to contract under section 11 of the Indian contract act(i.e he must be of sound mind, must not be disqualified in other words insolvent and alien enemy.

Sadiq Ali Khan Vs. Jai kishore,1928. [1]

Privy Council observed that a deed executed by a minor was nullity. Principle of estoppel cannot be applied to a minor. A minor is not competent to transfer yet a transfer to a minor is valid .

Amina Bibi vs Saiyid Yousuf 1922.All. 449. [2]

In this case it was held that a contract made by lunatic is void under section 11 of the Indian Contract Act, and so also, transfer by him of his property is void.

K Kamama Vs. Appana [3]

U/s. 11 of Hindu minority and guardianship Act, 1956 a defacto guardian is merely a manager and cannot dispose off minor’s property. In this case a defacto guardian sold property of a minor, the court declared the sale invalid.

Entitled to transferable property (a person who is the absolute owner of the property and is free from encumbrances can transfer the same) or

Authorized to dispose of transferable property not his own, is competent to transfer such property either wholly or in part, and either absolutely or conditionally, in the circumstances, to the extent and in the manner, allowed and prescribed by any law for the time being in force.

Hussiaa Banu v. Shivanarayan[4],

it was held that where one of the parties to a settlement gives up a claim to receive a certain sum of money from the other, in consideration of the latter’s given up the right to certain property claimed by him, it would amount to a transfer.

A transfer of property passes to the transferee all the interest which the transferor is then capable of passing in the property unless a different intention is expressed or implied. The transfer of a property creates a new interest for the transferee. If the transfer falls short of this criterion it may not be deemed to a valid transfer under the transfer of property act 1882.

References

[1] (1928) 30 BOMLR 1346

[2] 70 Ind Cas 968

[3] AIR 1973 AP 201

[4] AIR 1968 MP 307,

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Author Details: Aarthi V.

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