A brief on Transfer of Property Act, 1882

Introduction 
A transfer refers to a conversion of a thing from one person to another person.
Property may be defined as anything physical or a virtual entity owned by an
individual or a group of people. A property can be transferred from one person
to another person by transferring rights, or interest, or ownership, or
possession the party can satisfy either or all the ingredients. The transfer of
property can be made in the two following ways:

First: act of the parties; 

Second: by law. 

Transfer of property is defined under Section 5 of the Transfer of Property Act,

1882. It refers to an act done by a living person conveying property to one or
more person or by himself or by one or more living persons in the present or
the future. Living people include a company, an association, or body of
individuals whether incorporated or not. 

Illustration

A is the grandson of G and A owns three estates of which he wanted to transfer

one estate to his grandpa D but he died two years ago the transfer won’t be
held valid because the transfer of property should happen between two living
persons.

Sr. Transfer
Property  Act
No  between

Transfer of property Act,

1 Immovable property Living to living
1882

Living to
2 Movable property Sale of goods Act, 1930
living 

Immovable property and Movable Indian Succession Act,

3 Dead to living
property 1925
Background of the Transfer of Property Act,
1882  
Before the advent of the British Raj system in India, Hindus, and Muslims were
governed by their personal laws for the transfer of property. When Britishers
were actively involved in the Indian Legal system they established informal
Courts in which clear and concrete law was absent as compared to the law that
was prevailing in England. Various High Court expressed the need for creating
specific acts related to the transfer of property. As the principle of a good
conscience, equity, and justice was confusing and created various uncertainties,
the privy council noted the uncertainties and also told the authorities to take
immediate action.

So, the first commission was appointed by the British Queen Elizabeth II to
remove uncertainties. On matters related to the transfer of property. The draft
was sent in India after certain amendments were introduced in the legislative
Council in 1877. It was then sent to the selection committee but it was reversed
due to the public criticism. The Bill was redrafted by the Second law
commission. Some of the provisions were borrowed from English law on real
property, the Law of Conveyancing and Property Act, 1881. Mostly the law was
shaped in such a manner that suits the Indian population and can be easily
understood by a non-professional judge. 

Despite various amendments made by the Second Commission, there was an

expansion of the law. Therefore a special committee was appointed to make the
amendments in the prevailing act. So various amendments were made in the
act to expand its scope and correct the existing errors.

Important concepts highlighted in the Act

 Immovable property: According to the General Clauses Act,
1897 immovable property includes land, benefits arising out of the
land, things that are attached to the land. Under transfer of property,
the immovable property can be defined as all property are immovable
property other than standing timber, growing crops, or grass. 
Narayana Sa vs. Balaguruswami (1923) 

In this case, large artillery was fixed for blowing liquor. The Court held that it
would be considered as movable property if it was fixed in the land, not with an
intention for beneficial enjoyment. 
  Mortgage debt: After the amendment of 1900 mortgage debt was
excluded from actionable claims. In Peruma animal vs. Peruma
Naicker, Wallis C.J.held that before 1900 mortgage debts could be
transferred as actionable claims, it was excluded from the actionable
claims, the legislature intended that the mortgage debt must be
transferred in mortgagee’s interest through a registered instrument.
 Instrument: According to the transfer of property Act, 1882
instrument refers to a non-testamentary instrument. It acts as
evidence of the transfer of property between living parties. According
to the legal dictionary, an instrument refers to a formal legal
document. 
 Attested: It refers to a formal document signed by a witness. The
transferors of the property are known as the executant. The
amendment act was introduced in 1926 which mentioned that there
must be two or more witnesses who must sign the document in
presence of the executant not necessarily at the same time but they
shouldn’t be the party to the transfer. 
 Registered: According to the transfer of property Act, 1882 registered
refers to any property registered where the act is operative. One must
comply with various procedures of registration. 

1. The description of the property should be mentioned.

2. Avoid fraud. 
3. Deeds should be presented by a competent person. 
4. The property must be registered in the same territory where the
registered office is situated. 

 Actionable claims: A claim to any debt, other than the debt secured
by mortgage of immovable property or by hypothecation or pledge of
movable property or to any beneficial interest in a movable property or
to any beneficial interest in movable property not in the  possession,
either actual, or constructive possession of the claimant which the civil
courts recognize as affording grounded of relief, whether such debt or
beneficial interest be existent, accusing, conditional or contingent.
Illustration: A has given his house to B for rent but B hasn’t paid the rent
because this would amount to an actionable claim. 

 Notice: Notice refers to knowledge of the fact. The person has

knowledge of facts about various circumstances. According to the
Transfer of Property Act, 1882 it prescribed two kinds of notices 
Actual or implied notice: The person having actual knowledge about a particular
fact. 
Constructive notice: The knowledge of the fact is obtained through
circumstances.  

Essential elements of the Transfer of Property

Act, 1882
 To be a living or juristic person: For a transfer of property, there
must be a transfer between living or a juristic person.
In Shiromanigurudwara Prabhakar committee, Amritsar v. Sri Somnath
Dass (2000) the court defines a juristic person which can be an
individual firm, corporate, company society, association, but not a
partnership. Anyone who can sue or can be sued would satisfy this
requirement. 
 Transfer through Conveyance: Conveyance of property can be
either done in the present or in the future. It is necessary to ensure
nothing is transferred before the title. 
 The Property must be transferable: According to Section 6 of
transfer of property Act, 1882 there are properties which cannot be
transferred:

1. 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. 
2. The mere right to re-entry for breach of a condition subsequent cannot
be transferred to anyone except the owner.
3. The easement right cannot be transferred. 
4. The interest of the property restricted in its enjoyment to the owner
cannot be transferred. 
5. Political pensions, public office, the salary of the public officer cannot
be transferred. 
6. The right to sue cannot be transferred. 
7. Stipends to military, navy or the airforce, political pensioners, and civil
pensioners cannot be transferred. 
8. No transfer cannot be made as opposed to the natural interest or if the
object or the consideration is unlawful then the transfer cannot be held
valid. 
9. The right to future maintenance cannot be transferred.
 10. Tenants having an untransferable right to occupancy, the farmer of
an estate in respect of which default has been made in paying revenue
or lessee of an estate under the management of the court of wards, to
assign his interest as the tenant, farmer, or lessee.   

 Transfer of property must be done by a competent person: For a

valid transfer, it is necessary that the property transferred should be of
a sound mind, should not be intoxicated, must be a major or he is not
a person disqualified by law cannot enter into a contract of transfer of
property with another person. 
 The transfer should be made in a prescribed form: The transfer of
property need not be in  be made in writing however certain property
to transfer then it must be in writing:

1. Sale of movable property value more than a hundred rupees. 

2. Sale of intangible must be in a written format. 
3. All mortgages which are more than a hundred rupees should be
transferred in a written form.  
4. The transfer of actionable claims must be in a written form. 
5. A gift in a form of immovable property. 
6. Lease of immovable property exceeding more than one year. 

 The rule against perpetually: It is necessary that the property must

be transferred during the lifetime of an individual perpetuity rule
should not be followed during the time of transfer of property. 
 Property cannot be transferred to an unborn child:  A property
cannot be transferred to an unborn child necessary to consider that
while transferring the interest of the property person should be above
the age of 18 years.
 Conditional transfer of property: Under Section 25 of the transfer
of property Act, 1882, the property can be transferred complying to
the condition mentioned. If the condition becomes impossible,
forbidden by law, opposed to public policy, or is immoral the transfer
would be held void. 
Illustration: A is interested in purchasing B’s property but B sets a condition
that A in order to purchase B’s property has to kill C here the transfer is through
unlawful act, therefore, the transfer would be held void. 
Kinds of transfer under the Transfer of
Property Act, 1882
1. Sale of immovable property: There is a transfer of ownership from
the buyer to the seller in exchange for the price. Delivery of tangible
property from the seller to the buyer. 
2. Mortgage of immovable property: The property gets transferred
from the buyer to the seller in the form of a mortgage where the
immovable property is mortgaged to secure a loan. The mortgagor has
to pay the principal loan along with the interest to release the
immovable property from the mortgage. 
3. Leases of immovable property: The possession of the property is
being transferred from one person to another person for a fixed price
in this scenario there is no transfer of ownership. 
4. Exchange of immovable property: When two persons mutually
decide to transfer immovable property it would be referred to as an
exchange of property. 
5. Gift of immovable property:  According to the transfer of property
Act, 1882,  gift refers to a transfer of movable or immovable property
violently or without the consideration, by one person that is donee, to
donor transfer is accepted by and on behalf of the donee.  

Features of Transfer of Property Act, 1882 

 The preamble of the transfer of property Act lays down that it is related
to the transfer of property by the act of the properties.
 The transfer of property act, 1882 provides a uniform and a clear law
concerning the transfer of movable property from one living person to
another living person by the act of parties. 
 The Transfer of Property Act, 1882 is an extension of the Indian
Contract Act,1872 because the contract act was recognized as an
inexhaustive code. 
 The transfer of property law is not a copy of the English transfer of
property laws that was enacted based on socio-economic conditions of
the country.  
 The transfer of property Act, 1882 cannot be considered as totally
exhaustive; it covers the transfer of immovable property from the act
of parties. 
  Transfer of property is subject to the concurrent list that provides
power to both the state legislature and the parliament to pass laws
related to the matter of transfer of property.
 The act covers five types of transfer of immovable property they are as
follows: a) Mortgage b) gift c) sale d) actionable claims e) lease.
 The transfer of property Act, 1882 is a law that applies lex-loci to all
people living in that jurisdiction, not like personal laws that differ from
person to person. 
 The transfer of property Act, 1882 is governed by various principles
like justice, equity, and good conscience. 
 Initially, at the time of implementation, the act didn’t apply to the
State of Bombay, Punjab, and Delhi as because they had their own acts
related to property matters. Currently, the transfer of property act
doesn’t apply in Punjab; it complies with the rule of good conscience,
equity, and justice. 
 Transfer of property Act, 1882 highlights the provision of inter-vivos
parallel to the existing laws relating to the testamentary and interstate
transfer.
 The transfer of property act, 1882 is a general law and therefore it
cannot prevail over the special laws passed by the parliament. 
 Under the Transfer of Property Act, 1882 it mentions that absolute
conditional restraint is void and partial conditional restraint on the
transfer of property is valid.  

Conclusion 
The Act was introduced with an intention to create a comprehensive Act which
provides information about the transfer in a very simple language during the
time of introduction it was not complete and had various uncertainties. It has
gone through various amendment processes and the act has proved it time and
again about its effectiveness. In India, many more such acts like transfer of
property Act, 1882 are still in need to be implemented.