S- 9 Trfr of Prop Act(Mktg a- X201) 20 Jan 10

8/9/2019 S- 9 Trfr of Prop Act(Mktg a- X201) 20 Jan 10

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BUSINESS LAWS

SYMBIOSIS INSTITUTE OF

BUSINESS MANAGEMENTPune


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BUSINESS LAWS

Prof. Bala

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Session 8

The Transfer of Property Act 1882

Presentation on 6.1.201011.45 to 13.00 Hr.

Marketing A - X-201


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BUSINESS LAWS

Agenda

1 Recap

The Negotiable Instruments Act 1881

2 Days discussion on



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Why this Act is importantTransaction involves considerable amount of

money Property consists of permanent structure

linked with the government land records Land records 7 /12 extracts index II to

tally with the records Agricultural vs. commercial aspect Rights of the minor after attaining majority

when property is sold especially by Karta ofHUF

Boundaries / demarcation etc.


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The Transfer of Property Act 1882The Act consists of

8 chapters with

137 sections and deals with sale / purchase / mortgage / lease /

exchange and gift and

finally it ends up with actionableclaims.


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Contents of The Transfer of

Property Act 188

2Chapter Topics

1 Preliminary

2 Transfer of property by act of parties3 Sale of immovable property

4 Mortgage of immovable property & charges

5 Lease of immovable property

6 Exchanges

7 Gifts

8 Actionable claims


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Covers Transfer of property between two living persons

Kinds of transfer of property

- sale of property,

- lease or renting of property,- mortgage of property,

- gifting property and

- exchange of property.

Property transactions generally involve huge amounts ofmoney and so, it is advisable to know the relevant laws and

procedures so that proper precautions could be taken.


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2Contracts relating would be governed by The

Indian Contract Act of 1872

The chapters and sections of this act whichrelate to contracts shall be taken as part of theIndian Contract Act 1872

Applicability of Indian Registration Act 1908

And section 54, paragraphs 2 and 3, 59, 107and 123 shall be read as supplemental toIndian Registration Act 1908


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Immovable propertyDoes not include

Standing timber, growing crops or

grassRegistration

Registered in any part of the

territories to which this Act extendsunder the law


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Immovable propertyAttached to the earth

Rooted in the earth as in the case of

trees and shrubs Embedded in the earth, as in the case

of walls or buildings or

Attached to what is so embedded forthe permanent beneficial enjoymentof that to which it is attached


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Transfer of property by act of

parties (Ss6

to53)

Transactions between two Livingpersons (includes company,association, body of individuals-incorporated or not) Transfer of aninterest

What could be transferred and

What cannot be transferred

Persons competent to transfer

Transfer by operation of law


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Transfer with certain conditions /

contingent transfers Transfer with certain conditions

Transfer of contingent on happening

or specified uncertain eventExample

A transfer property to B for life andafter B to C and D equally to be

divided or to the survivor of them. Cdies during the life of B. D survives B.At Bs death the property passes to D


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Conditional transfers

Example

A lease a farm B on condition that he

shall walk 100 miles in an hour.The lease is void

A gives Rs. 4 lacs to B on condition

that he shall marry As daughterC

-at the date of transfer C was dead

The transfer is void


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Example

A transfers Rs. 4 lacs to his niece C if

she will desert her husbandThe transfer is void

A transfers Rs. 4 lacs to B on

condition that he shall murderC

The transfer is void


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Example

A transfers Rs. 5 lacs to B on condition heshall marry with the consent ofC, D and E.

E dies. B marries with the consent ofC andD.

B is deemed to have fulfilled the condition

Same example. B marries without the

consent ofC, D and E but obtain theirconsent after the marriage.

B has not fulfilled the condition


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Example

A transfers property to his wife; but in caseshe should die in his life time, transfers toB that which he had transferred to her. Aand his wife perish together; undercircumstances which make it impossible toprove that she died before him.

This disposition in favour of B does not takeeffect.


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Sale of transfer of property

(Ss54 to

57)

Transactions between two Livingpersons (includes company,association, body of individuals-incorporated or not) Transfer of aninterest

What could be transferred and

What cannot be transferred

Persons competent to transfer

Transfer by operation of law


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Sale of transfer of property

(Ss54 to

57)

Sale is a transfer of ownership inexchange for a price paid or promisedor part paid and part promised.

Sale how made

- registration and

-possession handing over

Contract for sale Rights and liabilities of buyer and

seller


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Rights and liabilities of seller

(S.55

) Disclosure any material defect Provide examination of documents To answer all queries to his best On payment execute the document proper time and

place Between contract of sale and delivery take care of

the property Deliver possession to desired person on request of

buyer To pay all charges till the property was with him It is the presumption that seller always had right to

deal with the property and transfers his right to thebuyer for a price


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Rights and liabilities of buyer

(S.55

) Disclosure if he is aware of any sellers interest

To pay the purchase money

When property passes on then to bear all lossarising from the destruction, injury or decrease invalue of the property not caused by the seller

To pay all the charges from day the property passeson to the buyer

Buyer is entitled for all benefit of / any improvementin / increase in value of the property and to the rents

/ profits etc. Provide examination of documents Charges on property ----- terms of contract


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Mortgages and charges

(Ss58

to 104) What is mortgage?

Transfer of an interest

For securing payment moneyadvanced or

To be advanced by way of loan

An existing debt or future debt or

The performance of an engagementwhich may give rise to an pecuniaryliability


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Types of mortgage Simple mortgage (possession

delivered)

Mortgage by conditional sale Usufructuary mortgage

(proceeds used for appropriation)

English mortgage ( transfer and re-transfer)

Mortgage by deposit of title deeds


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Rights and liabilities of mortgagee To foreclosure / sale

To bring suit

Sue for mortgage money

Power of sale when valid

Appointment of receiver

Renewal

Right to proceeds of revenue sale /compensation on acquisition

Pay the earlier mortgage charges in case ofsubsequent mortgage


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Rights and liabilities of mortgagor To redeem Re-transfer- owner to third party as

required

Inspection / production of documents Redemption separately or simultaneously

in case more than one property To recover possession Accession to mortgaged property Improvements to mortgaged property Renewal Implied contracts


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Leases of immovable property

(Ss 105

to 117) Parties

Lessor and Lessee

Lease contract written or local usage

Lease generally for a year / mode of renewal Rights and liabilities of lessor and lessee

Determination of lease

Waiver

Right against forfeiture for non-payment of rent Relief against forfeiture and other cases

Surrender

Effect of holding over


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Leases of immovable property

(Ss 105

to 117) What is lease?

Transfer of right to enjoy property

For certain time Express or implicit or in perpetuity

For consideration of a price paid or

promised Money / a share of crops / service or

any other thing - periodical


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Exemption of leases for agricultural

purposes Section 117

None of the provisions apply to leasefor agricultural purposes

Exception notification by the stategovernment specifying the applicationof lease provisions

Effect only when published in officialgazette after the expiry of sixmonths from publication


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Exchange (Ss 118

to 121) When two persons mutually transfer

the 0wnership of one thing foranother, neither thing or both things

being money only, the transaction iscalled an exchange.

Transfer of property in completion ofan exchange can be made only in themanner provided for the transfer ofsuch property by sale


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Gift (Ss 122 to 129

) Gift transfer of immovable property

without consideration by one (donor)

to another (donee) during the lifetime If donee dies before acceptance the

gift is void

Registration of the property for

transfer with two witness is therequirement.


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Gift (Ss 122 to 129

) Gift of future property is void

When gift be suspended or revoked

A gives a field as gift to B Bs assent that

A takes back the filed if B and hisdescendants die before A. B dies withoutdescendants. A could take back the filed

A gives 1 lac to B reserving himself with

Bs assent the right to take back Rs. 10,000for his pleasure out of the lac. The giftholds good as to Rs. 90,000 but is void asto RS. 10,000 which continue to belong A


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Onerous Gift (s 127)Onerous Gift

A has shares in X a prospective company

A has shares in Y which is difficulties

He gifts both to B B can refuse the gift in Y company

A gives gift of independent property to B along with one

more property on which he has debt which is more thanthe property worth. B is not bound accept the second gift.


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Actionable claims When property gets transfers the

debt on the property / mortgage /charge etc goes with the property and

the transferor is bound to give notice even if the notice not given, theliabilities are dischargeable by thetransferee.

Insurance unless assigned it is notvalid


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The Transfer of Property Act 1882 Actionable claims (Ss 130 137)

Actionable claims:-

- Transfer of actionable claims (insurance)

- Transfer of marine insurance exception

- Notice to be in writing signed

- Liability of transferee of actionable claim

- Warranty of solvency of debtor

- Mortgaged debt- Assignment of rights under policy of

insurance against fire


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Examples

A owes to B

B transfers debt to C

(notice not given) B demands debt from A

B pays to A

Question can C demands from AC cannot sue A for the debt


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Examples

X takes policy on his own life

Assigns to Bank and takes loan

A dies

Bank is entitled to receive money frominsurance company against policy

Without the concurrence of As heir /executors

Bank would recover money frominsurance company and the heirscannot get the money


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WHEN WE MEETNEXT TIME

Next Session on

WED

NESD

AY27 JANUARY 2010

TOPICSThe Factories Act 1948


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THANK YOU

Documents

S- 9 Trfr of Prop Act(Mktg a- X201) 20 Jan 10