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Dr. K.V.S.SARMA PROFFESOR OF LAW NALSAR UNIVERSITY OF LAW, HYDERABAD.

TRANSFER OF PROPERTY ACT,1882


The Act contains 137 sections .these 137 sections are divided into 8 chapters. Ch I Preliminary of Ss 1 4 Ch II Of transfer of property Ss 5 53A Ch III Of sale of immovable property 54 57 Ch IV Of mortgages of immovable property and charges 58 104 Ch V Of the leases of immovable property 105 - 117 Ch VI Of exchanges 118 - 121 Ch VII Of gifts 122 129 Ch VIII Of transfer of actionable claims 130 - 137

Dwaraka Prasad v Kothlan I.L.R.(1955) Nag 538 (T.P.Act is not applicable to govt. contracts ). When there is inconsistency between T.P.Act and Muslim law, Muslim law will prevail. Ch VII is not applicable to Muslim law.

PRELIMINARY ( Ss 1 4)
Sec 3:-

Immovable property:The Act has not defined this term Sec 3 merely lays down that immovable property does not include standing timber, growing crops or grass. General clauses Act , 1897. Immovable property shall include land benefit to arise out of land, things attached to the earth or permanently fastened to any thing attached to the earth ; Sec 3(25).

Registration Act , 1908 :Immovable property includes land buildings , hereditary allowances rights to ways , lights , ferries , fisheries or any other benefits to arise out of land and things attached to earth , but does not include standing timber , growing crops or grass. Immovable property includes : (a) Right to collect rent of immovable property (b) Right to fishery (c) Office of a hereditary priest of a temple (d) Right to collect lac from trees (e) Mortgagors right to redeem

Attached to the earth :- It means


(a) Rooted in the earth , as in the case of trees and shrubs ; or (b) imbedded in the earth , as in the case of walls or buildings; or c)attached to what is so imbedded for the permanent enjoyment of that to which it is attached ( doors , windows etc.) quicquid plantatur solo, solo cedit- what is planted on the soil belongs to the soil

Sec 3 Attested :
Attested , in relation to an instrument , means , and shall be deemed always to have meant , attested by two or more witnesses each of whom has :(i) a) seen the executant sign or b) affix his mark to the instrument or (ii) c) seen some other person sign the instrument in the presence of , and by the directin of the executant; or

d) received from the executant , a personal acknowledgement of his signature of such other person, and e) signed the instrument in the presence of the executant. It is not at all necessary that all the witnesses should be present at the same time . No particulars form or attestation is neccesary. To attest means to sign and witness any fact viz., the fact of execution by the executant.

Kaderbhai Ismailji v Fatmalbhai Golamhusain 45 Bombay Bom.L.R. 91(Attestor can put his signature at any place) M.N.Abdul Jabbar v H. VenkataSastri and sons. AIR 1966 S.C. 1147.(scribe and officer should not attest) Bhagavat v Gorakh. AIR 1934 Pat 34.(no proof that witness is aware of the documents)

If the Attestation is invalid , the documents cannot be enforced. Notice:- Kinds of notice:(1) Actual or express notice (2) Constructive or implied notice. (a) Wilful abstention from an enquiry or search (b) Gross negligence (c) Registration (d) Actual possession (e) Notice to agent

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Ch II ( Ss 5 53A)
Of transfer of property by Act of Parties . (A)Transfer of property whether movable or immovable.

Sec. 5:- Transfer of property:An act by which a living person conveys property , in present or in future , to one or more other living persons , or to himself and one or more others living persons, and to transfer property is to perform such act.
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Mere compromises does not amount to transfer .AIR 1996.S.C.869 When transferee is not a living person. Narasimha v Venkatalingham 60 Mad.687.(F.B) Abandonment , release or relinquishment is not a transfer:Khunnilal v Govind. 33All.356 .P.C. Subamma v BalaSubhaReddy(1945) 1 M.L.J 140. Partition in a J.H.F is not a transfer. Radhakrishnayya v Sarasamma I.L.R. 1951 Mad 607

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Sec 6:-What property may be transferred:The following rights can not be transferred :a) The chance of an heir-apparent succeeding to an estate , the chance of a relation obtaining a legacy on the death of a kinsman or any other mere possibility of a like nature, cannot be transferred. Anand Mohan v Gaur Mohan 50 Cal.929

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b) A mere right of re- entry for breach of a condition subsequent can not be transferred to anyone except the owner of the property affected thereby. c) an easement can not be transferred apart from the dominant heritage. d) an interest in the property restricted in its enjoyment to the owner personally can not be transferred to him. dd)a right to future maintenance, in what so ever manner arising, secured or determined , cannot be transferred.

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e)A mere right to sue cannot be transferred. f)A public office can not be transferred ,nor can the salary of a public officer whether before or after it has become payable. g)Stipends allowed to military , naval,air force and civil pensioners of the Govt. and political pensions can not be transferred. h)No transfer can be made (i) in so far as it is proposed of the interest affected thereby; or (ii)for an unlawful object or consideration within the meaning of Sec 23 of the Indian Contract Act, 1872;or (iii)to a person legally disqualified to be transferee
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(i) nothing in the section shall be deemed to authorize a tenant having an untransferable right of occupancy the farmer of an estate in respect of which default has been made in paying revenues , or the lessee of an estate, under the management of a court of wards , to assign his interst as such tenant , farmer or lessee. Nitya Gopal v Nanilal 47.Cal.990 The right of priests to share in the offerings that may be made in a temple worshippers is a mere possibility and so inalienable.

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Right of re-entry. Vaguran v Rangayyangar. Service inams:Anjaneyulu v Srivenugopala (Swasthivachakam service) Religious office:Raja Varma v Ravi Varma 1.Mad 235(P.C) Sec 7:-persons competent to transfer . Raghavachariar v Srinivasa 40 Mad425. Sec 8:-Operation of transfer. Sec 9:- Oral transfers .
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Illegal restrictions on certain alienations: Ss. 10-12 and 17-18 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 such condition or limitation(and not the transfer itself) is void.

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Such a condition is, however valid in the following two cases:a) in the case if a lease where the condition is for the benefit of the lessor (or those claiming under him) b)A transfer to, or for the benefit of , a woman(not being a Hindu, Muslim or Buddhist, so that she shall not have power, during her marriage to transfer or change the same

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If a condition involves a substantial prohibition of the right of alientation, it is treated virtually as a total restraint and is void.if , on the other hand , it is only a partial restraint upon the alienatory power it can be given effect to. Re Macley Eq.6. Mohammad Raza v Abbasbandi.(valid should not sell out side the family) T.V. Sangama Ltd.V. Shanguma Sundaram(1939)Mad 769 (at a particular price below market value void)

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Re Rosher (1884) 26 Ch.D.801(to wife at one-fifth market value - void ) Sec 11:-Restriction repugnant to interest created:Where on a transfer of property an interest there in is created absolutely in favour of any person but the terms of the 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 were no such directions: Exception:-Where any such direction has been made in respect of one piece of immovable property for the purpose of securing the beneficial enjoyment of another piece of such property.
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Pannalal v Fulmoni AIR(1987)Cal.368 (gift deed step mother ) valid Sec 12:- Condition making interest determinable on insolvency. Exception:-Lease Exceptions(to Sec 10, 11) :Direction for accumulation of income(Ss. 17, 18) Sec 17:- Sec 17(i) Where the terms of a transfer of property direct that the income arising from the property shall be accumulated either wholly or in the part , the direction will be good for the longer of the periods.
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(1)the life of the transferor or (2)a period of 18 years from the date of the transfer . Exceptions to Sec 17(1)are Ss. 17(2) and 18:Ss.17(2) :-Sec 17(1) shall not affect any direction for the purpose of (i)the payment of the debts of the transferor.(or any other person taking any interest under the transfer). Or (ii)the provision for children or remoter issue of the transferor(or of any other person taking any interest under the transfer); or

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(iii) the preservation or maintenance of the property transferred. (iv)Sec 18:- When the property is transferred for the benefit of the public in the advancement of religion , knowledge, commerce or health, safety, or any other object beneficial to mankind.

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TRANSFER BY CO-OWNERS ( Ss. 44 AND 47)


TRANSFER BY ONE CO-OWNER(S.44)
Where one co-owner of immovable property transfer his share, the transferee acquires as to that share(1)the right of joint possession, or (2)the right to partition to the extent enjoyed by the transferor. This would apply to a transferee of all kinds , including mortgages and lessees.but where the transferee of a dwelling house belonging to an undivided family is not a member of the family , he is not entitled to joint possessionor other common or part-enjoyment of the house.
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This section is based on the principle of subrogation or substitution.Thus, A, B and C mortgage their field to X. C then transfer his share of the field to D. Under these circumstances, D will have the right to joint possession with A and B, and also a right to claim partition and separate possession of his share. But the recently acquired share of D is still subject to the mortgage.
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Priority by co-owners of share in common property (S.47)


Where several co-owners of immovable property transfer a share therein without specifying that the transfer is to take effect on any particular share or shares of transferors,the transfer,as among such transferors,takes effect on such shares equally,where the shares were equal,and where they were unequal,proportionately to the extent of such shares:S.47.
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JOINT TRANSFERS(Ss.45-46)
1.Joint transfer for consideration (S.45)
Where immovable property is transferred for consideration to two or more persons, and such consideration is paid out of a fund belonging to them in common , they are , in the absence of a contract to the contrary, entitled to interests in such property, identical to the interest to which they were respectively entitled in the fund. Where, however, such a consideration is paid out of separate funds , they are entitled , in the absence of a contract to the contrary,to interests in such property in proportion to the share of the consideration advanced by them.
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Where there is no evidence as to the interests in the fund to which they were respectively entitled, or the shares which they advanced, such persons shall be presumed to be equally interested in the property:S.45.

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2.Transfer for consideration by persons having distinct interest(S.46)


Where immovable property is transferred for consideration by persons having distinct interests therein,the transferors are, in the absence of a contract to the contrary, entitled to share in the consideration -equally, where their interests in the property were of equal value and, -proportionately to the value of their respective interests, where such interests were of unequal value:S.46.
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Illustrations-(a) : A, owing a moiety, and B and C each a quarter share, of Mauza Sultanpur,exchange an eight share of that Mauza for a quarter share of Mauza Lalpura.There being no agreement to the contrary,A is entitled toan eight share in Lalpura nd B and C to a sixteenth share in that Mauza. (b)A being entitled to a life interst in Mauza Atrali, and B and C to the reversion, sell the Mauza for Rs.1000.As life interest is ascertained to be worth Rs. 600, the reversion Rs.400.A is entitled to receive Rs.600,out of the purchase money,B and C to receive Rs.400:S.46.
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PRIORITY OF RIGHTS CREATED BY TRANSFER(Ss.48 AND 78)


(1)Priority of rights previously created (S.48)
Where a person purports to create by transfer at different times, rights in or over the same immovable property, and such rights cannot all exist , or be exercised to their full extent together,-each later created right shall, in the absence of a special contract or reservation binding the earlier transferees, be subject to the rights previously created:S.48.

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The following ,however , are eleven exceptions to the rule that priority is determined by order of time: 1.Section 50 of the Registration Act, under certain circumstances, giving priority to a registered mortgage over an earlier unregistered deed of which registration is optional. 2.Another exception to the rule is salvage lien , I.e.,advances made for the purpose of protecting a priority from revenue sale,forfeiture of destruction. 3.When a mortgage is constituted a first charge, it takes precedence over prior mortgages by an order of the Court. 4.Land revenue falling in arrears subsequent to a mortgage takes precedence over it. 5.A State debt (even if subsequent) takes precedence over all other debts, secured or unsecured, in accordance with statutory provisions.
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6.When the prior encumbrancer misleads a subsequent encumbrancer by fraud ,misrepresentation or gross neglect, his priority is postponed. 7.When the priority is barred by estoppel, a subsequent transferee takes precedence. 8.A mortgage executed by a receiver , for the purpose of preserving the property, takes precedence over all other loans. 9.Advances made to save a mortgaged property from loss or destruction are payable in priority to all other charges. 10.A transfer operates from the date of execution of the deed , although it may have been registered at a later date:S.47,Registration Act. 11.A non-testamentary document duly registered has priority over any oral transfer though made earlier , except in the case of a mortgage by deposit of title deeds:S.48,Registration Act.
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TRANSFEREES RIGHTS UNDER POLICY(S.49)


Where immovable property, is transferred for consideration, and - such property (or any part thereof) is,at the date of the transfer , insured against loss or damage by fire, - in the case of such loss or damage, the transferee may in the absence of a contract to the contrary require any money under the policy(or so much thereof as may be necessary)to be applied in reinstating the property:S.49.
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BONA FIDE HOLDERS UNDER DEFECTIVE TITLE(Ss. 50-51)


This topic will be considered under the following two heads: (1)Rent paid to holder under defective title(S.50) (2)Improvements made by bona fide holders under defective title(S. 51).
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(1)Rent paid to holder under defective title(S.50)


S.50 provides that no person can be charged with any rents or profits of any immovable property,which he has , in good faith, paid or delivered to any person of whom he , in good faith, held such property,-notwithstanding it may afterwards appear that the person to whom such payment or delivery was made he had no right to receive such rents or profits. Illustration - A lets a field to B at a rent of Rs 50, and then transfers the field to C. B, having no notice of the transfer , in good faith, pays the rent to A. B is not chargeable with the rent so paid S:50.
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(2)Improvements made by bona fide holders under defective title(S.51)


When the transferee of immovable property makes an improvement on the property , believing in good faith that he is absolutely entitled thereto, and he is subsequently evicted therefrom by any person having a better title, - the transferee has a right to require the person causing the eviction either (i)to have the value of the improvement estimated and paid or secured to the transferee, or (ii)to sell his interest in the property to the transferee at the then market value thereof, irrespective of the value of such improvement. 38

The amount to be paid or secured in respect of such improvement shall be estimated value thereof at the time of eviction, If the transferee has planted or sown(on the property) crops which are growing when he is evicted therefrom, he is entitled (i)to such crops, and (ii)to free ingress and egress to gather and carry them:S.51.

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TRANSFER OF PROPERTY PENDING SUIT RELATING THERETO (LIS PENDENS):S.52


Its essentials In order to constitute a lis pendens , the following six elements must be present: (i)There should be a suit or a proceeding. (ii)The suit or proceeding must be one in which a right to immovable property is directly and specifically in question. (iii)The suit or proceeding must not be a collusive one. (iv)The suit or proceeding must be pending. (v)The property in a suit must be transferred during such pendency. (vi)The suit or proceeding must be pending in a Court of competent jurisdiction.
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FRAUDULENT TRANSFER (S.53)


Under the Transfer of Property Act, a transfer of immovable property by a debtor may be set aside by his creditor (1)if the transfer is made with intent to defeat or delay the transferors creditor, and (2)if the transferee is not a transferee in good faith and for consideration. A transferee from such debtor will be protected (a)if he acquires property for value and in good faith , i.e, without being a party to any design of the transferor to defeat or delay his creditors , even if the debtors intention may have been fraudulent;or (b)if he himself is a creditor and the transfer is made in satisfaction of his pre-existing debt.
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PART PERFORMANCE (S.53A)


(1)There should be a contract to transfer , for consideration, any immovable property by a writing signed by the transferor on his behalf,from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty. (2)The transferee should, in part performance of the contract , have taken possession of the property or any part thereof, or , if already in possession should have continued in possession in part performance of the contract and should have done some act in furtherance of contract.
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(3)The transferee should have performed or should be willing to perform his part of the contract. (4)the rights of any other subsequent transferee for consideration without notice should not be affected. If all the above conditions co-exist, in spite of the fact that (i)the contract though required to be registered , has not been registered or (ii)the instrument of transfer has not been completed in the manner prescribed thereof by law , e.g.,where it is not attested or registered , though required to be attested and registered, the transferor,or any person claiming under him will be debarred from claiming any relief , in respect of the property as against the transferee which is inconsistent with the terms of contract.
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The Proviso to S.53-A saves the right of a transferee for consideration who has no notice of the contract or its part performance. It is to be noticed , however, that ordinarily, possession will constitute notice of the title of person in possession.

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OF SALE OF IMMOVABLE PROPERTY(Ch III: Ss.54-57)


Sale defined ( S.54)
Sale is a transfer of ownership in exchange for a price paid or promised , or part paid and part-promised: S.54.

ESSENTIALS OF A VALID SALE-The


following are the eight essentials of a valid sale:

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1. The seller must be a person competent to transfer:see S.7. 2. The buyer must be a person competent to be a transferee.He may be any person who is not disqualified to be a transferee under S.6. 3. The subjectmatter must be transferable immovable property:see S.6. 4. There must be a transfer of ownership. 5. The transfer must be in exchange for a price. 6. The price must be paid or promised or part paid and part promised. 7. There must be a registered conveyance in the case of (i)tangible immovable property of the value of Rs. 100 and upwards, or (ii)a reversion of an intangible thing of any value. 8. In the case of tangible immovable property value is less than Rs.100, there must either be (i)a registered conveyance, or 46 (ii)delivery of property.

Sale how effected (S.54)


1.In case of(i)tangible immovable property of the value of Rs.100 and upwards, or (ii) a reversion, or (iii) any other intangible thing: a sale can be made by a registered instrument. 2.In case of tangible immovable property of a value less than of Rs.100: a sale can be made (i)by a registered instrument, or (ii)delivery of the property.
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Delivery of tangible immovable property takes place when the seller places the buyer , (or such person as the buyer directs) in possession of the property:S.54.

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Contract for sale defined (S.54) (agreement to sell)

A contract for the sale of immovable property is a contract that the sale of such property shall take place on terms settled between the parties . It does not , of itself, create any interest in , or charge on, such property: S.54.
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I.-BUYERS RIGHTS (S.55(6))


(a)Before completion of sale, ie., where ownership has not passed to him s. 55(6)(b).
The buyer is entitled to1) A charge on the property for the purchase money properly paid by him in anticipation of the delivery. 2) Interest on such purchase-money 3) The earnest, and costs awarded to him of a suit to compel specific performance of the contract or to obtain a decree for its rescission in case he properly declines to accept delivery.
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AFTER COMPLETION OF SALE, ie., WHERE OWNERSHIP HAS PASSED TO HIM S.55(6)(a)
The buyer is entitled to (i) the benefits of any improvement in, or increase in value of , the property, and (ii)the rents and profits thereof.
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II. BUYERS LIABILITIES [S.55(5)]


(a) Before completion of sale [S.55(5)(a) &(b)]
The buyer is bound 1. To disclose to the seller any fact as to the nature or extent of the sellers interest in the property of which the buyer is aware, but of which he has reason to believe that the seller is not aware, and which materially increases the value of such interest(An omission to make such disclosures amounts to fraud).
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2. To pay or tender the purchase money to the seller or such person as he directs.Where the property is sold free from encumberances, the buyer may retain, out of the purchasemoney, the amount of any encumberances on the property existing at the date of the sale, and shall pay the amount of any encumberances on the property existing at the date of the sale, and shall pay the amount so retained to the person entitled thereto.

(b) After completion[S.55(5)(c) & (d)]


The buyer is bound1.To bear any loss(not caused by seller)arising from destruction,injury,or decrease in the value of the property. 2.To pay public charges and rents which may become payable in respect of the property,the principal moneys due on any encumberances subject to which the property is sold, and the interest thereon afterwards accruing due. 53

III.-SELLERS RIGHTS[S.55(4)]
(a)Before completion of sale[S.55(4)(a)]
The seller is entitled to rents and profits till ownership passes to buyer.

(b)After completion of sale[S,55(4)(b)]


The seller is entitled to a charge upon the property in the hands of (i)the buyer,or(ii)any transferee without consideration, or(iii)any transferee with notice of nonpayment , for the amount of the unpaid purchase-money. The seller is entitled to such charge, only when the whole or part of the purchase-money is unpaid, and the ownership of the property has passed to the buyer.
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IV.-SELLERS LIABILITIES[S.55(1),(2)&(3)]
Before completion of sale [S.55(1)(a) to (g)]
The seller is bound1.To disclose to the buyer any material defect in(i)the property or (ii) the sellers title thereto, of which the seller is, and the buyer is not aware, and which the buyer could not, with ordinary care, discover. 2. To produce to the buyer, on his request, for examination, all documents of title relating to the property which are in the 55 sellers possession or power.

3. To answer, to the best of his information, all relevant questions put to him by the buyer with respect to the (i) property, or (ii) the title thereto. 4. On payment or tender of the price, to execute a proper conveyance of the property when the buyer tenders it to him for execution at a proper time and place. 5. Between the date of the contract of sale and the delivery of the property, to take as much care of the property, and all documents of title relating thereto, as a man of ordinary prudence would take. 6. To pay all public charges and rent accrued due in respect of the property up to the date of sale, the interest on all encumbrances on such property due on such date, and (except where the property is sold subject to encumbrances) to discharge all encumbrances on the property when existing.
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(b) After completion( s. 55(1),(2),(3)


1) The seller is bound to give to the buyer, or to such person as he directs, such possession of the property as its nature admits. 2)Where the whole of the purchase-money has been paid to the seller, he is also bound to deliver to the buyer, all documents of title relating to the property which are in the sellers possession or power.

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(a) Where the seller retains any part of the property comprised in such documents, he is entitled to retain all the documents. (b) Where the whole of such property is sold to different buyers, the buyer of the lot of the greatest value is entitled to such documents. The seller, or such buyer of the lot of the greatest value, ( as the case may be) is bound, upon the buyers request, to produce the said documents and furnish true copies thereof, and in the meantime, the seller or the buyer of the greatest value, as the case may be, must keep the said documents safe, uncancelled and undefaced, unless prevented from so doing by fire or other inevitable accident.
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3.Covenant for title:The seller shall be deemed to contract with the buyer that the interest which the seller professes to transfer to the buyer subsists and that he has power to transfer the same.

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Marshalling by subsequent purchaser (s.56)


If the owner of two or more properties mortgages them to one person, and then sells one or more of the properties to another, the buyer is, in absence of a contract to the contrary, entitled to have the mortgage-debt satisfied out of property or properties not sold to him, so far as the same will extend, but not so as to prejudice the rights of a) the mortgagees, or b)persons claiming under him, or c) any other person who has acquired any interest in any of the properties for consideration.

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Discharge of encumbrances on sale (s.57):This section prescribes the procedure for discharging an encumbrance on a property which is sold free from an encumbrance. The power which is given to the court under this section is intended to facilitate the alienation of encumbered estates by relieving the land from the encumbrance and substituting for the land another form of security. This section has been enacted to facilitate the realization of fair value for encumbered estates.

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CHAPTER IV OF MORTGAGES OF IMMOVABLE PROPERTY AND CHARGES(Ch. VI:58-104) A- MORTGAGES(Ss.58-99 & 102-104) Definition[S.58(a)] A mortgage is the transfer of an interest in specific immovable property for the purpose of securing(a) the payment of money advanced or to be advanced by way of loan, (b)an existing or future debt , or (c)the performance of an engagement which may give rise to a pecuniary liability.
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The transferor is called mortgagor, and the transferee a mortgagee; the principal money and the interest of which payment is secured for the time being are called the mortgage money; and the instrument (if any) by which the transfer is effected is called a mortgage deed.[The words mortgagors and mortgagees include persons deriving title from them respectively];Ss.58(a) and 59-A. In an old case ,Mahmood J. said of S. 58(a): A mortgage , as understood in this country , cannot be defined better than by the definition adopted by the Legislature in section 58 of the Transfer of Property Act.That definition has not in any way altered the law, but , on the contrary , has only formulated in clear language , the notions of mortgage as understood by all writers of text books on Indian mortgages . Every word of the definition is borne out by the decision of Indian Courts of Justice(Gopal v Parsotam, 1883 5 All. 121).
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SIX KINDS OF MORTGAGES AND THEIR CHARACTERISTICS: 1) Simple Mortgage S.58 (b) 2) Mortgage by conditional sale S. 58 (c) 3) Usufructuary mortgage s. 55(d) 4) English Mortgage s. 58(e) 5) Mortgage by deposit of title deeds or Equitable Mortgage S. 58(f) 6) Anomalous Mortgage s. 58 (g)

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1) Simple Mortgage: -Wherea) Without delivering possession of the mortgaged property, b) the mortgagor binds himself personally to pay the mortgage-money, and c) Agree that, in the event of his failing to pay, the mortgagee shall have a right to cause the mortgaged property to be sold, and the proceeds of sale to be applied so far as may be necessary, in payment of the mortgage-money, The transaction is called a simple mortgage, and the mortgagee a simple mortgagee. In simple mortgage , the mortgagee must have the power to sell the property. But the sale cannot be made out of court. He has no right of foreclosure.
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2) Mortgage by Conditional Sale: Where the mortgagor ostensibly sells the mortgaged property on condition that (i) on default of payment of the mortgage-money on a certain date, the sale shall become absolute, or (ii) on such payment being made, the sale shall become void, or (iii) on such payment being made, the buyer shall transfer the property to the seller, the transaction is called a mortgage by conditional sale In this form of mortgage, there is no personal liability on the part of the mortgagor to pay the debt. The remedy of the mortgagee is by foreclosure only. The mortgagee remains content with the property mortgaged, and cannot look to the other properties of the mortgagor, the latter not having any personal liability. No delivery of possession is given in this type of mortgage. Mortgagee can only acquire ownership over the property, which, however, will not vest in him inspite of a default of payment on the due date, until there is a decree for foreclosure. (S.67)
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1) USUFRUCTUARY MORTGAGE:- S.58(d Where the mortgagor a)delivers possession, or expressly or by implication binds himself to deliver possession of the mortgaged property to the mortgagee, and i) to retain such possession until payment of the mortgage-money, and ii) to receive the rents and profits accruing from the property, and iii) to appropriate them in lieu of interest or, in payment of the mortgage-money, or partly in lieu of interest and partly in payment of the mortgage-money, the transaction is called a usufructuary mortgage, and the mortgagee a usufructuary mortgagee: The mortgagor will not be personally liable, unless there is a distinct agreement to the contrary. Section 67 denying him the right of foreclosure and sale. A usufructuary mortgagee cannot sue either for sale or for foreclosure. His only remedy is to retain possession of the mortgaged property till the mortgaged-money is paid up. He is entitled to sue for possession and mesne profits in 67 case if he loses possession.

4) English Mortgage: - S.58 (e) Where the mortgagor a)binds himself to repay the mortgage-money on a certain date, and b)transfers the mortgaged property absolutely to the mortgagee, but subject to a proviso that he will re-transfer to the mortgagor upon payment of the mortgage-money as agreed, the transaction is called an English Mortgage. Characteristics: i)there is a personal covenant to pay the amount. ii) It is effected by an absolute transfer of property with a provision for re-transfer in case of repayment of the amount due. i) Power of sale out of court is conferred on certain persons under certain circumstances stated in s.69. ii) His remedy is by sale, and not by foreclosure. iii) An English Mortgagee has the right to enter into immediate possession of the property. iv) Absolute conveyance is converted into a mortgage. v) Remedy of an English mortgagee is by sale.
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1) MORTGAGE BY DEPOSIT OF TITLE-DEEDS OR EQUITABLE MORTGAGE: Where a person a)in any of the following towns, namely, the towns of Calcutta, Madras and Bombay and in any other town which the State Government concerned may, by notification in the official gazette, specify in this behalf, b)delivers to a creditor documents of title to immovable property, c)with intent to create a security thereon the transaction is called a mortgage by deposit of title deeds.
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Characteristics: a)the property need not be situated in the abovementioned towns. b)No delivery of possession of property takes place c)No registration is necessary d)It prevails against a subsequent transferee who takes under a registered instrument e)His remedy is by a suit for sale and he is not entitled to sue for foreclosure. f) There is no personal liability to repay the loan. The mortgagee has no power of sale without the intervention of court.

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6) ANOMALOUS MORTGAGE: -

Remedy of Mortgagee is by sale and foreclosure, if the terms of the mortgage permit it.

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S.59-A REFERENCE TO MORTGAGORS AND MORTGAGEES TO INCLUDE PERSONS DELIVERING TITLE FROM THEM:Unless otherwise expressly provide references in this chapter to mortgagors and mortgagees shall be deemed to include references to persons deriving title from them respectively.

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RIGHT TO SELL WITHOUT THE INTERVENTION OF COURT (S.69)


A mortgagee has the power to sell, or concur in selling, the mortgaged property or any part thereof in default of payment of the mortgage-money without the intervention of the court in the following three cases, and in no others, namely:
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1)Where the mortgage is an English mortgage, and neither the mortgagor nor the mortgagee is a (i) Hindu (ii) Buddhist, or (iii) Mohammedan, or (iv) a member of any other race, sect, tribe or class from time to time specified in this behalf by the State Government in the Official Gazette.

2)Where the Government is the mortgagee, and a power of sale without the intervention of court is expressly conferred by the mortgage-deed:

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3)Where the mortgaged property is situated in Calcutta, Madras and Bombay, or any other Gazetted town or area, provided the power of sale without the intervention of court is expressly conferred by the mortgage-deed: 4)However this power can be exercised onlyi) When the principal money (or part thereof) has remained unpaid for three months after service of notice in writing requiring payment on the mortgagor or one of several mortgagors, or ii) When the interest is not less than Rs. 500/- in amount is in arrears and remains unpaid for 3 months. The mortgagee himself cannot buy the property directly or through an agent, for a man cannot sell to 75 himself.

REMEDY FOR IMPROPER EXERCISE OF THE POWER OF SALE:- S. 69 (3)


When a sale has been made in the professed exercise of such a power, the title of the purchaser is not impeachable on the ground that no case had arisen to authorize the sale, or that due notice was not given, or that the power was otherwise improperly or irregularly exercised, but any one put to any loss by an unauthorized or improper or irregular exercise of the power, has a remedy in damages against the person exercising the power.

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Sec.73 RIGHT TO PROCEEDS OF REVENUE SALE OR COMPENSATION ON ACQUISITION: 1)Where the mortgaged property is sold owing to failure to pay arrears of revenue or public charges or rent due in respect of such property, and such failure did not arise from any default of the mortgageethe mortgagee is entitled to claim payment of the mortgage-money out of any surplus of the sale proceeds remaining after payment of the arrears, charges, deductions etc., Where the mortgaged property is acquired under the Land Acquisition Act, 1894, or any other like enactment, the mortgagee is entitled to claim payment of the mortgage money, out of the amount due to the mortgagor as compensation. Such claims shall prevail against all other claims except those of prior encumbrances, and may be enforced notwithstanding that the principal money on the mortgage has not become due .
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CHARGES
DEFINITION:- Where immovable property of one person is a) by act of parties or operation of law, b) made security for the payment of money to another, and the transaction does not amount to a mortgagethe latter person is said to have a charge on the property. All the provisions, which apply to a simple mortgage, apply to a charge. No charge can be enforced against any property in the hands of a person to whom such property is transferred for consideration and without notice of such charge. Exception:- It does not apply to the charge of a trustee on the trust-property for expenses properly incurred in the execution of his trust.
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REQUISITES OF CHARGE BY ACT OF PARTIES:1)It does not contemplate any transfer of an interest in the immovable property. 2)The property should be specified. 3)It is not necessary to use any technical terms. 4)It must be created in favour of a particular person specifically named. 5)A charge is a security for the payment of money. A mortgage is a security for the payment of debt.
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6) A charge may be created upon the wealth or property of a person. A mortgage must be executed in respect of a specified property. 7) In charge there is no covenant to pay. In a mortgage there may be a covenant to pay. 8) A charge may arise either by act of parties or by operation of law. A mortgage can only be made by act of parties. 9) In charge there is no personal liability. 10)A charge created by operation of law does not require registration. On the other hand mortgage can 80 be affected only by a registered instrument.

11) A charge created by act of parties requires registration irrespective of the amount involved. 12) A charge does not create right in rem. It is available only against a particular set of persons, who are affected with notice of charge. A mortgage gives rise to a right in rem. 13) A charge holder (by operation of law) cannot follow his security into whatsoever hands it goes. A mortgage can follow his security into whatsoever hand it goes. 14) A charge on future property is valid and operates on such property when it comes into existence. 15) A charge cannot be created on a future contingency.
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S.102 SERVICE OF NOTICE

S.103 NOTICE etc., TO OR BY PERSON INCOMPETENT TO CONTRACT: -

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CHAPTER V OF LEASES OF IMMOVABLE PROPERTY (SS.105-117)


DEFINITION OF LEASE (S.105) A lease of immovable property is a transfer of a right to enjoy such property for a certain time (express or implied), or in perpetuity, in consideration of (i) a price paid or promised, or (ii) of money (iii) a share of crops (iv) service or (v) any other thing of value, to be rendered periodically, or on specified occasions, to the transferor by the transferee, who accepts the transfer on such terms.

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S.107 LEASE HOW MADE:A lease of immovable property i) from year to year, or ii) for any term exceeding one year, can be made only by a registered instrument. In any other case i) either by a registered instrument, or ii) by oral agreement accompanied by delivery of possession. Both the lessor and lessee must execute the instrument.

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S.106 DURATION AND TERMINATION OF LEASES: 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 THE TENANCY.

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A lease of immovable property for any other purpose 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. The above statutory presumptions as to duration arise only when there is no agreement between the parties, or local usage to the contrary.
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S.6 REQUISITES OF NOTICE:-

Every notice under this section must be in writing, signed by or on behalf of the persons giving it.

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S. WAIVER OF NOTICE TO QUIT:-

S.108 (a) to (c) RIGHTS AND LIABILITIES OF THE LESSOR

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S.108 (d) to (j) RIGHTS OF THE LESSEE S.101 (k) to (q) LIABILITIES OF THE LESSEE S.109 RIGHTS AND LIABILITIES OF LESSORTRANSFEREE TERMINATION OF LEASES:(Ss.111-113)
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A lease of immovable property determines in the following eight cases:1)By efflux of the time limited thereby 2)Where such time is limited conditionally on the happening of some event-by the happening of such event 3)Where the interest of the lessor in the property terminates on, or his power to dispose of the same extends only to , the happening of any event- by the happening of such event. 4)Merger.
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5)By express surrender 6)By implied surrender 7)By forfeiture 8)On the expiration of a notice to determine the lease, or to quit the property leased, duly given by one party to the other.

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FORFEITURE OF A LEASE (Ss.111, 112,114 &115): A lease determines by forfeiture in the following cases i)Where the lessee commits a breach of an express condition which provides that on breach thereof the lessor may re-enter, or ii) where the lessee renounces his character as such by setting up a title in a third person or by claiming title in himself, or ii)Where the lessee is adjudged an insolvent and the lease provides that the lessor may re-enter on the happening of such event.
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S.112 WAIVER OF FORFEITURE S.114 & 114A- RELIEF AGAINST FORFEITURE S.116 HOLDING OVER AND EFFECT OF HOLDING OVER TENANT-AT-WILL TENANCY-AT-SUFFERENCE
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CHAPTER VII
OF GIFTS (122-129) S.122 & 123 Definition of Gift and gift how effected: Requisites of a valid Gift: 1)There should be a donor and a donee 2)The subject of the gift must be certain and existing and capable of transfer 3)The gift should be made voluntarily and without consideration. There should be a transfer on the part of the donor. 4)There should be an acceptance, by or on behalf of the donee during his lifetime. 5)The acceptance must be at the time when the donor is alive and capable of giving
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6)Therefore, it necessarily follows that the donor and the donee


must both be living. 7)When the property is immovable, there must be a registered instrument properly attested. 8) In case of movable property, there must be either a registered instrument properly attested or delivery of possession. 9)The section lays stress on the acceptance of the gift. 10)There can be no gift of future property. 11)Registration is compulsory in the case of a gift of immovable property whatever be the value of the property. 12)The gift becomes irrevocable once the deed of gift is delivered to the donee, even before its registration. 13)Once the deed is executed and the gift is accepted during the lifetime of the donor, the deed of gift may even be registered after the death of the donor. 14)An unregistered deed of gift cannot be used under the doctrine of part-performance, as the doctrine is applicable to transfers for consideration.
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VOID GIFTS: 1)Gift made for an unlawful purpose s.6 2)Gift depending on a condition, the fulfillment of which is impossible, or forbidden by law 3)Where the donee dies before acceptance s.122 4)Gift by a person incompetent to contract s.7 5)A gift comprising existing and future property is void as the latter s.124 A gift of a thing to two or more donees, of which one does not accept it, is void as to the interest, which he would have taken, had he accepted. S.125.
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Sec.127 ONEROUS GIFTS


1)Where a gift is in the form of a single transfer to the same person of several things, of which one is, and the others are not, burdened by an obligationthe donee can take nothing by the gift unless he accepts it fully. 2)Where a gift is in the 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. S.127 Onerous gift to disqualified person .
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S.128 UNIVERSAL DONEE S.126 REVOCATION OF GIFTS: A GIFT ONCE MADE IS IRREVOCABLE, EXCEPT IN THE FOLLOWING TWO CASES: 1)When the donor and the donee have agreed that on the happening of a specified event, the gift should be Suspended or revoked. 2)When the donors consent is not voluntary.
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S.129. Saving of donatio mortis causa and Mohammedan law.

GIFTS UNDER HINDU AND MOHOMEDAN LAWS

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CHAPTER VIII
OF TRANSFER OF ACTIONABLE CLAIMS (Ss.3 & 130137)
S.3 Definition: - A claim to any unsecured debt or a claim to any beneficial interest in movable property not in actual or constructive possession of the claimant.
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S.130 (1) TRANSFER HOW EFFECTED: -

RIGHTS AND LIABILITIES OF A TRANSFEREE OF AN ACTIONABLE CLAIM (Ss. 130 to 137)


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