TRANSFER OF

PROPERTY ACT, 1882:

AN INTRODUCTION
Manish Singh
Associate Professor
RMLNLU

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Preamble of the Act:
◦ WHEREAS it is expedient to define and amend certain parts of the law
relating to the transfer of property by act of parties; It is hereby
enacted as follows:— …………..
◦ Not to consolidate – Act not exhaustive

◦ Transfer inter vivos (not by operation of law)

◦ Enacted to harmonize rules of succession (testamentary or intestate), law of

contract and transfer of property as far as immovable property is concerned.

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Historical Development
◦ Transfer of property governed by principles of English law and Equity.
◦ Regulations and Acts passed by Governor General-in-Council also made applicable
◦ Courts decide on their own notions of justice and fair play.
◦ Case law became confusing and conflicting.
◦ Law Commission appointed in England to prepare a code.
◦ Third and Fourth Law Commission, under Chairmanship of Whitley Stokes, played very
crucial role in enactment of the Act.
◦ Transfer of Property Act, 1882 supplemented the Indian Contract Act, 1872 in relation to
inter-vivos transactions.
◦ Succession and Inheritance governed by respective personal laws.

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Interpretation Clause (Section 3):
1. Immovable Property:

Transfer of Property Act,1882:- “immoveable property” does not include standing

timber, growing crops or grass;

General Clauses Act, 1897:- Immovable Property shall include-

-land

-benefits to arise out of land

-things attached to earth or permanently fastened to anything attached to the

earth

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1. Land-
Land in legal parlance includes-
1. a determinate portion of the earth’s surface

2. possibly the column of space above surface

3. the ground beneath

4. all objects on or under the earth’s surface in its natural state (e.g. minerals)
(lakes, ponds rivers – land covered by water)

5. all objects placed by human agency on or under the surface, with the
purpose of permanent annexation

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2. Benefits to arise out of land (Profit pendre)-

Any interest in such property

-hereditary allowances

-right of way

-right of ferry, fishery, collecting lac etc.

-debt secured by a mortgage

-right to take minerals

-rent from ‘haat’

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3. Things attached to earth:

- rooted in the earth

- embedded in the earth

- attached to what is so embedded (for the permanent beneficial enjoyment of

that to which it is attached)

Question of fact and law – degree, manner, extent, strength

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Law Relating to Fixtures:

◦ Concerned with categorization: when an independent chattel be regarded

as having become part of the land.

◦ Question becomes relevant when land has been sold, mortgaged or leased
with chattels affixed – fixtures pass with the land as land.

◦ Lease – fixtures reverts to lessor when lease expires, chattel remain that of
lessee.

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Fixture Tests:
Test 1
◦ Traditional common law approach – degree of annexation.

◦ Substantially affixed – It would constitute a fixture.

◦ Slightly affixed (and the chattel could be removed without damaging the land)–
It would remain a chattel.

Reid v Smith, 1905

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Two General Presumptions w.r.to the degree of
annexation:
(i) if chattel is fixed to the land other than by its own weight - it is a fixture
(burden of proof on the party claiming it to be a chattel)

(ii) If chattel rests upon its own weight – presumed to remain a chattel
(e.g. anchor of a ship and anchor of a suspension bridge)
Above is a presumption and can be rebutted.

Lyon & Co. v London City & Midland Bank, 1903, KB

◦ Chairs firmly attached to a floor in a leased premises for a temporary purpose,
annexation being essential for safety reasons – Not fixtures.

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 Test 2
◦ Intention with which the chattel is affixed to land or object/purpose of affixation.

Leigh v Taylor, 1902, AC

➢ If Chattel attached to land in order to enhance the character, quality ,

enjoyment or status of the land, it is likely that the Court will find that the
chattel has become a fixture,

whereas,

if the chattel was attached to the land with the intention of increasing the
use or enjoyment of the chattel as an independent object, then it is unlikely that
the Court would find that the chattel has become a fixture.

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 Palumberi v Palumberi, 1986

◦ Perceptible decline in the comparative importance of the degree or mode of annexation

◦ Greater emphasis upon the purpose/object of annexation or the intention with which the
chattel is placed upon land.

Kay’s Leasing Corporation Pvt. Ltd. V

CSR Provident Fund Nominees Pvt. Ltd., 1962

◦ The degree of annexation remains an important factor in assessing the intention.

◦ But not the sole criterion.
◦ Each case must be assesses according to individual circumstances.

The relevant intention is the intention of the person actually attaching the chattels to the
land.

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If chattel was loosely attached to a dwelling or land, there was no intention to benefit
the land , but rather, to improve the use and enjoyment of the chattel in its own right.
Leigh v Taylor, 1902, AC

Facts: Valuable tapestries attached (nails) to the wall with the help of canvas and
wooden supports, by a life estate holder.
Issue: Whether or not tapestries were fixtures.
Determination: Intention of life estate holder when attaching the tapestries.
Decision: Despite annexation to the walls, it was clear by facts that the only way in which
ornamental tapestries can be properly viewed and enjoyed was through such
annexation.
In attaching the tapestries in such a way, the life estate holder only intended to
improve the enjoyment of the tapestries and not overall land.

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Contrasted decision given in -
Re Whaley, 1908, Ch. (Elizabethan Room Case)

Facts: Painting of Elizabeth I and a tapestry depicting a similar portrait were affixed by
screws and nails to one of the room in a mansion (Elizabethan room).
The pictures and hanging were placed there specifically to enhance the feel of
the room.
Issue: Whether or not tapestry was a fixture.
Decision: The affixation, despite being slight and similar to the facts of Leigh v Taylor, did
result in the picture and tapestry becoming a fixture, because the intention of
the affixation was for the beautification of the room as a whole rather than the
enjoyment of the hangings as individual portraits.

[The object of annexation will always overwhelm the degree of annexation]

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Intention can be gathered from the various factors of the case e.g.
- Purpose
- Nature of chattel
- Method (degree and mode)
- Circumstance
- Owner of land
- Relation with true owner
- The way chattel has been used
- Consequences for both the land and the owner if the chattel were removed.

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◦ Illustration – Nature of the chattel-
Belgrave Nominees Pvt.Ltd. V Barlin-Scott Air Conditioning System Pvt. Ltd
1984, SC of Victoria

Facts:
◦ Two buildings belonging to plaintiff to be renovated by a builder.
◦ The builder also subcontracted with plaintiff for supply and installation of AC system for
each building.
◦ Pipes, machinery, electric connections were completed – AC were installed and each
unit was placed on a separate platform on the roof resting upon its own weight.
◦ Final connections could not be achieved.
◦ Meanwhile, Building Co. went into liquidation and could not pay the defendant Co.

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◦ Plaintiff arranged for a new builder.
◦ Before this the defendant Co. removed the AC units without informing the plaintiff.
◦ Plaintiff sought mandatory injunction.
Decision: Partial instalment resulted in the units becoming fixtures.
Reasoning:
◦ In order to be operative, each unit had to be connected to the main reticulation
system of the building.
◦ Affixation of such a character that transforms the unit from chattel to fixtures.
◦ Once the unit has been affixed and connected to the building, it formed an essential
component of each building , necessary for their use and occupancy as modern
official buildings.
◦ The fact that installation has not been fully completed did not derogate from the clear
and objective purpose and nature of the unit.

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2. Attested:-
- testimony of fact of execution of execution of a document
Essentials-
◦ Two or more witnesses
◦ Each witness must
- see that the executant signs or affix his mark; or
- see some other person sign the instrument in the presence and under direction of
the executant; or
- receive a personal acknowledgement or mark or signature (from executant or
other person)

◦ Each witness must sign the instrument in the presence of the executant

◦ All witnesses need not have to be present and sign at the same time
nor
need to be present when the executant executes the document
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◦ Attesting witness must have signed the instrument ‘animo attestandi’.

◦ If not validly attested, the instrument will be ineffective (though still valid for other
purposes)

◦ Whether a person who is party to a deed can be its attesting witness?

Kumar Harish Chandra v Bansidhar Mohanty, 1965, SC

- ‘Party to the deed’ and ‘interested in transaction/ Party to transaction’-
difference.

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3. Actionable Claim:

◦ An intangible and incorporeal movable property – can be transferred as per Chapter

VIII of the Transfer of Property Act.
◦ Initially definition was too wide – covered every claim for which an action would lie in
Civil Courts.
◦ Amendment in 1930 definition was narrowed down.
◦ Actionable claim means a claim –
◦ to any unsecured debt, or
◦ to any beneficial interest in movables not in possession,

which the Civil Courts recognize as affording grounds for relief.

whether such debt or beneficial interest be existent, accruing , conditional or contingent.

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Examples of actionable claims:-
1. Right to claim benefit of a contract for the purchase of goods.
2. Claim to money under an insurance contract.
3. A share in partnership.
4. Claim for arrears of rent.
5. Claim for return of earnest money.

Following are not actionable claims:-

1. Debt, for the recovery of which a decree is passed is not an actionable claim.
2. Right to recover damages for the breach of contract.

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