TRANSFER OF PROPERTY ACT,1882 Shakuntla Sangam

Shakuntla Sangam Assistant Professor At Dr. RMLNLU Lucknow

In India, the personal laws governed the transfer of property assisted by orders of Courts under Civil Procedure Code. Transfer of movable goods was regulated to an extent by the Indian Contract Act, 1872 AND in case of transfer of immovable property, the Anglo-Indian courts often turned to principles of Justice, Equity and Good Conscience as it prevailed in England at that time. Prior to

 A Bill, finally presented to the Legislative Council, became a law on the 17 th  of February 1882 and came into force from 1st  July of the same year. (137 sections) The Transfer of Property Act, 1882 mainly deals with transfer of immovable property by the act of parties by the operation of law in some cases(section 57) sale by court Denendronath v Ramcoomar Ghose(1881) Ghose(1881) ILR 7 Cal 693, 8 IA 65, p 75.

It intended to define and amend the

existing laws and not to introduce any new principle. It applies only to voluntary transfers. It provides a clear, systematic and uniform law for the transfer of immovable immovabl e property. property.

Section 6 of the Act says „property of any kind‟ kind‟   it implies every possible interest or right that can be possessed and is a subject of ownership. Property may be tangible or intangible, property is essentially a bundle of rights or interest. When a property is transferred it actually the transfer of rights. All rights in a property denote the ownership or absolute interest.

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MOVABLE PROPERTY It can be transferred from one place to another  Movable property is dealt with under the Sales of Goods Act, 1930  Registration is optional as per the Indian Registration Act, 1908 Eg. A decree for sale of immovable property.  A royalty. Standing timber, growing crops, and grass. Right to collect rent of immovable property. 

IMMOVABLE PROPERTY The definition of Immovable property given in the S.3 of Transfer of Property Act 1882, is not exhaustive, it is the negative definition which exclude the things and says immovable property does not include standing timber, growing crops or grass. The definition in the General clauses Act Act also not exhaustive but it is some what positive definition which includes land, benefits to arise out of

Section-5 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, 1[or to himself] and one or more other living persons; and “to transfer property” is to perform such act. Future property not allowed “Living person” includes a company or association or body of individuals, whether incorporated or not, but nothing herein contained shall affect any law for the time being in force relating to transfer of property to or by companies, associations or bodies of individuals.]

Sale (Immovable Property). Transfer of Complete Rights. Consideration.  Mortgage. ( it is of six kind- 1. Possession,2. Enjoyment,3. Subject to Condition,4. Equitable,5. Symbolic, 6. Constructive.) Limited Rights Transfer. Transfer.  Gift- ( No consideration) claim.- Unsecure debt. debt.  Actionable claim. Lease (Time force, Rent)  NOTE-Will or Inheritance is the exception of this rule as property transfer automatically by operation of law. 

“Transfer" means a process or an act

by which something is made over to another. It does not however, mean that the making over of the thing should always be absolute.

Family settlement.  Compromise  Partition.  Surrender.  Relinquishment.  Charge. Release-- It is a transfer of property, Release because when larger interest falls into smallest interest every small interest generate a title for some one or new person. 

Section- 6 Part governed by personal laws Muslim Law-Wakf Law-Wakf of property Hindu Law-Religious Law-Religious offering and copasner like female legacy Civil Law- Agricultural Law- Agricultural Land Prohibited by any other law in force. Spes Successionis Successionis-- Expectation of succession ( of gaining something) eg. Will or inheritance

Section-9 says where writing is not necessary the property may be transferred orally or ally.. i.e. without wi thout writing any deed. It means there are two mode of transfer Delivery of possession- which generally happened in case of movable mo vable property. property.  Transfer by registration.

 Any body can transfer whomajority.  Attained the age of majority.  Soundness of mind. bar..  There should be no other legal bar Nemo dept quat non habit- You can transfer only those which you have. Note- Competent to inter into a contract.

General rule of TP General TPA A is trans transfer fer vivos that is transfer of property between living person at the date of transfer, but section 13 of this act provide the conditions where a interests can be created for unborn person or a person who is not exist at the date of transfer subject to certain conditions which is also authenticated by Indian Trust Act S.5

S-25:Provides S-25 :Provides conditions Pre condition eg. Gift of house with Pre condition condition to marry After  condition  condition eg. Gift of house with condition not visit within 3 years to USA Simultaneous/side by site condition eg. Simultaneous/side by Gift of house with condition has to live in the house.

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Impossible conditions

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Unlawful / forbidden by law

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Impossible performance.

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Opposed to public policy

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Fraudulent conditions

Section-35  : Election means choosing between two inconsistent or alternative rights . Under any instrument if two rights are conferred on a person in such a manner that one right is lieu of the other, he is bound to elect only one of them. This doctrine is based on equitable principle under which a person may not be allowed to approve that of an instrument which is beneficial to him and disapprove its that part which goes against him. ( Probate &Reprobate)

When a person professes to transfer a property not his own  In lieu of the property the transferor confers certain benefits to the owner of the property of benefit and confer of  Transfer benefit to be part of the same property. The election  Suspension of Electionmay suspend till the time there are any legal disability. 

S- 52; 52; Les= Litigation & Pendens= Pending  There is a pendency of a suit or proceeding  The suit or proceeding must be pending in a court of competent jurisdiction and  A right to immovable property is directly and specifically involved in the suit  The suit or proceeding must not be collusive  The property in dispute must be transferred or otherwise dealt with by any party to suit  The transfer must affect the rights of the other party to litigation It applies only on immovable properties

S-53-A; It is an equitable doctrine, it based on the Maxim equity looks on that as done which ought to have been done. This doctrine protect the transferee who has done his part or willing to perform his part, he can not be distitle on the basis of the legal formalities has not been done.

S-54-Sale is the transfer of ownership, in S-54-Sale exchange of price paid, or promises to paid or part paid or part promise. Essential of Valid Sale  Two parties seller and purchaser  Competent parties  Subject matter i.e. property in existence.  Money consideration, price of the property  The conveyance/ contract made in accordace with existing law

Registration of Sale Deed: Deed: Sale relating only with tangible immovable property, if the value of property above Rs 100, it must be registered, in case of value of tangible immovable property less then Rs 100 such transfer may be made either by registered instrument or transfer of property. Delivery of property : Deliver of tangible immovable property takes place when buyers takes the possession of the property.

Because the ownership of the property is not transferred to the transferee on the basis of such agreements. Purchaser take the possession of the property and agreed to pay the price against the property in future installment.  The installments are not the price paid in future.  In the same time the purchaser has the option to refuse the sale  The seller has also right to terminate the sale.  There is no absolute transfer of ownership.

Section-58(a) Transferring Section-58(a) Transferring Limited interest of property for taking Loans. It is a security against loan on the basis of any immovable property Where a loan is secured against any immovable property immovable  property is called Mortgage,, and when it secured against Mortgage any movable  property its called movable property pledge.

There must be transfer of Limited Interest  Interest transferred against any specific immovable property.  Purpose of transfer must be to secure payment of any debt, or performance of an engagement which may give rise to a pecuniary liability. 

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Sec-58 (d) where mortgagor delivers the possession to mortgagee to retain possession until payment and to receive rents/profits BUT there is no right to sell the property property..

Secton-100: Where immovable property of Secton-100: one person is, by act of parties or by operation of law, made security for payment of money to another, and the transaction does not amount to a mortgage, the latter person is said to have a charge on the property; and all provisions in respect of „simple mortgage‟ will apply to such charge. but it will be a „charge‟   for purpose of registration under „charge‟ Companies Act, as per section 124 of

Section-118: When two persons mutually Section-118: transfer the ownership of one thing for the ownership of another, neither thing or both things being money only, the transaction is called an „exchange‟ „exchange‟..

S- 130 „Actionable claim‟ claim‟   means a claim to any debt or to any beneficial in movable property not in possession (either actual or constructive) of the claimant. The claim should be such be such as Civil Court would recognize as affording grounds for relief. Such debt or beneficial interest be existent, accruing, conditional or contingent. Eg. Claim to any debt etc such as Arrears of rent

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Copy right

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Debentures

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Beneficial interest in immovable property

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 Gift is an instrument to transfer ownership without any exchange of money To gift immovable property, just have to draft the document on a stamp paper, paper, have it attested by two witnesses and register it. Registering a gift deed with the sub-registrar of assurances is mandatory as per Section 17 of the Registration Act, 1908, failing which the transfer will be invalid. Besides, such a transfer is irrevocable. Once the property is gifted, it belongs to the beneficiary and you cannot reverse the transfer or even ask for monetary compensation. c ompensation. Gift movable property like jewellery, registration is not compulsory. At the same time, a mere entry in an account book is not sufficient to establish a transfer. Apart from physically handing over the property, you need to back it with a gift deed. The process is slightly different if you are gifting company shares. You will have to fill out the share transfer form and submit it to the company or registrar, and the transfer agent of the firm. Once again, get a gift deed drawn and executed to complete the transfer, but the document need not

The biggest benefit is that there is no tax implication if you are gifting property to certain relatives .However .However,, you still have to pay stamp duty. Type of property

Rela tives Relatives

Non-relatives Non-rel atives

Immovable

1-8% for value of property

5-11% for value of property

Movable

2-8% for value of property

3-8% for value of property

which can vary depending on the state in which the transfer takes place. place. this duty duty have have to pay even even in the case of movable property. Expect to shell out 2-8% in case of relatives, and 3-8% for non-relatives.

Gift deed cannot be revoked It can be challenged on the grounds that the donor was not of sound mind or a minor Note- No one can gift a property that's held jointly jointly..

This document is quite different from a gift deed, though the legal implications are the same. It can be use to transfer rights in a particular property to another coowner. Such a transfer is also irrevocable even if it is without any exchange of o f money. money. It must be signed by both and registered there is no

It allows seamless transfer of the share in a jointly-held property property.. "This document is most commonly used when a person dies without leaving behind a will and all siblings end up inheriting the property,". Unlike a gift deed, the relinquishment deed for monetary consideration can be drawn.

There are no tax benefits. The term 'transfer' includes relinquishment, not gift. When there is relinquishing of property for monetary consideration, it will result in capital gains for the transferor and if the consideration is less than the stamp duty value of the property, the difference between the stamp duty and the consideration will be taxed in the hands of the buyer," . If relinquish is

without any consideratio consideration, n, the

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 Wife or husband • Brother or sister  • Wife or husband's brother or sister  • Parents • Wife or husband's parents • Parents' brothers and sisters • wife or husband's parents' brothers and sisters • Legal heir, if any

For the purpose of Real Estate the Long-term Capital gain would be only if you hold the property for more than three years, then it is subjected to tax @20%. In case you sell the property in less than three years time then it would become short-term Capital Gain and the same is required to be taxed at the prevailing tax schedule of the rate applicable to the assessed depending on his other incomes.

The instruments like Agreement to Sell, Conveyance Deed, Exchange of property, Gift Deed, Partition Deed, Power of Attorney, settlement and Deed and Transfer of lease attract Stamp Duty on market value of the property.

Spouse: Lineal ascendant Spouse: or descendant( their spouses) of you and your spouses. Spouse‟s siblings and their respective spouses. Brothers  or sisters of either of your Brothers  parents. Note- In case of Hindu Hin du undivided family family,, b b l i t th f il

Salary Property rental income Capital gains such as profit from sale of house, land, gold, etc. Income from business/profession: This applies for entrepreneurs and small business people who don't get a regular salary income. Some examples are doctors, lawyers, etc Income from other sources such as interest received on bank deposits, winnings from lotteries or game shows, etc.

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Income Tax! Any transfer of an immovable property will now invite a tax deduction at source of one per cent on the value of the transfer if it is Rs. 50 lakh or more, according to the provisions of the Union Budget 2013, which has come into force with effect from June 1, 2013. The objectives of this provision are multiple many significant transactions go unreported with neither the buyer nor the seller quoting a PAN and also the one per cent TDS on these transactions will address fiscal deficit by increasing revenue collection. While the objectives are commendable, the lay person is likely to face several questions such as is TAN (Tax Deduction and Collection Account Number) required to comply with provisions, how does one issue TDS certificate to seller, filing of TDS returns, deposit of taxes and

Where any document required to be registered under the provisions of clause (a), clause (b), clause (c) or clause (e) of sub- section (1) of section 17 of the Indian Registration Act, 1908, 1908, purports to transfer, assign, limit or extinguish any right, title or interest in any property,  property,  other than agricultural land, belonging to any person to whom this Act applies, no registering officer appointed under the said Act shall register any such document, unless it is certified by the Income- tax Officer of the area in which the property is situate in respect of the person whose right, title or interest in the property is to be so transferred, assigned, limited or extinguished

Recovery of taxes where property has been transferred without a certificate, of any right, title or interest in any immovable property, other than agricultural land, belonging to any person to whom this Act applies, the Incometax Officer of the area where the property is situate is satisfied, after giving such person notice in this behalf for a period of not less than one month, month, that no certificate in the terms mentioned in section 3 would have been issued to him if this Act had been in force on the date the transfer was made, he

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