BLS LLB 5 Years Sem 7 Transfer of Property Act and Easement Act 2025-26 - ATKT 75/25 Question Paper with Solutions

Section 118: when two persons mutually transfer the ownership of one thing for the ownership of another, neither thing or both things being money only, the transaction is called an exchange. A transfer of property in completion of an exchange can be made only in the manner provided for the transfer of such property by sale.

Section 21: where, on a transfer of property, an interest is created in favour of a person to take effect only on the happening of a specified uncertain event, or if a specified uncertain event shall not happen, that person thereby acquires a contingent interest in the property. It becomes a vested interest on the happening of the event, or when the happening of the event becomes impossible.

Section 4 of the Indian Easements Act, 1882: the land for the beneficial enjoyment of which the easement exists is called the dominant heritage, and its owner or occupier the dominant owner; the land on which the liability is imposed is called the servient heritage, and its owner or occupier the servient owner.

The mortgagor, under section 60, and, under section 91, besides him:

• (a) any person, other than the mortgagee of the interest sought to be redeemed, having any interest in, or charge upon, the property mortgaged or upon the right to redeem it, which covers a puisne mortgagee, a co-mortgagor, a lessee, a purchaser of the equity of redemption and a chargeholder;
• (b) any surety for the payment of the mortgage-debt; and
• (c) any creditor of the mortgagor who has, in a suit for the administration of his estate, obtained a decree for sale of the mortgaged property.

Section 128: subject to the provisions of section 127, where a gift consists of the donor's whole property, the donee is called a universal donee and is personally liable for all the debts due by, and liabilities of, the donor at the time of the gift, to the extent of the property comprised in the gift.

The requirements

1. The gift must be of the donor's WHOLE property, moveable and immoveable. If the donor retains anything, the donee is not a universal donee and the section does not apply at all. This is the requirement problems turn on.
2. The liability is PERSONAL. The creditor may sue the donee himself, and a decree may be executed against him. It is more than taking property subject to a charge.
3. Only debts and liabilities existing at the time of the gift are covered. Anything the donor incurs afterwards is his alone.
4. The liability is CAPPED at the value of the property comprised in the gift. The donee never pays out of his own pocket.

Section 127 is expressly saved, and works alongside. Where the gift is in the form of a single transfer of several things, one of which is burdened by an obligation, the donee takes nothing unless he accepts it fully; where it is by separate and independent transfers, he may accept one and refuse another. A donee not competent to contract who accepts an onerous gift is not bound, but becomes bound on attaining competence if, with knowledge, he retains the property.

Who an ostensible owner is. A person who, with the express or implied consent of the real owner, is held out to the world as the owner of property and has the outward marks of ownership, though the beneficial ownership is in another. He is more than an agent, manager or caretaker: the real owner must have clothed him with the appearance of ownership.

Section 41. Where, with the consent, express or implied, of the persons interested in immoveable property, a person is the ostensible owner of such property and transfers the same for consideration, the transfer shall not be voidable on the ground that the transferor was not authorised to make it; provided that the transferee, after taking reasonable care to ascertain that the transferor had power to make the transfer, has acted in good faith.

The five conditions, all to be proved by the transferee

1. The transferor was the ostensible owner.
2. He was so with the express or implied consent of the real owner, given freely and with knowledge. A minor or a person under disability cannot give it.
3. The transfer was for consideration. A gift is outside the section.

Effect. Where the section applies, the sale is not voidable at the real owner's instance, and he is left to his personal remedies against the ostensible owner for the price received or for damages. Where any condition fails, the sale is voidable and the real owner may recover the property.

i. Is the sale valid if the sale deed is not registered?

No. An unregistered sale deed of a house transfers nothing.

Section 54 provides that a transfer of ownership by sale, in the case of tangible immoveable property of the value of one hundred rupees and upwards, can be made only by a registered instrument. A house worth Rs. 50 lakh is plainly within that. There is no alternative mode: unlike property worth less than Rs. 100, a house cannot be sold by delivery of possession.

1. Sue for specific performance. This is her principal remedy, and it is the one that will get her the house. Under the Specific Relief Act, 1963 she may obtain a decree directing Mohan to execute and register a proper conveyance, and, if he still refuses, the Court will execute it through an officer under Order XXI Rule 34 of the Civil Procedure Code. Four points to make:

• Since the 2018 amendment, specific performance is no longer discretionary: section 10 now provides that it shall be enforced by the Court, subject to sections 11(2), 14 and 16. The old plea that the Court "may refuse in its discretion" is gone.
• She must plead and prove her readiness and willingness to perform under section 16(c), and must be able to show she was and is ready with the Rs. 50 lakh.
• Limitation is three years from the date fixed for performance, or, where none is fixed, from the date she has notice that performance is refused, under Article 54 of the Limitation Act, 1963. Mohan's refusal starts the clock, so she must sue promptly.
• She may also claim compensation in addition to or in substitution for specific performance under section 21 of the Specific Relief Act.

4. Secure the money she has paid. If any part of the price has been paid in advance, section 55(6)(b) gives Sona a charge on the house, as against Mohan and all persons claiming under him, for the purchase money properly paid in anticipation of delivery, with interest, and for the earnest and costs. She should also seek an injunction restraining Mohan from selling to anyone else pending the suit; and once the suit is filed, section 52 of the Transfer of Property Act applies of its own force, so any sale by Mohan during the suit will not bind her under the decree.

B is the owner of the land, and an owner may in general do as he pleases with his own. But an easement is a burden on the land itself, and B took or holds the land subject to it. Once the easement exists, B's ownership is qualified to that extent.

Section 32 puts it directly: the owner or occupier of the dominant heritage is entitled to enjoy the easement without disturbance by any other person. A blockage across the way is a disturbance.

What B may lawfully do. The section does not make B a servant of A's convenience:

• Section 27: the servient owner is not bound to do anything for the benefit of the easement. He need not repair the path, light it or keep it clear.
• Section 9: B may impose further easements on his land in favour of others, provided they do not lessen the utility of A's.
• B may use the land himself in any way that does not obstruct the way, and may fence or build elsewhere on it.

• if the disturbance is only threatened or intended, when the act threatened would necessarily, if performed, disturb the easement.

This is A's principal remedy, because damages will not reopen a blocked way. He should seek a mandatory injunction under section 39 of the Specific Relief Act to compel the removal of the blockage, and a prohibitory injunction under sections 37 and 38 to restrain further obstruction. A temporary injunction may be sought under Order XXXIX Rules 1 and 2 of the Civil Procedure Code pending the suit.

2. Compensation, section 33. The owner of any interest in the dominant heritage, or the occupier of it, may sue for compensation for the disturbance of the easement or of any accessory right, provided the disturbance has actually caused substantial damage. By Explanation I, the doing of any act likely to injure the plaintiff by affecting the evidence of the easement, or by materially diminishing the value of the dominant heritage, is substantial damage. A permanent blockage of the only way to a farm plainly satisfies that, and it will usually cause actual loss as well, since the farm cannot be worked.

Identify the situation. C says he paid for the property but allowed it to be registered in A's name. That is the classic description of a benami transaction, in which A is the ostensible owner and C claims to be the real owner. A has then sold to B for consideration. The question is whether B keeps the property.

i. Is the transfer valid? Can C claim the property back from B?

On the ordinary law, the transfer is protected by section 41 if B satisfies its conditions; and on the present statute law, C's claim is in any event barred by the Benami Act. B keeps the property.

4. B took reasonable care. He must show he examined the title deeds, searched the register, which showed A as owner, and enquired into possession, since Explanation II to section 3 fixes him with notice of the title of anyone in actual possession. If C was in possession, this is where B's case is weakest.
5. B acted in good faith, that is honestly and without notice of C's claim.

If all five are made out, the sale is valid and not voidable, and C cannot recover the property from B. The principle is Ramcoomar Koondoo v. McQueen (1872): where one of two innocent persons must suffer by the fraud of a third, the loss falls on the one whose own conduct enabled the fraud, which here is C, who put the property in A's name.

Second, and decisively today, the Benami Transactions (Prohibition) Act, 1988, as amended by the Benami Transactions (Prohibition) Amendment Act, 2016. It prohibits benami transactions, and bars any suit, claim or action to enforce any right in respect of property held benami against the person in whose name the property is held. A benami transaction includes one where the property is transferred to, or held by, a person and the consideration has been provided by another person, and the property is held for the benefit of that other.

Against A, if B loses the property or the title proves defective:

1. The implied covenant for title, section 55(2). The seller is deemed to contract with the buyer that the interest which he professes to transfer subsists and that he has power to transfer it. If A had no such power, B may sue on that covenant for damages, and the benefit of the covenant runs with the land.
2. Non-disclosure, section 55(1)(a). A was bound to disclose any material defect in his title of which he was aware and B was not, and which B could not with ordinary care discover. Concealing that the purchase money had come from C is exactly such a defect, and deliberate concealment is treated as fraud.
3. Refund of the price with a charge, section 55(6)(b). Unless he has improperly declined to accept delivery, the buyer has a charge on the property for the purchase money properly paid, with interest.

A note on the wording before answering. The condition in the stem is that C should run 100 km a day, while sub-question (ii) asks what happens if B fails to run it. The paper has slipped between the two names. Both readings are answered below, because the law is the same in each: the condition is void, and the property stays with B.

i. Is the transfer valid? What is a conditional transfer?

The transfer is VALID; the condition is VOID; and B holds the property absolutely.

• It is impossible. Running 100 km every day, indefinitely and without a break, is beyond human capacity to sustain. A condition need not be logically impossible to fall within section 25; it is enough that performance is practically impossible, and a requirement of that kind, continuing every day for as long as the property is to be held, plainly is.
• It implies injury to the person. A condition whose performance would injure the health of the person required to perform it falls within the head "involves or implies injury to the person or property of another", and a Court would in any event regard it as opposed to public policy.

And on the reading that C must run, there is a further and independent objection: C is a stranger to the transfer. B's interest would then be liable to be divested by the default of a person over whom he has no control, and a condition of that kind is not one the transferee can be required to answer for. Section 31 contemplates a specified uncertain event, and where the event is the act of a third party the condition may still be valid in form, but a condition requiring a stranger to do a physically impossible act is void for the reasons already given.

1. The condition is void under section 25, and by section 32 an invalid divesting condition is disregarded, leaving the interest absolute. There is nothing left for B to breach.
2. A condition subsequent must be STRICTLY fulfilled before it can divest (section 29). A condition that cannot be performed at all can never be strictly fulfilled, and the law does not divest a vested interest by reference to a condition it has already declared void.
3. A void condition does not create a reversion. Because the condition is disregarded from the outset, no interest was ever limited over to A, and there is nothing to revert. Compare section 30: where an ulterior disposition is invalid, the prior disposition is unaffected, which is the same idea seen from the other side.

When would the property revert? Only if the condition were valid, that is a lawful, possible, specified uncertain event, and were strictly broken. The illustration to section 31 shows a good one: A transfers a farm to B for his life, with a proviso that in case B cuts down a certain wood the transfer shall cease to have any effect; B cuts down the wood, and he loses his life interest. Cutting down a wood is lawful and possible; running 100 km a day for ever is not.

For full marks, cover: section 58(a) and the equity of redemption in two lines, then the mortgagor's rights (sections 60, 60A, 60B, 61, 62, 63, 63A, 64, 65A) and duties (section 65, and section 66 on waste), then the mortgagee's rights (sections 67, 67A, 68, 69, 69A, 70 to 73) and duties (section 76), and close with the clog doctrine.

The setting. By section 58(a) a mortgage is the transfer of an interest in specific immoveable property to secure a debt. Ownership stays with the mortgagor, and what remains with him is the equity of redemption. The rights and duties on both sides are worked out from that single fact, and almost all of them operate "in the absence of a contract to the contrary".

RIGHTS OF THE MORTGAGOR

6. Right to accession, section 63, and to improvements, section 63A: accessions to the mortgaged property in the mortgagee's possession belong to the mortgagor on redemption, and he must pay for a separate accession acquired at the mortgagee's expense only if he wants it.
7. Right to a renewed lease, section 64, where the mortgaged property is a lease and the mortgagee obtains a renewal.
8. Right to lease, section 65A. A mortgagor in lawful possession may make leases binding on the mortgagee, subject to the conditions the section states: at the best rent reasonably obtainable, without a premium, rent payable at least half-yearly, no covenant for renewal, taking effect within six months, and, for a lease of buildings, not exceeding three years.
9. Right to sue for waste and to enforce the mortgagee's duties under section 76, including accounts.

DUTIES OF THE MORTGAGOR

Chiefly the implied contracts in section 65, which are covenants in the absence of a contract to the contrary:

• (a) covenant for title: that the interest professed to be transferred subsists and that he has power to transfer it;

1. Right to foreclosure or sale, section 67, by suit, according to the kind of mortgage: foreclosure for a mortgagee by conditional sale; sale for a simple mortgagee, a mortgagee by deposit of title-deeds and an English mortgagee; neither for a usufructuary mortgagee, whose security is his possession; and, for an anomalous mortgage, whatever the deed gives him (section 98).
2. Section 67A: where he holds several mortgages from the same mortgagor and is entitled to the same kind of decree on each, he must sue on all or forfeit the rest.
3. Right to sue for the mortgage-money, section 68, where there is a personal covenant; where the property is wholly or partially destroyed or the security rendered insufficient by the mortgagor's wrongful act and he does not provide further security; where the mortgagee is deprived of the whole or part of his security by the mortgagor's default in title; and where, being entitled to possession, he is not put in possession.

• (a) manage the property as a person of ordinary prudence would manage it if it were his own;
• (b) use his best endeavours to collect the rents and profits;
• (c) pay government revenue, and all other charges of a public nature and rent, out of the income, in the absence of a contract to the contrary;
• (d) make necessary repairs out of the income;
• (e) commit no act destructive or permanently injurious to the property;
• (f) where he has insured the property, apply any insurance money in reinstating it or, if the mortgagor so directs, in reduction of the mortgage-money;
• (g) keep clear, full and accurate accounts of all sums received and spent, and give them to the mortgagor at his request and cost;
• (h) apply the receipts first in payment of government revenue and other charges and repairs, then in payment of interest, and the residue in reduction or discharge of the principal; and
• (i) account to the mortgagor for the receipts, and be debited with what he might have received but for his gross default.

THE CLOG ON THE EQUITY OF REDEMPTION

For full marks, cover: the equitable origin and the mischief, section 53A in full, the six conditions with examples, the 2001 registration change with its date, the shield-not-sword rule with cases, who is bound and the proviso, the comparison with the English doctrine, and the section's relationship with specific performance and with sections 41 and 52.

What the doctrine is. Part performance is the rule that a person who has been let into possession of immoveable property under a contract of transfer, and has acted upon that contract, is protected against being dispossessed by the transferor merely because the transfer was never completed in the form the law requires.

The mischief it meets. A buyer pays, takes possession, builds and lives on the land for years, but the seller never executes or registers a conveyance. If the law looked only at the deed, the seller could eject him and keep both land and money. Equity refuses to allow a statute passed to prevent fraud to be used as an instrument of fraud.

Where any person contracts to transfer for consideration any immoveable property by writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty, and the transferee has, in part performance of the contract, taken possession of the property or any part of it, or, being already in possession, continues in possession in part performance of the contract and has done some act in furtherance of the contract, and the transferee has performed or is willing to perform his part of the contract, then, notwithstanding that, where there is an instrument of transfer, the transfer has not been completed in the manner prescribed therefor by the law for the time being in force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract.

Proviso: nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof.

THE SIX CONDITIONS, WITH EXAMPLES

5. The transferee has performed or is willing to perform his part, continuously and absolutely from the contract to the suit. Example: he has paid half and tendered the balance. A person who has done nothing for years and comes forward when prices rise is not willing.
6. Registration, for contracts made on or after 24 September 2001. The Registration and Other Related Laws (Amendment) Act, 2001 deleted from section 53A the words "the contract, though required to be registered, has not been registered", and inserted section 17(1A) into the Registration Act, 1908, which makes such documents compulsorily registrable and provides that if unregistered they "shall have no effect for the purposes of the said section 53A".

That sixth condition dates an answer: every book written before 2001 says registration is unnecessary, and for a contract made on or after that date it is now wrong.

A SHIELD, NOT A SWORD

The transferor and everyone claiming under him, including his heirs, legal representatives and a gratuitous transferee. Not bound is a transferee for consideration without notice of the contract or of the part performance. In practice the proviso rarely saves a purchaser, because Explanation II to section 3 fixes him with notice of the title of any person in actual possession, and the transferee in possession is exactly such a person: a buyer who inspects the property will discover him, and one who does not has not taken reasonable care.

INDIA AND ENGLAND COMPARED

3. The transfer must be voluntary, that is with free consent, untainted by coercion, undue influence, fraud or misrepresentation.
4. It must be without consideration. Natural love and affection is a motive, not consideration; money consideration makes it a sale and consideration in kind an exchange.
5. A competent donor (competent to contract and entitled to the property, section 7) and an ascertained donee. A gift to an unborn person must satisfy sections 13 and 14, and is in practice made through a trust.
6. Acceptance by or on behalf of the donee during the donor's lifetime.
7. The mode prescribed by section 123.

SECTION 123 AND THE CASE LAW

For immoveable property, a gift must be effected by a registered instrument signed by or on behalf of the donor and attested by at least two witnesses. For moveable property, by such an instrument or by delivery.

Three propositions from the decided cases:

• Under Muhammadan law the position is reversed, and section 129 saves it: a hiba requires declaration, acceptance and delivery of possession, and registration is not necessary. In Hafeeza Bibi v. Shaikh Farid (2011) 5 SCC 654 the Supreme Court held that where the three essentials of a hiba are satisfied, the gift is valid, and a deed recording a completed oral gift does not require registration.
• A gift obtained by undue influence may be set aside. Where the donor was old, ill or dependent on the donee, the burden may shift to the donee to show the gift was the donor's free act, on the principles in section 16 of the Indian Contract Act, 1872.

THE REST OF THE CHAPTER

• Section 124: a gift of future property is void; of existing and future property, void as to the latter only.
• Section 125: a gift to two or more donees, of whom one does not accept, is void as to his interest.

4. Not to revoke a completed gift except on the grounds in section 126.
5. To make good the title, in the limited sense that he must not defeat the gift by his own act after it is complete.

Rights

1. To impose a valid condition. A gift may be made subject to a lawful condition subsequent under sections 31 and 32, and a valid condition will defeat it on the event.
2. To reserve a right of revocation by agreement on a specified event not depending on his own will, under section 126.
3. To reserve a life interest or the income to himself: Renikuntla Rajamma confirms that this does not invalidate the gift.
4. To refuse to complete an incomplete gift. Before registration and acceptance nothing has passed, and a promise to give, being without consideration, is void under section 25 of the Indian Contract Act, save the narrow exception in section 25(1).
5. To revoke on a ground on which a contract could be rescinded, and to take back the property if he does.

3. To bear the burdens on the property: he takes it subject to every mortgage, charge, lease or easement already on it, because the donor could not give more than he had.
4. To answer the donor's debts as a universal donee, section 128, where the gift is of the whole property, up to the value received.
5. To restore the property if the gift is validly revoked under section 126, or is avoided under section 53(1) as a fraud on creditors.

REVOCATION, section 126

Two grounds only: by agreement that on a specified event not depending on the will of the donor the gift shall be suspended or revoked, the agreement forming part of the same transaction; and on any ground on which a contract could be rescinded, that is fraud, coercion, undue influence or misrepresentation, but not want of consideration. A gift revocable at the mere will of the donor is void. The rights of transferees for consideration without notice are saved.

For full marks, cover: section 4 with the Explanation and the two heritages, the essentials, the four types under section 5 with the Act's illustrations, positive and negative, permanent and limited, appurtenant and in gross, the types by mode of acquisition with sections 13, 15 and 18, and what is not an easement.

Definition, section 4. An easement is a right which the owner or occupier of certain land possesses, as such, for the beneficial enjoyment of that land, to do and continue to do something, or to prevent and continue to prevent something being done, in or upon, or in respect of, certain other land not his own.

The land for whose beneficial enjoyment the right exists is the dominant heritage and its owner the dominant owner; the land on which the liability is imposed is the servient heritage and its owner the servient owner.

3. The right must exist for the beneficial enjoyment of the dominant heritage, not for its owner personally.
4. The two heritages must be different and in different hands.
5. The right must be capable of forming the subject matter of a grant: certain, definite, and not so extensive as to amount to ownership.

TYPES UNDER SECTION 5

• Continuous: enjoyment is, or may be, continual without the act of man. Examples: light and air through a window, water through a fixed drain, a right of support.
• Discontinuous: needs the act of man. Example: a right of way.
• Apparent: shown by a permanent sign visible on careful inspection by a competent person. Examples: a window, a door, the visible opening of a drain.
• Non-apparent: with no such sign. Examples: an unmarked right of way, a right to prevent a neighbour building above a height.

• Permanent and limited. By section 6 an easement may be permanent, or for a term of years or other limited period, or subject to periodical interruption, or exercisable only at a certain place, at certain times, between certain hours, or for a particular purpose, or on a condition that it shall commence or become void on a specified event. A limited easement is extinguished on the expiry of the period or the happening of the condition (section 40).
• Appurtenant and in gross. Every Indian easement is appurtenant, annexed to a dominant heritage, and by section 19 it passes with that heritage on a transfer. An easement in gross, belonging to a person and not to land, is not recognised in India, because section 4 requires a dominant heritage.

TYPES BY MODE OF ACQUISITION

Section 21 bars use for any purpose unconnected with the enjoyment of the dominant heritage; section 22 requires the dominant owner to exercise the right in the mode least onerous to the servient owner; section 23 allows him to alter the mode of enjoyment within limits; section 24 allows accessory acts necessary to secure enjoyment; section 25 puts the cost of preservation on him; section 28 fixes the extent of easements; section 29 provides that he cannot increase the easement by altering the dominant heritage; and section 31 allows the servient owner to obstruct an excessive user, but only to the extent necessary.

The following documents shall be registered, if the property to which they relate is situate in a district in which the Act is in force:

• (a) Instruments of GIFT of immovable property, whatever the value. Note that value is irrelevant here: a gift deed of land worth ten rupees must be registered. This dovetails with section 123 of the Transfer of Property Act, which requires a gift of immoveable property to be by a registered instrument attested by two witnesses.
• (b) Other non-testamentary instruments which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property. This is the widest clause and it catches the ordinary dealings: a sale deed, a mortgage deed (other than a mortgage by deposit of title-deeds), an exchange deed, a partition deed, a release, a settlement, and a declaration of trust of immovable property.
• (c) Non-testamentary instruments which acknowledge the receipt or payment of any consideration on account of the creation, declaration, assignment, limitation or extinction of any such right, title or interest.

The sub-section takes a long list out of clauses (b) and (c). The ones worth naming are:

• any composition deed;
• any instrument relating to shares in a joint stock company, notwithstanding that the assets of the company consist in whole or in part of immovable property;
• any debenture issued by such a company and not creating any right, title or interest in specific immovable property, and any endorsement or transfer of it;
• any endorsement upon or transfer of a debenture so issued;
• any document not itself creating or extinguishing any right or interest in immovable property, but merely creating a right to obtain another document which will create such a right, that is, an ordinary agreement to sell, subject now to section 17(1A);
• any decree or order of a Court, except one expressed to be made on a compromise and comprising immovable property other than that which is the subject matter of the suit;
• any grant of immovable property by the Government;
• any instrument of partition made by a Revenue Officer;
• any order granting a loan under the Land Improvement or Agriculturists' Loans Acts;

No document required by section 17 or by the Transfer of Property Act to be registered shall:

• (a) affect any immovable property comprised therein;
• (b) confer any power to adopt; or
• (c) be received as evidence of any transaction affecting such property or conferring such power,

unless it has been registered.

The proviso, which must be given, is where most marks are lost. An unregistered document affecting immovable property and required to be registered may be received as evidence:

• of a contract in a suit for specific performance under Chapter II of the Specific Relief Act, 1877 (now 1963);
• as evidence of part performance of a contract for the purposes of section 53A of the Transfer of Property Act; and
• as evidence of any collateral transaction not required to be effected by a registered instrument.

Read with section 17(1A), the second limb now operates only where the contract has been registered, so for post-2001 agreements the practical effect of the proviso is the first and third limbs.