Property Law Notes

Sections 1, 3, 5, 6, 7, 8, 10, 13, 14, 15,18, 19, 20, 21, 23, 25, 26, 27, 28, 29, 31, 35, 36, 37, 38, 39, 41, 42, 43, 48, 53, 53A, 54, 55, 56, 58, 60,62, 67, 68, 69, 69A, 78, 81, 100, 105, 106, 107, 108, 109, 110, 122, 137 of The Transfer of Property Act, 1882. . Transfer by act of parties, vested and contingent interest, election, clog on, right to foreclosure, mortgage, sale, charge, lease and gift. PROPERTY LAW NOTES AND CASES Chapter 1: What is immovable property? We know that property is the total wealth of a person. It may include land, buildings, mortgage rights, debts owed to him, insurance money due, cheques received, cash, etc. The Transfer of Property Act, 1882, defines immovable property as that which does not include standing timber, growing crops and grass. This is a very open-ended definition though, so we must look at the definition furnished by the General Clauses Act, 1897, wherein it is mentioned that immovable property includes – a) land, b) benefits arising out of land, c) things attached to the earth, or d) permanently fastened to anything attached to the earth.  Also, the Registration Act defines immovable property as land, buildings, hereditary allowances, rights to ways, lights, ferries, fisheries, or any other benefits arising out of land and things attached to the earth, but not standing timber, growing crops or grass. The Sale of Goods Act, which deals with the sale of movable property, says that movable property, or goods, includes any property other than actionable claims and money. This is why transfer of any actionable claim is dealt with in the TOPA. CASE: Ananda Behera v. State of Orissa  The dispute was about fishing rights in the Chilka Lake, which was part of an estate owned by the Rajah of  Parikud. By the Orissa Estates Abolition Act, the estate became vested in the State of Orissa. The petitioner had obtained from the previous proprietor the right to fish in the lake, long before the property became vested in the state. The State refused to recognize these licenses. The petitioner claimed that the transaction was based on the sale of future goods, and as fish was movable property, it should not be covered under the act that a bolished the estates. There can be no doubt that the lake is immovable property. Therefore, the state, in whom the right to the lake is vested, can bar access to the lake for anyone else. The right the petitioner had was to catch and carry away fish from the lake. Now, this amounts to a benefit arising out of land, and hence, should be covered under immovable property. Also, fish is not standing timber, growing crop, or grass! If it was a mere sale of goods, there should be an instrument to prove it, that is, a written and registered receipt. The sale in this case was oral. The case is different from Firm Chhotabhai Jethabai Patel & Co. v. The State of Madhya Pradesh , where it was held that the right to pluck Tendu leaves from trees was not under the purview of immovable property, as it is under the definition of a growing crop.  Also, the state was not a part of the contract between the Rajah and the petitioner, so the state cannot be asked for the money, nor can the Rajah be asked to compensate, as he did not breach the contract either. The suit was dismissed. (Question: What is profit a prendre ? Answer: It is a privilege or right to enter another’s land and take away some valuable, natural thing. For e xample, fish, wood, honey, etc.)

CASE: Shantabai v. State of Bombay  The petitioner’s husband was a zamindar , who had executed an unregistered document in favour of the petitioner  giving her the right to enter upon certain areas in the zamindari to cut and extract bamboo, fuel wood and teak. Only the lease for forest woods was given to her. Then the Madhya Pradesh Abolition of Proprietary Rights Act was passed and it was held that the petitioner no longer had an enforceable right against the state as far as lumbering work was concerned, as all proprietary land became vested in the state. Justice Bose said in this case that a tree draws subsistence from the soil as long as it stands, and therefore, it is permanently attached to the land and should be treated as immovable property. Standing timber must be in such a state that if cut, it can be used straightaway for building houses, bridges, ships, etc. The rule is that if there is an intention to sever such things as timber from the immovable property for the purpose of selling separately, then such separate items would constitute movable property. A tree can be said to be standing timber if it can be looked at as timber in all practical purposes, even if it is still standing. The deed for the transfer was unregistered, and the price was Rs. 26000, so the petitioner could not execute any right against the state. Appeal dismissed.  A debt secured by mortgage mortgage of immovable property is itself immovable immovable property.

DIFFERENCE BETWEEN PROPERTY LAW IN INDIA AND ENGLAND Indian law classifies property into movable and immovable. But English law divides property into realty and personalty. Realty was the kind of property which could be regained by a person if he lost possession of it, through a real action. If a person lost possession of land, he had the right to take the land back from the new possessor. In the case of goods, if a person lost possession, he could not recover the goods, but he had the right to recover damages. Such action taken was personal action, and hence, goods were termed as personalty. However, the Indian system is prevalent in the UK now, aft er the Real Property Amendment Act of 1925. FREEHOLD AND LEASEHOLD  An estate is said to be freehold when it is vested in a person for a definite period, which is of uncertain duration. For example, let us say Anubhab owns NUJS for life. Here, we know that as long as the period of Anubhab’s life is running, NUJS is vested in him. However, we do not know how long he will survive, so the duration is uncertain. On the contrary, a leasehold estate is held by a person for a definite period and certain duration. For example, a property may be leased to Anubhab for a period of 99 years. Thus, we know that it will be divested only after 99 years pass.

Chapter 2: What Property is Transferable? The TOPA deals with transfer of property inter vivos (between living persons). Hence, it does not apply to wills or  testaments, which operate only after the death of the testator. Dedication of property to a temple or a deity is also invalid, as these are not living persons. However, sections 13, 14 and 20 make an exception, by allowing transfers in favour of unborn persons, with certain restrictions. This is quoted in Section 5 of the act. If a holder of property relinquishes his rights over it to the coparcener, or a widow gives up her right to the reversioner (person in whom the property is vested once the original possessor gives up his right to it) in order to accelerate his succession, they are not transfers, but merely extinction of rights in property. Partition of property is also not a transfer, but only a change in the mode of enjoyment of the property. Transfer of future property is invalid, that is, you cannot transfer property that is not in existence. In England, after the Law of Property Act, 1925 was passed, the creation and conveying of estate tail and life estate became banned. Only estate in fee simple and estate for a term of years were valid. In India, all 4 of these estates can be conveyed or created under the TOPA. Estate in fee simple – simple – This implies absolute ownership. When a fee simple tenant dies, the estate passes to the nearest heir. Estate tail – tail  – It is created on the grantor’s request when on the grantee’s death, the estate goes to the grantee’s lineal descendants, or heirs of the body. If there are no such heirs, it reverts back to the grantor, or if the grantor  is dead, the grantor’s representatives. Life Estate – Estate – It arises when an estate is granted to the grantee for the period of life of the grantee or of any other  person. In the second case, it is known as per autre vie . Estate for term of years – years – The property is transferred for a definite period of time.  A family arrangement of a disputed claim is also not a transfer of property. It is recognition of pre -existent rights and does not convey any new or distinct title to the parties. CASE: Kalyani v. Narayanan  Here, a man named Karappan had two wives, Nani and Ponni. Two of the defendants, the plaintiff’s husband, and the deceased father of three more defendants were born of his first wife, in addition to 4 daughters (a very fertile woman indeed!), and his second wife had a son and 2 daughters. The family was governed by Mitakshara law, and Karappan had e xecuted a registered deed for the partition of the property. Karappan had property worth 8000. He gave 1300 to each of his male issues. 300 went to his first wife and 1000 to his second wife. 200 went to his stepmother. Karappan died, and soon after this, Raman, his third son and husband of the plaintiff, followed th daddy upstairs. Widowed Kalyani sued for partition and separate possession of her 1/4 share in the property. The defendants held that the Karappan and his sons were coparceners of the property, and thus, Karappan had no authority to execute such a deed. They also contended that the 4 sons were coparceners to the property, and succession depended on survival. Since Kalyani’s husband was dead, therefore, she could not get the property. It was ancestral property, and all 4 sons had acquired interests to it by birth. Therefore, Karappan had no right to dispose of by will ancestral property in his hand. A Hindu father cannot impose such a family arrangement

DIFFERENCE BETWEEN PROPERTY LAW IN INDIA AND ENGLAND Indian law classifies property into movable and immovable. But English law divides property into realty and personalty. Realty was the kind of property which could be regained by a person if he lost possession of it, through a real action. If a person lost possession of land, he had the right to take the land back from the new possessor. In the case of goods, if a person lost possession, he could not recover the goods, but he had the right to recover damages. Such action taken was personal action, and hence, goods were termed as personalty. However, the Indian system is prevalent in the UK now, aft er the Real Property Amendment Act of 1925. FREEHOLD AND LEASEHOLD  An estate is said to be freehold when it is vested in a person for a definite period, which is of uncertain duration. For example, let us say Anubhab owns NUJS for life. Here, we know that as long as the period of Anubhab’s life is running, NUJS is vested in him. However, we do not know how long he will survive, so the duration is uncertain. On the contrary, a leasehold estate is held by a person for a definite period and certain duration. For example, a property may be leased to Anubhab for a period of 99 years. Thus, we know that it will be divested only after 99 years pass.

Chapter 2: What Property is Transferable? The TOPA deals with transfer of property inter vivos (between living persons). Hence, it does not apply to wills or  testaments, which operate only after the death of the testator. Dedication of property to a temple or a deity is also invalid, as these are not living persons. However, sections 13, 14 and 20 make an exception, by allowing transfers in favour of unborn persons, with certain restrictions. This is quoted in Section 5 of the act. If a holder of property relinquishes his rights over it to the coparcener, or a widow gives up her right to the reversioner (person in whom the property is vested once the original possessor gives up his right to it) in order to accelerate his succession, they are not transfers, but merely extinction of rights in property. Partition of property is also not a transfer, but only a change in the mode of enjoyment of the property. Transfer of future property is invalid, that is, you cannot transfer property that is not in existence. In England, after the Law of Property Act, 1925 was passed, the creation and conveying of estate tail and life estate became banned. Only estate in fee simple and estate for a term of years were valid. In India, all 4 of these estates can be conveyed or created under the TOPA. Estate in fee simple – simple – This implies absolute ownership. When a fee simple tenant dies, the estate passes to the nearest heir. Estate tail – tail  – It is created on the grantor’s request when on the grantee’s death, the estate goes to the grantee’s lineal descendants, or heirs of the body. If there are no such heirs, it reverts back to the grantor, or if the grantor  is dead, the grantor’s representatives. Life Estate – Estate – It arises when an estate is granted to the grantee for the period of life of the grantee or of any other  person. In the second case, it is known as per autre vie . Estate for term of years – years – The property is transferred for a definite period of time.  A family arrangement of a disputed claim is also not a transfer of property. It is recognition of pre -existent rights and does not convey any new or distinct title to the parties. CASE: Kalyani v. Narayanan  Here, a man named Karappan had two wives, Nani and Ponni. Two of the defendants, the plaintiff’s husband, and the deceased father of three more defendants were born of his first wife, in addition to 4 daughters (a very fertile woman indeed!), and his second wife had a son and 2 daughters. The family was governed by Mitakshara law, and Karappan had e xecuted a registered deed for the partition of the property. Karappan had property worth 8000. He gave 1300 to each of his male issues. 300 went to his first wife and 1000 to his second wife. 200 went to his stepmother. Karappan died, and soon after this, Raman, his third son and husband of the plaintiff, followed th daddy upstairs. Widowed Kalyani sued for partition and separate possession of her 1/4 share in the property. The defendants held that the Karappan and his sons were coparceners of the property, and thus, Karappan had no authority to execute such a deed. They also contended that the 4 sons were coparceners to the property, and succession depended on survival. Since Kalyani’s husband was dead, therefore, she could not get the property. It was ancestral property, and all 4 sons had acquired interests to it by birth. Therefore, Karappan had no right to dispose of by will ancestral property in his hand. A Hindu father cannot impose such a family arrangement

without his sons’ consent after his death. The second wife’s son son had already taken his share out and left the th family. Therefore, the brothers were tenants-in-common, and the property was allowed to be divided. 1/4 share was granted to the plaintiff.

Section 6 of the act talks about what kinds of property may be transferred and what may not be transferred. In section 6(a), we find that the chance of an heir-apparent succeeding to an estate, the chance of a relative obtaining a legacy on the death of his kinsman, or any other such mere possibility, cannot be transferred. These things mentioned in clause (a) are known as spes successionis . It means a mere chance, or bare possibility. It is different from future interest. In Indian law, the transfer of an expectancy or any agreement to transfer expectancy are both void. CASE: Annada Mohan Roy v. Gour Mohan Mullick  In this case, the appellant purchased from the respondents their rights expectant, under the will of their uncle, upon the termination of his surviving widow’s rights. Later, there was a compromise between the widow and the respondents as a result of which the respondents got certain properties. The appellants filed a suit for the recovery of the properties from the respondents. The court held that the transfer was of a spes successionis , and was thus forbidden by the TOPA. CASE: Karpagathachi v. Nagarathinathachi  2 co-widows co-widows divided their husband’s properties into 2 shares and took separate possessions, with each widow giving up her life interest under the partition deed. The respondent is the daughter of the widow who died. The surviving widow filed a suit against the daughter for recovery of the property in her mother’s possession, alleging that the arrangement by which her right of survivorship was relinquished was repugnant to section 6(a). The court said that the interest of each widow was property, and this, along with the incidental right of survivorship could be lawfully transferred. The section might prohibit the transfer of the bare chance of the surviving widow taking the entire property as the next heir of the husband, but it does not prohibit the transfer by the widow of her present interest together with the incidental right of survivorship to the daughter. Suit dismissed. The ratio is that right of  survivorship can be transferred. (Question: What is reversion? Answer: If I grant my land to Pritam for life, Pritam becomes entitled to it. On Pritam’s death, the land would be returned to my possession, and this is called reversion. Suppose now, that I grant a life estate to Pichu and then then a fee simple [which would imply absolute ownership and reversion to Pichu’s nearest heir, say Bulba], then Bulba’s estate will be called ‘Remainder’. It may either be a vested remainder, as in this case, or a contingent remainder, say, with a condition of Bulba cracking CLAT.) CASE: Amrit Narayan v. Gaya Singh  The guardian of a minor reversioner entered into a contract with the female holder of property that the properties would be relinquished in favour of other relatives. In a suit for the reversioner for possession of property after the female’s death, it was held that he had no right or interest at the time when the agreement was made, because the female owner was holding the property for life. Until it vested in him on her death, he had nothing to a ssign or  relinquish or transfer. He, being the reversioner, has a right only after her death, and until then it is mere spes  successionis. EASEMENTS  An easement is a right which the owner or o r possessor of certain immovable property possesses for the proper  enjoyment of the property (this must have a dominant heritage), like a right of way over adjoining property (which enjoys servient heritage). Since the right cannot subsist without the dominant heritage, the right of easement alone cannot be transferred. This is outlin ed in clause (c). Clauses (f), (g) and (h) are prohibited based on public policy. An office is granted to a person on personal grounds, and he alone can discharge the duties, and hence, be entitled to the salary. Loss of such remuneration might mean a lack of inducement to perform duties and temptation to accept bribes.

Section 7 of the TOPA says that any person, who has the capacity to contract and is entitled to transferable property or authorized to dispose of such property, can transfer such property. In Mohari Bibi v. Dharmodas , it was held that a conveyance of land by a minor is void, as he is not competent to contract. Section 8 says that a transfer of property to a transferee transfers all the interests which the transferor can pass in the property (e.g. rents, profits, benefits arising from it, things attached to earth, etc.), unless a different intention is expressly or impliedly present. CASE: Nathoo Lal v. Durga Prasad 

One Ramchandra dies, and gifts his property to his elder daughter Laxmi. On Laxmi’s death, her husband takes possession, claiming right as her heir. He mortgages the property to the appellant, Nathoo Lal. Meanwhile, after  12 years, the son of the other daughter (Bhuri) returns and claims the property, saying his aunt Laxmi only had a limited stake in it. The court observed that unless there are express terms in the deed of gift to indicate the donor  who had the absolute interest, a gift in favour of an heir who inherits a limited interest cannot be understood as an absolute interest. Court held that to convey an absolute estate to Hindu female no express power of alienation need be given. The words used in the gift deed were of amplitude enough to convey full ownership to Laxmi.The Laxmi.The appellant won the case.

 ACTIONABLE  ACTIONAB LE CLAIM  Actionable claim means a claim to any debt, other than debt secured by mortgage/pledge mortgage/pledge of immovable property, or to any beneficial interest in movable property not in the possession of the claimant, which are recognized by law as affording grounds for relief.

Chapter 3: General Rules regarding Transfer of Property Sections 10-18 contain the first set of rules that must be observed when alienating property. There is a principle in economics that wealth should be in free circulation so that the greatest benefit can be derived from it, and hence these sections provide that ordinarily there should not be any restraint on alienation.

Section 10 provides that where property is transferred based on a condition or limitation which absolutely restrains the transferee or any person claiming under him from parting with or disposing of the interest in property, such condition or limitation is void. There are exceptions in the case of a lease where the condition is for the benefit of the lessor, and when the property is transferred to or for the benefit of a woman so that she shall not have power during her marriage to transfer or charge the same f or her beneficial interest. In almost all property law systems, the rule is alienatio rei praefertur juri accrescendi , that is, the law favours alienation of property rather than accumulation. Section 10 must be read with Section 12 which says that where property is transferred subject to a condition or  limitation making any interest therein, reserved or given to or for the benefit of any person, to cease on his becoming insolvent or trying to dispose of the same, such condition or limitation is void. Nothing in this clause applies to a condition in lease for the lessor’s benefit.  A condition which says that the transferee will not transfer his interest in a property for 3 years or that he will not transfer it to any member of a p articular family is partial restraint and is therefore a llowed. But if a condition exists saying that the transferee is prevented from transferring his property to anyone but the transferor or his heirs and that too only if they are willing to buy, it constitutes absolute restraint, and is void. Assume that a situation arises where Suman, Arghya and Dipayan partition a joint property and agree that if anyone of them does not have a baby, he should not sell his property to anyone else, but leave it for the other two. This is a case of absolute restraint. If I sell a property to Biju and Biju independently executes an agreement whereby he states that if he wants to sell the property he would only sell it to me, the agreement would be valid, because I did not imp ose any condition against alienation at the time of transfer. Biju himself added the condition.  As far as lessors are concerned, the condition is good only if it is for the benefit of the lessor, for example, if a conveyance gives the power to the lessor to re-enter (take control of the property once it is out of his possession) instead of merely entitling to damages. Restraints on the power of alienation i n favour of married women (who are not Hindus, Muslims or Buddhists) will be valid. Under old English law, a husband and wife were looked at as one legal entity. All the property of the woman would become her husband’s on marriage, and she could not dispose of it without his consent, and nor  could she devise a will. The Married Women’s Property Act of 1882 of 1882 changed this. Thenceforth, the transferor has the power to decide to what extent he wants to restrain the woman’s power of alienation. Such provision can be used to prevent a married woman from alienating her property as long as she is unde r her husband’s protection.

Section 13 of the act provides that when an interest (the interest must, of course, be subject to a prior interest, as you cannot directly transfer to a person unborn) is created for the benefit of a person not yet born on the date of the transfer, the interest will not take effect unless it extends to the entire remaining interest of the transferor in the property. Example – Example  – say Johnny transfers a property to Pony, and after Johnny’s death to the eldest son of  Pony and after his death to the youngest son, the interest created for the eldest son is void, because the remainder does not go to him but the younger son is also included.

Children in the womb and children adopted by a lady after her husband’s death are deemed to be in existence for  this purpose.  Again, this section exhibits that law favours free circulation of property. This section foils theDe Donis  Conditionalibus statute. This is also known known as the rule against Double Possibility. The court foils the attempt of  owners to create a series of future interests. Difference between English and Indian law – law – the rule of double possibility is more stringent in Indian law. Say a property is vested in X for life, to Y, an unborn child on X’s death, and to Z on Y’s death. In English English law, the interest created for Z is void, as it requires double possibility – possibility – 1) birth of Y before X’s death, and 2) death of Y before Z. In Indian law, interests in favour of both Y and Z are void, as the remainder does not go to Y on X’s death, but there is a chance of it vesting in Z as well. Under this section, 3 conditions must be complied with for the interest to be valid – valid  – 1) interest of the unborn person must be preceded by a prior interest in favour of a living person, 2) the unborn person must be in existence when the prior interest comes to an end, and 3) the interest must be the whole of the remaining interest of the transferor, a life interest will not do, must be an absolute interest. CASE: Ganendramohun Tagore v. Juttendramohun Tagore  This was an 1872 case, and the law now stands changed. The defendants were trustees under the will of one Prosonocoomar Tagore, and the plaintiff was his son. The defendants were tenants for life. Prosonocoomar died in 1868, and his will provided nothing for his heirless son. This is probably because his son had converted to Christianity. All of the testator’s property was stipulated to go to the 4 trustees. Much of the property was granted to Juttendramohun for his life, and after his life, to his eldest son son who would be born during the testator’s life, and thereafter to the sons of the eldest son. The plaintiff contended that the will was void save as far as Juttendramohun’s life interest was concerned, and thereafter, he himself should receive the property. property. He also said that it was an ancestral estate, which the testator had no right to dispose of this way. The High Court had dismissed the plaint. Sreemutty Soorjemoney v. Denobundoo Mullick  is referred to. English law says that a person must be in existence to take under a will. Court held that Juttendromohun had a life interest, after which, the will fails, and the property passes to the plaintiff as the testator’s heir -at-law. -at-law.

Section 14 enshrines the rule against perpetuity. It says that the property cannot be transferred if it is to take effect after the lifetime of one or more persons living at the date of transfer, and the minority of some person who shall be in existence at the expiration of the period, to whom the interest is to belong on attainment of adulthood. Confused? Me too… Let’s exemplify. Suppose a grant is made to A for life and the remainder goes to A’s eldest son 3 years after A’s death. Here, the beneficiary must be a minor at the time of A’s death. However, his enjoyment of the property can be delayed till he is a major. In English law, however, an absolute period of 21 years is permitted after the death of the person concerned who had the prior interest. So, the second beneficiary may be major on the date of the first one’s death. Read Sarathi for more illustrations on this, page 57. CASE: Ganesh Sonar v. Purnendu Narayan Singha  The plaintiff-respondent’s plaintiff-respondent’s father had granted a registered lease in favour of the defendant-appellant -appellant for the purpose of a homestead. One of the conditions of the lease was that the lessor would have the right of re-entry upon the land at anytime and at such time the lessee would have to vacate the property, being entitled to the money value of any constructions he may have made. The instrument said that the defendant and his heirs would enjoy the property until the plaintiff wanted it back for creation of a hat . The appellants’ counsel contended that the agreement to the option given to the lessor to determine the lease and take possession of the leasehold land was a covenant between the parties and offended the rule against perpetuities. However, it was held in Rama  Rao v. Thimmappa that a clause entitling a lessor to terminate the lease at anytime which is described as permanent and which is to be enjoyed from generation to generation does not offend the rule against perpetuities. In this case, it was merely a personal covenant and not one which created an interest in land, and therefore, no offence to the rule. It was also contended that the covenant was for relinquishment by the lessee to the lessor, and not the lessor’s heirs. This contention was baseless, as the deed stated otherwise. So, the appeal was dismissed.

Chapter 7: Equitable Rules When Property Rights Conflict CASE: MacQueen v. Ramcoomar Koondoo  The case dealt with the doctrine of holding out as enunciated in section 41. The respondent’s father, Ramdhone, had purchased a property from one Bunnoo Bibi. The Koondoos had since that time possessed the property.

Bunnoo Bibi was the mistress of one Alexander MacDonald, and the appellant in this case is the husband of   Alexander’s daughter Maria. It appears that the purchase of property by Bunnoo Bibi was a benami transaction, and that Alexander was the real purchaser, having simply used Bunnoo’s name in the transaction. The appellant’s claimed that their father had purchased the property with a bona fide belief that Bunnoo was the real owner. They contended that they had not only paid full value at the time of the transaction, but also occupied the property for more than 30 years. The High Court held that Ramdhone should have made an enquiry as to Bunnoo Bibi’s status. However, the Privy Council held that an enquiry would have revealed that MacDonald was in possession, and he had sufficiently improved the property by building a bungalow on it. Bunnoo Bibi’s statement in the instrument also said that the transfer was with the support of her family, and thus, it would have been prudent for Ramdhone to have looked at whether she was entitled to transfer the property or not. Thus, the appeal was allowed. CASE: Nagubai Ammal v. Shama Rao  The properties in dispute belonged to one Munuswami who died leaving behind a widow and three sons. In 1919, the widow filed a suit in forma pauperis for maintenance and marriage expenses of her daughters. The suit was decreed in 1921. In 1920, the properties were sold to the appellant’s predecessor. In execution of the maintenance decree which also created a charge on the suit properties, the decree-holder purchased the properties in 1928. The widow’s side contended that the sale of 1920 was attacked by the doctrine of lis  pendens and the purchaser contended that the sale of 1928 was null and void. It was held that the sale of 1920 was pendente lite and that the sale of 1928 to the widow was valid. CASE: Abdul Shakoor v. Arji Papa Rao   A sale deed was executed in 1949 with respect to a part of the assets of the vendors. A creditor (defendant) of  the vendors filed for recovery of his debt and attached that property. A purchaser (plaintiff) filed a suit to have the summary order set aside. The creditor contended that the sale was made to the purchaser with the intention of  defrauding the creditors. The Court held that the fact that all the vendor’s property had not been sold would not repel the application of section 53(1), unless there was proof that there was other property left sufficient in value to pay off the creditor. Thus, the decision was reached that it was not a bona fide purchase, and it was made with the intention of putting the property out of the creditor’s reach.

Chapter 9: Doctrine of Part Performance The doctrine is enshrined in Section 53A which basically states that even if there is no formal instrument of  transfer, if the transferee has paid consideration and there is an agreement to transfer between the parties the transfer is valid because it has been partly performed, and the defendant cannot be evicted. CASE: Maneklal Mansukhbhai v. Hormusji Jamshedji  There was a lease agreement between the two parties through a series of correspondences. The defendant was put in possession of the property. Rent was also collected for several years. However, there was no formal lease deed ever executed. When the plaintiff tried to eject the defen dant on the grounds that he was trespassing, it was held that section 53A aimed at defending a person who has no registered title deed I maintaining his property if  he could produce a signed contract and some action on his part in part performance of the contract. The building of a factory on t he land, in this case, was construed by the court as part performance.

Chapter 10: Sale of Immovable Property There is a difference between ‘contract for sale’ and ‘contract of sale’.  A ‘contract for sale’ is an agreement between the parties as to the various terms and conditions based on which the property will be sold. It does not create any interests in the property per se.  A ‘contract of sale’ creates an interest in the property concerned. It is basically the formal legal instrument or  conveyance which evidences the sale of the property.

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SKN/NUJS/3 Yr-6 Sem/2007

SOME MODEL QUESTIONS ON PROPERTY LAW. (WITH ANSWERS) (Please supplement this reading material with text books)

Q1.. Name three immovable properties other than house and landed property.  Ans 1: The law of transfer of property , as contained in the Transfer of Property Act, 1882 , does not contain an exhaustive definition of immovable property. Immovable property has been defined to be one which does not include standing timber, growing crops or grass. By any generic legal sense immovable property not only means tangible immovable property like land, building and structure standing on land etc, it also includes some intangible rights like, a) b) c) d) e) f) g) h)

the equity of redemption, right to collect rents of immovable property, right of ferry, a right of way, a right of fishery, a debt secured by mortgage of immovable property, a right to graze cattle or mow grass, the interest of a mortgagee in immovable property.

Q2. What do you understand by transfer of property? 

 Ans 2: Section 5 of the T.P Act specifies that the expression 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, or to himself and one or more other living persons; and “to transfer property” is to perform such act. It also specifies that “living persons” includes a company or association or body of 

individuals whether incorporated or not. However, nothing shall affect any law relating to transfer of  property to or by companies, association or bodies of individuals..

Q3. Specify five things which may not be transferred.

 Ans 3: Section 6 of the T.P Act provides that a) the chance of an heir apparent succeeding to an estate, the chance of a relation obtaining a legacy on the death of kinsman, or any other mere possibility , of a like nature, cannot be transferred, b) a mere right of re-entry for breach of a condition subsequent cannot be transferred to anyone except the owner of the property affected thereby c) an easement cannot be transferred apart f rom the dominant heritage d) an interest in property restricted in its enjoyment to the owner personally cannot be transferred by him e) a mere right to sue cannot be transferred f) a public office cannot be transferred, nor can the salary of a public officer, g) stipends allowed to military, naval, air force and civil pensioners of the government and political pensions cannot be transferred.

Q4. When does a transfer of property operate? 

 Ans 4: Section 8 of the T.P. Act provides that unless a different intention is expressed or necessarily implied, a transfer of property  passes forthwith to the transferee all the interest which the transferor, then capable of passing in the property, and legal incident thereof.

Q5. (a) How can a sale of immovable property be made?  (b) How can a mortgage of an immovable property be effected?  (c) How can a lease of immovable property be made?  (d) How can a gift be effected?.

 Ans 5: (a) As per Section 54 of the T.P. Act a sale of any tangible immovable property of the value of  one hundred rupees and upwards, can be ma de only by a registered instrument.

If the value of the property is less than one hundred rupees, such transfer may be made either by a registered instrument or by deliver of the property.

 Ans 5(b) As per provision of Section 59 of the T.P. Act where the principal money secured is one hundred rupees or upwards, a mortgage other than a mortgage by deposit of title deeds can be effected only by a registered instrument signed by the mortgagor and attested by at least two

witnesses.

 Ans 5(c) Section 107 of the T.P. Act provides that a lease of a i mmovable property from year  to year, or for any term exceeding one year, or reserving a yearly rent, can be made only  by a  registered instrument.

All other leases of immovable property may be made either by a registered instrument or by 

oral agreement accompanied by delivery of possession.

Such registered instruments shall be executed by both the lessor and the lessee.

 Ans 5(d) Section 123 of the T.P. Act provides that for the purpose of making a gift of immovable property, the transfer must be effected by a registered instrument  signed by or on behalf of the donor, and attested by at least two witnesses. A gift of  movable property  may be effected either by a registered instrument signed as aforesaid, or by delivery.

Q6. A gifts his house X to M, his son-in-law with a condition that he cannot sell it to  anybody. Is the transfer valid in law? If so, why? If not, why? Specify the reason for your  answer.

 Ans 6: Sec 10 of the T.P Act provides that where property is transferred subject to a condition or limitation absolutely restraining the transferee or any person claiming under him from parting with or disposing of his interest in the property, the condition or limitation is void  (except in case of a lease, where the condition is for the benefit of the lessor).

In the instant case A makes a gift of his house property X to his son in law M, subject to a condition restraining M from alienating the said property absolutely. The transfer stands but the condition is void. This signifies that once the transfer takes effect M is not bound by the condition.

Q7. A sells his flat to B, his brother at a concessional price on condition that he cannot lease out the property and induct a tenant therein. Explain the validity of the transfer, with  reason.

 Ans 7: Section 11 of the TP Act provides that where, on a transfer of property an interest therein is created absolutely in favour of any person, but the terms of transfer direct that such interest shall be applied or enjoyed by him in a particular manner, he shall be entitled to receive and dispose of such interest as if there was no such condition.

In the instant case when A sells his flat to B at a concessional price, signifying that the transfer, notwithstanding that it was at a concessional price, was intended to be absolute in nature. In that case the transferee B is entitled to receive the property as if there was no such condition..

Q8. A, who is to marry B, transfers his property X in favour of B, his intended wife for life  and after her death, to S1, the eldest son of the intended marriage for life and then to S2,  the second son. Was the transfer valid? Specify the reason for your answer.

 Ans 8: Section 13 of the T.P. Act provides that where, on a transfer of property, an interest therein is created for the benefit of a person not in existence at the date of the transfer, subject to a prior interest created by the same transfer, the interest created for the benefit of such person shall not take effect, unless it extends to the whole of the remaining interest  of the transferor in the property.

In the instant case the transfer in favour of S1, after the life time of B, shall not take effect because of the fact that the said transfer in favour of S1 was limited for his life and does not extend to the whole of the remaining interest of A in the property. The transfer is valid up to the life time of B and the transfer made in favour of S1 fails and as the transfer in favour of S1 fails, the transfer in favour of S2 , being dependant on the transfer in favour of  S1, also fails.

Q9. A transfer his house property X to S1, his unborn son, absolutely. Comment with  reasons on the legality of the transfer.

 Ans 9: As per provisions of Section 13 of the T.P.Act no interest in favour of an unborn person for his benefit can be created except through a prior interest created by the same transfer in favour of a person living on the date of transfer. Accordingly any transfer directly in favour of an unborn person is void in law. It also offends the provisions of Section 5 of the T.P.Act, which indicates that atransfer of property signifies a transfer of property between two living persons.

Q10. A transfers his house property X to B for life, then to C for life and then to C’s son, unborn on the date when A made the transfer, absolutely. Comment with reasons on the legality of the transfer.

 Ans 10: As per provisions of Section 13 and 14 of the T.P. Act an interest in favour of an unborn person for his through some prior interest created by the same transfer in favour of  some person or persons living on the date of transfer. Another requirement of Section 13 is that such interest created in favour of an unborn person  must extend to the whole of the  remaining interest of the transferor. This in other words means that the transferor cannot keep anything reserve for himself and the transfer must be absolute.

In the instant case a prior interest is created in favour of B, a person living on the date of  transfer and thereafter to C’s son, unborn on the date of transfer. The transfer in favour of the

unborn person is absolute and hence in consonance with the requirement of law. (The only thing is that the unborn son must come into existence before expiration of the prior interest,. i.e. before the death of B.)

Q11. On 15.7.1980 A transferred his house property X to B for life and then to C, who was not born on the date of transfer, absolutely. B died on 22.12.1980. C, however, was born on 25.12.1980.

To what extent the transfer of X on 15.7.1980 by A takes effect?. Specify the reasons for  your answer.

 Ans 11: As per provisions of sections 13 and 14 of the T.P. Act a transfer in favor of an unborn person for his benefit can be made, provided the transfer initially must be in favor of a living person and that the transfer in favor of the unborn person must be absolute and that he must come into existence before expiration of the prior interest and further that the interest created in favor of an unborn person shall not extend beyond his minority.

In the instant case the transfer in favor of C, the unborn person was absolute, but he was born only after the death of B. In that view the transfer in favor of C fails and C cannot claim any benefit therefrom.

However there are certain judicial decisions wherein it has been held that a person in mother’s womb is deemed to be in existence. In that view the transfer in favor of C takes effect.

Q12. A transfers his house property to B for life and after his death to C. Do B and C   acquire any kind of interest in the property on the date of the transfer?

 Ans 12: Section 19 of the T.P. Act provides that where, on a transfer of property, interest therein is created in favor of a person without specifying the time when it is to take effect, or in terms specifying that it is to take effect forthwith, on the happening of an event which must happen, such interest is vested unless a contrary intention appears from the terms of the transfer. It also provides that a vested interest is not defeated by the death of the transferee before he obtains possession.

In the instant case when A makes the transfer, both B and C acquire a vested interest in the concerned property. While B acquires a vested interest with immediate possession, C also acquires a vested interest in the property, but to possess only after the death of B. (If C dies before taking possession of the property, or before the death of B, because of the fact that C has already acquired a vested interest in the concerned property, his heirs will step into the picture in the event of C’s

dying before taking possess ion or B’s death).

Q13. On 15.9.1998 A transferred X, a plot of land to B with a direction that X will be  handed over to B on his attaining majority but if B dies as minor, the property shall go to C. Does C acquire any kind of interest in X on the date of transfer?

 Ans 13: Section 21 of the T.P. Act provides that where, on a transfer of property, interest therein is created in favor of a person to take effect only on the happening of a specified uncertain even, or if a specified uncertain event shall not happen, such person thereby acquires a contingent interest in the property. Such interest becomes a vested interest in the former case, on the happening of the event; in the latter, when the happening of the event becomes impossible.

In the instant case the interest created in favor of C is contingent on happening of an event, namely B’s dying as minor, which is an uncertain event. That contingency could have happened or

could not have happened. Accordingly, C acquires a contingent interest in the concerned property on the date of transfer.

Q14. On 1.7.1990 M gave to N Rs.1,25,000/-, to be paid to N at the death of P. Does N   acquire any interest in X on 1.7.1990?

 Ans 14: Section 19 of the T.P. Act specifies what is a vested interest. (Explain what is vested interest.)

In the instant case, on 1.7.1990 an amount of money was transferred in favor of N, which was to be paid at the death of P. Death of P was an event of a certain nature. Accordingly, on such transfer N acquires a vested interest in the property, only the enjoyment is postponed till the death of P.

Q15. On 22.9.1996 A executed a deed of gift with a direction that the income arising from  the property X will be given to A for life and after his death the corpus will be divided and   given to B C and D. Do B C and D acquire any interest in X on 22.9.1996?

 Ans 15: Section 19 of the T.P. Act specifies what is a vested interest. (Explain what is vested interest.)

In the instant case on the date of transfer on 22.9.1996 B, C, D acquire vested interest in the property X, which will be given to them only after the death of A.

Q16. A gave property X to W, his wife for life and on W’s death one share to B, who is A’s brother and the other to S1 and S2, two son’s of A. B and S1 died during the life time of   the widow. What happens to the share transferred to B and S1?

 Ans 16: Section 19 of the T.P. Act specifies what is a vested interest. (Explain what is vested interest.)

In the instant case the transfer in favor of B, S1 and S2 were to take effect on the death of  W. It signifies that B, S1 and S2 acquired a vested interest in the property on the date of transfer. Since B and S1 died during the lifetime of W, the interest transferred in favor of B and S1 will be inherited by their legal heirs respectively (as because B and S1 acquired a vested interest in the property on such transfer).

Q17. On 15.10.1988 A transfers his property X to S, his son for life and then to GS1, his  grandson, absolutely. GS1 was not born on 15.10.1988. When shall GS1 acquire any interest in the property and if so, what kind of interest?

 Ans 17: Section 19 of the T.P. Act specifies what is a vested interest. (Explain what is vested interest.)

If a transfer is made in favor of an unborn person for his benefit and thereby if the said unborn person acquires a vested interest in the concerned property, the said unborn person acquires an interest in the said property only when he is born or comes into existence.

Q18. A transfer his property X to B for life, then to her (B’s) adopted son; if she dies without adopting anybody, then to C. Did C acquire any interest in X on the date of the  transfer?

 Ans 18: Section 21 of the T.P. Act specifies what is a contingent interest. (Explain what is contingent interest.)

In the instant case C ‘s acquisition of interest in X on the date of transfer was dependent on one event, that is, B’s dying without adopting a son. Accordingly, C acquired only a con tingent

interest in X (If the contingency happened, that is, if B died without leaving an adopted son, only then C would have got the property).

Q19. X, an estate is transferred to A for life and after A’s death to B, if B shall then be living; but if he dies before A then to C. Do B and C acquire any kind of interest in the estate? State the reason for your answer.

 Ans 19: Section 21 of the T.P. Act specifies

what is contingent interest. . (Explain what is

contingent interest.)

In the instant case the transfer to B is dependent on the fact of B’s surviving A. The transfer in favour of C is dependent on B’s dying before A. Only in that event C can acquire an interest in the

concerned estate. Accordingly, both B and C acquire a contingent interest in the property on the date of transfer. (it becomes vested in case of B if he survives A and in case of C, if B dies before A)

Q20. A transfers his Delhi farm house to B, if B shall convey his Jodhpur farm house to C.  Does B acquire any kind of interest in the Delhi farm house?

 Ans 20: (Explain what is contingent interest).

In the instant case B is acquisition of interest in Delhi Farm house is dependent on B transferring his (B) Jodhpur Farm House to C and accordingly B will acquire interest in Delhi farm house only after B transfers his Jodhpur Farm House to C. On the date of transfer, until B transferred his Jodhpur farm to C, B acquired only a contingent interest in the Delhi farm house.

Q21. M transfers Rs.2,00,000/- to N, when N attains majority and provides that the income  arising out of the said money shall be applied for maintenance of N until he reaches  majority. Does N acquire any interest in the said fund?

 Ans 21: In the instant case N acquires a vested interest in the concerned fund.

Q22. A transfers property X to B, if C does not marry D within 3 years from the date of transfer. Does B acquire any interest in the property? Specify the reason for your answer.

 Ans 22: (Explain what is contingent interest).

In the instant case the interest of B in the concerned property is contingent upon fulfillment of the condition i.e. C’s not marrying D with in three years from the date of transfer.

Q23. A gives Rs.3,50, 000/- to B on condition that he shall marry C, A’s daug  hter. On the  date of the transfer C was dead. Comment on the legality or otherwise of the transfer.

 Ans 23: Sec 25 of the T.P. Act provides that an interest created on a transfer of property and dependent upon a condition, fails if the fulfillment of the condition is impossible or is forbidden by law, or is of such nature that, if permitted, it would defeat the provision of any law or is fraudulent or involves or implies injury to the person or property of another, or the Courts regards it as immoral or opposed to public policy.

In the instant case the fulfillment of the condition, on which the transfer was dependent, was impossible and hence the transfer was void.

Q24. A transfers Rs.5,00.000/- to B on condition that he shall murder C. Comment on the legality of the transfer.

 Ans 24: (Explain the provisions of Sec 25- Conditional Transfer).

The condition of the transfer is illegal and forbidden by law and hence the transfer is void.

Q25. A transfer Rs.3,50.000/- to B, his niece, if B desserts her husband. Comment on the legality of the transfer.

 Ans 25: (Explain the provisions of Sec 25- Conditional Transfer).

The condition of transfer is immoral or opposed to public policy and hence the transfer is void

Q26. A transfers his property to B for life and then to C, if C gets married. B died in 1998  and C gets married in 2005 and claims the property. Comment on the legality or otherwise  of his claim.

 Ans.26: Sec.23 of the T.P>Act provides that where, on a transfer of property, an interest therein is to accrue to a specified person if a specified uncertain event shall happen, and no time is mentioned  for the occurrence of the event, the interest fails, unless such events happens before, or at the

same time, as the immediate or precedent interest ceases to exi st. In the instant case the transfer to C will not take effect unless he is married either in the lifetime of B or at the same time as B dies.

Q27. A transfer Rs.1, 00,000/- to B on condition that B shall marry with the consent of C D  and E. E dies. B marries with the consent of C and D. Did B fulfill the condition? State the  reason for your answer.

 Ans.27: Section 26 of the T.P. Act provides that where the terms of a transfer of the property impose a condition to be fulfilled before a person can take interest in the property,  condition  shall be deemed to have been fulfilled if it has been substantially complied with. In the instant case as E dies and B marries with the consent of the other two persons namely C and D, it shall be deemed to be a substantial compliance of the condition and B shall be deemed to have fulfilled the condition.

Q28. A transfer Rs.1, 00,000/- to B on condition that B shall marry with the consent of C D and E. B marries without the consent, but obtains the consent after the marriage. Did B fulfill the condition? State the reason for your answer.

 Ans 28: Law requires substantial compliance of a condition precedent  for a transfer. But in the instant case B married without consent of C, D, and E, but obtains their consent after marriage. So B

did not comply with the condition of taking consent of C, D, and E before his marriage, and a subsequent ratification by them will not mean substantial compliance of the condition by B. In that view B has not fulfilled the condition.

Q29. A transfers Rs.1,00,000/- to B on condition that B shall execute a certain lease within three months after A’s death and if B should neglect to do so, to C. B dies in A’  s lifetime.  Does the disposition in favour of C take effect?

 Ans 29: Section 27 of the T.P. Act provides that where, on a transfer of property an interest therein is created in favour of one person, and by the same transaction an ulterior disposition of the same interest is made in favour of another, if the prior disposition under the transfer shall fail, the ulterior disposition shall take effect upon the failure of the prior disposition, although the failure may not have occurred in the manner contemplated by the transferor. In the instant case the ulterior disposition in favour of C was dependant on or conditional on B’s executing a lease within three months after A’s death, and in case B should neglect to do so, the

transfer in favour of C shall take effect. B died during the lifetime of A. As the period of disposition failed, the ulterior disposition in favour of C takes effect.

Q30. A transfers a farm to B with the condition that he shall go to England within three years from the date of transfer, failing which, the money shall go to C. B did not go to England within three years form the date of transfer. Does the transfer in favour of C take effect? Specify the reason for  your answer.

 Ans 30: Section 31 of the T.P. Act provides that on a transfer of property an interest therein may be created with the condition superadded that it shall cease to exist in case a specified uncertain event shall happen, or in case a specified uncertain event shall not happen.

In the instant case on transfer of the farm to B, a condition was superadded, requiring B to go to England within three years from the date of the transfer and on failure of which condition the interest of B in the transfer shall cease to have effect. As B did not go to England within the specified time, the interest in his favour ceases to take effect.

Q31. A transfers Rs.5, 00,000/- to B to be paid to him on his attaining majority, or  marrying, with a proviso that if B dies a minor or m arries without C’s consent, the money shall go to D. B marries when he was only 17 years of age and without C’s consent. What   happens to the transfer in favour of D.? Specify the reason for your answer.

 Ans 31: Section 29 of the T.P. Act provides that an ulterior disposition of the kind contemplated in Section 28 cannot take effect unless the condition is strictly fulfilled. It is a basic tenet of law that it favours vesting of property and disfavors divesting of such property, which has once vested on the transferee. In other words, while law requires only a substantial compliance of a condition precedent, but it is an essential requirement of law that for divesting an interest there shall be a

strict compliance of the condition subsequent.

In the instant case since B did not fulfill the condition strictly and meticulously the transfer in favour of D takes effect.

Q32. A transfers X, a farm to B for her life, and if she does not desert her husband, then to C. Comment with reason on the legality or otherwise of the transfer.

 Ans 32: Section 30 of the T.P. Act provides that if the ulterior disposition is not valid, the prior  disposition is not affected by it.

In the instant case the ulterior disposition being illegal and invalid, B is entitled to the farm during her life as if no condition had been inserted.

Q33. A transfers X, a farm to B for her life, with a proviso that in case he cuts down a  certain wood, the transfer shall cease to have any effect. B cuts down the wood. What  happens to the said transfer?

 Ans 33: Section 31 of the T.P. Act provides that a condition that transfer shall cease to have effect in case specified uncertain events happens or does not happen.

In the instant case as B cuts down the wood, his interest in the farm ceases.

Q34. A transfers X, a farm to B, with a condition superadded that if B shall not go the  England within three years from the date of transfer, his interest in the farm shall cease. B  does not go the England within the specified time. What, if, happens to the said transfer?

 Ans 34: Here also on B’s failure to fulfill the condition super added to the transfer, namely, B’s inability to go to England within three years from the date of transfer, his interest in the farm ceases.

Q35. A gifted X, a house property to B, his daughter, with a condition super added that if   she died childless, the property should re-vest in the grantor. B dies childless. What  happens to the said property? Specify the reason for your answer.

 Ans 35: In the instant case the transfer of the house property in favour of B contained a condition that the property shall re-vest in the guarantor in the event of B’s dying childless. B having died childless the property transferred in favour of B shall re-vest in the grantor.

Q36. A made a gift of her house to B with a condition that B should pay up the debt of A  and shall also maintain A as long as she lived. B failed to comply the two conditions. What  happens to the said property? Specify the reason for your answer.

 Ans 36: In this case also B having failed to fulfill the two conditions, namely, paying up the debt of A and also maintaining A as long as she lived, the donor can be held to be entitled to cancel the gift, and get the property back.

Q37. The Jodhpur farm is the property of C and worth Rs. 80,00,000/-. A by a instrument  of gift professes to transfer the farm to B, giving by the same instrument rupees one crore  to C. If C elects to retain the farm, what happens to the gift of rupees one crore?  Ans 37: Section 35 of the T.P. Act provides that when a person professes to transfer a property, which he has no right to transfer, and  as part of the same transaction confers any  benefit on the owner of the property, such owner must elect either to confirm such transfer  or to dissent from it; and in the latter case he shall relinquish the benefits so conferred, which shall revert to the transferor as if it had not been disposed off. It also provides where the transfer is gratuitous and the transferor has, before the election, died and in all cases where the transfer is for consideration, the disappointed transferee shall be paid the value of the property attempted to be transferred to him. If C elects to retain the farm he forfeits the gift of rupees one crore.

Q38. In question no 37, what happens if A dies before election? 

 Ans 38: If A dies before the election by C, A’s representative must pay Rs. 80,00,000 /- to B from out of said rupees one crore.

Q39. In question no 36, what happens if C does not specify anything in this regard within  five years of the transfer?

 Ans 39: Section 35 of the T.P. Act provides that if C does not within  one year after the date of the transfer signify to the transferor (A) or his representatives his (B) intention to confirm or to dissent from the transfer, the transferor or his representatives may, upon expiration of  that period, require him to make his election; and, if he does not comply with such requisition within a reasonable time, he shall be deemed to have elected to confirm the transfer.

Q40. A transfers the Jodhpur farm, the property of C, to B and as a part of the same  transaction gives C a coal-mine. C did not specify anything about election, but takes  possession of the mine and exhausts it. What happens to the transfer? Specify the reason  for your answer.  Ans 40: Section 35 of the T.P. Act provides that when an election is necessary, the person whose duty is to elect shall specify his decision in this regard either expressly or by implication. In the instant case as C takes possession of the mine and exhausts it, by implication he has thereby conformed the transfer of the estate to B.

Q41. A obtained a property from B by way of exchange. At the time of exchange B had   only a half share, although he professed to transfer the whole. B subsequently purchased   the remaining half. What happens to the exchange deal? Specify the reason for your  answer.  Ans 41: Section 43 of the T.P. Act provides that where a person fraudulently or erroneously represents that he is authorized to transfer such property for consideration, such transfer shall, at the option of the transferee, operate on any interest which the transferor may acquire in such property at any time during which the contract of transfer subsists.

In the instant case at the time of exchange B had only a half share, although he professed to transfer the whole. There is nothing to indicate that by the time B purchased the remaining half  share, A had repudiated and impeached the contract. Accordingly, as per provisions of the said section 43, as the contract of transfer subsisted A was entitled to it and may require B to deliver the other half share subsequently acquired by B.

Q42. A, B, and C owned a company in equal shares. C had been ill for sometime past and   not attending the office of the company. A and B leased the whole property to D, as if C   had no interest at all. C died and gave his share to A and B. What legal right can D invoke in such a situation?

 Ans 42: In the instant case as per provisions of section 43 of the T.P. Act, the contract of  transfer having not been called in question and repudiated, D was entitled to the share of C and may require A and B to convey the said share of C to him (D).

Q43. A mortgages a half share in the family property to B, in which he has only a third   share. Later on, on the death of his father A became owner of a half share. This fact had   been known to B before the transaction. Is B entitled to enforce his mortgage against the  half share? Specify the reason for your answer.  Ans 43: The right conferred to a transferee under section 43 of the T.P. Act is not available to a transferee who had knowledge that at the time of transfer his transferor had not possessed the right, title, interest and share in the property he was professing to transfer. In the instant case B having known that at the time of transfer A had only one third share, he (B) is not entitled to enforce a mortgage in respect of half share of the concerned property, but to the extent of one third share, only.

Q.44 On the death of F, his house and other properties were inherited by his two sons A  and B. While A had all through been out of India, B was in effective control of the house  and representing the same to be his property, transferred the same to C in 1996 for  consideration. C having discovered that at the time of sale B had only a half share  repudiated the deal by instituting a suit against B for appropriate relief in 1998, by calling in question the whole transaction. In 1999, A gifted his half share to B. Can C now  require B to transfer the other half share (gifted by A to B) in favour of C?  Ans 44: The right conferred by section 43 of the T.P. Act to a transferee is available only if  the contract of transfer subsists. In the instant case C having discovered that at the time of sale B had only half share in the property, C repudiated the deal and instituted a suit against B impeaching the transaction, and seeking appropriate relief in 1998. B acquired the other half share from A by gift in 1999, only after the transaction has been called in question and impeached In that view it cannot be said that when B acquired the other half share from A, the contract of transfer in question was subsisting. Accordingly, in such circumstances C cannot require B to transfer the other half  share (gifted by A to B) in favor of C.

Q45. A representing that he had the authority to transfer an immovable property X, which  he, in fact, did not have, and transferred the same by way of mortgage to one B. Subsequently a acquired a transferable interest in X, which he subsequently thereto  transferred to another person C, who had absolutely no notice of the previous transaction.  Does C get any legal protection in respect of his transaction?  Ans 45: The right conferred by section 43 of the T.P. Act on a transferee shall not impair the right of the transferees in good faith for consideration without notice of the previous transaction. In the instant case C having no notice of the previous transaction, the transferee (C) in good faith for consideration without notice gets the protection of law and the tr ansfer in favor of C shall remain unaffected and valid.

Q46. A owns three properties namely X,Y,Z. He mortgages them to B. Later on A  mortgages property X to C free from encumbrance. What legal right C may invoke in this  situation?  Ans 46: As per provisions of section 81 of the T.P. Act, if the owner of two or more properties mortgages them to one person and then mortgages one or more of the properties to another person, the subsequent mortgagee is, in the absence of a contract to the contrary, entitled to have the prior mortgage debt satisfied out of the property or properties not mortgaged to him, so far as it covers the mortgage debt. In the instant case if properties X, Y, Z are mortgaged to B and again property X is mortgaged to C, C may require and ask B, under this rule of marshalling of securities, to realize his mortgage due as far as possible from out of the property Y and Z and leave X free for realization of his dues.

Q47. A desires to transfer by way of gift his Lancer car to his elder son B, and his Chevrolet car to his younger son C. How can A lawfully make the transfer?  Ans 47: Section 123 of the T.P Act provides that for the purpose of making a gift of  immoveable property, the transfer must be effected by a registered instrument signed by or on behalf of the donor, and attested by at least two witnesses.

The section further provides that for the purpose of making a gift of movable property, the transfer may be effected either by a registered instrument signed as aforesaid  or  by delivery. The section also provides that such delivery may be made in the same way as goods sold may be delivered. In the instant case both the cars being movable properties, the said cars may be gifted by the father to his sons either by a registered instrument or b y delivery.

Q48. In order to bear the medical treatment of his son, A has to sell his land at Kanpur by which he can fetch a sum around Rs.75,000/- . How can he lawfully make the transfer of   his Kanpur land in favour of B, who is willing to purchase the same?  Ans 48: Section 54 of the T.P. Act provides that sale of any tangible immovable property of  value of one hundred rupees and upwards can be made only by a registered instrument. Accordingly, in the instant case A can sell his land at Kanpur fetching a sum around Rs. 75,000  by execution and registration of a sale deed  in favor of B (such a document, unlike a deed of mortgage or a deed of gift or a will, does not require attestation by witnesses).

Q49. A intends to sell his Patna house to B at a consideration of Rs.28 Lakhs and on 15.10.2002 both A and B entered into an agreement to transfer the property by A to B in the following terms. On 15.10.2002 B paid to A a sum of Rs.8 lakhs by way of earnest money and as per terms of the agreement promised to pay Rs.5 lakhs first by the end of November 2002 and so on and the last  installment of Rs.5 lakhs by the end of February, 2003. On such payment by B, A shall execute and  register an appropriate sale deed in favour of B by 15

th

of March 2003. Does the agreement for 

sale dated 15.10.2002 require registration? Specify the reason for your answer 

 Ans 49: An agreement for sale is substantially different from a deed of sale. A deed of sale involves transfer of right, title, interest in the property from the transferor (seller) to the transferee (buyer). Section 54 of the T.P. Act provides that sale of a tangible immoveable property of rupees hundred or upwards can be effected only by a registered instrument.

The Indian Registration Act 1908, provides for the law relating to registration of  documents. Section 17 of the Registration Act provides that any non testamentary instrument which purports or operates to  create, declare, assign, limit or extinguish any right, title, interest of the value of one hundred rupees and upwards, to or in any immovable property is  compulsorily registrable. Section 47 of the Registration Act provides that in the absence of  registration of a document, which is required by law to be registered,  the title in the property  does not pass from the transferor to the transferee.

In a deed of sale, by its execution (on receipt of consideration), the right, tit le, interest in the property has to shift from transferor to the transferee and hence is also required to be registered compulsorily under the provisions of section 17 of the Registration Act.

In an agreement to sale, unlike a sale deed, the parties to the document do not  in fact

transfer any right, title, interest in the property  from each other. They only agree to transfer the  property by appropriate document (Sale deed). Hence in an agreement to sale, (by virtue of that document) no right, title, interest in any immovable property is either created, or extinguished or transferred. Accordingly, a document professing to be an agreement to sale is not required to be

registered .

Q50. In Q49 does B acquire any interest in the subject Patna house on 15.10.2002? How early and in what manner can B acquire any interest in the said house?  Ans 50: In the context of the facts B, the intending purchaser does not acquire any interest in the subject Patna house on the date of execution of the deed of agreement to sale, i.e. on 15. 10. 2002. Proviso to section 54 of the T.P. Act provides that  a contract for sale  does not, of  itself, create any interest in, or charge on, such property.

Q51. In Q49 does the sale deed executed by A in favour of B by 15.3.2003 require to be registered?  Specify the reason for your answer.

 Ans 51: A sale deed involves creation of right, title, interest in favor of the transferee and extinction of such right of the transferor and as such is required to be compulsorily registered  in accordance with the provisions of section 17(1)(b) of the Indian Registration Act 1908.

Further section 54 of the T.P. Act provides that a sale of any tangible immovable property of the value of hundred rupees and upwards can be effected only by a registered instrument. Hence the sale deed dated 15.03.2003 is required under l aw to be registered.

Q52. In what manner is a transaction of mortgage effected? 

 Ans 52: Section 59 of the T.P. Act provides that where the principal money secured is one hundred rupees or upwards, a mortgage other than a mortgage by deposit of title-deeds can be effected only by a registered instrument signed by the mortgagor and attested by at least two witnesses.

In other cases a mortgage may be effected either by a registered instrument signed and attested as aforesaid, or (except in the case of simple mortgage) by delivery of the property.

Q53. What is a right of redemption? Explain with illustration. When is such right available ? When is such right extinguished? 

 Ans 53: A right of redemption is an invaluable right belonging to the mortgagor to redeem or get  back his property mortgaged . Section 60 of the T.P. Act provides that at any time after the principal

money has become due, the mortgagor has a right, on payment, of the mortgage money, to require the mortgagee (a) to deliver  to the mortgagor the mortgaged deed  and all documents relating to the mortgaged property which are in possession of the mortgagee, (b) where the mortgagee is in possession of the mortgaged property to deliver possession thereof to the mortgagor and (c) at the cost of the mortgagor retransfer the mortgaged property to him and (where the mortgage has been effected by a registered instrument) to have registered an acknowledgement in writing that any right in derogation of his interest transferred to the mortgagee has been extinguished. This right is called the right to redeem, and a suit to enforce it, is called a suit for redemption.

When a mortgagor makes payment of the mortgage money inclusive of interest on expiration of the stipulated period of loan, a mortgagor can legitimately exercise his right of  redemption of the mortgaged property.

Such right of redemption is not lost merely on default in making payment by the mortgagor. The mortgagor in exercise of this right can redeem his property until such right has not been extinguished by act of the parties or by a decree of a co urt.

Q54. What is a right of foreclosure? When can this right be exercised? 

 Ans. 53: Section 67 of the TP Act provides that in the absence of a contract to the contrary, the mortgagee has, at any time after the mortgage money has become due and before a decree has

been made for redemption of the mortgaged property, or the mortgaged money has been paid, a right to obtain  from the court  a decree that the mortgagor shall be absolutely debarred of his right  to redeem the property .

A suit to obtain a decree that a mortgagor shall be absolutely barred  of his right to  redeem the mortgaged property is called a suit for foreclosure.

A mortgagee, other than a mortgagee by condition of sale, is not entitled to bring a suit for foreclosure. Further, a mortgagee under an anomalous mortgage is entitled to bring an action for foreclosure only if the terms of the mortgage enables him to do so, otherwise not. A usufructuary mortgagee or a mortgagee by conditional sale is not entitled to institute of sale. (On default of payment of the mortgage money inclusive of interest, a simple mortgagee, an English mortgagee, a mortgagee on deposit of title deeds, and an anomalous mortgagee generally, can  sue for sale; while a mortgagee by conditional sale can  sue for  foreclosure. A mortgagee under an anomalous mortgage may also sue for foreclosure, if the terms of the mortgage contain such provisions.)

Q55. A borrows Rs.8, 00,000/- for two years from B by mortgaging his house property X and   personally binds himself to pay the mortgage money, and in the event of his failure to pay, B shall  have the right to sell X. After two years, A failed to pay the mortgage money. B as a mortgagee contemplates to sue A for foreclosure. Advise B

 Ans 55. The transaction in question is a clear case of a simple mortgage. The interest transferred in a simple mortgage is mortgagor’s personal covenant or obligation to the mortgagee the right to sell

away the property in the event of mo rtgagor’s default in making payment of the mortgage money on expiration of the stipulated period. Accordingly, the mortgagee B, can be advised to go for a suit for sale, and not for a suit for foreclosure, as contemplated by him.

Q56. On 15.7.2001 A sold his house property X to B on condition that if A fails to pay to B Rs.5,25,000/- by 15.7.2004, the sale shall be absolute; but if A pays the amount to B as aforesaid, the sale shall become void and that B shall re-convey X to A.

On 15.7.2003 A defaulted in making payment as aforesaid and B contemplates to  sell X to realize the due. Advise B.

 Ans. 56 The transaction in question is a clear case of mortgage by conditional sale. On default  of  payment of the mortgage money on expiration of the stipulated period by the mortgagor, the sale, as per terms of the mortgage instrument, shall become absolute. Accordingly, law does not require any further sale of the mortgaged property. In such a situation law provides that such a mortgagee may sue for getting a decree of foreclosure so that the mortgagor shall be absolutely debarred of his rights to redeem the property. This is how the mortgagee can perfect his title in the concerned property. So B shall be advised to go for a suit for foreclosure and not for a suit for sale.

Q57. In a usufructuary mortgage on default of payment of mortgage money, can the mortgagee sue for sale or foreclosure of the mortgaged property? 

 Ans. 57. In a usufructuary mortgage, the mortgagor delivers possession, or binds himself to deliver possession of the mortgaged property to the mortgagee, and authorizes him to retain such possession until payment of the mortgaged money, and to receive the rents and profits accruing from the property. In case of such a mortgage the basic idea is to adjust the mortgaged money from out of the profits and usufructs of the property and the mortgaged property may be retained until the usufructs and profits of the property exhausts the amount due. Accordingly, in such a case the mortgagee does not possess a legal right either to go for foreclosure or for sale.

Q58. In a usufructuary mortgage, the mortgagor failed to give possession of the mortgaged   property to the mortgagee. Can the mortgagee institute a suit against the mortgagor?  Ans. 58 In case of usufructuary mortgage the essential requirement for the mortgagor is to deliver possession of the mortgaged property to the mortgagee, so much so, that t he usufructs and the profits arising out of the mortgaged property shall adjust against the amount payable by the mortgagor to the mortgagee. The possession and the time period for which the possession is to be enjoyed by the mortgagee are very important in a usufructuary mortgage. A delayed delivery of possession by the mortgagor to the mortgagee, in a usufructuary mortgage, may not be adequate to adjust the whole claim of mortgaged money. Accordingly,

if the mortgagor fails to deliver the mortgage property in terms of the mortgaged instrument the mortgagee necessarily suffers and he has a right to bring a suit against the mortgagee, for possession of the mortgaged property. (This is neither a suit for foreclosure, nor a suit for sale, which such a mortgagee cannot avail of.)

Q59. How is a mortgage by deposit of title deed effected? Does such mortgage require registration? 

 Ans. 59. Section 58 (f) of the T.P. Act provides that where a person in any of the towns of Calcutta, Madras, Bombay or such other towns as notified in this behalf, delivers to a creditor or his agent,

documents of title to immovable property , with intent to create a security  thereon the transaction is called a mortgage by deposit of title deeds. As per provision of law, such a mortgage can be effected in the specified area only by deposit of the documents of title of the concerned property with the creditors. Since the transaction takes place by mere deposit  of title deeds, no

documentation is required  and accordingly, the requirement of registration is also held to be redundant.

Q.60 A took a loan from B, by mortgaging his house property X by an instrument to that effect executed by B and attested by C. Comment on the legality of the transaction.

 Ans. 60. Section 59 of the T.P. Act provides that a mortgage can be effected only by a registered instrument signed by the mortgagor and attested by at least two witness. In the instant case attestation was done by only one witness, namely C. Further, in the absence of registration, there cannot be a valid mortgage transaction. Accordingly the transaction suffers on t hose two counts.

Q. 61 Explain “once a mortgage, always a mortgage”. Elucidate - A clog on the equity of  redemption.

 Ans. 61. A mortgage is basically a transfer of interest in specific immovable property for the purpose of securing a loan. In a transaction of outright sale, or gift of any property, the transferor, after a lawfully valid transaction to that effect, divests himself or is striped of any right title interest in the concerned property and the right title interest is created in favour of the transferee. But in a mortgage, the property is held as a security for repayment of loan. So this is basically not a outright transfer of right title interest in the concerned property, and the borrower or the mortgagor retains his right title interest and ownership in the property, but subject to certain rights and interests transferred in favour of the lender or the mortgagee. In such a transaction, the mortgagor possesses a valuable right of getting back the property on redemption, that is, on paying back the amount due to the mortgagee on expiration of the stipulated period.

As a borrower is usually supposed to be in need to borrow money, the lender cannot be allowed to take advantage of his financial superiority and to force the borrower to agree to such a term, which makes redemption of the property very difficult. Law as well as equity support the mortgagor by ignoring such a condition and assist the mortgagor in redeeming his property. Law does not permit any contrivance, which shall stand a s an impediment in mortgagor’s way of  redemption of the mortgaged property. Such condition is held to be a clog to be on equity of  redemption and is treated as illegal and void in law.

Stretching this concept to support redemption of mortgaged property from the hands of the mortgagee, law has always supported the concept that once a transaction is held to be a mortgage, no contrivance in its terms and conditions shall be allowed to render the transaction to be anything other than a mortgage. Hence, the concept emerged as ‘once a mortgage, always a mortgage’. On failure of the mortgagor to pay back the mortgage money to the mortgagee after expiration of the stipulated period, the mortgagor, ispo facto, does not loose his right of redemption forthwith. Such right is not extinguished until the court passes a decree for foreclosure, or the mortgaged property is actually being sold away following a decree for sale.

Q.62 If a mortgaged property in possession of the mortgagee receives accession, who is entitled to such accession on redemption of the mortgage? 

 Ans. 62. Section 63 of the T.P. Act provides that where a mortgaged property in possession of the mortgagee, during continuance of the mortgage, received any accession, the mortgagor upon redemption, shall, in the absence of a contract to the contrary, be entitled as against the mortgagee to such accession.

Q.63 If a mortgaged property in possession of the mortgagee, is improved, who shall be entitled to the improvement on redemption? 

 Ans. 63. Section 63-A (1) of the T.P. Act provides that where the mortgaged property in possession of the mortgagee, has during the continuance of the mortgage, being improved, the mortgagor, upon redemption, shall, in the absence of a contract to the contrary, be entitled to the improvement, and the mortgagor shall not be liable to pay the cost thereof.

Q. 64. In Q. 63, if the improvement was effected at the cost of the mortgagee and was necessary to  preserve the property, who shall be entitled to such improvement in the mortgaged property on redemption.

 Ans. 64. Subsection 2 of section 63-A (1) of the T.P. Act provides that where any such improvement was effected which was necessary to preserve the property from destruction, or deterioration or was made in compliance of the lawful order of any public servant, the mortgagor shall, in the absence of any contract of contrary, be liable to pay proper cost thereof in addition to the mortgaged money.

Q. 65 A borrows money from B for three years by mortgaging his two house properties X and Y to B on 7.2.2000. Thereafter, A again borrows money from C for three years on 14.3.2000 by  mortgaging X to C. On default in 2003, B contemplates to sell X and Y for realization of his mortgaged debt. Has C any legal right to protect his interest for realization of the debt owed by A to C? 

 Ans. 65. Section 81 of the T.P. Act provides that if the owner of two or more properties mortgaged them to one person and then mortgages one or more of the properties to another person, the subsequent mortgagee is, in the absence of a contract to the contrary, entitled to have the prior mortgage debt satisfied out of the property or properties, not mortgaged to him, so far as the same may cover the debt.

In the instant case, C may require B to marshal the securities in such a way so that his mortgaged debt be satisfied, first from out of property not mortgaged to him, i.e. from Y, so that as its covers the debt. If, however, Y is not sufficient to liquidate the mortgage debt, then only B can enforce his mortgage as against X.

Q. 66. Two farms X and Y are valued at Rs 20,00,000 and Rs 30,00,000 respectively. X and Y are mortgaged to secure a loan of Rs. 20,00,000. What should be the ratable contribution from X and Y  in respect of the debt? 

 Ans. 66. Section 82 of the T.P, Act provides for contribution to mortgage debt.

If two properties X and Y valued Rs. 20,00,000 and 30,00,000 respectively and mortgaged to secure a loan of Rs. 20, 00,000, the ratable share to be borne by the properties would be in the proportion of 2:3 and the amount for which X and Y would be liable, would be 8,00,000 and 12,00,000 respectively.

Q.67. A house property X is charged to secure payment of a loan taken by A from B. A failed to repay the money with interest by the stipulated debt. What step B may take to realize his due? 

 Ans. 67. When a property is made security for payment of money to another constituting a charge as contemplated in Section 100 of the T.P. Act, on default of payment a charge can be enforced only by sale of the property through the court. Accordingly B may take step by instituting a suit to enforce his charge on the property so as to realize his dues.

Q.68 A, the owner of a huge agricultural farm lets out the same to B on 1.4.1998 for a period of 10  st 

years at a rental of Rs 50,000 per English calendar year beginning from 1 of April of any year to st 

31 March of the following year. How can lessor A determine the lease after expiration of the stipulated period? 

 Ans. 68. Section 111 of the T.P.Act provides that a lease of immovable property determines (a) by efflux of time limited thereby..;

In the instant case the lease being for a specified period of ten years, it automatically determines on expiration of the stipulated period and in such a situation there is no need to issue a notice determining the lease.

Q.69 In Q.68 say there was a dispute between A and B. Can A ever terminate the lease before 31.3.2008? 

 Ans. 69. Section 111 of the T.P. Act provides for determination of lease and section 111(g) provides that a lease can be determined by forfeiture, that is to say, (1) in case the lessee breaks an express condition, which provides on breach thereof, the lessor may re enter, or (2) in case the lessee renounces his character by setting up a title to third person or to himself or (3) if the lessee is adjudicated an insolvent; and any of this cases the lessor or his transferee gives notice in writing to the lessee of his intention to determine the lease.

In the instant case A can terminate the lease before 31.3.2008, only if B’s action comes

within the ambit of any of the provisions of section 111.

Q.70. A lets out a field to B at an annual rental of Rs. 40,000 per English calendar year from 1 st  st 

 January to 31 December. A serves a six months notice under S. 106 of the TP Act to B, on 15.9.2002 terminating the lease. How early can A institute a suit for eviction of B on the basis of  the said notice? 

 Ans. 70 . Section 106 of the T.P. Act provides that a lease of immovable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year terminable on the part of  either lessor or lessee, by six months’ notice expiring with the end of a year of tenancy.

In the instant case the notice was served to B on 15.9.2002. As per provisions of said section 106, such a lease is terminable by a six months notice ending with the month of tenancy. Here, the said six months ending with the year of tenancy would commence from July to December of any English calendar year. This period, the lessee is likely to get only from July 2003 to December 2003. st

Hence at the earliest, A can institute a suit for eviction of B on 1 January 2004, and not on any date before that.

Q.72 B is the tenant of A in an area where TP Act is applicable. The tenancy commences from 15 th

th th

of any English calendar month to 14 of the following month. A serves 15 days’ notice to B on 7 

 January 2007. How early could A institute a suit for eviction of B from the aforesaid tenancy on the basis of the said notice? 

 Ans. 71. Section 106 of the T.P.Act provides that a lease of immovable property, other than for agricultural and manufacturing purposes, for year to year, or for more than one year etc shall be deemed to be a lease from month to month, terminable on the part of either lessor or lessee, by

 fifteen days notice expiring with the end of a month of the tenancy .

In the instant case the notice was served to B on 7.01.2007. As per provisions of said Section 106, such a lease is terminable by fifteen days’ notice ending with the month of tenancy. Here, the

said fifteen days ending with the month of tenancy would commence only from 31 st

st

th

to 14 of the

th

following month. This period the lesse is likely to get from 31 January 2007 to 14 February 2007. Hence, at the earliest, A can institute a suit for eviction of B on 15

th

of February 2007 and not on any

date before that.

th

Q.73 In Q. 72, if instead A had served the notice on B on 28  January 2007, how early could A institute a suit for eviction of B from the aforesaid tenancy on the basis of the said notice? 

 Ans 73. In Q. 72, if the notice was served on the 28 th of January 2007, the lessee or the tenant gets the fifteen days’ period from 31st January to 14

th

February 2007. Hence, at the earliest, A can

th

institute a suit for eviction of B on 15 of February 2007 and not on any date before that.

Q.74 In a tenancy where the TP Act is applicable, what ground or grounds the lessor needs to  prove to evict his lessee? 

 Ans. 74. In a tenancy where the TP Act is the governing law on the subject, the only requirement to evict a lessee or tenant is to serve him either a six months’ or fifteen days’ notice expiring with the end of year of tenancy or month of tenancy, as the case may be. This apart, the lessor is not required under the law to prove any ground for achieving eviction of his tenant. (But, in provincial rent legislations, which are applicable in municipal areas, the subject law requires the landlord-lessor to prove one or more of the grounds enumerated therein for eviction of the tenant. Such laws specify that there shall not be any decree for eviction without one or more of the grounds having been satisfactorily proved before a court of law, and otherwise not. Such suit for eviction also precedes by usual one month’s notice expiring with the end of a month of tenancy.)

Q.75 B, a colleague of A, approached A to permit B to stay in A’s vacant fl at for two months to enable him to join the office on transfer and in the meantime, to find out a suitable rented  accommodation. A agreed to B’s proposal and allowed him to stay. Even after a passage of six  months, and inspite of A’s repeated requests to v acate the flat, B did not do so. How can A evict B  from the said flat and recover possession of the same? 

 Ans. 75. As A permitted B, his colleague, to stay in A’s vacant flat for two months, B occupied the flat as a licensee. As B overstayed and did not vacate the concerned premises even after a passage of six months in spite of A’s repeated requests to vacate the flat, A can now evict B by instituting a suit for eviction of a licensee. (In such a suit, there is no need for any such notice as is required to evict a tenant either under the TP Act or under the provincial rent legislations; nor the licensor is required to prove any ground for eviction of the l icensee.)

Q.76 In Q. 75, could A require B to vacate the flat even before two months? 

 Ans. 76. A license is basically in the nature of a personal covenant between the parties, more so in the nature of a personal prerogative of the grantor. He is at liberty to revoke the license or the permission at any time according to his desire. In that view, A could terminate the license and require B to vacate the flat even before the expiration of two months from his occupation.

(However, if the license granted is subject to payment of fee and if, on account of eviction of  a licensee following premature revocation of license, the licensee suffers any loss, he may be compensated by the licensor but that will not stand in the way of eviction of the licensee even before the said two months.)

Q.77 In Q.75, was it necessary for A to prove a ground on which B could be evicted? 

 Ans. 77. As a license is a personal grant, the grantor can revoke such permission at any time as he desires and for eviction of a licensee, a licensor is not at all required to prove any ground.

Q.78 B, a lessee of A, in A’s apartment, without A’s permission, erected a partition wall to bifurcate the dining space from the drawing room, and made a second entrance of the leased   property by converting a window to a door. A being aggrieved, what step can he take against B in such a situation? 

 Ans. 78. Section 108 of the TP Act provides for the rights and liabilities of the lessor as well as that of the lessee. It provides that, amongst other requirements, the lessee is bound to keep the tenanted premises in good condition and he must not, w ithout the lessor’s consent, erect on the property any permanent structure. B’s erection of a partition wall to bifurcate the dining space from the drawing room and making a second entrance of the leased property by converting a window to a door, all without lessor A’s permission, is not in consonance with the provisions of law and hence, offer a ground for eviction of the lessee B on that ground only.

Q.79 In July 2004, a lease between A and B was forfeited. B paid rent to A for the months  of August 2004 and September 2004, which A duly accepted. What happens to the  forfeiture?

 Ans. 79 . Section 112 of the TP Act provides that a forfeiture under section 111, clause (g), is waived  by acceptance of rent  which has become due since the forfeiture, or by distress for such rent, or by any other act on the part of the lessor showing an intention to treat the lease as subsisting. It is also provided that the lessor is aware that the forfeiture has been incurred. The section also provides that, where rent is accepted after the institution of a suit to eject the lessee on the ground of  forfeiture, such acceptance is not a waiver.

In the instant case the lease was forfeited in July 2004 and B paid rent to A for the months of  August and September 2004, which A duly accepted. There is nothing to indicate that B did not know about the forfeiture. This payment of rent by the lessee and acceptance thereof by the lessor, after the forfeiture of the lease constitutes waiver of forfeiture of the lease.

Q.80 A, the lessor, gives B, the lessee, a notice to quit the property leased. The notice expires and B remains in possession. A gives to B a second notice to quit. What happens to the first notice? 

 Ans. 80. Section 113 of the TP Act provides that a notice given under Section 111, clause (h), is waived, with the express or implied consent of the person to whom it is given, by any act on the part of the person giving it showing an intention to treat the lease as subsisting.

In the instant case as B continues in possession in spite of the notice to quit given to him, when A gave to B a second notice to quit. The effect of a second notice in the facts and circumstances of the case constitutes waiver o f the previous notice.

Q.81 A lets a house to B for 5 years. B underlets the house to C at a monthly rent of Rs. 5000/-. The  five years expire, but C continues in possession of the house and pays rent to A. What is the legal  consequence of such payment? 

 Ans. 81. Section 116 of the TP Act provides that if lessee or under-lessee of property remains in possession thereof after the determination of t he lease, the lessor or his legal representative accepts rent from the lessee or under-lessee, or other wise assents to his his continuing in possession, the lease is, in the absence of an agreement to the contrary, renewed from year to year, or month to month, as the case may be.

In the instant case as the original lease to B was for five years and B under-let the house to C, and on expiration of five years C continued in possession and paid rent to A. In the circumstances C’s lease is renewed from month to month.

Q.82 A lets a farm to B for life of C. C dies, but B continues in possession with A’s assent. What  happens to B’s lease in such a situation? 

 Ans. 82. (Explain the provisions of Section 116 of the TP Act). In the instant case the original lease to B was for the life of C and even after C’s death B continues in possession with A’s assent. In the circumstances B’s lease shall be deemed to be renewed from year to year.

Q.83 A transfers a house property X worth Rs. 22,00,000 to B and B in return transfers to A his house Y worth Rs. 20,00,000 and gives cash of Rs.2,00,000. Is this a sale or an exchange? Specify  the reason for your answer.

 Ans. 83. Section 118 of the TP Act provides when two persons mutually transfer the ownership of  one thing for the ownership of another, neither thing or both things being money only, the transaction can be termed as an exchange. It also provides that a transfer of property in completion of an exchange can be made only in manner provided for the transfer of such property by sale.

In the instant case in return for a property X worth Rs. 22,00,000 to B, B in return transfers to A his house Y worth Rs. 20,00,000 and gives cash of Rs.2,00,000 here the transaction in substance was an exchange even though a small amount of money constituted part of it.

Q.84 A transfers his house X worth Rs. 22,00,000 to B and B in return pays to A Rs.20,00,000 in cash and a small piece of land worth Rs.2,00,000. Is this a sale or an exchange? Specify the reason  for your answer.

 Ans. 84. (Specify the provision of Section 118 of the TP Act)

In the instant case in return for a property worth Rs.22,00,000, B paid a cash amount of  Rs.20,00,000 and a small piece of land worth Rs.2,00,000. This cannot be stated to be an instance of  an exchange in substance, as almost the entire amount is paid in cash.

Q.85 In 1990, A made a gift of his farmhouse X to B, one of his sons, who was then in the USA. A died in 1998. In 2005, B came back to accept the gift, which was objected by A’s other son C. Was B entitled to the gift, or was C’s objection valid? 

 Ans. 85. Section 122 of the TP Act provides that a gift is the transfer of certain existing movable or immovable property made voluntarily and without consideration, by one person, called donor, to another, called the donee and accepted by or on behalf of the donee. It also provides that such an acceptance must be made during the lifetime of the donor and while he is still capable of giving. It also provides that if the donee dies before acceptance the gift is void. In the instant case the gift of the farm house was made by A to B in 1990 and the donor A died in 1998. it appears that B came to accept the gift in 2005, i.e. after the death of  the donor. Accordingly, B cannot accept the gift in 2005 and the gift turns out to be void in law in 1998. In that view his C’s objection is not without substance.

Q.86 A transferred X, his farmhouse, by a registered instrument of gift executed by A and attested  by C, D and E. Was the transfer valid? 

 Ans. 86. Section 123 of the TP Act provides that for the purpose of making a gift of immovable property, the transfer must be effected by a registered instrument signed by or on behalf of the donor, and attested by at least two witnesses.

In the instant case the gift of the farm house was made by execution of deed of gift and attested by C, D, and E and which document was registered by the donor. Law’s requirement is

attestation by at least two witnesses. Here the attestation was done by three witnesses which is evidently in conformity with law. Accordingly the transfer was lawful and valid.

Q87. A gives a farm to B, reserves to himself, with B’s assent, the right to take back t he farm in case B and his descendants die before A. B dies without descendant in A’s lifetime. Is this a valid  gift? Can A take back the farm?.

 Ans. 87. Section 126 of the TP Act provides that the donor and the donee may agree that on the happening of any specified event which does not depend on the will of the donor a gift shall be suspended or revoked; but a gift which the parties agree shall be revocable only or in part, as the case may be.

In the instant case si nce both A and B agreed to A’s taking back the farm gifted to B on condition of B’s descendants dying before A and B having died without descendants, A may take

back the farm.

Q88. A gives Rs.1,00,000/- to B, reserving to himself, with B’s assent, the right to take back at   pleasure, Rs.20,000/- . Is the gift valid? Is B bound to return Rs.20,000/- if demanded by A subsequently?.

 Ans. 88. (Explain the provisions of Section 126 of the TP Act)

In the instant case the right of donor A to take back Rs.20,000 at his pleasure, even though with B’s consent, is not in consonance with law on the subject. From the facts and circumstances it

can be held that the gift holds good for Rs.80,000, but is void as to Rs.20,000, which continued to belong to A.

Q89. A transfers a property by gift to B, and with B’s assent, reserves the right to revoke the gift if  B fails to get himself enrolled at the Bar. B while in possession sells the property to C, who had no notice of the right of revocation, If B fails to enroll at the bar, can the property be recovered from C? 

 Ans. 89. (Explain the provisions of Section 126 of the TP Act).

In the instant case A transferred the property by gift to B, reserving the right to revoke the gift if B failed to get himself enrolled at the bar. The facts of the case indicate that B, while in possession, sold the property to C, who without notice of the right of revocation accepted it. If B failed to enroll at the Bar, A could not recover the property from C, as C was a bona fide transferee for value without notice of the right of revocation by A.

Q90. A by a single transaction gifts to B three properties X,Y,Z, out of which X is burdened with obligation. Can B accept Y & Z only, leaving X? 

 Ans. 90. Section 127 of the TP Act provides that where the gift is in form of a single transfer  to the same person of several things of which one is, and the others are not, burdened by an obligation, the donee can take nothing by the gift unless he accepts it fully. It also provides that where the gif t is in form of two or more separate and independent transfers to the same person of several things, the donee is at liberty to accept one of them and refuse the others, although the former may be beneficial and the latter onerous.

In the instant case as the gift of three properties X, Y and Z to B is made by a single

transaction, B has to accept either the whole of the gift, including the onerous part of it or not at all. Accordingly, B cannot accept Y and Z alone, leaving X.

(If the said three properties were gifted to B by three separate instruments or transactions, B was at liberty to choose which of the gifts he would acc ept)

Q91. A is owner of properties X & Y. A borrows Rs.75,000/- from B. Thereafter A makes a gift of X  & Y to C. Can C acce pt X & Y, ignoring to pay A’s debt of Rs.75,000/? 

 Ans. 91. Section 128 of the TP Act provides that where a gift consists of donor’s whole property, the donee is personally liable for all the debts due by and liabilities of the donor at the time of the gift to the extent of the property comprised therein.

In the instant case, as the gift consists of donor’s whole property, the donee C shall be

personally liable for all debts due and liabilities of the donor A. If C accepts the gift from A, C shall be liable to pay Rs. 75,000/- from out of the properties X and Y he received from A by way of gift.

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Q92. On 7  February, 1996 A agrees to sale a house property X to B at a consideration of  Rs.35,00,000/-. Rs.5,00,000/- paid by B to A on 7.2.1996 as earnest money. They agree that B should pay Rs.30,00,000/- in 3 installments of Rs.10,00,000/- each to be paid at the end of March,  April and May 1996 respectively. th

On 18  February, 1996 C offers a price of Rs.40,00,000/- for X to A and thereafter A is making all endeavor to do away with the agreement with B. What shall B do to get the property? 

 Ans. 92. In such a situation, B shall be advised to institute a suit against A for specific performance of the contract in question. While instituting such a suit , it shall be plaintiff B’s case to show before the court that he has performed his part of the contract and he is willing to perform his remaining part of the contract and shall deposit the unpaid balance amount of  consideration in court at the time of filing the suit. He shall pray for a decree to direct A to perform his part of the contract, namely, after accepting the remaining balance amount of  consideration deposited in court, A shall prepare, execute and register an appropriate sale deed in respect of the concerned property in favour of B and shall deliver possession of the property to B, if at all the possession was not yet delivered. (After obtaining a decree for specific performance of contract, if defendant A fails to comply with the directions of the decree by execution and registration of an appropriate sale deed in favour of B, on application for execution of the decree by the decree-holder B, the court shall execute and register an appropriate sale deed on behalf of the failing defendant, now judgment-debtor, A.)

Q93. On 8 th September 1995 A leased a property X to B. On 17 th November 1995 A leased X to C. On th

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5 December 1995 A mortgaged X to C. The two deeds of C were registered on 20  December 1995 nd 

and B’s deed was registered on 22 December 1995. Can B maintain a suit for possession of X? 

 Ans. 93. Section 47 of the Indian Registration Act, 1908 provides that a registered document  shall operate from the time from which it would have commenced to operate if no registration thereof had been required or made, and not from the time of its registration. This signifies that irrespective of the date of registration of a document, involving transfer of  interest from the transferor to the transferee, the document shall operate not from the time of  its registration, but from the date of its execution. In the instant case, all three documents were validly registered within the time limited therefor. Since the registered documents operate retrospectively from the date of their execution, B’s document of lease being earliest in point of time, notwithstanding its

registration took place after registration of C’s documents, B’s document s hall prevail over the other documents, in that view, it shall be lawful for B to institute and maintain a suit for possession of X on the basis of his document, which is earliest in point of t ime.

Q94. A sales X to B on 15.10.1998. Thereafter A sales X to C on 18.10.1998. A registers both sale deeds on 22.10.1998. Who got the title in X? 

 Ans. 94. (Explain the provisions of Section 47 of the Indian Registration Act). In the instant case, B’s document was executed on 15.10.1998 and C’s document was executed on 18.10.1998 in respect of the same property. But the facts indicate that A registered both the sale deeds on 22.10.1998. As per provisions of Section 47 of the Indian Registration Act, any registered document operates retrospectively from the date of its execution and not from the date of its registration. Accordingly, as both the documents were registered on 22.10.1998, the effect of such registration was to give effect to the passing of  title from the transferor to the transferee with effect from the respective dates of execution. It appears that B’s document was former in point of time and, accordingly, shall prevail over  C’s document.

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Q95. A sold X to B on 1 October 1998 again A sold X to C on 15 nd 

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October 1998. A registered C’s

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deed on 22 October 1998 and B’s deed on 25 October 1998. Who shall get the title in X? 

 Ans. 95. (Explain the provisions of Section 47 of the Indian Registration Act.) As any registered document operated retrospectively with effect from the date of its execution and not from the date of its registration, both the documents in question in favour of B and C being validly registered within the time stipulated therefor, the documents shall be operative from the time of execution and, in that view, the document executed former in point of time shall prevail over the document executed later on.

Q96. A executes a sale deed in respect of his house property X in favour of B and himself presents the deed before the Sub-Registrar and admits execution of the same. The Sub-Registrar refuses to register the document. What step B & A may take to register the deed? 

 Ans. 96. Section 72 of the Indian Registration Act provides that except where the refusal of  registration by the Sub-Registrar is made  on the ground of denial of execution, an appeal   shall lie as against the order of a Sub-Registrar refusing to admit a document to registration,  to the Registrar. So, in this case, B or A may prefer an appeal before the Registrar, calling in question the decision of the Sub-Registrar.

Q97. In Q.96 if A had denied executions before the sub-Registrar, what step B should take to register the document? 

 Ans. 97. Section 73 of the said Act provides that, when a Sub-Registrar has refused to register a document on the ground of denial of execution, any person claiming under such document, may, within thirty days after the making of the order of refusal,  apply to the Registrar in order to establish his right to have the document registered. So, in this case, as against the decision of the Sub-Registrar, B should make an application before the Registrar to have the document registered.

Q98. In Q96 if the Registrar refuses to register the document, can B go for a further appeal? 

 Ans. 98. Section 77 of the said Act provides that, where the Registrar refuses to order the document to be registered, under Section 72 or Section 76, any person claiming under such document, may, institute in the Civil Court, within the local limits of whose original  jurisdiction is situate the office in which the document is sought to be registered, a suit for a decree directing the document to be registered in such office, if it be duly presented for registration within thirty days after the passing of such decree. So, in this case, B cannot go for a further appeal, which is also prohibited under Section 76(2) of the said Act but has to file a suit before the appropriate civil court for a decree directing the document to be registered.

Q99. A, a poor illiterate widow with 3 minor children, enters into an agreement with B, a solvent  merchant to sell X, her only homestead at a consideration much less than the market price of the  property. She accepted Rs.10,000/- as part of the agreed consideration. As being advised by her  relation A refused to execute & register a sale deed in respect of X. B filed a suit for specific   performed of contract. Is the Court bound to pass a decree for specific performance of contract? 

 Ans. 99. In the instant case, it appears that there was a lawfully valid agreement for sale of the homestead of the widow in favour of the rich merchant. He also paid Rs. 10,000/- to the widow lady as part of the agreed consideration. On ultimate refusal by the lady to sell the property, the merchant filed a suit against her seeking a decree for specific performance of contract. The plaintiff  merchant can show and establish by adducing sufficient proof before the Court of law that there was a lawfully valid agreement and that, in pursuance of the agreement, he paid money to the lady, and that he was ready and willing to perform the remaining part of the contract. On this basis, court may pass a decree for specific performance of contract against the lady. But the basis of Specific Relief  Act is based on the principle of equity, justice and good conscience, and accordingly, notwithstanding that the case of the plaintiff otherwise stands on its own feet on merit, yet, considering all aspects of the case, and also considering that such a decree may cause immense hardship for the defendant lady, the court may refuse to grant such a relief. Even if the case for a decree for specific relief is proved, grant of such relief is ultimately the discretion of the court, which discretion shall be exercised objectively, judicially, impartially, depending upon fax and circumstances of each particular case. So a court is not bound to grant a decree for specific performance of contract merely because it is lawful to do so. In such a case, if part-payment has been made, the court may direct return of the money with interest to the party paying the amount.

Q100. On 15.7.2007, Young India Association, a club registered under the Societies’ Registration  Act, entered into an agreement with A, a noted singer to perform for their club from 6pm to 9pm th

on 15 August 2007. For this show, tickets were already sold to the public. On 1.8.2007 A informed  that she might not be able to perform for the club on that date. Can the agreement be specifically  enforced? Specify the reason for your answer.

 Ans. 100. The instant case is one involves is a t ypical agreement, which, otherwise, on breach by either party, calls for an action for a decree for specific performance of contract. But if the contract or agreement is dependant on any personal skill of the other party, such an agreement cannot be enforced merely because the decree, will be unenforceable. A court will not make any endeavour to pass a decree which cannot be executed. Notwithstanding a decree, the defendant may refuse to comply with the same. In the instant case, since the performance depends on the personal skill, quality and volition of the singer, the court shall not pass a decree compelling her a performance (which she may refuse to do).

Q101. A intended to transfer to B a half share in a field belonging to A. But owing to a  mistake of the scribe, instead of the half, the whole property was transferred. The mistake was detected only after the original sale deed was received by the parties after registration.  Advise A how the mistake can be rectified?  Ans. 101 . Section 26 of The Specific Relief Act, 1963 provides that when, through a fraud or mutual mistake of the parties, a contract or other instrument in writing does not express their  real intention, then either party or his representative in interest  may institute a suit to have  the instrument rectified. In the instant case, as A intended to transfer to B only a half share in the field, but owing to mistake of the scribe, instead of the half share, the whole property was transferred. So, in effect the instrument in question did not express the real intention of the parties. Accordingly, as per provisions of Section 26 of the Specific Relief Act, 1963, A should be advised to institute a suit to have the instrument rectified. (The mistake in the document, after its registration, cannot be rectified in any other way even by the parties agreeing to the same).

Q102. A, a tenant at B’s property, was forcibly dispossessed at the behest of B. Suggest  what legal remedy can A avail in this situation?

 Ans.102. Section 6 of the Specific Relief Act, 1963, provides that if any person is dispossessed without his consent of immovable property otherwise than in due course of law, he or any person claiming through him  may, by suit, recover possession thereof, notwithstanding any other title that may be set up in such suit. It also provides that such a suit is to be brought within six months from the date of dispossession. In the instant case, B being a lessee, was forcibly dispossessed at the behest of the lessor A. Accordingly, in such a situation, B may be advised  to institute a suit for possession of the property, of which he was the lessee and from which he has been dispossessed otherwise than in due course of law. But his only relief in such a suit shall be restricted to possession of the property only.

Q103. In Q102, what difference would have been there, if A’s status was that of a  trespasser?

 Ans.103. (Explain the provisions of Section 6 of the Specific Relief Act, 1963.)

What said Section 6 emphasizes is that no one, irrespective of his status, should be dispossessed from any immovable property except in due course of law. Even a trespasser cannot be forcibly dispossessed, in which case, with the aid of this section, he may institute and maintain a suit for possession of the property from which he has been forcibly dispossessed, even though he did not