GENERAL PRINCIPLES OF TRANSFER OF PROPERTY ACT

In the year 1882, the Transfer of Property Act was enacted. It only applies to transfers made by parties, not through the operation of law. This Act governs the transfer of property inter vivos, or between living individuals. It covers both mobile and immovable property transfers, but the majority of the legislation solely applies to immovable property transfers.

The following are the general principles of property transfer:-

1.) The property must be able to be transferred. (Section 6)– It speaks precisely about what can be transferred. Except as otherwise allowed by this act or any other legislation in force at the time, property of any sort may be transferred.

2.) Property Alienation Restraints. (Section 10)– Any restriction or limitation that ‘absolutely’ prevents the buyer or transferee from alienating the property is a void condition, according to Section 10 of the Act. However, there are two exceptions to this rule:
a.) in circumstances of lease where restraint is for the benefit of the lesser or the estate leased out; and
b.) When the property is passed to a woman who is not a Hindu, Muslim, or Buddhist under the condition that she does not have the ability to transfer or create any encumbrance in the sale of property transferred to her during her marriage. It is worth noting that Section 10 only bans absolute alienation restraints; partial restraints are acceptable.

3.) Transfer to a Preborn Child (Section 13)– A transfer to an unborn person is prohibited under Section 13 of the Transfer of Property Act of 1882. A prior interest created in favor of a living person must always come before an interest created in favor of an unborn person. The transfer to an unborn person must be complete, with no subsequent transfers from him to anyone else.

4.) Perpetuity Rule (Section 14)– No transfer of property can create an interest that will take effect after the lives of one or more persons living at the time of the transfer, and the minority of some person who will be alive at the end of that period, and to whom the interest created will belong if he reaches full age.

5.) Vested and Contingent Interest (Section 19 & 21)– According to Section 19 of the Transfer of Property Act of 1882, a vested and contingent interest is one that is created in favor of a person without regard to time or the occurrence of a specific event. The person with a vested interest does not receive possession of the property; instead, he or she has the expectation of receiving it when a certain event occurs.

It is an interest created in favor of a person on the condition of the occurrence of a specified uncertain event, according to Section 21 of the Transfer of Property Act, 1882. The person with the contingent interest does not receive possession of the property, but rather has the expectation of receiving it if the event occurs, but will not receive it if the event does not occur because the condition is not met.

6.) Conditional Transfer (Section 25)- This refers to any transfer that is contingent on the other party fulfilling a condition for the transfer of property.

7.) Priority Doctrine (Section 48)– This rule is based on the maxim “Qui prior est tempore potior est jure,” which roughly translates to “He who is prior in time is superior in law.” which means “subsequent dealings by the transferor of the same property cannot prejudice the rights of the transferee of the same property (prior transferee).”

When a transferor distributes the same property to many transferees, each transferee inherits the property’s rights from the previous transferee. It also follows the idea that no one can transfer a title to which he is not entitled.

8.) Ostensible owner's transfer (Section 41)– Transfer by ostensible owner: “Where a person is the ostensible owner of immovable property and transfers the same for consideration with the consent, express or implied, of the persons interested in such property, the transfer shall not be voidable on the ground that the transferor was not authorized to make it if the transferee has taken reasonable precautions to ensure that the transferor is not authorized to make it.

According to Section 41, the following are the most important things to remember:
A.Immovable property has been transferred.
B.Ostensible Owner is the one who makes the transfer.
C.The Real Owner’s consent must be acquired, and it may be expressed or implied.
D.The transfer is being made for the purpose of consideration.
E.The transferee acted with integrity.
F.The transferee (Third-party) has used reasonable diligence in determining the transferor’s authority to make the transfer.

9.) Estoppel Rule (Section 43)– The theory of estoppel feeding the grant is founded on the principle “nemo dat quod non-habet,” which means “no one may give to another what he himself does not possess.”

“Where a person fraudulently or erroneously embodies that he is authorized to transfer certain immovable property and expresses to transfer such property for consideration, such transfer shall, at the option of the transferee, operate on any interest that the transferor may acquire in such property at any time during the term of the contract of transfer, such transfer shall operate on an interest that the transferor may acquire in such property at any time during the term of the contract of transfer, such transfer shall operate on an interest that the transfer”

10.) Lis Pendens Doctrine (Section 52)– During the pendency of any suit or proceeding in any Court having authority within the limits of India, excluding the State of Jammu and Kashmir, or established beyond such limits by the Central Government, in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit.

The essentials of the Lis Pendens theory are:
A.Pendency of a suit or action.
B.Pending in a competent jurisdictional court.
C.It is an immovable property right that is concerned.
D.There must be no collusion in the lawsuit or proceeding.
E.Disputed property must be transferred.
F.The transfer has an impact on the rights of the other party.

11.) Fraudulent Transfer (Section 53)– A transfer is required to trigger this section. Immovable property must be transferred. The transfer must be genuine and result in a vested title in the third party. This clause does not apply to fictitious transfers. The transferor retains the true owner of the property in a bogus transfer. As a result, in order to have the transfer set aside under section 53, it must be proven that the transfer was genuine and not a sham.

12.) Part-Performance Rule (Section 53A)– The doctrine of part performance forbids a transferor from benefiting from non-registration of documents on the condition that the transferee has completed his share of the contract and, as a result of that performance, has gained possession of some part of the property.

ENDNOTES: https://blog.ipleaders.in/brief-transfer-property-act-1882/

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