Transfer of Property Act
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This article has been written by Chandan Kumar Pradhan, from KIIT School of Law, Odisha. This article talks about the various types of transfer of property under the Transfer of Property Act, 1882.

Introduction

Section 5 of the Transfer of Property Act, 1882 defines that, the property will be delivered by a living person to one or more other people in the present date or in future times or to himself only. The expression mentioned above “in present or in future” is deriving the meaning of the word ‘deliver’. There will be no transfer of future property. The transferee needn’t be a competent person like a transferor. A transferee can also be a minor, insane or child in a mother’s womb.

In this section “living person” includes “companies, private associations, which are registered or not, but nothing in this section affects the law while doing the transfer of property to any company or association or individual body”.

Kinds of transfer

Subsequent forms of transfer under the Act are: 

  • Sale– It’s an out-and-out transfer of property And also the consideration is money.
  • Mortgage– It’s a transfer of a limited interest during a property.
  • Lease– A lease may be a transfer of a right to enjoy the immovable property for a particular time.
  • Exchange– It’s the same as sale, but differ in consideration. Here the consideration is another thing not money.
  • Gift– Here, there’s no consideration.

Which is not amounting to the transfer of property?

Another meaning of transfer of property is “Conveying the property”. A fresh interest within the mind of the transferee, if new interest has not been created in mind of the transferee, the property can not be said to be conveyed, thus no transfer of property is finished.

  1. Partition- When two blood relatives like brother and brother dividing their property between themselves is called partition. And it can’t be transfer of property because that property was already in their own possession and no new property is created.new is formed by co-sharer on the partition, it’s not a transfer of property. His specific share, which settled in him earlier, is just separated.
  2. Relinquishment (sacrifice)- Here, there is nothing to transfer, because in this, the successor who was the owner of that property, he sacrificed that property to his/her closet person, the transferee may be one or more then one. Therefore, those who got the profitable property they can enjoy over that.
  3. Surrender- A transferor has a contract to transfer some property with a minor. But, if the guardian of the minor has a condition with another person then it will not be a transfer of property.
  4. Easement- The creation of an easement doesn’t amount to a transfer.
  5. Will- Because it comes from the death of the person making it, while the definition of transfer is for the future by a living person, it doesn’t come under the definition of transfer.
  6. Compromise- It depends on the facts and circumstances of every case. It may or might not amount to transfer.
  7. Family arrangement/settlement- Any family problem arises about their property, then if a third person came and solved that problem and put an end to the disputes is not amounting to transfer of property.

What is also transferred?

Section 6– “ Any types of property which can be additionally transferred, except provided by this act or by any other law for nowadays in effect”. 

This section specifies different types of property which can not be transferred (Exception to Section 6)-

  1. Spes Successionis [Section 6(a)]- “The possibility that an heir apparent is clearly unsuccessful in a certain situation, that the possibility in a relationship, receiving an ancestral property by the death of an ancestor or in another natural event, then the transfer can not be performed.”

Any opportunity for the heir apparent to succeed under certain conditions is not included in the category of assets that can be transferred. 

For e.g, ‘X’ a Hindu, dies and leaves his wife with ‘C’. ‘C’ has only a spes succession, his succession depends upon two factors, that the surviving of the X’s wife and the property which was left by ‘X’.

  • Right of Re-entry [Section 6(b)]- “A simple right of re-entry for breach of a condition following can not be transferred to anyone except the owner of the property.”
  • Easement [Section 6(c)]- “An easement can not be transferred except from the dominant heritage.”

An easement right to use, or restrict the utilization of land of another in their way, for example- the right of way, right of water or light, etc. (Section 3 Easement Act).

  • Restricted Interest [Section 6(d)]- “A right of the owner is strictly prohibited in its enjoyment to him or her personally can not be transferred to any other.”

E.g- A man can not transfer the right of enjoyment of the home to any different person. If the home is lent to the man for his personal use.

  • Maintenance [Section 6(d)]– “A right of a person to his future maintenance, in whatever manner it would arise, that should be secured or determined, and can not be transferred to anyone.”
  • Mere right to sue [Section 6(e)]- “A mere right to sue can not be transferred to anyone.”

A right to sue is a personal possibility for the injured..

  • Public office [Section 6 (f)]- “A public office cannot be transferred to anyone because, it’s a public property and the person who has the qualities, they should only enjoy the rights of the office not all. And always changes and pays for work not for the office.”
  • Pensions [Section 6(g)]- “Stipends are allowed only for the military, air force, naval and civil pensioners of the govt. and political pensions that can not be transferred to anyone, pension means a periodical allowance or stipend which they will get after their job is over.
  • Nature of Interests [Section 6(h)]- “There is no transfer on this point because it against the nature of the interest affected thereby, or as far as unlawful object or consideration within the meaning of Section 23 of the Indian Contract Act, 1872, or to someone who is legally disqualified to be a transferee.”

This clause restricts the transfer with anyone which is in nature and isn’t transferable, e.g- res communes (things are also utilized by all men, which nobody specifically is the owner), res nullius (things belonging to nobody).

  • Untransferable interests [Section 6(i)]- “In this section it is not mentioned that, to authorize a tenant it is compulsory to have an non-transferable right of occupancy, like the farmer has a condition to pay the revenue, in which there are some conditions are also on the lessee, under the supervision of a Court’s department”.

When a person competent to transfer?

Section 7 of the Act provides that, “the person who is allowed to sign a contract is also allowed to transfer a property and then he will be allowed to enjoy the property wholly after it takes place. Legally permitted and determined for the time being in force.”

These are some persons can be competent to transfer:

Competent to contract, sound mind, the transferor must be entitled to transferable property.

Operation of transfer

Section 8 of the Transfer of Property Act provides transfer of various types of property and their legal incidents. It means that “A transfer of property passes to the transferee with all the interest which the transferee is then capable of using the property in his/her future within the all legal incident.”

In any situation, where the property is related to land or the property is rented, then the transferor and transferee should make a plan about the outcomes of the property which will be generated after the transfer takes place. After that, there will be no problem arising in the future and if the property generates money, then the income can be calculated after the transfer takes place.

Section 6(a) of the Act provides certain rules which are non-transferable (spes succession). These are as follows-

  • The possibility of a person who is most likely to get the ancestral property after his or her ancestor’s death under certain situations.
  • The probability of a relationship obtaining a legacy(gift) on the death of a blood relative.
  • Another mere possibility from nature.
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  • Chance of an Heir Apparent

The expectation forbids both Hindu Law and Muslim Law. A mere possibility of an heir succeeding to a condition is eliminated from the class of transferable property. A Hindu successor has no right. In presents within the property which the female owner holds forever for her life.

  • Chance of Legacy(gift)

The chance of getting a gift has more possibility of being non-transferable than getting the ancestor’s property as a legal heir.

  • Chance of nature

This rule has more possibilities of being non-transferable than the other two, which are mentioned above.

E.g- The chance of winning a prize from a certain competition, which cannot be transferred in the property.

Transfer by an unauthorised person(Doctrine of feeding empty grant by Estoppels)

A person, who has no right to transfer any immovable property, cannot transfer that property. Transfer by such person will be called the transfer by an unauthorized person.

Section 43– Transfer by unauthorized persons means, where someone fraudulently shows that he’s authorized for the transfer of certain immovable property and declares to transfer such property for consideration such transfer shall at the choice of the transferee.

E.g,- ‘X’, the son of ‘Y’. ‘X’ has separated from his father. ‘X’ sells 4 fields to ‘Z’ that ‘A’, ‘B’, ‘C’, ‘D’, representing that he is authorized to transfer the same. From these fields ‘C’ does not belong to ‘X’, it has been retained by ‘Y’ on the partition. But on Y’s dying ‘X’ as heir obtains ‘C’. ‘Z’, not having revoked the contract of sale, may require ‘X’ to deliver ‘C’ to him.

The general rule of Nemo dat quod non-habet (no one can give to different person, what he himself doesn’t have the rights)has been relaxed through this section,

For the applying of this section following must be satisfied:

  • There must be a fraudulent representation of ownership by the transferor.
  • Transfer must be by the incorrect owner.
  • The transferee must act on it false representation in good faith.
  • The transfer is for consideration.
  • The property which someone professed to transfer subsequently acquires some interest in that property.
  • The contract of transfer still subsists.

Subsequently acquired interest doesn’t pass automatically to transferee but only if he claims right in such property.

The exception to the present section protects the rights of the record transferee in good faith and also the consideration who has no notice of the choice in favour of the primary transferee.

A legal question on Transfer of Property Act, 1882

Can you transfer a property you are going to inherit?

Legally, a son, who is hoping to inherit the property of his father can not transfer his rights of this property to any other person, till his father is alive. If a person promises to transfer his right over his future property to someone else when he will get the ownership, the contract between those two parties will be void. However, you can never make a contract to gift a property which you are hoping to get in future. Transfer of your future property as a gift without receiving any consideration will be void.

Conclusion

Section 6(a) and Section 43 have some problems with each other. Where Section 6(a) deals with spes successionis and defined that which property are untransferable property and which are not, whereas Section 43 deals with the unauthorized transfer of property, in such transfer very big problem will arose on behalf of transferee because the transferee had no idea that the property is unauthorized and the transferee will take that property in good faith which is wrong.

In this Act, if a transferor wants to transfer anything then he or she has to think clearly about the possibility of doing something which he has to sought to be conveyed to the transferee about the property.


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