Aligarh Muslim University Mallapuram Center, Kerala
Aligarh Muslim University Mallapuram Center, Kerala
GCT-1
SECTION – 5 OF TRANSFER OF
PROPERTY ACT
Page Number
i
Table of Contents
Topic Covered
o
o The Transfer of Property Act, 1882: Bare Provision
1
o Transfer of Property: An Introduction 1
o Living Persons 3
o In Present of In Future 5
o To Himself
6
o Family Settlement
6
o Compromise 7
oPartition 8
oSurrender 9
oRelease 9
o Relinquishment
10
oCharge
11
oBibliography.
ii
Table of Cases
Balkrishna v. Raghunath 7
Gobinf v. Dwarkanath 11
Jones v. Skinner 2
Kalka v. Jaswant 9
Mohendra v. Kali 5
iii
Morati v. Krishna 9
Naranbhai v. Suleman 6
Narasimha v. Venkatalingum 4
Narasingarji v. Panaganti 2
Reddiar, MP v. A. Ammal 7
Sarin v. Poplai 8
iv
The Transfer of Property Act, 1882
Bare Provision of the Act
Chapter II
The word “transfer” is defined with the reference to the word “convey”. This word in English
Law in its narrower and more usual sense refers to the transfer of an estate in land; but it is
sometimes used in a much wider sense to include any form of assurance inter vivos.
The word „conveys‟ in Section 5 of the Indian Act is used in the wider sense referred to
above. Transferor must have an interest in the property. He cannot sever himself from it and
yet convey it.3 A lease comes within the meaning of the word „transfer‟.4
The words „living person‟ exclude transfers by Wills and the Will only operates after the
death of the testator.5
In Ma Kyin Hone v. Ong Boon Hock,6 a single Judge of the Rangoon High Court said that
the word „transfer‟ is a word of very wide meaning and includes every transaction whereby a
party divests himself or is divested of a portion of his interest, that portion 5subsequently
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vesting or being vested in another party. This meaning of „transfer‟ is supported by the
aforesaid definition in the Act.
The Legislature has not attempted to define the word „property‟, but it is used in this Act in
its widest and most generic legal sense. 6 Section 6 says that „property of any kind may be
transferred‟, etc. Thus an actionable claim is property; 7 and so is a right to a reconveyance of
land.8 Property is not only the thing which is the subject matter of ownership, but includes the
dominium or the right or ownership or of partial ownership, and as Lord Langdale said it is
the most comprehensive of all terms which can be used inasmuch as it is indicative and
descriptive of every possible interest which the party can have.9
It may be noted that property is essentially a bundle of rights and interests. When a property
is transferred, there may be transfer of all the rights in that property or only some of it. All the
rights in the property signify ownership or absolute interest. Only some rights or interests in a
property would mean partial or limited interest. In Sunil Sidharthbai v. Commissioner of
Income Tax,10 the Supreme Court rightly observed that in general, transfer of property means
passing of a right in the property from one person to another. In one case there may be
passing of entire bundle of rights from transferor to transferee, but in another case there may
be transfer only some of such rights. This, if A makes a gift of his house to B, there is transfer
of absolute interest of the house. It is a transfer of „property‟. On the other hand, if A
transfers the right of enjoyment of his house to B for a certain period it is called a
„lease‟. It is transfer of only partial interest in the house but it is also a transfer of
„property‟.11
Living Persons
The words “living person” can only mean a human being, who is alive and conveys his
property to another person. A person, who disposes of his property by will, does not convey it
3 See Mulla, The Transfer of Property Act, 9th Ed., LexisNexis Butterworths, 2004, p. 73.
4 Krishna Kumar Khemka v. Grindlays Bank PLC, AIR 1991 SC 899.
5
See topic Living Persons at p. 3.
5 AIR 1937 Rang. 47.
6 Bansigopal v. V.K. Banerji, AIR 1949 All. 433.
7 Rudra Perkash v. Krishna, (1887) 14 Cal. 241, 244.
8 Narasingarji v. Panaganti, AIR 1921 Mad. 498.
9 Jones v. Skinner, (1835) 5 LJ Ch. 87, 90.
10 AIR 1986 SC 368.
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as a living person because the transfer takes effect after his death. There is no present
transfer.12
The words are use d as the transfer under the Act must be a deed intra vivos and not by will.
According to the Section, both the transferor and the transferee must be living, which
includes under Section 13 a person not in existence at the date of the transfer 13. The
explanation to the section further includes in the phrase a company or association or body or
individuals whether incorporated or not. So does also “person” according to the General
Clauses Act, 1897.14
The expression „inter vivos‟ refers to transfer or conveyance of the property from one living
person to another. Thus it is an act between two living persons who are parties to such
transaction, which takes place between two. That also is the trust of Section 5 of the Transfer
of Property Act. It is significantly more clear and explicit when it says that “transfer of
property” means „an act by which is living person conveys property to one or more other
living persons.‟
A deity is not included in the definition of person in Section 5 of the Act. 17 If a deity is not a
person, the provisions of the Act including Section 3 do not govern a transfer of property
made in favor of a deity.18
An idol is a juristic person capable of holding property, 20 but it is not a „living person.‟ An
idol not being a living person, a dedication of land to an idol does not fall within the terms of
11 Sinha, Dr.R.K., The Transfer of Property Act, 11 th Ed., Central Law Agency, Allahabad, 2010, p. 53.
12 Row, Sanjiva, The Transfer of Property Act, 4 th Ed., Vol. 1, The Law Book Company (P) Ltd., Allahabad, 1989.
p. 113.
13 Section 13 reads “Transfer for benefit of unborn person. – Where, on transfer of property, an interest
therein is created for the benefit of a person not in existence at the date of the transfer, subject to a prior
interest created by the same transfer, the interest created for the benefit of such person shall not take effect,
unless it extends to the whole of the remaining interest of the transferor in the property.”
14 Vakil, Darashaw J., Commentaries on the Transfer of Property Act, 2 nd Ed., Wadhwa and Company Nagpur,
New Delhi, 2004. p. 93.
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Section 12219 and need not be made in writing or by a registered instrument under Section
12320 of the Act.21 It has also been said that an idol is only the symbol of the deity and that it
would be contrary to the Hindu religion that a deity make an acceptance of worldly goods 22 as
discussed in the case below.
In Bhupati Nath v. Ram Lal,23 a full bench of the Calcutta High Court dealing with a Hindu
will, held that the principle of Hindu Law which invalidates a gift other than to a sentiment
being capable of accepting it does not apply to a bequest to the trustees for the establishment
of an image and the worship of a Hindu deity after the ancestor‟s death nor does it make such
a bequest void. The Full Bench, after examining the Hindu texts and authorities observed that
according to the strict Hindu juridical notion there can be no gift in favor of the Gods for in
the case of deities there cannot be any acceptance and therefore necessarily any gift.
Court has not been regarded as „living person‟ therefore; transfer made by the order to the
Court is not a transfer of property within the meaning of Section 5 of the Transfer of Property
Act.24
In Present or in Future
The words “In Present of in Future” mean that the conveyance may be one which takes effect
immediately on execution or at some distant date, that is to say, the interest of the transferee
arises immediately on the execution of the document of at the date fixed by the parties. In Re
15 Usha Rani Kundu v. Agradut Sangha and other, AIR 2006 (NOC) 911 Cal.
16 Sohoni, Vishwas Shridhar, Transfer of Property Act, Premier Publishing Company, Allahabad, 2008. p. 66.
17 Ashrafi Devi v. Prem Chand, AIR 1971 All. 457 (464).
18
Ibid.
20
Pramatha Nath v. Jai Indra Bahadur Singh, (1919) 46 IA 228; 42 All. 158; AIR 1919 PC 55.
19 Section 122 reads “Gift Defined. – Gift is the transfer of certain existing movable or immovable property
made voluntarily and without consideration, by one person, called the donor, to another, and accepted by or
on the behalf of the done.” “Acceptance when to be made. – Such acceptance must be made during the
lifetime of the donor and while he is still capable of giving. If the done dies before acceptance, the gift is void.”
20 Section 123 reads “Transfer how effected. – For the purpose of making a gift of immovable property, the
transfer must be effected by registered instrument signed by or on behalf of the donor, and attested by at
least two witnesses. For the purpose of making a gift of movable property, the transfer may be effected either
by a registered instrument signed as aforesaid or by delivery. Such delivery may be made in the same way as
goods sold may be delivered.”
21 Narasimha v. Venkatalingum, (1927) Mad. 687.
22 th
See Mulla, The Transfer of Property Act, 9 Ed., LexisNexis Butterworths, 2004, p. 81.
23 (1910) 37 Cal. 128.
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Mahomed Hasham & Co.,25Martin, J., in holding that Section 5 did not apply to the
Presidency Town Insolvency Act, observed: “I am not absolutely sure what the words „in
presenter in future‟ refer to. I should have thought grammatically they refer to property. In
Shumsuddin v. Abdul Husein,26 Jenkins, CJ., remarked, “there is no definition in the Act of
„convey‟ or of „property,‟ but It is to be noticed that a transfer means a conveyance of
property not only in present but also in future.27
A transfer of property may take place not only in present, but also in the future, 28 but
the property must be in existence. The words „in present or in future‟ qualify the word
„conveys‟, and not the word „property.‟29 A transfer of property that is not in existence
operates as a contract to be performed in the future which may be specifically enforced as
soon as the property comes into existence.30
• A makes a gift of his property to B. He does not mention to when B shall get
the property and also does not law down any condition. The transfer is present
and B gets the property with immediate effect.
• A transfers his property to B for life and then to C. The transfer in favor of B
is present (although he gets only life-interest) but the transfer in favor of C is
future transfer.
• A makes a gift of his watch to B provided that B gets first division in the next
examination. Here, although the gift has been declared today but it shall take
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effect only if B gets first division. Such transfers are called conditional
transfers.
To Himself
A transfer of property under Section 5 of the Act requires two „living persons‟, the transferor
and the transferee. One cannot transfer a property to himself. But, one can transfer a property
to himself in some other capacity. The words „to himself‟ were added to this section by the
Amending Act, 1929 to include in the transfer of property also a case where a person makes
any settlement of his property in a trust and appoints himself as the sole trustee. 32 Here, the
transferor and the transferee are physically the same person but as transferor he has the legal
status of settlor whereas as transferee his legal status is that of trustee.
Transfer of property as contemplated under this Act carries the same meaning throughout
this enactment as it has been defined in Section 5. This definition has limited the scope of the
term „transfer of property‟. Unless the above mentioned essential elements are present in
transaction, it cannot be regarded as a transfer of property.33
Family Settlement
Family settlement or family arrangement is not a transfer of property. In a joint family
property all the members have their specific shares but they are not separated and are held
conjointly by all of them. When a family settlement takes place, the already existing specific
shares of the members of the family are defined and separated in order to avoid any possible
disputes. Thus, in a family settlement there is a mutual agreement between the members of a
family to hold their respective shares separately. It simply acknowledges and defines the title
for each member.34 In Sadhu Madho Das v. Pandit Mukund Ram,35 the Supreme Court
observed that family arrangement is based on the assumption that there is an antecedent title
of some sort in the parties and the agreement acknowledges and defines what that title is.36
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Supreme Court held that such memorandum agreed between the family members can be
treated as „family settlement‟ and the Court cannot interfere with this. The Court will not
“easily disturb it.” Accordingly it was held as family settlement and not as a transfer of
property.
It is not necessary that a family settlement should be restricted to the members of the family
upon a particular degree. Such settlements can take place not only among the heirs of a
particular class, they can include persons outside the preview of succession.38
In a family settlement since there is no „creation of new title or interest in favor of any
member, there is no conveyance, therefore, it is not a transfer of property.
Compromise
A compromise of doubtful rights is not a transfer but is based on the assumption that there
was an antecedent title of some kind in the parties which the agreement acknowledged and
defined.39 The position would be different if such a compromise also transferred properties to
a person who has neither a pre-existing title nor a claim to such a title.40
In other words compromise is not a transfer of property. Compromise means agreement for
the settlement of doubtful claims between the parties in respect of some property. Like family
settlement, here too the titles or interests of the parties are antecedent or already existing; the
compromise deed simply defines them.41 Since there is no conveyance in compromise it is not
a transfer of property.
Partition
A partition of property is not a transfer of property, but is analogous to an exchange 42. In
other words partition means separating the parts of co-owned property. If in a property there
are several co-owners having, under the law, their respective interests but the whole property
is neither used nor enjoyed by them separately then, after the partition each member gets
33 Sinha, Dr.R.K., The Transfer of Property Act, 11 th Ed., Central Law Agency, Allahabad, 2010, p. 54.
34 Tek Bahadur v. Devi Singh, AIR 1966 SC 292.
35 AIR 1955 SC 481
36 Sinha, Dr.R.K., The Transfer of Property Act, 11 th Ed., Central Law Agency, Allahabad, 2010, p. 55.
37 AIR 2006 SC 3304.
38 Zaheda Begum v. Lal Ahmed Khan, AIR 2010 AP 1.
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merely the separate right of enjoyment 43. Accordingly it has been held that partition is not
really a process by which a joint enjoyment is transformed into an enjoyment severally, and
no conveyance is involved in the process as the conferment of a new title is not necessary. 44 It
simply effects a change in the mode of enjoyment of property but it is not an act of conveying
property from one living person to another. 45 In Mohar Singh v. Devi Charan,46 the Supreme
Court explained the legal nature of a partition in the following words:
“Partition is not actually a transfer of property, but would only signify the surrender of a
partition of a joint right, in exchange for a similar right from the other co-sharer or
cosharers.”
Mookharjee, J., in Atrabanessa Bibi v. Safutullaah Mia,47 said that partition signifies the
surrender of a portion of a joint in exchange for a similar right from the co-sharer.
In Sarin v. Poplai,48 Gajendragadkar, CJ., has observed that „the true effect of partition is
that each coparcener gets specific property in lieu of his undivided right in respect of the
totality of the property of the family.‟
For the purpose of determining whether the document is a partition deed, it is the contents of
the document that are to be taken in to consideration and not the nomenclature alone. There is
no recital in the whole order agreement to the effect that it was recording the agreement of an
earlier partition which had already taken place. The agreement in question purported to
create, declare, assign, limit and extinguish right and interest over immovable properties. It
was held that the document required to be duly stamped and properly registered.49
A father partitioned his property among his three sons. The agricultural land was given to
one of them, the plaintiff in the case. The pucca house was given to the two others. They
were already in possession of the property respectively as distributed under the partition and
had been making improvement in their respective shares. Thus they had been acting on the
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family settlement. They had become bound by it. The Court said that it was immaterial that
the mutation of the agricultural land was in the name of all the three sons.50
Surrender
Surrender is not a transfer of property as defined in the section. 51 Surrender means merging
of a lesser interest with a greater interest in such a manner that the greater interest is not
enlarged. Surrender is therefore falling of lesser estate into greater. For example, A is
landlord and B is his tenant. A as landlord has ownership of the house. Ownership or absolute
interest is a greater interest. B as a tenant has also an interest in A‟s house but B‟s interest is
lesser interest because it is limited only to the right of enjoyment. Now, if B vacates the house
before expiry of the term of tenancy, it would amount surrendering of his right of residence.
Here, the lesser interest, namely the right of residence, which was away from the absolute
interest of the landlord during tenancy, comes back to ownership. There is no creation of any
new title or interest in favor of the landlord. Thus surrender by a tenant to the landlord 52 or by
a widow to the reversioners56 has not been regarded as a transfer of property.
Release
Release is a transfer of property. Is a larger interest falls into a smaller interest in such a way
that smaller interest is enlarged then, for the holder of the smaller interest there is creation of
a new title or interest. Since some new titles or interest are added to transfer of
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property.53 Where a person in whose favor the “release” is executed gets rights by virtue of
Relinquishment
Relinquishment is not alienation,57 unless intention to transfer is found to exist, as when it is
in favor of a person having no interest. 58 A registered instrument styled as a release deed
releasing the right, title and interest of the executant in the proprietary in favor of the release
for valuable consideration may operate as a conveyance.59
In other words, relinquishment means giving up of one‟s rights or interests. Its effect is
extinction of one‟s rights in a property; there is no intention that the person relinquishing his
interest is conveying that interest in favor of another person. Relinquishment is therefore, not
a transfer so that it may amount to a transfer of property as defined in Section 5 of the Act.64
53 Official Assignee, Madras v. Tehmina Dinshaw Tehrani, AIR 1972 Mad. 187.
54 Mulla, Transfer of Property, 5th Ed., p. 51. Cited in Sinha, Dr. R.K., The Transfer of Property Act, 11 th Ed.,
Central Law Agency, Allahabad, 2010, p. 57.
55 (1975) 1 MLJ 236.
56 AIR 2003 AP 498.
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Charge
Charge is not a transfer of property. Charge is created on a property for securing a
payment out of that property. When the property of a person is charged for securing certain
payments e.g. maintenance, it is simply securing „personal obligation‟ out of the property. A
charge is, not transfer because the only right created under it is a right to payment out of the
property subjected to the charge.60
57 Provident Investment Co. v. Income Tax Commissioner, AIR 1951 Bom. 95.
58 Kuppuswami Chettiar v. Arumugam, (1967) 1 SCR 275, AIR 1967 SC 1395.
59 Thayyil Mammo & Another v. Ramunniram & Another, AIR 1966 SC 337.
64
See supra 62.
60 Gobinf v. Dwarkanath, (1908) 35 Cal. 837.
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Bibliography
• Mulla, The Transfer of Property Act, 9th Ed., LexisNexis Butterworths, 2004.
• Nandi, N., The Transfer of Property Act, 1882, 2 nd Ed., Dwivedi Law Agency,
Allahabad, 2010.
• Row, Sanjiva, The Transfer of Property Act, 4th Ed., Vol. 1, The Law Book Company
(P) Ltd., Allahabad, 1989.
• Sinha, Dr.R.K., The Transfer of Property Act, 11th Ed., Central Law Agency,
Allahabad, 2010.
• The Transfer of Property Act, 1882, Bare Act, Universal Law Publishing Co. Pvt.
Ltd., New Delhi, 2010.
• Vakil, Darashaw J., Commentaries on the Transfer of Property Act, 2 nd Ed., Wadhwa
and Company Nagpur, New Delhi, 2004.
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