MEANING AND DEFINTION OF PROPERTY

Meaning of property:
 Property has very wider meaning in its real sense
 It not only includes money and other tangible things but also
intangible things
 In general sense, property is only physical or virtual entity, owned
by an individual or jointly by a group of individuals
 The important aspect of the concept of ownership and property is
the word ‘thing’ on which a person has control for use.
 There are some traditional principles related to property rights:
 Control over the use of property
 Right to take benefit from property
 Right to transfer or sell the property
 Right to exclude others from property
 The word ‘property’ is derived from the latin word proprietary, which
means a thing owned.
Definition of property:
 In the transfer of property act, there is no definite definition for the
term ‘property’.
 Sec.2(c) of the benami transactions (prohibition) act, 1988 defines
property. “property” means property of any kind, whether movable
or immovable, tangible or intangible and includes any right or
interest in such property.
 Sec.2(11) of the sale of goods act, 1930 defines property as
“property means the general property in goods and not merely a
special property.”
Kinds of property
CORPOREAL

Property is essentially of two kinds

INCORPOREAL

Movable and
CORPOREAL immovable

Real and personal

property

In re propria
INCORPOREAL

In re aliena
1. Corporeal and incorporeal property

a. Corporeal property:
 Corporeal property is the right of ownership on material things
 Always visible and is tangible
 Can be perceived by sense
 Ex: a house, land car, bike etc.

b. Incorporeal property:
 Incorporeal property also known as intellectual property or
conventional property
 It includes all valuable interest protected by law
 It is intangible
 Exs: patents, copyrights, trademarks etc.
 Incorporeal property is divided into two:
 Jura in re propria – over a material thing (for ex: patents,
copyrights, trademark etc.)
 Jura in re aliena – whether over a material or immaterial
things (for ex: lease, mortgage and servitude etc.)

2. Movable and immovable property

 All corporeal property is either movable and immovable
 In English law, these are termed as chattels and lands
respectively.

a. Movable property:
 Movable property which can be transferred from one
place to another place with human efforts

b. Immovable property:
 It includes
 Lands
 Benefits arising out of land
 Things attached to earth or permanently anything
that is attached to earth

3. Real and personal property

 In English law, property has been divided into real and
personal property
 This is identical with immovable and movable property

a. Real property:
 It is a immovable property, ie. Its land and anything attached
to land.
b. Personal property:
 It is a movable property, ie anything that can be subject to
ownership, except land.
 It can be tangible or intangible

4. Public and private property

a. Private property:
 A property owned by an individual or group of individuals
 Ex: furniture, car, house, land, jewels
 Owner of private property can sell, exchange or even destroy
his property

b. Public property:
 Property owned by the government
 Such property meant for the welfare of the people
 All people in the country have equal rights to use it
 Ex: public parks, trains, post office, public roads, public
hospitals
 The government can sell, exchange or destroy the property.
 SCOPE AND OBJECT OF THE TRANSFER OF PROPERTY
ACT, 1882
 In a civilized society, transfer of property from one person to
another person is quite obvious.
 There are different laws governing transfer of property, movable and
immovable under different circumstances:
a. Sale of goods act, 1930 – it deals with moveable property or
goods transferred from one living person to another living person
b. Law of succession – the Hindu succession act, 1956 and Indian
succession act 1925, deals with property transferred from dead
person to living person
c. Transfer of property act, 1882 – an immovable property is
transferred from one living person to another living person
Introduction to transfer of property act, 1882:
 The act is passed on 1882 and came into force from 1st July 1882.
 It mainly deals with transfer of immovable property and also
movable property between two living persons
 It contains 137 sections and it divided into 8 chapters.
Transfer of property
 Transfer of movable and immovable property
 Transfer of inter vivos and transfer from one dead person to one or
more living
 Voluntary transfer
Among the above, the transfer of property act mainly deals with transfer
of immovable property, transfer inter vivos and voluntary transfer.
Meaning and object of the act:
 Main object enshrined in the preamble of transfer of property act is
to amend or regulate the law relating to transfer of property by act
of parties.
 Preamble of the act is deals with transfer of property by act of
parties.
 The act provides a uniform and clear law concerning tarndfer of
movable property from one living person to another living person by
the act of the parties.
 Transfer of property act, 1882 is an extension of Indian contract act,
1872
 The act cannot be considered as totally exhaustive, it covers the
transfer of immovable property from the act of the parties.
 The act covers five types of transfer of immovable property such as
mortgage, gift, sale, actionable claims, lease
  The act is governed by various principles like justice, equity and
good conscience
 This act 1882, highlights the provision of inter-vivos.
Scope of the act
The scope of transfer of property act is limited, as it does not
apply to all transfers which take place in India. The act is subject to
certain territorial and other limitations as stated below:
 This act applies to transfer by act of parties
 The act deals with transfer of property inter – vivos, ie… a transfer
of property inter – vivos, ie… a transfer between the living persons
Kishori Vs. krishna kamini– A transmission of property which takes
place under a will or through a succession is not covered by this
enactment.
 This act also contains provision for transfer of movable property
(eg.sec.5 – sec.37) – a major portion of enactment is applicable to
transfer of immovable properties.
 Territorial limitations.

 This act has been amended, repealed partly from time to time
 The amendment act of 1929 amended more than 50 sections and
introduced some new sections.

Changes brought about by the act 1929:

The transfer of property (amendment) act, 1929 came into force from 1 st
April 1930 and introduced a drastic change in the act
 Registration of a compulsory registerable document operates as
constructive notice. The effect of this provision is to supersede the
privy council decision in tilak dhari lal’s case.
 Transfer in favour of a class is not to be wholly void though some
members of the class are unable to take.
 The doctrine of part performance has been statutorily recognized
and embodied in sec.53A
 Scheme of transfer of property act, 1882

TRANSFER

BY ACT OF BY OPERATION
PARTIES OF LAW
(VOLUNTARY) (COMPLUSORY)

TESTAMENTARY INTER VIVOS

TRANSFER OF PROPERTY TRANSFER OF IMMOVABLE

WHETHER MOVABLE OR PROPERTY
IMOVABLE
(SEC.25 – 53A AND SEC.54 – 137)
(SEC.5 – 37 AND SEC.122 – 137)

SALES MORTGAGE LEASES EXCHANGE GIFT

(SEC.54- (SEC.58 - (SEC.105 (SEC.118 – (SEC.12
57) 108) – 117) 121) 2 – 129)
 MOVABLE AND IMOVABLE PROPERTY
Property may be divided into:
 Movable
 Immovable

a. Movable property:
 Property which can be transferred from one place to another
with human efforts
 Ex: vehicles, books utensils

b. Immovable property:
 Property which cannot be transferred from one place to
another without causing damage to the property
 Transfer of property act deals with transfer of both movable
and immovable property
 Ex: land, houses, flats etc..
Why should we determine whether the property falls under
movable or immovable
 Sale of movable property is covered under sale of goods act, 1930
 Such sales are liable to be paid the value added tax previously
known as sales tax.
 Sale of immovable property is covered under transfer of property
act,1882
 Such transfers to be registered before the sub-registrar office
 To pay stamp duty under Indian stamp act, 1899
 Registration fee to be paid under registration act, 1908
 It is necessary to classify properties for:
 For taxation purpose
 For determination of rights between transferee and transferor
 For purpose of court procedures
Definition of immovable property (sec.3)
 Sec.3, para 2 of the act defines immovable property. “Immovable
property” does not include standing timber, growing crops or grass
 The expression ‘standing timber’ means trees fit for use for building
or repairing houses
 Growing crops – grass can be used as fodder and is movable
property. Ex: pan leaves, sugarcane
  The above definition says that 3 things, standing timber, growing
crops and grass are not movable property.

General clauses act, 1897:

 Sec.3K(26) of act defines the term ‘immovable property’
 The term immovable property includes three things namely:
a) Land
b) Benefits arising out of the land
c) Things attached to earth
Indian registration act, 1908
 Sec.2(6) of the act defines immovable property
Correct definition of immovable property
 Negative definition of transfer of property act + positive definition of
general clauses act, we can come to a conclusion:
 immovable property includes three things
 Lands
 Benefits arising out of the land
 Things attached to earth
 Immovable property excludes three things
 Standing timber
 Growing crops
 grass

Whether trees come under the term movable property

 trees so long as they are rooted in earth they are treated as
“immovable”
 as soon as they are cut and removed, they become “movable”
Marshal Vs Green
In this case the real test for judgement whether a tree is a movable
or immovable, to consider the purpose it to be dealt with at the time of
transfer. If the intention is to cut trees and remove it within a reasonable
time is treated as movable property. If the intention is to grow and yield
fruit it is to be treated as immovable property because it has to draw
nourishment from land. This is a leading case in this regard. The house of
lords held that the sale was relating to movable property only.
State of Orissa Vs. Titaghur paper mills Co.ltd (AIR 1985)
The govt. of orissa and co. entered into contract for supply of bamboo.
The government leived sales tax, treating the bamboo contract as
movable. The company to pay money for cutting bamboo in forest for
number of years. The supreme court held that bamboo contract was benfit
to arise out of land and contract for no. of years. The state government
could not impose sales tax on company.
Right to catch fish from lake/pond
Whether the right to catch fish form lake/pond comes under movable or
immovable
Supreme court answered this question in Anand behara Vs. State of
Orissa (1956) – the sale of right to catch fish form lake / pond requires a
registered instrument for its validity under sec.54 of transfer of property
act, 1882
 ATTESTATION
 immovable property is transferred from one property to another
 it requires a procedure ie. Execution of deed to be attested by two
witnesses
 sec.3 of transfer or property act, deals with the definition of the
term attestation.
Meaning of attestation
‘Attestation’ means “to sign and witness the fact of execution of
document by executant”.
Essential of valid attestation
1. Definition under section is confined only to non-testamentary
instrument
2. Minimum 2 attesting witness are needed. Maximum not mentioned
3. Three modes of attestation is recognized
 each sees the executant signing
 each sees some other person signing in the presence and by
the direction of the executant
 each has received personal acknowledgement from the
executant.
4. Each witness signs the instrument in presence of executant
Case law: Sant lal mahtan Vs. Kamala prasad – supreme court
held that it was not a valid attestation and held that attestation
witness should sign after the executant signed, then only it becomes
a valid attestation.
5. Presence of both or all witness one and at a same time is not
essential
6. No particular form of attestation is prescribed.
Qualification of attestor:
 An attestor must be major
 Person of sound mind
 He may be literate or illiterate
 Scriber of the deed is competent person to witness the deed
 A party to the deed
Case law: Abdul jaffar Vs. Venkata sastri (AIR 1969), supreme court
opined that ordinarily the registering office puts his signature in the
performance of his statutory duty. Attesting witness must have ‘animo
attestandi’. This intention is lacking in registering office – he cannot be
treated as an attestor.

NOTICE
 The literal meaning of term ‘notice’ is knowledge
 The doctrine of notice in reference to Transfer of Property Act, 1882
is used to adjudicate the disputes regarding rights and claims of the
parties, who are involved in unconscionable transaction.
Illustration: A father makes a will in the favour of his son and imposes a
condition that he will pay Rs. 5,000/- per month to his mother for her
maintenance and till he makes an alternative arrangement of an
equivalent amount for her; he should not sell the property.
It would be unconscionable for the son to sell the property without
making such an arrangement. The son sells the property to X, without
making the required arrangement.
The mother and X are innocent but the son has taken up an

unconscionable stand. The mother and purchaser of the property are

bound to go to the court, and here the rights and duties of the mother and
the purchaser shall be determined on the basis of doctrine of notice.
The Court in this case will examine that whether X, the purchaser,
is a bonafide purchaser and he had the ‘notice’ or knowledge of mother’s
rights over the property at the time of contract between him and son. In
case, it is proved that he had notice of this fact, it becomes his
responsibility to honour the right of the mother, otherwise, the mother
would not be able to enforce her claim against the property in hands of
the purchaser.
Kinds of Notice
Notice is of three kinds:
(i) Actual notice
(ii) Constructive or Implied notice
(iii) Notice to agent or imputed notice
1.Actual Notice
 It means actual knowledge.
 A person is said to have actual notice/express notice of a fact
if he actually knows it.
 To consider it as binding, one will have to look at the fact that
the notice is definite and information given in respect of the
notice is correct.
 It must be definite information given in the course of
negotiations by person interested in the property.
 A person is not bound to attend vague rumors.
2. Constructive Notice
 It means ‘knowledge imputed by the Court on a person’.
 It is a notice which treats a person who ought to have known a fact,

as if he actually knows it.

 In other words, a person may claim that he did not know a fact, but
if the circumstances surrounding him are such, that as a reasonable
prudent person, he ought to have known a fact, he will be deemed
to know it.
Constructive notice can be applied by the Court in following
cases:
a) There is wilful abstention from an enquiry or search.
b) Gross negligence
c) Registration of the Document
d) Actual possession
(a)Willful abstention from search which one ought to make
 In case of absence of actual notice, a person may constructively and
in the eye of law, be affected with notice of fact when he has wilfully
or deliberately abstained to take notice of a fact which a reasonable
man would have taken in the normal cause of life.
 The presumption of the court in such like cases would be that the
person has purposely abstained from making an inquiry into the
contents of the deed with the intention of avoiding taking its notice.
 So constructive notice is implied only in situations where a person
has means of knowing a particular fact, but has failed to know it.
Case laws: Bank of Bombay v. Suleman
‘S’ left his house and land to his 1 st wife son’s and appointed them as the
executors of his will. He bequeathed Rs. 30,000/- to the sons of 2 nd wife as
a charge upon the property given to the sons of first wife by will. The first
wife’s son borrowed from the Bank depositing the title deeds of the house
and land as security. If the Bank had made inquiries as to how the
mortgagee derived the title from S, they would have had cognizance of
the will and so of the charge in favour of the second wife’s sons.
In case of wilful abstention from making an inquiry, when there seems any
doubt or suspicion. Here law demands the careful and vigilant conduct on
the part of the transferee to verify the correctness of the title of the
transferor, and the possibility of existence of charge over the property.

Mohd. Yunus Khan v. Courts of Wards (AIR 1937)

Where the purchaser is shown the title deeds which mention that the
property is partitioned property with certain conditions, the purchaser
here will be considered as having the knowledge of the fact of the
partition and its conditions, here he cannot be allowed to take plea of the
ignorance of such conditions.
(b) Gross Negligence
 Negligence means carelessness or omission to do such act which a
man of ordinary prudence would do.
 Mere negligence is not penalised.
 It should be high degree of neglect.
In Hudston v. Vincy, (1921), “Gross negligence does not mean mere
carelessness, but means carelessness of so aggravated a nature as to
indicate a attitude of mental indifference to obvious risk.” It can be
described as ‘a degree of negligence so gross that a court of justice may
treat it as evidence of fraud, impute a fraudulent motive to it and visit it
with the consequences of fraud’.
Alwar Chetty v. Jagannath (1928)
‘A’ sells his property to ‘B’, and delivers possession to him for a
consideration of Rs. 10,00,000/-. ‘B’ pays a sum of Rs. 5,00,000/- and
promised to pay the balance after six months. The fact that a balance of
five lakhs has to be paid to ‘A’ by ‘B’, is written on the title deeds.
‘B’ fails to pay ‘A’, and mortgages this property by deposit of the title
deeds in favour of ‘C’. ‘C’ fails to read the noting that ‘B’ has to pay Rs.
5,00,000/- to ‘A’ and pays the loan amount of Rs. 5,00,000/- to ‘B’. ‘B’ fails
to repay the loan amount to ‘C’ as well, and this property that is subject to
the mortgage is brought up for sale.
The total amount recovered after sale of the property is 5,00,000/-. At this
point, ‘A’ puts up his claim of 5,00,000/- rupees.
The issue is – who would get this amount, ‘A’ or ‘C’.
‘C’ can get this amount only subject to the condition, if he has entered the
transaction as a bonafide transferee without notice of A’s claim over the
property. If he proves the fact, that he had no actual or constructive notice
of A’s claim over the property.
(c) Registration as notice
 If an instrument is required to be registered, then it amounts to
notice.
 In case a document does not require to be registered, its registration
does not amount to notice.
 Section 17 & 18, the Registration Act, 1908 - The instrument should
be registered in the manner prescribed by the Act of 1908.
 In view of the above registration may be treated as constructive
notice of its content, following conditions must be satisfied:
 The instrument must be compulsorily registrable.
 All the formalities prescribed under the Registration Act are
duly completed in the manner prescribed.
 The instrument and particulars must be correctly entered in
the registers.
 After registration, document becomes a public document and the
title can be confirmed in the Registrar’s office.

(d) Actual Possession

Deniels Vs. Davison (1809), ‘A’ leased a house and garden to ‘B’ who
takes possession of the properties. ‘A’ then sells the said properties to ‘C’.
‘C’ is deemed to have constructive notice of B’s rights over these
properties, i.e., ‘C’ cannot plead that he had no knowledge (notice) of the
fact of B’s possession on the properties.
3. Imputed Notice /Notice to An Agent
 This is based on the maxim Qui facit per alium facit per se, i.e., he
who does by another, does by himself.
Case laws:
In Mohori Bibee Vs. D. Ghosh, (1903), held that although the
principal was absent from Calcutta and did not take part in the
transaction personally, his agent in Calcutta stood in his place for the
purposes of the transaction and the acts and knowledge of the agent
were the acts and knowledge of the principal.
 PARTIES TO TRANSFER
Sec.7 of the transfer of property act, 1882 provides for the persons
competent to transfer a property. According to section 7, any person can
transfer a property provided the following conditions are satisfied:
 He must be competent to contract
 He must have title to the property or authority to transfer the
property, if it is not own.

a. Competent to contract:
 Competency to contract is an essential element to a
valid contract
 Sec.11 of the Indian contract act, 1872 provides that
every person is competent to contract.
 A person in order to enter into a contract must possess or
fulfill the following conditions:
 He/ she must be a major
Who is a minor?
Sec.3 of the Indian majority act, 1875 defines minority:
“Every person domiciled in India shall be deemed to have attained his
majority when he shall have completed his age of 18 years and not
before.”
Thus a minor is not a competent person to contract.
Case laws: Mohoribibi Vs. Dharmadas ghose (1903)
The privy council rejected the defence of estoppel of the
defendant, opining that the defendant’s agent knew the real age of the
minor at the time of execution of the document, and held that there was
no estoppel. It held that the contract entered between a minor and a
major would be purely void.
  He/ she must be of sound mind (sane)
 He/ she must be qualified by the law in force or must
not be disqualified by law

b. Entitled to transferable property or authorized to dispose of

not his own:
 The second requirement is that the transferor must either be
entitled to the transferable property
(Or)
 He must have authority of the owner of property to dispose of
the same.
 Ex: a trespasser cannot make a valid transfer of the property.

PROPERTIES WHICH CAN BE TRANSFERRED AND WHICH

CANNOT BE TRANSFERRED
 Sec.6 of the transfer of property act lays down that property of any
kind may be transferred expect the exception given under this
section
 Sec.6 has given various exceptions as to which properties cannot be
transferred.
1. spes successionis (chance of succession) - Sec.6 (a)
 The expression ‘spes successionis’ means “mere chance or hope of
succession”
 An anticipation or hope of the heir succeeding to the property of
deceased person
 The right of a person to inherit to another in future is a mere
chance, which may or may not happen
 Hence, it cannot be transfreed
Illustration: ‘A’ owner of the property, ‘B’ and ‘C’ are two sons (they are
known as spes successionis). There are only chances for ‘B’ and ‘C’ to
acquire the property. At this point of time, believing the property is yet to
come, ‘B’ or ‘C’ cannot make a transfer and it is held as void transfer.
Case laws: Anand mohan Vs. Gour mohan
In this case, ‘A’ a Hindu widow was in possession of
property. If she died ‘B’ would have taken the property as a reversionary
heir. Even before ‘A’s death ‘B’ entered into a contract with ‘C’ to sell her
property to him and agreed to put in possession whenever ‘A’ dies.
Subsequently ‘A’ died. ‘C’ sued for specific performance of contract. The
privy council held that the contract is for transfer of a spes successionis
and so such transaction is not valid.
2. Mere right of re-entry - Sec.6 (b)
  Sec.6(b) provides that a mere right to re-entry for breach of
condition cannot be transferred to anyone, except the owner of the
property.
 Mere right to re-entry is meant a right to resume possession of land,
which has been given to another person for a certain time.
 This right to re-entry is usually inserted in leases empowering the
lessor.
Illustration: ‘A’ grants a lease of a plot of land to ‘B’ with a condition that
if ‘B’ shall build upon it, he would re-enter. ‘A’ transfer’s ‘C’ his right of re-
entering in case of breach of the covenant not to build. The transfer is
invalid because the right is a personal license and not transferable. But if
‘A’ transfers the ownership along with the right to re-entry then the
transfer is valid one.

3. Easement - Sec.6 (c)

 Right to way, water, air, light are termed as easmentary light
 This right is used for common enjoyment
Illustration: ‘A’, the owner of a house, has a right of way over an
adjoining plot of land belonging to ‘B’. ‘A’ transfers his right of way to ‘C’.
the transfer is a transfer of easement and therefore invalid. But if ‘A’
transfers the house itself, the easement passes on to ‘C’ on such transfer.
4. Restricted interest - Sec.6(d)
 Certain interest in a property is enjoyed by the owner alone and
cannot be transferred to anyone.
 The assignment of the land by the government to the weaker
sections comes under this clause.
 The government allot house-sites and grant patta certificates to the
poor SC, ST etc.
 The object of such assignment is to give benefits to such class of
people.
 The condition mentioned in patta certificates restricting the patta
certificate holders from transferring the property
 If any beneficiary sells his house, his transfer is void.
Case law: Eshwarappa Vs. State of Karnataka (1979)
The Karnataka high court gave judgement that inam lands is not
transferable. The inamdars can claim the occupancy rights.
5. Future maintenance - Sec.6 (dd)
 A right to future maintenance is solely for the personal benefit of the
person to whom it is granted and hence, cannot be transferred
Case laws: Nandrani Vs. Krishna (1935)
 In this case, there were disputes between husband and wife.
Simultaneously there was an agreement between X- creditor and the
wife that she would transfer the future maintenance that would be
granted by the court against her husband. After the court gave
judgement in favour of the wife X asked her to transfer the decree inn
his favour. She refused to do so. He filed a case against her. The
madras high court gave judgement in favour of nandrani holding that
future maintenance should not be transferred.
6. Mere right to sue – Sec.6 (e)
 A mere right to sue cannot be transferred
 A right to sue is a personal right of the party aggrieved and there
can be no assignment of a right to sue for damages in torts or for
breach of contract.
 The object of this clause is enunciated in the legal maxim “Nemo
alieno nomine lege agere potest”. (No one may sue at law in the
place of another)
7. Public office – Sec.6 (f)
 Public offices or salary of public officer cannot be transferred
 This prohibition is imposed on the basis of public policy
 A public servant is defined under sec.21 of IPC
 The object of this clause is to protect the property and integrity of
the government.
8. Stipends – Sec.6 (g)
 Stipends and pensions allowed to army, navy, airforce cannot be
transferred
 This clause is enacted in respect in respect of the honour to the
servants who had rendered their services in military, naval, air force
 This prohibition does not apply to railway employees and other
private employees.
9. Unlawful transfers – Sec.6 (h)
 Transfers made by a person disqualified by law are known as
‘unlawful transfers.’
 A transfer of property in consideration of doing a murder is void.
10. Certain other occasions – Sec.6 (i)
 A tenant having untransferable right of occupancy, cannot transfer
his right of tenancy.