Transfer of Property All Notes
Transfer of Property All Notes
Transfer of Property All Notes
1 ll SHRI SAI ll
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Q. Define "Immovable Property". Distinguish it from 'Movable Property'.
OR
A INTRODUCTION –
The Transfer of Property Act is one of the most important Act of the Law of
Property. It was passed and enacted in the year 1882 and came into force from
1st July, 1882, which contains 137 Sections and is divided into 8 Chapters. This Act
mainly deals with the transfer of immovable property and also movable
property in certain circumstances but this Act mainly deals with the transfer of
immovable property.
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3. When property is transferred from dead person to living person/s,
the law applied is the Law of Succession.
Though, the Transfer of Property Act deals with the transfer of both
immovable and movable property but most of the provisions of this Act relate to
immovable property.
The Transfer of Property Act, 1882 does not give complete definition of
'Immovable Property'. Section 3 of the Act defines, "Immovable Property" &
"attached to the earth". Both of them do not give the comprehensive picture of
immovable property. The definition in the Transfer of Property Act, is negative
and not exhaustive.
1. Land.
Land does not include only the upper surface of the earth but is extensive
enough to cover things below it FOR EXAMPLE - Minerals. All these are
immovable property. Any right in respect of these or any other interest in it are
all immovable property.
A benefit arising out of land like the right to receive future rent is an
immovable property. The example of benefits is rent from house, shops,
Revenue from agriculture etc. The Right to collect lac, leaves or other things
from forest trees, etc.
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Section 3 of the Transfer of Property Act also defines "things attached to
earth" –
b. things imbedded in the earth for e.g. wall and building, minerals etc.
3 The Indian Registration Act, 1908 – Section 2(6) of the Act defines
'Immovable Property' as follows-
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For example – Land, house, tree attached to the grounds/land, so long
they are so attached.
3. Mango trees if cut and sold for timber purpose are deemed as movable
property.
Mango trees, if sold for nourishment and for fruits they are deemed as
immovable property.
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Q. What is mean by "Transfer of Property"? Who can be transferor &
transferee under the Transfer of Property Act and state what are non-
transferable properties/ interest under the Transfer of Property Act,
1882?
OR
OR
"Property of any kind may be transferred" What are the exceptions to this
general rule.
A INTRODUCTION –
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because the transfer of property in goods is called as 'Sale' and it has been
covered by "the Sale of Goods Act, 1930".
The transfer must be from one living person to another living person so it
is not applicable to conveyance from one dead to another living person. In this
section 'living persons' includes a company or association or body of individuals,
whether incorporated or not.
2. The transfer must be from one living person to another living person
so it is not applicable to conveyance from one dead to another living
person. In this section 'living persons' includes a company or
association or body of individuals, whether incorporated or not. The
words 'living persons' include a company, association or body of
individuals, but it does not include the God, idol, dead persons etc.
FOR EXAMPLE –
4. The transferor and transferee must be living persons only. There may
be joint transferors, who have joint ownership. There may be joint
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transferee, who purchase the property from a single owner or joint
owners.
In other words, Section 6 of the Transfer of Property Act provides for the
GENERAL RULES that all kinds of property is alienable/ transferable. However,
Certain EXCEPTIONS are provided under Clauses (a) to (i) that means properties
which are contained in Section 6 (a) to (i) of the TP Act are NOT TRANSFERABLE.
Property includes any kind of Immovable nature i.e. lands, houses etc.
certain kinds of properties are not transferred as per Section 6, as follows –
SECTION 6(a) –
cannot be transferred.
In other words, during the lifetime of a person, the chance of his heir
succeeding to his property under his will is called, “Spes Successionis” and the
heir who has such chance of succession is called “Spes Successioner”. Such
Expectancy cannot be made the subject matter of a transfer. It is a nullity and
has no effect in law.
FOR EXAMPLES –
1. Ashish, a Hindu, dies leaving a widow Ganga and a brother Dinesh. Here,
Dinesh has only a CHANCE OF SUCCESSION and this Chance of succession
depends on two FACTORS –
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2. Jitendra expects that he would be inheriting a property worth Rs. 3 Lakhs
belonging to his Aunt who has no Issues. Since, he has only a mere
Chance of Succession to his Aunt’s Property i.e. Rs. 3 Lakhs, he cannot
transfer it.
SECTION 6 (b) –
The landlord has the Right of Re-entry on his immovable property when
the Tenant or the Lessee makes Default in payments.
FOR EXAMPLE –
If Bhagyesh lends his house to Pravin for treating his guest, Pravin cannot
transfer that Right to any one otherthan Bhagyesh, the Owner.
In simple words, in a Contract of Lease, the lessor (i.e. landlord) has a right
of re-entry. A mere right of re-entry, cannot be transferred.
SECTION 6(c) -
The term 'Easement' means "right over the property of another i.e. right
in re aliena".
FOR EXAMPLE –
Dinesh has an easementary right to get the water from the Well of Ashish.
Dinesh cannot transfer this easement right to any third person.
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A person having right to a property can transfer the same either subject
to a restriction or without restriction. Where property is transferred subject to
restriction the transferee is supposed not to act contrary to the restriction that
it is to be enjoyed by him personally, he shall have no right to transfer such a
property and if he transfers the property in violation of the restriction, the
transfer shall be void under this clause. FOR EXAMPLE - A priest in a temple,
mutawalli or a house is lent to a person for his personal use, he cannot transfer
his right of enjoyment to another.
FOR EXAMPLE –
In simple words, the object of this clause is that the right to maintenance
is purely a personal right and cannot be transferred. The word 'Maintenance'
itself shows the source of livelihood of a poor person such as wife, minor sons
and unmarried daughters and old aged parents.
FOR EXAMPLE –
NANDARANI Vs KRISHNA (1935 ALJ 715) – Madras High Court gave judgement
in favour of Smt. Nandarani holding that future maintenance should not be
transferred.
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SECTION 6 (e) – A MERE RIGHT TO SUE CANNOT BE TRANSFERRED -
'To Sue' means to make a legal claim or to take legal proceedings against
any person. Thus, a right to sue is personal right of the party aggrieved and
there can be no assignment of a right to sue for damages of tort or for a breach
of contract.
FOR EXAMPLE –
A Public Office cannot be transferred nor can the salary of the Public
Officer. A Public Office is a position which has a public duty attached to it.
In other words, the Public Offices, Salary of the Public Officer, etc., cannot
be transferred before or after it has become payable.
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3. to a person legally disqualified to be a transferee.
a. forbidden by law;
c. is fraudulent;
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NOTE NO.2 II SHRI SAI II
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A VALID TRANSFER -
2. IDENTITY OF PERSON –
One person cannot transfer his own property in his own favour. The
person transferring and the person beneficiary should not be identical.
3. CAPABILITY OF TRANSFER –
Thus, with all the above qualifications, the property must be capable of
being transferred in favour of another person.
In other words, transferor must have title and interest in the property
which he wants to transfer or convey.
1
FOR EXAMPLE –
All the lawful formalities must be carried out at the time of transfer. In
the absence of these legal formalities the transfer may be void.
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In other words, all the Interests in the property which the transferor is
capable of passing, passes to the transferee.
2
Such INCIDENTS includes from-
ii. the RENTS & PROFITS which accrue after the transfer; &
ii. The RENTS & PROFITS thereof accruing after the transfer; &
iv. All other THINGS provided for permanent use in the House.
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3
In other words, transfer of property may be affected under the Act both
orally as well as in writing.
There are many Instances where Courts have recognized ORAL TRANSFERS
such as Release, Relinquishment, Surrender, Compromise, Partition, Transfer of
Easementary Rights, Settling Maintenance Claims, Donation and Family
Settlements etc.
The transaction like Sale, Mortgage, Lease, Gift etc. are necessarily in
writing. The Sale of immovable property more than Rs. 100/- must be in
Writing and Registered at the proper office of Sub-Registrar, in order to change
the ownership over the property after Sale is over.
ii. All Mortgages Securing Rs. 100/- and upwards (Section 59).
Though, transactions are not in writing and are not registered but they
have protection of law.
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In simple words, the transaction in which writing and registration of
documents are not necessary as per T.P.Act, such transfer just called as, "Oral
Transfer".
The Oral Nature of such transaction has been presumed by the T.P. Act
itself and hence, though they are oral, the person can have remedy in the Court
of Law for any loss out of the said oral transaction of property.
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A. INTRODUCTION –
Section 10, 11, 12, 17 & 18 give the Instances of Illegal Restrictions on
certain transfers. Such Restrictions are deemed to be Absolute Restraints, totally
depriving the owner of the property of its free enjoyment.
The following are the FOUR types of Illegal Restrictions which are not Valid –
5
FOR EXAMPLES –
There are TWO EXCEPTIONS to the above Rule where such Absolute
Restrictions are Valid –
i. In the case of Lease, for the benefit of Lessor or his legal heirs,
Absolute Restrictions can be imposed on the Lessee, at the time of
transfer of property.
FOR EXAMPLE -
TYPES OF RESTRICTIONS –
a. Absolute Restriction.
b. Partial Restriction.
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2. RESTRICTION ON FREE ENJOYMENT OF THE PROPERTY (SECTION 11) –
FOR EXAMPLE –
In other words, a full Ownership confers upon the owner complete liberty
of action with regard to its Enjoyment, Disposition and Management.
EXCEPTIONS TO SECTION 11 –
FOR EXAMPLE –
2. if the Restrictions are for the benefit of his adjoining land, such
Restrictions are Valid.
FOR EXAMPLE –
Hitesh has two properties ‘M’ and ‘N’. Hitesh sells ‘M’ property to
Indrajit with a CONDITION that Indrajit should keep a portion of the
property ‘M’ without any construction for the beneficial enjoyment of the
property ‘N’. Such Restriction is Valid and Enforceable.
7
3. CONDITIONS MAKING INTEREST DETERMINABLE ON INSOLVENCY OR
ATTEMPETED ALIENATION (SECTION 12) –
FOR EXAMPLE –
If terms of a transfer of property directs that the Income arising from the
property must be accumulated fully or partly either for a period exceeding the
life of the transferor or for a period of 18 years from the Date of transfer, then
such Condition is Void.
FOR EXAMPLE –
The Period during which the transferor is alive is more than 18 years from
the date of the transfer, but as per above Rule, accumulation is allowed till the
longer of the above two periods and hence, the direction of accumulation till
2000 is valid.
If, however, the transferor dies in 1985, then the longer period would be
18 years and as such, the direction would be valid till 1988.
8
tNOTE NO. 3
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OR
A INTRODUCTION –
Otherwise, such interest created for the benefit of the unborn person shall
not take effect.
FOR EXAMPLE –
Akhil (transferor) transfers property to his first Son Siddhesh and his
intended wife, for their lives and after the death of the survivor to their unborn
Son for life and after his (unborn son’s) death, Akhil’s (transferor’s) second Son
Ritesh. Now, the first transfer to Siddhesh and Siddhesh’s intended wife is Valid
and lawful as they are living persons.
After their life time, the transfer to Siddhesh’s unborn son is not valid
because the property is not transferred absolutely, i.e., only life interest is
created as after his death, property will go to Akhil’s Second Son. In other
words, the whole of interest of Akhil is not created in favour of Siddhesh’s
unborn Son.
1
RULES REGARDING TRANSFER FOR THE BENEFIT OF UNBORN PERSONS –
1. NO DIRECT TRANSFER –
After that, the whole of interest (absolute interest) must be created in favour
of the unborn person. If only limited interest or life interest is created in favour
of the unborn person, then such transfer is void and it does not take effect at all.
Thus, the transfer up to the living person/s is valid and after that, it becomes
void. In such an event, the ownership remains only with the transferor, as he
has transferred the property to the living person/s only for life.
FOR EXAMPLE –
Raman made a GIFT of his properties to Ketan as life interest and then to
Ketan’s Son absolutely, but if she does not have any Son, then to Ketan’s
Daughter and if there is not Descendant, then to Ketan’s Nephew. Ketan dies
without having any Issue.
It was held that Gift in favour of unborn Son or Daughter was invalid u/s
13 because the gift was of a limited interest upon Ketan (life interest).
The Gift in favour of Ketan’s Nephew also is not valid u/s 16 of the
Transfer of Property Act, 1882, because in a transfer of property , if the prior
interest fails, then the subsequent interest also fails.
2
MOHAMMEDAN LAW REGARDING TRANSFER TO UNBORN PERSON/S –
A Gift to a person not in existence i.e. unborn person on the date of transfer
is VOID under Mohammedan Law, except in the case of a Wakf. So, Section 13 is
not applicable to Gifts to Mohammedan Unborn Person/s.
But after the passing of the Hindu Disposition of Property Act, 1916, Section
13 is applicable to Hindus, and so now a Hindu can transfer property in favour of
any unborn person subjected to Rules in Section 13 and 14.
Even such creation of trust, etc, should not prolong for a period of more
than the unborn person attaining majority (Section 14).
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A INTRODUCTION –
3
“Perpetuity” means Permanency or Infinity (Indefinite Period). The Old
Law of transfer of property was that the property should be detained for a
permanent period from free enjoyment and absolute ownership.
The above Rule was abolished both in English Law and Indian Law i.e. by
Section 14 of the Transfer of Property Act, 1882 and as such, a property cannot
be detained for an infinite period. The RULE is known as “Rule against
Perpetuity”.
FOR EXAMPLE –
Vishal transfers a piece of land to his friend Mohit for life and afterwards
to his friend Viky for life and then to Viky’s unborn Son and then to Unborn Son
of Viky’ Son and so on. This is called “Perpetuity Transfer” (Transfer for an
indefinite period).
FOR EXAMPLE –
Prasad gave his property to Vivek at his Marriage. Prasad directs that Vivek
shall enjoy the property for life and after Vivek’s death, to Vivek’s unborn son
and after that to Vivek’s Son’s Son. Here, there are two Uncertain Events –
4
INDIAN LAW OF “RULE AGAISNT PERPETUITY” (SETION 14) –
1. The Vesting of Interest cannot be postponed beyond the life time of any
one or more persons living at the date of transfer.
FOR EXAMPLE –
4. Ultimate beneficiary must come into existence before the death of last
living person. If the next person not comes in existence then that is rule
against perpetuity.
ILLUSTRATIONS –
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2. Vinayak transfers his property to Atharva for life and after Atharva’s
death to Yogesh for life and after death of Yogesh to the eldest Son of
Yogesh at the Age of 25. Here, the Rule against Perpetuity is VIOLATED,
because it exceeds the Minority Period namely 18 years.
In other words, the rule does not apply in case of transfer for the
benefit of the public i.e. advancement of religion, knowledge, commerce,
health and safety.
Whether by any Rule contained in Section 13 and 14, an Interest created for
benefit of a person or a Class of persons fail in regard to such person or the
whole of such class, any interest also fails if prior interest fails.
FOR EXAMPLE –
Vinod settles a Property for Aniket and his intended wife successively for
their lives and then on their eldest Son for life and then on the eldest Son of
such eldest Son for his life and then to Manoj.
The prior interest of the Son and Grandson of Aniket fails under Section
13 and 14 and therefore, the subsequent interest of Manoj also fails.
6
Q. Define “Vested Interest” and “Contingent Interest”.
FOR EXAMPLE -
FOR EXAMPLE -
3. The death of the transferee before obtaining possession does not affect
the vested interest and so the interest vests in his representatives.
5. An unborn person acquires vested interest only on his birth. He may not
get immediate enjoyment.
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CONTINGENT INTEREST (SECTION 21) –
FOR EXAMPLE –
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NOTE NO. 4
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A INTRODUCTION –
FOR EXAMPLE –
FOR EXAMPLE -
1
2. The Condition Precedent must be Lawful and not Forbidden by Law.
FOR EXAMPLE -
FOR EXAMPLE -
FOR EXAMPLE –
2
CONDITION SUBSEQUENT (SECTION 27 TO 34) –
This Section deals with the Second Transfer on FAILURE of the Prior Valid
Transfer. The Rule is that “if the Prior Interest fails, then the Subsequent
Interest in the property takes effect, even though the First transfer has failed in
a manner not as thought of by the transferor. This is otherwise known as
“Doctrine of Acceleration”.
“DOCTRINE OF ACCELERATION” –
The Husband gifted a property to his wife for life and then absolutely to their
children. The Gift to the wife failed under a Local Act due to Non-Registration.
The Court held that since the Gift to Wife was not Valid, it accelerated the Gift
to the Children.
FOR EXAMPLE –
FOR EXAMPLE –
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does not go within the said period, property will go the Vishwas. Now in case,
Shankar does not go to England, then Vishwas gets a property.
FOR EXAMPLE –
Nitin marries without Dipak’s Consent. Now the transfer to Sudesh takes
effect.
If the Ulterior (Subsequent) Disposition is not valid then the prior disposition
is not affected by such Ulterior Invalid Disposition.
FOR EXAMPLE -
Arjun transfers a Farm to Kiyara for her life and if Kiyara then does not
desert her husband then the farm will go to Kareena. Now, Kiyara is entitled to
the farm during her life time as if there is No Condition has been attached
because the Condition is Illegal/ immoral.
FOR EXAMPLE –
1. Madhu transfers an Agriculture Land to Vaibhav for his life with the
Condition that in case, Vaibhave cuts down a certain tree, then the
transfer shall cease to have any effect. Now, Vaibhave cuts down that
tree and so Vaibhav loses his life interest in that land.
4
transfer, then his interest in the farm shall cease. If Dhananjay does not
go to USA within 1 year then Dhananjay’s Interest in that land ceases.
Only if the Event specified is Lawful, the Condition that an interest shall cease
to exist shall be Valid.
FOR EXAMPLE –
1. when the person does any act, which renders the performance
IMPOSSIBLE or
FOR EXAMPLE –
A Gift made to Ranjit on the Condition that unless Ranjit joins Army, then
the Gift will go to Jivan. Now, Ranjit joins an Ashram as a Monk and thereby
renders it impossible that Ranjit shall fulfil the Condition. Now Jivan is entitled
to get the property.
FOR EXAMPLE -
Chetan transfers property to Sumit with a condition that if Sumit does not
go to France within 3 years, then the property will go to Sharad. Sharad adopts
foul means and prevents Sumit from going to France. Now, the Delay in the
performance of the Condition is Excused.
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Q. Explain essential CONDITIONS for application of "Doctrine of Election".
OR
OR
OR
A INTRODUCTION –
“ELECTION” means Choosing of one right between two rights, when there
is clear intention that both the rights cannot be enjoyed but only one.
The word "Elect" literally means "to choose by vote". It is based on the
Principle of Equity and is applicable to all kinds of properties, Immovable or
Movable.
Anant has 10 Acres of land worth Rs. 75 Lakhs at Ghoti, in Nasik District.
Anant's friend Sumant wanted to give this land to his daughter Mohini as
a GIFT and ready to give Rs. 90 lakhs rupees to Anant, if Anant gives CONSENT to
transfer this land to Mohini.
If, Anant elects to receive Rs. 90 lakhs, he gets the benefit of Rs. 15 lakhs
and Mohini with 10 acres of land. This is "Doctrine of Election" & if Anant
refused to give his land then he has to relinquish the benefit of Rs. 15 Lakhs.
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ELECTION WHEN NECESSARY (Section 35) –
5. The real owner is requires "to accept the transfer in toto" or "reject it
in toto". He cannot partly accept and partly reject.
7
Q. Who is an "OSTENSIBLE OWNER"? Explain the principle underlining the
Doctrine of Ostensible Owner.
OR
OR
OR
After his death, JAYA sold the bunglow to DEVENDRA and got it registered
in favour of DEVENDRA.
RATAN, the son of NAGESH & JAYA, sued DEVENDRA alleging that JAYA
had no right to sale the bunglow because NAGESH being the real owner of the
house.
8
Court held that RATAN has no right on the property. JAYA being an
OSTESIBLE OWNER & she has right to sale hence she is competent to sale the
bunglow.
Provided that the transferee after taking reasonable care to ascertain that
the transferor had power to make the transfer and transferor has acted in good
faith.
The General Rule is that all Ostensible Owner cannot pass on a good title
to the transferee but if the condition laid down in the section is fulfilled, then
the transfer shall not be voidable on the ground that the transferor was not
authority to make such transfer that means if the transferor has authority to
transfer the property then the transfer becomes valid.
REQUIREMENTS OF SECTION 41 –
4. The transferee has taken reasonable care to find out that whether the
transferor had power to transfer the property?.
Apparently, such ostensible owner of property looks like a real owner but
if scrutinized minutely, it may be found that though his name (ostensible owner)
appears on the Record of Rights, Sale deed etc. and he posses property but he is
not a real owner.
9
The expression in Section 41 excludes such person who had possession of
the property as an agent, guardians or person in any fiduciary relationship. A
guardian of a minor cannot be said to be ostensible owner of the minor's
property, as a minor cannot give consent.
The transferee must prove that he had taken a reasonable care or made
reasonable enquires to ascertain that the transferor had power/ authority to
transfer the property.
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OR
OR
The word "ESTOPPEL" is derived from the French word "ESTOUP" which
means "shut the mouth". When a person tells us something, we generally hear
him. If he says something different or contradicting, we would not hear any
more and contradict such statement. Otherwise, we shall comply with it.
The transferee would get a good title. The transferor would be estopped
from denying his title.
10
ILLUSTRATION-
JITENDRA, a hindu, who has separated from his father SOHAN. JITENDRA
sells to SANJIV 3 FARMS i.e. 'X' , 'Y' & 'Z' representing that JITENDRA is
authorised to transfer the same.
Out of these 3 Farms 'Z' does not belong to JITENDRA because it has been
retained by his father SOHAN on Partition.
But, on SOHAN's death JITENDRA as a sole legal heir obtains 'Z', SANJIV
not having rescinded the Contract of Sale, may require JITENDRA to deliver 'Z' to
him if JITENDRA refusing to transfer that farm i.e. 'Z' to SANJIV.
Nothing in this section shall impair the right of transferee in good faith for
consideration without notice of the existence of the said option.
In other words, the transferee must have been mislead that the transferor
had power to transfer the property.
11
ii. TRANSFER IS FOR CONSIDERATION -
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Lis = Litigation
Pendens = Pending
The Legal Maxim "Ut lite pendente nihil innoventure" which means
"pending litigation nothing new can be introduced"
The "Doctrine of Lis Pendens" has been explain in Section 52 of T.P. Act,
1882.
ILLUSTRATION-
Within the stipulated date, PRAKASH does not come forward to register
Sale Deed on repeated request of JAYESH. Hence, JAYESH filed a suit against
PRAKASH for Specific Performance of the Contract.
While, the suit is pending before the Court, PRAKASH sold the Bunglow to
SUYOG and registered a Sale Deed in favour of SUYOG.
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"LIS PENDENS" (SECTION 52) –
2. That the suit or proceeding should not be under any collusion between
the parties.
4. Further transfer has been made during the pendency of the suit or
proceeding.
5. That further transfer has been made by any of the party to the suit.
6. That suit is treated as pending from the date of filing the suit in the
Competent Court.
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OR
"A transfer made with intent to defeat or delay the creditors of the
transferor is called as, "Fraudulent Transfer".
13
fraudulent transfer of his property to defeat or delay the interest of creditor and
seeking to put his property out of his creditor, is a fraudulent transfer.
ii. This sub- section shall not impair the rights of the transferee in
good faith & for consideration.
But, if RAMESH sold his property i.e. mortgaged flat for Rs. 40 lacs to
SARTHAK instead of his wife and SARTHAK never know about the bad intention
of RAMESH and he purchased it in good faith then he is a "Bonafide Purchaser".
Then, there shall not impair the rights of SARTHAK i.e. transferee in good faith
and for consideration.
If, RAMESH transferred his flat to his nephew ROHIT by Gift. After
enquiry, ROHIT knows that RAMESH transferred that property to him to defeat
or delay the creditor then its depend upon ROHIT either, to accept the transfer
or not.
1. T.P. Act does not allow the fraudulent transfer and secured an
innocent person to suffer with the fraudulent transfer.
14
If the transferor and transferee collude with each other with bad
intention to defeat or delay his creditor of the transferor, such act of
the transferor is called as "Fraudulent Transfer" and Section 53
prohibits such type of transfer.
15
NOTE NO.5
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OR
A INTRODUCTION-
Sometimes, Seller may become greedy if, other person offers of more
price, induce by the subsequent offer of more price, the seller wants to
repudiate the contract i.e. the original contract who has already performed
certain portion of the contract. In such case, Section 53-A protects such prior
purchaser.
In certain occasions, the purchaser/ transferee also goes back from the
contract as he could not procure sufficient money for the consideration of
property. In such case, the seller has to face financial hardship due to the breach
of contract by the purchaser. In such case, Section 53-A also protects the seller.
1
ILLUSTRATION FOR PART PERFORMANCE-
When DINKAR was ready to pay the balance amount i.e. Rs. 60 Lacs to
RITESH then RITESH refused to receive the said amount and demanded DINKAR
to vacate the Flat and to cancel the Agreement to Sell.
DINKAR is ready and willing to perform his part of contract but RITESH is
not ready and willing to perform his par of contract.
Section 53-A of the T.P. Act, which deals with the "Doctrine of Part
Performance", is an Exception to the General Rule that, "Every Transfer of
Property is to be registered, if it is required by Law".
3. The terms and conditions of the document i.e. Agreement to Sell even
though it is not registered can be understood with reasonable
certainty.
5. The transferee, after taking into possession of the property must have
done some act in furtherance of the contract i.e. agreement to sell.
2
6. The transferee has performed or ready and willing to perform his part
of contract.
3
PART II
SPECIFIC TRANSFER
(Section 54 – 137)
OR
OR
A INTRODUCTION -
Chapter II, containing Section 54 to 57 of T.P. Act, 1882 lay down the
provisions relating to "SALE OF IMMOVABLE PROPERTY"
The word 'Sale' literally means, "Voluntary transfer of property from one
person to another for a price".
In the case of tangible immovable property of a value less than Rs. 100/-,
such transfer may be made either by Registered Instrument or by delivery of
4
property. Delivery of tangible immovable property takes place when the seller
places the buyer in the possession of property.
1. PARTIES TO SALE-
There are two parties in a Sale i.e. Seller/ Vendor and Buyer/ Purchaser.
2. SUBJECT-MATTER-
3. PRICE OR CONSIDERATION-
The Registration Act, 1908 if the immovable property worth Rs. 100/- or
more requires any Sale Deed in Writing and Registered. Ownership is not
transferred until registration.
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Section 54, therefore clearly provides that Possession (+) Unregistered Sale
Deed do not transfer valid transfer to the buyer. Nobody can call himself as a
owner on the basis of Agreement to Sell.
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Q. State the Rights and Liabilities of Seller and Buyer of immovable property.
OR
Discuss the Rights and Liabilities of Seller and Buyer before and after the
completion of Sale.
A INTROCUTION -
Section 55 of T.P. Act, 1882 deals explains about Rights and Liabilities of
Seller and Buyer before and after completion of Sale.
* LIABILITIES OF SELLER-
f. to give to the buyer or such other person as the buyer directs, such
possession of the property.
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g. to pay all public charges or taxes due on such date.
4. If the seller has any dues or debts or any encumbrances (i.e. bank
loan, tenant etc) on that property, he shall have to pay such dues or
debts or encumbrances. He shall have to pay all the public charges
i.e. assessment tax, electricity bill, water bill etc. up to the date of
Sale deed and delivery of possession.
5. The seller should sale his own property. He should not enter into a
contract of sale if the property on which he has no right i.e. "Nemo
dat quod non habet" i. means "no one can transfer better title than
he has".
6. It is the duty of the seller to follow all the terms and conditions of
Agreement to Sell and also the law in force.
*RIGHTS OF SELLER –
2. The seller is entitled to receive rents and profits of the property till
the ownership thereof passes to the buyer.
4. If the seller has debts, he may direct the buyer to pay all or any of
such debts from the consideration of the property to the creditors
of the seller. The seller may give directions to the buyer to pay the
consideration to the third person.
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AFTER SALE-
1. It is the duty of the buyer to inspect the property and if he could not
find any material defects of his inspection at the time of agreement
to sell, afterwards he cannot raise his objection. But, he has right to
raise the objection in case of latent defects.
2 It is the duty of the buyer to enquire about the title of the seller i.e.
ownership of the property.
AFTER SALE-
4 The buyer is bound to pay at the time and place of the completing
the sale, the purchase money to the seller or to such other person as
the seller directs.
RIGHTS OF BUYER-
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2 The buyer has right to inspect all the documents relating to the
property and the seller has to produce all such documents for the
inspection of the buyer.
5 The buyer need not pay any public charges up to the date of final
Sale Deed. It is the duty of the seller to pay all such public charges
that is electricity bill, water bill, property tax etc. until the date of
completion of sale.
AFTER SALE –
9 After the sale is completed, the buyer is entitled to get all original
documents relating to the property.
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MORTGAGE
Q. Define "MORTGAGE". State its essentials and also discuss various
KINDS OF MORTGAGES.
INTRODUCTION-
Section 58(a) of the T.P. Act defines the terms Mortgage, Mortgagor,
mortgagee, Mortgage Money and Mortgage deed
DEFINITION OF MORTGAGE –
ILLUSTRATION OF MORTGAGE -
DHIRAJ wants to repair and interior his own bunglow, hence, he has need
of 10 Lacs rupees. So, he MORTGAGED his bunglow with BANK OF
MAHARASHTRA for the purpose of security of loan. He executed on agreement
i.e. MORTGAGE DEED in favour of Bank and also registered that MORTGAGE
DEED. In this case DHIRAJ has not transfer his ownership but he only
transferred an interest in the property.
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"MORTGAGOR", "MORTGAGEE", "MORTGAGE-MONEY", "MORTGAGE-
DEED" –
"MORTGAGOR"-
"MORTGAGEE –
MORTGAGE-MONEY –
The Principal amount (+) Interest of which payment is secured for the time
being, is called as, "Mortgage-Money".
MORTGAGE-DEED –
The Instrument i.e. document by which the transfer is effected is called as,
"Mortgage-Deed".
Any property which is above Rs. 100/-, such property i.e. mortgage must
be Written (i.e. Mortgage Deed) and Registered.
1. PARTIES OF MORTGAGE-
The term Mortgagor is includes his heirs etc. It is similarly, the mortgagee
also includes heirs, executors etc. It is Common in every Kind of Mortgage.
2. TRANSFER OF INTEREST-
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3. SPECIFIC IMMOVABLE PROPERTY –
4. SECURITY-
5. CONSIDERATION-
6. REGISTRATION-
1. Simple Mortgages.
3. Usufructuary Mortgage.
4. English Mortgage.
6. Anomalous Mortgage
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iii. If the Mortgagor fails to pay the Mortgage Debt, the Mortgaged
Property can be sold by the Mortgagee.
on condition that on such payment being made, the sale shall becomes
void or
on condition that on such payment being made, the buyer shall transfer
the property to seller.
ii. Usufructuary means one that has to use and get the profit of a
thing.
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4. ENGLISH MORTGAGE (SECTION 58(e)) –
This is with a view to help the business community to raise money without
the lengthy procedure of preparation of Formal Mortgage Deed and its
Registration. The Main Advantage of this Mortgage is that there need not be
any Registration of the Mortgage-Deed.
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NOTE NO.6
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OR
The Mortgagor has the Right to direct the Mortgagee to transfer the
mortgaged property to a third party instead of transferring it to the Mortgagor
himself.
The Mortgagor is the natural owner of the property and he has Right to
Inspect the property and documents at any time as and when he desires. It is the
right to check out whether the mortgaged property is maintained properly or not.
In case of Documents, he can take copies from such documents.
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5. POWER TO MAKE LEASE (SECTION 65-A) –
The Mortgagor has the Power to make lease also, but it must be with the
consent of the Mortgagee. Such lease must satisfy the prescribed conditions.
The Mortgagor has the right to reasonable waste of the property, but he
must not make permanent injuries or destruction of the property to reduce its
value. If he does so, then he must give additional security to the mortgagee.
The Mortgagor has the right to claim improvement made in the mortgaged
properties.
The Mortgagor has the right to deposit the mortgage-money in the Court,
if there is any Suit pending in the Court relating to the property.
The Mortgagor must indemnify the mortgagee for any defective title to
the property. If any third person interferes, the mortgagor must compensate
the mortgagee for the expenses incurred by him (i.e. mortgagee) in
protecting the title.
The Mortgagor must compensate the mortgagee for payment of all taxes
and public charges. Similarly, when the mortgagee is not in possession of the
mortgaged property, the mortgagor must pay all the taxes and public charges.
When the mortgaged property is Leased, the mortgagor must direct the
Rent payable under the lease, etc. to the mortgagee.
2
RIGHTS OF MORTGAGEE (SECTION 67 TO 73) –
1. At any time after the mortgage money has become due, the mortgagee
has the right to obtain from the Court, a Decree for Foreclosure (i.e. Sale
through Court Decree) (Section 67).
2. The Mortgagee can Sue for the mortgage money in the following Four
Cases (Section 68) –
3. The Mortgagee has the power to sell the mortgaged property without the
Intervention of the Court, on default of payment mortgage money by the
mortgagor in the following three cases (Section 69) -
5. The mortgagee has the right of accession to the increased properties for
renewal of security.
6. The mortgagee has the right for reimbursement with the interest for the
money spent for purposes like preservation of mortgaged property, etc.
2. It is possible that the same property might have been mortgaged more
than one occasion to more than one party i.e. mortgagee. In the event of
such of the simultaneous mortgage by the mortgagor then it is on the
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mortgagee to file a suit in that behalf in the Court of Law to set the things
right.
3. After the returning the mortgage money to the mortgagee, it is the duty of
mortgagee to return the mortgage property to the mortgagor if it is in his
possession.
5. The Mortgagee is bound to keep clear, full and accurate accounts of all
sums received as mortgaged money and give them to the mortgagor when
asked.
4
LEASE
Q. What is LEASE? What are the ESSENTIALS of valid lease? What are the
RIGHTS AND LIABILITIES of lesser and lessee?
A INTRODUCTION –
ILLUSTRATION-
Here, SUNIL is a landlord that means owner of Flat that means Lesser.
LOKESH is a tenant that means Lessee. The Lease Period is of 3 years, Rent is Rs.
10,000/- p.m.
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III. PREMIUM - The price is called as “Premium”.
i. PARTIES TO LEASE –
There are two parties i.e. Lessor and Lessee. The “Landlord” is called as
“Lessor” and he is “Transferor” of the property.
The Right to Enjoy Property must be for a Certain Period. A lease may also
be in perpetuity. FOR EXAMPLE - Agricultural Leases.
a. Tenancy at Will
b. Tenancy by Sufferance.
a. TENANCY AT WILL –
When the lease contains a Clause that the lessor or lessee may have Option
to terminate a lease, it is called “Tenancy at Will”.
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A Tenant by Sufferance cannot claim the Right of Tenancy. A tenant by
sufferance pays only Compensation and not Rent for Use and Occupation.
In tenancy by holding over, the tenant continues possession even after the
termination of tenancy but with the Consent of the landlord.
iv. CONSIDERATION –
The Consideration i.e. Premium + Rent as well as Rent alone. The ‘Price’ is
called as ‘Premium’.
The Inclusion of Municipal taxes, water taxes, electrical charges etc. Rent
depends upon mutual agreement lessor and lessee.
A lease for immovable property from Year to Year for any term exceeding
1 year can be made only by Written and Registered i.e. LEASE DEED.
All other leases of immovable property i.e. Month to Month may be made
either by Written and Registered or by Oral Agreement by delivering
possession.
1. The Lessor is bound to disclose to the lessee all material defect in the
property with reference to use of property of which lessor is aware but
lessee is not aware. Lessee could not with the ordinary care discover the
defect.
2. The Lessor is bound to put the lessee in possession of the leased property.
The lessee however must request the lessor to put him in possession.
3. The Lessor must indemnify the lessee for all losses due to interruption in
the enjoyment of the property. It is an implied condition that the lessee
will have free and quiet enjoyment of the property.
4. If the lessor transfers the leased property, then the transferee gets all the
rights and liabilities of the lessor.
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RIGHTS AND LIABILITIES OF THE LESSEE –
1. If part of property is destroyed by fire then the lease becomes void at the
option of the lessee. However, such destruction of the property must not
be due to wrongful act of the lessee.
2. If the lessor neglects to make sufficient repairs even after notice by the
lessee, the lessee can make such repairs himself and can deduct the
expenses of such repairs with interest from the Rent.
3. If the lessor neglects to make payment of Revenue, Tax, etc., then the
lessee can make such payment and deduct such payments from the Rent
with interest or recover the amount from the lessor with interest.
4. After the termination of the lease, the lessee can remove all the things,
which he had attached to the earth but he must leave the property in the
same state (i.e. condition) as he received it.
5. If the lease is terminated by some uncertain events, then the lessee or his
legal representatives can get all the crops harvested by them and to have
ingress (entry) and egress (exit) together with the produce and carry them.
6. The lessee not sub-lease or mortgage the whole or part of leased property
to anybody.
7. The lessee is bound to pay the Premium or the Rent to the lessor or to his
Agent as agreed upon, at the proper time or place.
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A. INTRODUCTION –
8
A lease is not a mere contract but is a transfer of an interest in immovable
property. The section recognises also a lease of immovable property in
consideration of share or crops that means the Rent may be either Money or
Share of Crops or Service or anything of value to be rendered periodically by the
transferee to the transferor. The Fundamental Conception of a lease is that it is
the Separation of the Right of Possession from Ownership.
ILLUSTRATION-
Here, SURESH is a landlord that means owner of flat that means lesser.
LALIT is a tenant that means lessee. The lease period is of 3 years, Rent is Rs.
9,000/- p.m.
if the Lease Deed prescribes a Time Limit, then after the Expiry of such
period, the lease comes to an end. At any time after this period the lessee can
demand the return of money from the lessor. If there is a Condition for
Renewal, the lessee may claim enforcement of such Condition.
Since a lease is for a definite period and since it expires by Efflux of Time,
the Service of Notice under Section 106 is not necessary for termination of
lease.
b. BY HAPPENING OF AN EVENT –
if the term of lease depends upon the happening of a Specified Event, the
lease terminates when that Event happens.
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FOR EXAMPLE –
A Lease for Life of the Lessee gets terminated on the death of the Lessee.
if the lease depends upon the lessor’s limited interest, then when such an
interest gets over, the lease is also terminated.
FOR EXAMPLE –
The lease can be terminated by giving a Valid Notice by the lessor to the
lessee
e TENANCY AT WILL –
“Tenancy at Will” means that the tenant holds the land in possession and
the lease terminates at any time at the Will and Pleasure of either the landlord
or tenant.
f CONDITIONAL LEASE –
FOR EXAMPLE –
g FORFEITURE –
When the lessee or tenant breaches the express condition of lease, the
lessor gets the Right of Re-entry in the property. Such Re-entry terminates the
lease.
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iii. Breach of any other condition.
v. Insolvency of tenant.
h. BY MERGER –
i. By act of parties.
i. BY ACT OF PARTIES –
The tenant may become the owner by buying the leased property. After
buying the property, he is no longer a tenant.
Similarly, when two properties merged into one, then also there is Merger.
The Principle is that there must be Union of the entire interest of the lessor and
lessee.
The Court may declare that the lessee is the actual owner. The Court’s Order
terminates the lease.
i. BY EXPRESS SURRENDER –
Lessee, with the consent of lessor may surrender his interest in lease to
the lessor. Such surrender to lessor by lessee terminates the lease.
In other words, if the lessee surrenders the lease property before the
Expiry of lease period by mutual consent, the lease is terminated.
e. BY IMPLIED SURRENDER –
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NOTE NO. 7
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A. INTRODUCTION -
FOR EXAMPLE –
"Where two persons/ mutually transfer/ the ownership/ of one thing/ for
the ownership/ of another/ neither thing or both thing being money only/, the
transaction is called as an, "Exchange".
1
IMPORTANT POINTS REGARDING EXCHANGE -
In all the cases, an exchange involves transfer of property but this transfer
must be in consideration of another movable or immovable property.
If the real owner of the property, exchange the property and obtained
another property in the name of his wife, whether the property so received was
in the name of husband or wife made no difference for the purpose of Section
118 and it must be held that it is a Deed of Exchange.
RULES OF “EXCHANGE” –
If any party to an Exchange due to any defect in the title of the other party is
deprived of the thing received in exchange, then the other party is liable to
Compensate the loss caused to the first party.
The Rights and Liabilities of each party to the Exchange is that of Seller and
Buyer for the thing Exchanged. Hence, all Essentials of Sale must be fulfilled for
Exchange.
Thus, where both the properties are movable, the delivery of things will
affect an exchange.
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But, if both properties are immovable, a Written and Registered,
"Exchange Deed" is to be executed if value of such properties are more than
Rs.100/-.
2. In Sale, there is one thing for the ownership transfer from one person
to another. The buyer pays money/price and gets the ownership of
the immovable property. The seller takes the money and gives
ownership of property.
3. Example in sale- Aditya sales house for Rs.15 lakhs to Pratap who pays
money/price, it is a sale.
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Q. Explain the essentials of “GIFT”. How Gift is effected? Discuss the grounds
of revocation of Gift.
OR
OR
CHAPTER VII containing Sections 122 to 129 lays down the provisions
relating to “GIFT OF PROPERTY” OR “GIFTS BETWEEN LIVING PERSONS” (Gift
inter vivos).
3
There are two kinds of Gifts –
i. Gift inter vivos is a gift between living persons which is dealt with
Section 122 of the Transfer of Property Act, 1882.
The person who transfers the property is called as “DONOR” and the
person to whom it is transferred is called as “DONEE”. It is very essential that
the acceptance of the gift shall take place during the lifetime of the donee.
Otherwise, it becomes void.
Such Acceptance must be made during the lifetime of the donee. If the
donee dies before acceptance then the gift becomes Void.
4
ESSENTIALS OF VALID GIFT –
The Most Essential Ingredients of Gift is that the transfer must be made
without Consideration. It is no gift if there is any consideration. Natural Love
and Affection is the consideration.
DONOR -
DONEE –
Donee is the person who accepts the gift. Donee must be having the
capacity to accept the gift.
Gift made to Minor are valid. The phrase is made in Section 122 “accepted
by or on behalf of donee” shows that Guardian of the Minor can accept the gift
on behalf of the minor but donee must alive at the time of gift.
5
4. GIFT MUST BE TO THE LIVING PERSON –
d. a ‘Class gift’ i.e. gift to two or more persons is valid. Where, a gift is
made to several donees and one of them does not accept the gift
then the gift is valid for the remaining donees except the donee
who does not accept (Section 125)
For the purpose of making a gift of Movable Property, the transfer may be
affected either by a Registered Instrument or by delivering that means
Registration is not compulsory.
For the purpose of making a gift of Immovable Property, the transfer must
be affected only by Written and Registered Instrument i.e. GIFT DEED.
Section 126 of the T.P. Act provides about “Suspension and Revocation of
Gift”.
6
2. In such a case if it were a contract voidable at the option of
donor if gift is made by employing coercion, fraud etc.
A Resumable Gift is not a Valid Gift. Resumable Gift means a gift which is
revocable at any time at the mere Will and Pleasure of the donor without any
reason or condition. Such revocation is not Valid.
7
2. ONEROUS GIFT (SECTION 127) (qui sentit commondum sentire debet
et onus) –
FOR EXAMPLE –
The Onerous Gift is based on the Maxim – “qui sentit commondum sentire
debet et onus” i. means “he who receives Advantage must bear the Burden
also”.
In other words, a Universal Donee is one whom all the properties of donor
have been given and is liable for all the debts and liabilities of the donor at the
time of the gift.
Such Gifts are Death Bed Gifts and are governed by Section 191 of the
Indian Succession Act, 1925.
8
Transfer of Property Act, 1882 deals with this concept in respect of
Immovable Property only and Section 191 of Indian Succession Act, 1925 deals
with this concept with regard to the Movable Property.
It is to be noted that Death Bed Gift is valid only when the donor dies. It
has no effect before the death of donor.
9
NOTE NO.8
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A. INTRODUCTION-
FOR EXAMPLE –
These are Easemental Rights and such rights are given to the property to
make the enjoyment of that property in more beneficial manner.
1. APPURTENANCE –
Sai Law Academy INDIAN EASEMENT ACT, 1882 ©ALL RIGHTS RESERVED
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2. RIGHT IN RE-ALIENA –
The person who allows such Easementary right is called “Servient Owner”
and the property is called as “Servient Property”.
Dominant Heritage-
The land for the beneficial enjoyment of which the right is exist is called
as, "Dominant Heritage" and the Owner and Occupier thereof is called as,
"Dominant Owner".
Servient Heritage –
The land on which the liability is imposed is called as, "Servient Heritage"
and the Owner and the Occupier thereof is called as, "Servient Owner".
The term “Land” includes all things permanently attached to the earth
also.
EXAMPLE OF EASEMENT –
1. Sandesh, the Owner of Certain Agriculture Land has right to take Water
from Mohit’s Well to supply his (Sandesh) Agriculture Land, this is an
Easement.
Sai Law Academy INDIAN EASEMENT ACT, 1882 ©ALL RIGHTS RESERVED
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2. Nikhil, the Owner of a house has the right to take the leaves which have
fallen from the trees on Rakesh’s land for the purpose of grazing Nikhil’s
Cattle, this is an Easement.
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Positive Easement enables the dominant owner to commit some positive act
upon the servient property.
FOR EXAMPLE –
FOR EXAMPLE –
FOR EXAMPLE –
FOR EXAMPLE –
Sai Law Academy INDIAN EASEMENT ACT, 1882 ©ALL RIGHTS RESERVED
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3. EASEMENT FOR A LIMITED TIME (SECTION 6) -
Quasi Easement are covenants which the Servient Owner must grant for the
benefit of the Dominant Owner. This is strictly not easement but termed as
Quasi Easment.
i. By Grant-
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iv. Easement by custom-
v. Easement by Prescription-
If the person exercises any right over the property of another for a period
of 20 years openly, peacefully and without any objection then on the expiry of
20 years period, such person will become entitled to exercise that right as
easement arising out of prescription.
Sai Law Academy INDIAN EASEMENT ACT, 1882 ©ALL RIGHTS RESERVED
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EXTINCTION OF EASEMENT -
Many times the right of easement is created for a limited period, on the
expiry of the period, the easement comes to an end.
In other words, extinction takes place when the easement is created for a
limited period and the period expires.
Sai Law Academy INDIAN EASEMENT ACT, 1882 ©ALL RIGHTS RESERVED
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vii. BY PERMANENT CHANGE IN DOMINANT OR SERVIENT HERITAGE
(SECTION 43) AND (SECTION 44) –
When the servient heritage is permanently altered in such a way that the
dominant owner can no longer enjoy the easement, such easement is
extinguished (Section 44).
The right of easement requires that both the dominant and servient
heritage must be under the ownership of different persons. So if the dominant
owner purchases the property of servient owner then there will be Unity of
Ownership and thus right of easement comes to an end.
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Suspension takes place when the owner of one heritage gets possession of
the other estate for a limited interest.
FOR EXAMPLE –
A Dominant Owner took on lease the Servient Heritage for more than 20
years. Since, there was Unity of Possession for over 20 years i.e., till the
expiration of the period of lease, the easement was extinguished after the
expiry of 20 years from suspension.
Sai Law Academy INDIAN EASEMENT ACT, 1882 ©ALL RIGHTS RESERVED
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LICENCES
(SECTION 52 to 64)
Q. Define Licenses. Explain essential characteristics of License.
“License” is defined as -
In the absence of such right, the same thing becomes Unlawful. Further,
such right does not amount to an Easement or an Interest/ in the property.
3. A license may be Oral also in the terms and conditions and may be
Written also.
4. All licenses necessary for the enjoyment of any exercise of any right,
are implied and are called as “Accessory Licence”.
FOR EXAMPLE –
Amit sells the trees growing on his land to Manoj. Manoj is licensed
to go into the land and take away the trees.
6. The grantor of a license must disclose to the licensee, all defects in the
property to be dangerous to the licensee.
8
10.It does not create an interest in the property and also not create an
easement in the property in respect of which it is granted.
12. If licensee for consideration is evicted by the grantor without any fault
of the licensee and before fully enjoying, the licensee can recover
compensation from the grantor.
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FOR EXAMPLE –
3. When license has been granted for a limited period and the period
expires.
4. When the license has been acquired on Condition that is shall becomes
Void on the performance or non performance of a specified act.
5. When the license property is destroyed or damaged that the licensee can
no longer exercise his right.
6. When the licensee become the absolute owner of the licensed property.
7. When the license granted for a Specific Purpose and the purpose is
attained or abandoned or becomes impracticable.
9. When the license is not totally used for 20 years Continuously, without
any Specific Contract for the same.
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EFFECT OF REVOCATION (SECTION 63) -
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