Essentials of a valid transfer under the TPA,1882

    The Transfer of Property Act,1882 is a piece of legislation that governs the transfer of property between parties by act of the parties themselves. Section 5 of the Act defines the term ‘transfer of property.’ A bare perusal of the provision makes it abundantly clear that transfer of property refers to a transfer of property inter vivos by means of gift, mortgage, sale, lease, exchange and actionable claim. There are certain essentials of a valid transfer under the Act which have been discussed below.

    Essentials of a valid transfer

    A transfer of property attains the stamp of validity in the eyes of the law when the following conditions have been fulfilled:

    The property must be transferable

    The question of transferability of property has been dealt with under Sections 6 of the Act. Section 6 enlists ten non transferable properties which fall under the following categories[1]:

    Spes Successionis: Spes Succesionis under Section 6(a) includes property which might be acquired in the future by means of inheritance or will.  This clause includes chance of an heir apparent succeeding an estate, chance of a relation obtaining the legacy of a kinsman or any other possibility of a like nature.attain. Section 6(a) forbids the transfer of any property which falls under the purview of ‘spes successionis’.

    A mere right of re-entry: A mere right of reentry indicating a right to regain possession has been barred under the Act. Section 6(b) states that the right of re-entry is not transferable

    Easement apart from dominant heritage: A right of easement is a right meant for beneficial enjoyment and is attached to the property of another person. The property with regard to which the right of easement exists is called the dominant heritage and the property upon which the right is exercised is known as servient heritage. Section 6(c) of the Act states that a right of easement apart from the dominant heritage is not transferable.

    Restricted interest: Section 6(d) prohibits the transfer of property in which an interest subsists that has been restricted in its enjoyment to the owner personally. Offices such as those of a Shebait or Pujari [2], or Muttawali of a Waqf[3] or Mhant of a mutt[4] are not transferable.

    Right to future Maintenance: A right to be entitled to maintenance in the future is not transferable under Section 6(dd). The rationale behind the prohibition is that maintenance is awarded solely for the benefit of a person and is hence, non transferrable. There was a lack of unanimity amongst the judiciary with regard to the transferability of a future maintenance. The conflict was resolved after the passing of the Amendment Act of 1929 which expressly barred such transfers.

    Right to sue: A right to sue for an ascertained sum of money is an actionable claim and is hence, transferrable. However, a right to sue for an uncertain sum of money can not be transferred. Section 6(e) of the Act brings claims like those for unliquidated damages either in contract or in tort, claim for mesne profit, suing an agent for accounts  under its purview.

    Public office and salary of public officer: Section 6(f) prohibits the transfer of a public office and the salary of a person holding such an office. A person holds a public office by virtue of his personal qualities and the pecuniary gain attached thereto is his beneficial interest. The objective behind the prohibition on such a transfer is to maintain the dignity of the office.

    Pensions and Stipends: Under clause (g) of Section 6, the stipends allowed to military, naval, air force and and civil pensioners are not transferable. The principle behind the prohibition is the same as that Section 6(f).

    Transfer opposed to nature of Interest etc.: Section 6(h) prohibits transfer under the following circumstances:

    1. A) Where the transfer is opposed to the nature of interest created thereby,
    2. B) Where the transfer is made for unlawful object or consideration,
    3. C) Where the transfer is made to a person  who is legally disqualified to be  transferee

    Non Transferable right to occupancy: Under Section 6(i), a tenant having a non transferable right can not transfer his property. A similar provision is spelled out in section 108(j) of this Act.

    Transferor Must Be Competent

    According to Section 7 of the Transfer of Property Act,1882, any person who is competent to contract is competent to transfer a property. The competency of a person to contract has been laid down in Section 11 of the Indian Contract Act,1872. It enlists the attainment of the age of majority, presence of a sound mind and the condition of not being disqualified to contract under any law as the prerequisites for competency.

    Age of Majority: Section 3 of the Indian Majority Act,1875 lays down 18 years of age to be  the age of majority but where a guardian has been appointed under the Guardian & Wards Act,1890, the age of majority has been declared to be 21 years of age. Transfer of property by a minor is void and can not attain validity by a subsequent ratification on reaching the age of majority[5].

    Soundness of Mind: Soundness of mind refers to a mental condition in which a person is aware of the nature of the contract and understands its implication upon his actions. Unsoundness of mind can be of two types. It can be idiocy or lunacy which is permanent and can not be cured but not permanent. A lunatic person may sometimes possess a sound mind. Such intervals of time are called lucid intervals. A transfer of property made during such intervals is valid and can not be imparted a colour of invalidity

    Legal disqualifications: Insanity and unsoundness of mind are legal disqualifications. However, there might be several other legal disqualifications under any other law a person is subject to.

    The provision brings both natural as well as juristic persons in its purview.

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    Transferor Must Be Entitled To Transfer

    The transferor should also have the authority to transfer. A person who is the holder of a limited interest in a property can only transfer to that extent. A person having no title in a property is not entitled to transfer the property[6].

    Transferee Must Also Be Competent

    The position of a transferee is different from that of a transferor under The Transfer of Property Act,1882. Unlike a transferor, the transferee is not required to have attained the age of majority or to be a person of a sound mind. A transferee should not be disqualified under any law in force and should be in existence on the date of the transfer. A transferee can be a minor or an insane person or even a child in the mother’s womb provided the child is born alive.

    Completion of necessary formalities

    The Transfer of Property Act,1882 provides for  two modes of transfer[7]. These are by delivery of possession and  by registration.

    Moveable properties and all other properties which are not required to be transferred in writing are transferable by delivery of possession .

    Transfer of property by registration can only be done where the transfer is in writing. The Transfer of Property provides that the following transfers should be done by means of a written deed that has been duly registered:

    • Gift of an immovable property[S.123],
    • Sale of an immovable property of the value of or exceeding rupees one hundred[S.54],
    • Sale of a reversion or other intangible property irrespective of the value[S.54],
    • Leases from year to year or for a term exceeding one year or reserving a yearly rent[S.107]
    • Simple mortgage[S.59],
    • Other kinds of mortgage barring mortgage by deposit of title deeds where the sum secured exceeds Rupees One Hundred[S.59],
    • Exchange of immovable property the value of which exceeds Rupees One Hundred[S.118],
    • Transfer of actionable claim. For a valid transfer of an actionable claim to take place, registration is not a prerequisite. Transfer by a written deed shall suffice.[S.130]

    Transfer in favour of an unborn child

    The Act states that one of the essentials of a valid transfer is that the transferee must be a living person. The interest in favour of an unborn child must be preceded by a prior interest in favour of one or more living persons. The unborn child must be in existence when the prior interest reaches termination and he must hold the interest in the property latest by when he attains the age of majority

    Adherence to the rule against perpetuity

    Section 14 of the Act deals with the rule against perpetuity . The term perpetuity refers to continuity, everlastingness, infinity. The rule states that a transfer of property can not create an interest which takes effect after the life-time of one or more persons living at the date of such transfer, and the minority of some person who will be in existence at the expiration of that period, and to whom, if he attains full age, the interest created is to belong. The rule has been propounded to ensure that the transfer of a property is not delayed beyond a certain period of time.

    Conditional transfers not to be illegal, immoral or opposed to public policy

    In case of a conditional transfer of property, the condition so imposed shall not be any of the following:

    • Impossible to perform: An impossible condition is one which can not be performed. The impossibility of performance fails the transfer. In Rajendra Lal v Mrinalini Dassi,[8] the condition imposed was that the legatee excavated a tank when the testator did it in his lifetime. Since the performance of such a condition was impossible, the bequest of property had failed.
    • Unlawful: A condition becomes unlawful in the eyes of law under the following circumstances:
    • The condition is fraudulent,
    • The condition is forbidden by law,
    • The performance of the condition defeats the provision of a law,
    • The condition is opposed to public policy,
    • The performance of the condition involves injury to a person or property.

    Conclusion

    The Transfer of Property Act, 1882 enlists the aforementioned conditions as the essentials of a valid transfer. The transfer may be rendered void for the non fulfillment of any of these conditions.

    REFERENCES

    [1] Dr. R.K. Sinha, The Transfer of Property Act 62 (Central Law Agency, 30-D/1, Moti Lal Nehru Road ,Allahabad-2, 18th Edn., 2017).

    [2] Nagendra v. Rabindra, AIR 1926 Cal 490.

    [3]Wahid Ali v. Ashruff, (1881) 8 Cal.732.

    [4]Prayag Das v. Mahant Kriparam, (1908) CLJ 499.

    [5] Sadiq Ali Khan v. Jaikishore, AIR 1928 PC 152.

    [6]Attaur Rahman Fateh Md v. Hari Birand, AIR 2008 NOC 1920(Bom.).

    [7]The Transfer of Property Act,1882, s.9.

    [8]AIR 1922 Cal. 116.


    BY ANINDITA DEB | NATIONAL LAW UNIVERSITY AND JUDICIAL ACADEMY, ASSAM

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