THE TRANSFER OF PROPERTY ACT, 1882 
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A R R A N G E M E N T   O F   S E C T IO N S  
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CHAPTERI 

PRELIMINARY 

PREAMBLE 

SECTIONS 

1.  Shor t  t it l e. 

commencement.  
Extent. 

2.  Repeal of Acts. 

Saving of certain enactments, incidents, rights, liabilities, etc. 

3.  Interpretation-clause. 
4.  Enact ment s   r el at i ng  t o  cont r act s   t o  be  t aken  as   par t   of   Cont ract   Act   and 

s uppl ement al  t o t he Regi s t r at i on Act . 

CHAPTER 11 

OFTRANSFERS OF PROPERTY BY ACT OF PARTIES 

(A) Transfer of pr oper ty, whether moveable or immoveable 

5.  “Transfer of property” defined.  
6.  What maybe transferred. 
7.  Persons competent to transfer. 
8.  Operation of transfer. 
9.  Oral transfer. 
10. Condition restraining alienation. 
11.  Restriction repugnant to interest cleated. 
12.  Condition making interest determinable on insolvency or attempted alienation. 
13. Transfer for benefit of unborn person. 
14. Rule against, perpetuity. 
15. T r ansf er  t o cl as s  s ome of  who m co me unde r  s ect i ons  13 and 14. 
16. Transfer to take effect on failure of prior int erest. 
17. Direction for accumulation. 
18. Transfer in perpetuity for benefit of public. 
19.  Vested interest.  
20. W hen unbor n pers on acquir es  vest ed i nterest on trans fer  f or  his  benef it. 
21. Contingent interest. 

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SECTIONS 

22. Transfer to members of a class who attain a particular age. 
23. Transfer contingent on happening of specified uncertain event. 
24. Transfer to such of certain persons as survive at some period not specified. 
25. Conditional transfer. 
26. Fulfilment of condition precedent. 
27. Conditional  transfer  to  one  person  coupled  with  transfer  to  another  on  failure  of  prior 

disposition. 

28. Ulterior transfer conditional on happening or not happening of specified event. 
29. Fulfilment of condition subsequent. 
30. Prior disposition not affected by invalidity of ulterior disposition. 
31. Condition  that  transfer  shall  cease  to  have  effect  in  case  specified  uncertain  event 

happens or does not happen. 

32. Such condition must not be invalid. 
33. Transfer conditional on performance of act, no time being specified for performance. 
34. Transfer conditional on performance of act, time being specified. 

35. Election when necessary. 

Election 

Apportionment 
36. Apportionment of periodical payments on determination of interest of person entitled. 
37. Apportionment of benefit of obligation on severance. 

(B) Transfer of immoveable property 

38. Transfer by person authorised only under certain circumstances to transfer. 
39. Transfer where third person is entitled to maintenance. 
40. Burden  of  obligation  imposing  restriction  on  use  of  land,  or  of  obligation  annexed  to 

ownership but not amounting to interest or easement. 

41. Transfer by ostensible owner. 
42. Transfer by person having authority to revoke former transfer. 
43. Transfer  by  unauthorised  person  who  subsequently  acquires  interest  in  property 

transferred. 

44. Transfer by one co-owner. 
45. Joint transfer for consideration. 
46. Transfer for consideration by persons having distinct interests. 
47. Transfer by co-owners of share in common property. 
48. Priority of rights created by transfer. 
49. Transferee's right under policy. 
50. Rent bona fide paid to holder under defective title. 

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SECTIONS 

51.  Improvements made by bona fide holders under defective titles. 
52. Transfer of property pending suit relating thereto. 
53. Fraudulent transfer.  

53A. Part performance. 

54.  “Sale” defined. 

Sale how made.  

Contract for sale. 

CHAPTER III 

OF SALES OF IMMOVEABLE PROPERTY 

55. Rights and liabilities of buyer and seller. 
56. Marshalling by subsequent purchaser. 

57. Provision by Court for incumbranccs, and sale freed therefrom. 

Discharge of incumbrances on sale 

CHAPTER IV  

OF MORTGAGES OF IMMOVEABLE PROPERTY AND CHARGES 

58. “Mortgage”,  “mortgagor”,  “mortgagee”,  “mortgage-money”and  “mortgage-

deed”defined. 

Simple mortgage. 

Mortgage by conditional sale. 

Usufructuary mortgage. 

English mortgage. 

Mortgage by deposit of title-deeds. 

Anomalous mortgage. 

59. Mortgage when to be by assurance. 

59A.  References  to  mortgagors  and  mortgagees  to  include  persons  deriving  title  from 

them. 

Rights and liabilities of mortgagor 

60. Right of mortgagor to redeem. 

Redemption of portion of mortgaged property. 

60A.Obligation to transfer to third party instead of re-transference to mortgagor. 

60B. Right to inspection and production of documents. 
61. Right to redeem separately or simultaneously. 
62. Right of usufructuary mortgagor to recover possession. 
63. Accession to mortgaged property. 

Accession acquired in virtue of transferred ownership. 

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SECTIONS 

63A. Improvements to mortgaged property. 
64. Renewal of mortgaged lease. 

65. Implied contracts by mortgagor.  

65A. Mortgagor’s power to lease. 
66.  Waste by mortgagor in possession. 

67. Right to foreclosure or sale. 

Rights and liabilities of Mortgagee 

67A. Mortgagee when bound to bring one suit on several mortgages. 
68. Right to sue for mortgage-money. 
69.  Power of sale when valid.  

69A. Appointment of receiver. 
70.  Accession to mortgaged property. 
71. Renewal of mortgaged lease. 
72.  Rights of mortgagee in possession. 
73.  Right to proceeds of revenue sale or compensation on acquisition.  
74. [Repealed.]. 
75. [Repealed.]. 
76. Liabilities of mortgagee in possession. 

Loss occasioned by his default. 

77. Receipts in lieu of interests. 

Priority 

78. Postponement of prior mortgagee. 
79. Mortgage to secure uncertain amount when maximum is expressed. 
80.  [Repealed.]. 

Marshalling and contribution 

81.  Marshalling securities. 
82.  Contribution to mortgage-debt. 

Deposit in Court 

83. Power to deposit in Court money due on mortgage. 

Right to money deposited by mortgagor. 

84. Cessation of interest. 

Suits for foreclosure, sale or redemption 

Foreclosure and sale 

85. [Repealed.]. 

86. [Repealed.]. 
87. [Repealed.]. 
88. [Repealed.]. 

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SECTIONS 

89. [Repealed.]. 
90. [Repealed.]. 

Redemption 

91. Persons who may sue for redemption. 
92. Subrogation. 
93. Prohibition of tacking. 
94. Right ofmesne mortgagee. 
95. Right of redeeming co-mortgagor to expenses. 
96. Mortgage by deposit of title-deeds. 
97.  [Repealed.]. 

98. Rights and liabilities of parties to anomalous mortgages. 

Anomalous mortgages 

Attachment of mortgaged property 

99.  [Repealed.]. 

100.  Charges. 
101.  No merger in case of subsequent encumbrance. 

Charges 

Notice and tender 

102.  Service or tender on or to agent. 
103.  Notice, etc., to or by person incompetent to contract. 
104.  Power to make rules. 

CHAPTER V 

OF LEASES OF IMMOVEABLE PROPERTY 

105.  Lease defined. 

Lessor, lessee, premium and rent defined. 

106.  Duration of certain leases in absence of written contract orlocal usage. 
107.  leases how made. 
108.  Rights and liabilities of lessor and lessee. 
109.  Rights of lessor’s transferee. 
110.  Exclusion of day on which term commences. 

Duration of lease for a year. 

Option to determine lease. 

111.  Determination of lease. 
112.  Waiver of forfeiture. 
113.  Waiver of notice to quit. 
114.  Relief against forfeiture for non-payment of rent.  

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SECTIONS 

114A. Relief against forfeiture in certain other cases. 
115.  Effect of surrender and forfeiture on under-leases. 
116.  Effect of holding over. 
117.  Exemption of leases for agricultural purposes. 

CHAPTER VI 

OF EXCHANGES 

118.  “Exchange” defined. 
119.  Right of party deprived of thing received in exchange. 
120.  Rights and liabilities of parties. 
121.  Exchange of money. 

CHAPTER VII  

OF GIFTS 

122.  “Gift”defined. 

Acceptance when to be made. 

123.  Transfer how effected. 
124.  Gift of existing and future property. 
125.  Gift to several, of whom one does not accept. 
126.  When gift may be suspended or revoked. 
127.  Onerous gifts. 

Onerous ‘gift to disqualified person. 

128.  Universal donee. 
129.  Saving of donations mortis causa and Muhammadan law. 

CHAPTER VIII 

OF TRANSFERS OF ACTIONABLE CLAIMS 

130.  Transfer of actionable claim.  
130A. [Repealed.]. 
131.  Notice to be in writing, signed. 
132.  Liability of transferee of actionable claim. 
133.  Warranty of solvency of debtor. 
134.  Mortgaged debt. 
135.  Assignment of rights under policy of insurance against fire. 

135A. [Repealed.]. 
136.  Incapacity of officers connected with Courts of Justice. 

137. Saving of negotiable instruments, etc.  

THE SCHEDULE. 

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THE TRANSFER OF PROPERTY ACT, 1882  

ACT NO. 4 OF 1882 

An Act to amend the law relating to the Transfer of Property by act of Parties. 

Preamble.—WHEREAS  it  is  expedient  to  define  and  amend  certain  parts  of  the  law 

relating to the transferof property by act of parties; It is hereby enacted as follows:— 

[17th February, 1882.] 

CHAPTER I  
PRELIMINARY 

1.  Short  title.—This  Act  may  becalled  the  Transfer  of  Property  Act,  1882. 
Commencements.—It shallcome into force on the first day of July, 1882. 
Extent.—1[Itextends 2 in the first instance to the whole of India. except  3[the territories 
which, immediately before the 1st November, 1956, were comprised in Part B States or in 
the States of], Bombay, Punjab and Delhi.] 

4 [But  this  Act  or  any  part  thereof  may  by  5 notification  in  the  Official  Gazette  be 
extended  to  the  whole  or  any  part  of  6 [the  said  territories]  by  the  State  Government 
concerned.]  

7[And any State Government may,  8*** from time to time, by notification in the Official 
Gazette,  exempt,  either  retrospectively  or  prospectively,  any  part  of  the  territories 
administered  by  such  State  Government  from  all  or  any  of  the  following  provisions, 
namely:—  

Sections 54, paragraphs 2 and 3, 59, 107 and 123.] 

1. Subs. by the A.O. 1950, for the third paragraph. 
2. The application of this Act was barred in the Naga Hills District, including the Mokokchung Sub-division, the 
Dibrugarh Frontier Tract, the North Cachar Hills, the Garo Hills, the Khasi and Jantia Hills and the Mikir hills 
Tract, by notification under s. 2 of the Assant Frontier Tracts Regulation, 1880 (2 of 1880). 
Partially extended to Berar by Act 4 of 1941. Extended to Manipur by Act 68 of 1956; to Dadra and Nagar Haveli 
by Reg. 6 of 1963, s. 2 and Sch. I; to Goa, Daman and Diu by Reg. 11 of 1963, s. 3 and Sch.; to Lakshadweep by 
Reg. 8 of 1965, s. 3 and Sch., to Pondicherry by Act 26 of 1968, s. 3 and Sch. 

It has been amended to Bombay by Bombay Act 14 of 1939, S7 of 1959, in U.P. by U.P. Act 24 of 1954, 14 of 1970 and 57 

of 1976. 
Extended to the Union territory of Jammu and Kashmir and Union territory of Ladakh by Act 34 of 2019, s. 95 and the Fifth 
Schedule (w.e.f. 31-10-2019). 

3. Subs. by the Adaptation of Laws (No. 2) Order, 1956, for “Part B States”. 
4. Subs. by the A.O. 1937, for the original paragraph. 
5.The Act has been extended to— 

The Presidency of Bombay (except Scheduled Districts) w.e.f. 1-1-1893; to Mehwassi Estate by Born. Reg. 1 
of 1949; and to former princely area w.e.f. 1-4-1951; now applicable to whole of Maharashtra; 

Gu jar at (Sau rash tra are a) b y S au rash tra Ord in an ce 2 5  o f 1 9 4 9 , an d  to  Ku tch  area w.e. f.1-1-1950. 

Madhya Pradesh: 
Mysore, w.e.f. 1-4-1951; 
Rajasthan, w.e.f. 1-7-1952; 
the former State of Travancore-Cochin, w.e.f. 1-5-1952, now applicable to whole of Kerala. 
The provisions o( sections 54, 107 and 123 were extended to— 
Delhi, w.e.f. 30-5-1939. Section 129 was extended to certain areas of Delhi w.e.f. 16-11-1940 and to 
the  remaining  areas  w.e.f.  1-12-1962.  the  remaining  provisions  were  also  extended  to  the  Union 
territory ofDelhi w.e.f. 1-12-1962; 
Himachal Pradesh, w.e.f. 7-12-1970: 
Punjab, w.e.f. 1-4-1955 and to former princely area w.e.f. 15-5-1957. (Section 59 was enforced in 

Haryana area, w.e.f. 5-8-1967). 

The Act has been declared in force in the Pargana of Manpur by the Manpur Law Regulation, 1926 (2 of 1926), 
inPanthPiploda  by  the  PanthPiploda  Laws  Regulation,  1929  (1  of  1929)  and  in  the  State  of  Sikkim  on 
1.9.1984  videNotification  No.  S.O.  643(E),  dated  24-8-1984,  Gazette  of  India,  Extraordinary,  Pt.  II,  sec. 
3(0. 
The Act has been repealed as to Government Grants by the Government Grants Act, 1895 (15 of 1895). 
The Act has been repealed or modified to the extent necessary to give effect to the provisions of Madras Act 3 
of1922, in the City of Madras see s. 13 of Madras Act 3 of 1922. 
6. Subs. by the Adaptation of Laws (No. 2) Order, 1956, for “the said States”. 
7. Subs. by Act 3 of 1885, s. 1, for the original paragraph. 
8. The words “with the previous sanction of the Governor General in Council” omitted by Act 38 of 1920, s. 2 and the 

Schedule. 

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1[Notwithstanding  anything  in  the  foregoing  part  of  this  section,  sections  54,  paragraphs  2 
and 3, 59, 107 and 123 shall not extend or be extended to any district or tract of country for the 
time  being  excluded  from  the  operation  of  the  Indian  Registration  Act,  2[1908  (16  of  1908)], 
under the power conferred by the first section of that Act or otherwise.] 

2.  Repeal  of  Acts.  Saving  of  certain  enactments,  incidents,  rights,  liabilities,  etc.—
In  the  territories  to  which  this  Act  extends  for  the  time  being  the  enactments  specified  in 
the Schedule hereto annexed shall be repealed to the extent therein mentioned. But nothing 
herein contained shall he deemed to affect— 

(a) the provisions of any enactment not hereby expressly repealed; 

(b)  any  terms  or  incidents  of  any  contract  or  constitution  of  property  which  are  consistent 

with the provisions of this Act, and arc allowed by the law for the time being in force; 

(c) any right or liability arising out of a legal relation constituted before this Act comes into force, 

or any relief in respect of any such right or liability; or 

(d) save as provided  by  section 57 and Chapter  IV of this Act, any transfer by operation 

of law or by, or in execution of, a decree or order of a Court of competent jurisdiction; 

and nothing in the second Chapter of this Act shall be deemed to affect any rule of 3*** Muhammadan 
4*** law. 

3.  Interpretation-clause.—In  this  Act,  unless  there  is  something  repugnant  in  the  subject  or 

context,— 

“immoveable property” does not include standing timber, growing crops or grass; “instrument”, 

means a non-testamentary instrument; 

5[“attested”,  in  relation  to  an  instrument,  means  and  shall  be  deemed  always  to  have 
meant attested by two or more witnesses each of whom has seen the executant sign or affix 
his  mark  to  the  instrument,  or  has  seen  some  other  person  sign  the  instrument  in  the 
presence and by the direction of the executant, or has received from the executant a personal 
acknowledgement  of  his  signature  or  mark,  or  of  the  signature  of  such  other  person,  and 
each of whom has signed the instrument in the presence of the executant; but it shall not be 
necessary that more than one of such witnesses shall have been present at the same time, and 
no particular form of attestation shall be necessary;] 

“registered”  means  registered  in 6[7[any  part  of  the  territories]  to  which  this  Act  extends] 

under the laws8 for the time being in force regulating the registration of documents; 

“attached to the earth” means— 

(a) rooted in the earth, as in the case of trees and shrubs; 

(b) imbedded in the earth, as in the case of walls or buildings; or 

(c) attached to what is so imbedded for the permanent beneficial enjoyment of that to which it is 

attached; 
9[“actionable claim” means a claim to any debt, other than a debt secured by mortgage of 

1. Added by Act3 of 1885, s. 2 (w.e.f. 1-7-1882). 
2. Subs. by Act 20 of 1929, s. 2, for “1877”. 
3. The word “Hindu” omitted by s. 3, ibid. 
4. The words “or Buddhist” omitted by s. 3, ibid. 
5. Ins. by Act 27 of 1926, s. 2, as amended by Act 10 of 1927, s. 2 and Sch. 1. 
6. Subs. by Act 3 of 1951, s. 3 and the Schedule, for “a Part A State or a Part C State” (w.e.f. 1-4-1951). 
7. Subs. by the Adaptation of Laws (No. 2) Order 1956, for “any State”. 
8. See the Indian Registration Act, 1908 (16 of 1908). 
9. Ins. by Act 2 of 1900, s. 2. 

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immoveable  property  or  by  hypothecation  or  pledge  of  moveable  property,  or  to  any  beneficial 
interest in  moveable property  not in the possession, either actual  or  constructive, of the  claimant, 
which  the  Civil  Courts  recognise  as  affording  grounds  for  relief,  whether  such  debt  or  beneficial 
interest be existent, accuring, conditional or contingent;] 

1[“a person is said to have notice”] of a fact when he actually knows that fact, or when, but for wilful 
abstention from an enquiry or search which he ought to have made, or gross negligence, he would have 
known it. 

Explanation  1.—Whereany  transaction  relating  to  immovable  property  is  required  by  law  to  be 
and has been effected by a registered instrument, any person acquiring such property or any part of, 
or share or interest in, such property shall be deemed to have notice of such instrument as from the 
date  of  registration  or,  2[where  the  property  is  not  all  situated  in  one  sub-district,  or  where  the 
registered  instrument  has  been  registered  under  sub-section  (2)  of  section  30  of  the  Indian 
Registration  Act,  1908  (16  of  1908),  from  the  earliest  date  on  which  any  memorandum  of  such 
registered  instrument  has  been  filed  by  any  Sub-Registrar  within  whose  sub-district  any  part  of  the 
property which is being acquired, or of the property wherein a share or interest is being acquired, is 
situated]: 

Provided that— 

(1)  the  instrument  has  been  registered  and  its  registration  completed  in  the  manner 
prescribed by the Indian. Registration Act, 1908 (16 of 1908) and the rules made thereunder, 

(2)  the  instrument 3[or  memorandum]  has  been  duly  entered  or  filed,  as  the  case  may  be,  in 

books kept under section 51 of that Act, and 

(3) the particulars regarding the transaction to which the instrument relates have been correctly 

entered in the indexes kept under section 55 of that Act. 

Explanation  II.—Any  person  acquiring  any  immoveable  property  or  any  share  or  interest  in 
any such property shall be deemed to have notice of the title, if any, of any person who is for the 
time being in actual possession thereof. 

Explanation III.—A  person shall be deemed to have had  notice of  any fact  if  his agent acquires 

notice thereof whilst acting on his behalf in the course of business to which that fact is material: 

Provided  that,  if  the  agent  fraudulently  conceals  the  fact,  the  principal  shall  not  be  charged 

with notice thereof as against any person who was a party to or otherwise cognizant of the fraud.] 

4. Enactments relating to contracts to be taken as part of Contract Act and supplemental to the 
Registration Act.—The Chapters and sections of this Act which relate to contracts shall be taken as part 
of the Indian Contract Act, 1872 (9 of 1872): 

4[And sections 54, paragraphs 2 and 3, 59, 107 and 123, shall be read as supplemental to the Indian 

Registration Act, 5[1908 (16 of 1908)]] 

1. Subs. by Act 20 of 1929, s. 4, for certain words. 
2. Subs. by Act 5 of 1930, s. 2, for certain words. 
3. Ins. by s. 2, ibid. 
4. Added by Act 3 of 1885, s. 3. 
5. Subs. by Act 20 of 1929, s. 5, for “1877” 

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CHAPTER II1 

OF TRANSFERS OF PROPERTY BY ACT OF PARTIES 

( A )   T r a n s f e r   of   pr o p er t y ,   w he t he r   m o ve a b l e   o r   i m m ov e a bl e 

5. “Transfer  of  property”  defined.—In the following sections “transfer of property” means an act 
by.which a living person conveys property, in present or in future, to one or more other living persons, or 
to himself, 2[or it himself] and one or more other living persons; and “to transfer property” is to perform 
such act. 

3 [in  this  section  “living  person”  includes  a  company  or  association  or  body  of  individuals, 
whether incorporated or not, but nothing herein contained shall affect any law for the time being in 
force relating to transfer of property to or by companies, associations or bodies of individuals.] 

6.  What  may  be  transferred.—Property  of  any  kind  may  be  transferred,  except  as  otherwise 

provided by this Act or by any other law for the time being in force: 

(a) The chance of an heir-apparent succeeding to an estate, the chance of a relation obtaining a 
legacy on the death of a kinsman, or any other mere possibility of a like nature, cannot be transferred. 

(b) A mere right of re-entry for breach of a condition subsequent cannot be transferred 

to any one except the owner of the property affected thereby. 

(c) An easement cannot be transferred apart from the dominant heritage. 

(d)  An  interest  in  property  restricted  in  its  enjoyment  to  the  owner  personally  cannot  be 

transferred by him. 

4[(dd) A right to future maintenance, in whatsoever manner arising, secured or determined, cannot 

be transferred.] 

(e) A mere right to sue  5***cannot be transferred. 

(f) A public office cannot be transferred, nor can the salary of a public officer, whether before or 

after it has become payable. 

(g) Stipends allowed to military, 6[naval], 7[air-force] and civil pensioners of 8[the Government] 

and political pensions cannot be transferred. 

(h)  No  transfer  can  be  made  (1)  in  so  far  as  it  opposed  to  the  nature  of  the  interest 
affected thereby, or  (2) 9[an unlawful object or  consideration  within  the  meaning  of section 
23 of the Indian Contract Act, 1872 (9 of 1872), or (3)to a person legally disqualified to be 
transferee]. 
10[(i)  Nothing  in  this  section  shall  be  deemed  to  authorise  a  tenant  having  an  untransferable 
right  of  occupancy,  the  farmer  of  an  estate  in  respect  of  which  default  has  been  made  in  paying 
revenue, or the lessee of an estate under the management of a court of Wards, to assign his interest 
as such tenant, farmer or lessee.] 

7. Persons competent to transfer.—Every person competent to contract and entitled to transferable 
property,  or  authorised  to  dispose  of  transferable  property  not  his  own,  iscompetent  to  transfer  such 
property either wholly or in part and either absolutely or conditionally, in the circumstances, to the extent 
and in the manner, allowed and prescribed by any law for the time being in force. 

1. Nothing in Chapter II is to be deemed to affect any rule of Muhammandan law—see s. 2, supra 
2. Ins. by Act 20 of 1929, s. 6. 
3. Added by s. 6, ibid. 
4. Ins. by s. 7, ibid. 
5. The words “for compensation for a fraud or for harm illegally caused” omitted by Act 2 of 1900, s. 3. 
6. Ins. by Act 35 of 1934, s. 2 and the Schedule. 
7. Ins. by Act 10 of 1927, s. 2 and the First Schedule. 
8. The word “Government” successively adapted by the A.O. 1937 and the A.O. 1950 to read as above. 
9. Subs. by Act 2 of 1900, s. 3, for “for an illegal purpose”. 
10. Added by Act 3 of 1885, s. 4. 

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8.  Operation  oftransfer.—Unless  a  different  intention  is  expressed  or  necessarily 
implied,  a  transfer  of  property  passes  forthwithto  the  transferee  all  the  interest  which  the 
transferor is then capable of passing in the property, and in the legal incidents thereof. 

Such  incidents  include,  where  the  property  is  land,  the  easements  annexed  thereto,  the  rents  and 

profits thereof accruing after the transfer, and all things attached to the earth; 

and,  where  the  property  is  machinery  attached  to  the  earth,  the  moveable  parts 

thereof; 

and,  where  the  property  is  a  house,  the  easements  annexed  thereto,  the  rent  thereof 
accruing  after  the  transfer,  and  the  locks,  keys,  bars,  doors,  windows  and  all  other  things 
provided for permanent use therewith; 

and,  where  the  property  is  a  debt  or  other  actionable  claim,  the  securities  therefor 
(except where they are also for other debts or claims not transferred to the transferee), but 
not arrears of interest accured before the transfer; 

and, where the property is money or other property yielding income, the interest or income thereof 

accruing after the transfer takes effect. 

9.  Oral  transfer.—A  transfer  of  property  may  be  made  without  writing  in  every  case 

in which a writing is not expressly required by law. 

10.Condition  restraining  alienation.—Where  property  is  transferred  subject  to  a 
condition or limitation absolutely restraining the transferee or any person claiming under him 
from  parting  with  or  disposing  of  his  interest  in  the  property,  the  condition  or  limitation  is 
void, except in the case of a lease where the condition is for the benefit of the lessor or those 
claiming  under  him:  provided  that  property  may  be  transferred  to  or  for  the  benefit  of  a 
woman  (not  being  a  Hindu,  Muhammadan  or  Buddhist),  so  that  she  shall  not  have  power 
during her marriage to transfer or charge the same or her beneficial interest therein. 

11.  Restriction  repugnant  to  interest  created.—Where,  on  a  transfer  of  property,  an 
interest  therein  is  created  absolutely  in  favour  of  any  person,  but  the  terms  of  the  transfer 
direct that such interest shall be applied or enjoyed by him in a particular manner, he shall be 
entitled to receive and dispose of such interest as if there were no such direction. 

1[Where any such direction has been made in respect of one piece of immoveable property 
for  the  purpose  of  securing  the  beneficial  enjoyment  of  another  piece  of  such  property, 
nothing  in  this  section  shall  be  deemed  to  affect  any  right  which  the  transferor  may  have  to 
enforce such direction or any remedy which he may have in respect of a breach thereof.] 

12.  Condition  making  interest  determinable  on  insolvency  or  attempted  alienation.—
Where property is transferred subject to a condition or limitation making any interest therein, 
reserved  or  given  to  or  for  the  benefit  of  any  person,  to  cease  on  his  becoming  insolvent  or 
endeavouring to transfer or dispose of the same, such condition or limitation is void. 

Nothing in this section applies to a condition in a lease for the benefit of the lessor or those claiming 

under him. 

13.  Transfer  for  benefit  of  unborn  person.—Where,on  a  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. 

1. Subs. by Act 20 of 1929, s. 8, for the second paragraph. 

11 

 
                                                      
 
Illustration 

A transfers property of which he is the owner to B in trust for A and his intended wife succesively for their lives, and, after 
the death of the survivor for the eldest son of the intended marriage for life, and after his death for A's second son. The interest so 
created for the benefit of the eldest son does not take effect, because it does not extend to the whole of A's remaining interest in 
the property. 

14. Rule against perpetuity.—No transfer of property can operate to create an interest which is to 
take  effect  after  the  lifetime  of  one  or  more  persons  living  at  the  date  of  such  transfer,  and  the 
minority of some person who shall be in existence at the expiration of that period, and to whom, if he 
attains full age, the interest created is to belong. 

15. Transfer to class some of whom come under sections 13 and 14.—If, on a transfer of property, 
an  interest  therein  is  created  for  the  benefit  of  a  class  of  persons  with  regard  to  some  of  whom  such 
interest fails by reason of any of the rules contained in sections 13 and 14; suchinterest fails 1[in regard 
to those persons only and not in regard to the whole class]. 

2[16.  Transfer to  take  effect  on failure  of  prior interest.—Where, by reason of any of the 
rules contained in sections 13 and 14, an interest created for the benefit of a person or of a class 
of  persons  fails  in  regard  to  such  person  or  the  whole  of  such  class,  any  interest  created  in  the 
same transaction and intended to take effect after or upon failure of such prior interest also fails. 

17.  Direction  for  accumulation.—(1)  Where  the  terms  of  a  transfer  of  property  direct  that  the 
income  arising  from  the property  shall  be  accumulated  either  wholly  or in  part during  a period longer 
than—  

(a) the life of the transferor, or 

(b) a period of eighteen years from the date of the transfer, 

such direction shall, save as hereinafter provided, be void to the extent to which the period during 
which the accumulation is directed exceeds the longer of the aforesaid periods, and at the end of 
such  last-mentioned  period  the  property  and  the  income  thereof  shall  be  disposed  of  as  if  the 
period during which the accumulation has been directed to be made had elapsed. 

(2) This section shall not affect any direction for accumulation for the purpose of— 

(i) the  payment  of  the  debts  of the  transferor  or  any  other  person  taking  any  interest  under  the 

transfer, or 

(ii) the provision of portions for children or remoter issue of the transferor or of any other person 

taking any interest under the transfer, or 

(iii) the preservation or maintenance of the property transferred; 

and such direction may be made accordingly. 

18.  Transfer  in  perpetuity  for  benefit  of  public.—The  restrictions  in  sections  14,  16  and 
17shall not apply in the case of a transfer of property for the benefit of the public in the advancement 
of religion, knowledge, commerce, health, safety, or any other object beneficial to mankind.] 

19.  Vested interest.—Where, on a transfer of property, an interest therein is created in favour 
of a person without specifying the time when it is to take effect, or in terms specifying that it is to 
take effect forthwith  or on the  happening of an event  which  must happen, such interest is  vested, 
unless a contrary intention appears from the terms of the transfer. 

A vested interest is not defeated by the death of the transferee before he obtains possession. 

Explanation.—An intention that an interest shall not be vested is not to be inferred merelyfrom a 
provision whereby the enjoyment thereof is postponed, or whereby a prior interest in the same property 
is given or reserved to some other person, or whereby income arising from the property is directed 

1. Subs. by Act 20 of 1929, s. 9, for “as regards the whole class”. 
2. Subs. by s. 10, ibid., for sections 16, 17 and 18. 

12 

 
                                                      
 
to be accumulated until the time of enjoyment arrives, or from a provision that if a particular event 
shall happen the interest shall pass to another person. 

20. When unborn person acquires vested interest on transfer for his benefit.—Where, on 
a transfer of property, an interest therein is created for the benefit of a person not then living, he 
acquires upon his birth, unless a contrary intention appear from the terms of the transfer, a vested 
interest, although he may not be entitled to the enjoyment thereof immediately on his birth. 

21.  Contingent  interest.—Where,  on a transfer  of property,  an interest therein 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,  such  person  thereby  acquires  a  contingent  interest  in 
the property. Such interest becomes a vested interest, in the former case, on the happening of the 
event, in the latter, when the happening of the event becomes impossible. 

Exception.—Where,  under  a  transfer  of  property,  a  person  becomes  entitled  to  an  interest 
therein upon attaining a particular age, and the transferor also gives to him absolutely the income 
to arise from such interest before he reaches that age, or directs the income or so much thereof as 
may be necessary to be applied for his benefit, such interest is not contingent. 

22.  Transfer  to  members  of  a  class  who  attain  a  particular  age.—Where,  on  a  transferof 
property,  an  interest  therein  is  created  in  favour  of  such  members  only  of  a  class  as  shall  attain  a 
particular age, such interest does not vest in any member of the class who has not attained that age. 

23. Transfer contingent on happening of specified uncertain event.—Where, on a transferof 
property,  an  interest  therein  is  to  accrue  to  a  specified  person  if  a  specified  uncertain  event  shall 
happen,  and  no  time  is  mentioned  for  the  occurrence  of  that  event,  the  interest  fails  unless  such 
event happens before, or at the same time as, the intermediate or precedent interest ceases to exist. 

24. Transfer to such of certain persons as survive at some period not specified.—Where, on 
a transfer of property, an interest therein is to accrue to such of certain persons as shall be surviving 
at some period, but the exact period is not specified, the interest shall go to such of them as shall be 
alive when the intermediate or precedent interest ceases to exist, unless a contrary intention appears 
from the terms of the transfer. 

Illustration 

A transfers property to B for life, and after his death to C and D, equally to be divided between them, or to the 

survivor of them. C dies during the life of B. D survives B. At B's death the property passes to D. 

25.  Conditional transfer.—An interest created on a transfer of property and dependent upon a 
condition fails if the fulfilment of the condition is impossible, or is forbidden by law, or is of such a 
nature that, if permitted, it would defeat the provisions of any law, or is fraudulent, or involves or 
implies injury to the person or property of another, or the Court regards it as immoral or opposed to 
public policy. 

Illustrations 

(a) lets a farm to B on condition that he shall walk a hundred miles in an hour. The lease is void. 

(b) A gives Rs. 500 to B on condition that he shall marry A's daughter C. At the date of the transfer C was dead. The 

transfer is void. 

(c) A transfers Rs. 500 to B or. condition that she shall murder C. The transfer is void. 

(d) A transfer Rs. 500 to his nece C if she will desert her husband. The transfer is void. 

26.  Fulfilment  of  condition  precedent.—Where  the  terms  of  a  transfer  of  property  impose  a 
conditions  to  be  fulfilled  before  a  person  can  take  an  interest  in  the  property,  the  condition  shall  be 
deemed to have been substantially complied with. 

Illustrations 

(a) A transfers Rs. 5,000 to B on condition that he shall marry with the consent of C, D, and E. E dies. B marries with 

the consent of C and D. B is deemed to have fulfilled the condition. 

(b) A transfers Rs. 5,000 to B on condition that he shall marry with the consent of C, D and E.B marries without the 

consent of C, D and E, but obtains their consent after the marriage. B has not fulfilled the condition. 

13 

 
27.  Conditional  transfer  to  one  person  coupled  with  transfer  to  another  on  failure  of  prior 
disposition.—Where, on a transfer of property, an interest therein is created in favour of one person, and 
by  the  same  transaction an  ulterior  disposition  of  the  same  interest  is  made  in  favour  of  another, if  the 
prior disposition under the transfer shall fail, the ulterior disposition shall take effect upon the failure of 
the  prior  disposition,  although  the  failure  may  not  have  occurred  in  the  manner  contemplated  by  the 
transferor. 

But, where the intention of the parties to the transaction is that the ulterior disposition shall take effect 
only in the event of the prior disposition failing in a particular manner, the ulterior disposition shall not 
take effect unless the prior disposition fails in that manner. 

Illustrations 
(a) A transfers Rs. 500 to B on condition that he shall execute a certain lease within three months after A’s death, and, 

if he should neglect to do so, to C. B dies in A's life-time. The disposition in favour of C takes effect. 

(b)  A  transfers  property  to  his  wife;  but,  in  case  she  should  die  in  his  life-time,  transfers  to  B  that  which  he  had 
transferred  to  her.  A  and  his  wife  perish  together,  under  circumstances  which  make  it  impossible  to  prove  that  she  died 
before him. The disposition in favour of B does not take effect. 

28. Ulterior transfer conditional on happening or not happening specified event.—On a transfer 
of property an interest therein may be created to accrue to any person with the condition superadded that 
in case a specified uncertain event shall happen such interest shall pass to another person, or that in case a 
specified  uncertain  event  shall  not  happen  such  interest  shall  pass  to  another  person.  In  each  case  the 
dispositions are subject to the rules contained in sections 10, 12, 21, 22, 23, 24, 25 and 27. 

29. Fulfillment of condition subsequent.—An ulterior disposition of the kind contemplated by the 

last preceding section cannot, take effect unless the condition is strictly fulfilled. 

Illustration 

A transfers Rs. 500 to B, to be paid to him on his attaining his majority or marrying, with a proviso that, if B dies a 
minor or marries without C's consent, the Rs. 500 shall go to D. B marries when only 17 years of age, without C's consent. 
The transfer to D takes effect. 

30. Prior disposition not affected by invalidity of ulterior disposition.—If the ulterior disposition 

is not valid, the prior disposition is not affected by it. 

Illustration 

A transfers a farm to B for her life, and, if she do not desert her husband to C. B is entitled to the farm during her life as 

if no condition had been inserted. 

31. Condition that transfer shall cease to have effect in case specified uncertain event happens 
or does not happen.—Subject to the provisions of section 12, on a transfer of property an interest therein 
may  be  created  with  the  condition  superadded  that  it  shall  cease  to  exist  in  case  a  specified  uncertain 
event shall happen, or in case a specified uncertain event shall not happen. 

Illustrations 

(a) 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. He loses his life-interest in the farm. 

(b) A transfers a farm to B, provided that, if B shall not go to England within three years after the date of the transfer, 

his interest in the farm shall cease. B does not go to England within the term prescribed. His interest in the farm ceases. 

32.  Such  condition must be  invalid.—In order that a condition that an interest shall cease to exist 
may be valid, it is necessary that the event to which it relates be one which could legally constitute the 
condition of the creation of an interest. 

33. Transfer conditional on performance of act, no time specified for performance.—Where, on 
a transfer of property, an interest therein is created subject to a condition that the person taking it shall 
perform a certain act, but no time is specified for the performance of the act, the condition is broken when 
he renders impossible, permanently or for an indefinite period, the performance of the act. 

34.  Transfer  conditional  on  performance  of  act,  time  being  specified.—Where  an  act  is  to  be 
performed  by  a  person  either  as  a  condition  to  be  fulfilled  before  an  interest  created  on  a  transfer  of 
property is enjoyed by him, or as a condition on the non-fulfillment of which the interest is to pass from 

14 

 
him to another person, and a time is specified for the performance of the act, if such performance within 
the specified time is prevented by the fraud of a person who would be directly benefited by non-fulfilment 
of  the  condition,  such  further  time  shall  as  against  him  be  allowed  for  performing  the  act  as  shall  be 
requisite to make up for the delay caused by such fraud. But if no time is specified for the performance of 
the  act,  then,  if  its  performance  is  by  the  fraud  of  a  person  interested  in  the  non-fulfillment  of  the 
condition rendered impossible or indefinitely postponed, the condition shall as against him be deemed to 
have been fulfilled. 

35.  Election:  Election  when  necessary.—Where  a  person  professes  to  transfer  property  which  he 
has  no  right  to  transfer,  and  as  part  of  the  same  transaction  confers  any  benefit  on  the  owner  of  the 
property, such owner must elect either to confirm such transfer or to dissent from it; and in the latter case 
he shall relinquish the benefit so conferred, and the benefit so relinquished shall revert to the transferor or 
his representative as if it had not been disposed of, 

subject nevertheless, 

where the transfer is gratuitous, and the transferor has, before the election, died or otherwise become 

incapable of making a fresh transfer, 

and in all cases where the transfer is for consideration, 

to  the  charge  of  making  good  to  the  disappointed  transferee  the  amount  or  value  of  the  property 

attempted to be transferred to him. 

Illustrations 

The farm of Sultanpur is the property of C and worth Rs. 800. A by an instrument of gift professes to transfer it to B, giving 

by the same instrument Rs. 1,000 to C. C elects to retain the farm. He forfeits the gift of Rs. 1,000. 

In the same case, A dies before the election. His representative must out of the Rs. 1,000 pay Rs. 800 to B. 

The rule in the first paragraph of this section applies whether the transferor does or does not believe 

that which he professes to transfer to be his own. 

A person taking no benefit directly under a transaction, but deriving a benefit under it indirectly, need 

not elect. 

A  person  who  in  his  one  capacity  takes  a  benefit  under  the  transaction  may  in  another  dissent 

therefrom. 

Exception to the last preceding four rules.—Where a particular benefit is expressed to be conferred 
on the owner of the property which the transferor professes to transfer, and such benefit is expressed to be 
in lieu of that property, if such owner claim the property, he must relinquish the particular benefit, but he 
is not bound to relinquish any other benefit conferred upon him by the same transaction. 

Acceptance  of  the  benefit  by  the  person  on  whom  it  is  conferred  constitutes  an  election  by  him  to 
confirm the transfer, if he is aware of his duty to elect and of those circumstances which would influence 
the judgment of a reasonable man in making an election, or if he waives enquiry into the circumstances. 

Such  knowledge  or  waiver  shall,  in  the  absence  of  evidence  to  the  contrary,  be  presumed,  if  the 
person  on  whom  the  benefit  has  been  conferred  has  enjoyed  it  for  two  years  without  doing  any  act  to 
express dissent. 

Such knowledge of waiver may be inferred from any act of his which renders it impossible to place 
the persons interested in the property professed to be transferred in the same condition as if such act had 
not been done. 

Illustration 

A transfers to B an estate to which C is entitled, and as part of the same transaction gives C a coal-mine. C takes possession 

of the mine and exhausts it. He has thereby confirmed the transfer of the estate to B. 

If  he  does  not  within  one  year  after  the  date  of  the  transfer  signify  to  the  transferor  or  his 
representatives his intention to confirm or to dissent from the transfer, the transferor or his representative 
may, upon the expiration of that period, require him to make his election; and, if he does not comply with 

15 

 
such requisition within a reasonable time after he has received it, he shall be deemed to have elected to 
confirm the transfer. 

In case of disability, the election shall be postponed until the disability ceases, or until the election is 

made by some competent authority. 

36. Apportionment of periodical payments determination of interest of person entitled.—In the 
absence  of  a  contract  or  local  usage  to  the  contrary,  all  rents  annuities,  pensions,  dividends  and  other 
periodical payments in the nature of income shall, upon the transfer of the interest of the person entitled to 
receive such payments, be deemed, as between the transferor and the transferee, to accrue due from day to 
day,  and  to  be  apportion  able  accordingly,  but  to  be  payable  on  the  days  appointed  for  the  payment 
thereof. 

37.  Apportionment  of  benefit  of  obligation  on  severance.—When,  in  consequence  of  a  transfer, 
property is divided and held in several shares, and thereupon the benefit of any obligation relating to the 
property as a whole passes from one to several owners of the property, the corresponding duty shall, in 
the  absence  of  a  contract  to  the  contrary  amongst  the  owners,  be  performed  in  favour  of  each  of  such 
owners in proportion to the value of his share in the property, provided that the duty can be severed and 
that the severance does not substantially increase the burden of the obligation; but if the duty cannot be 
severed,  or  if  the  severance  would  substantially  increase  the  burden  of  the  obligation  the  duty  shall  be 
performed  for  the  benefit  of  such  one  of  the  several  owners  as  they  shall  jointly  designate  for  that 
purpose: 

Provided that no person on whom the burden of the obligation lies shall be answerable for failure to 
discharge  it  in  manner  provided  by  this  section,  unless  and  until  he  has  had  reasonable  notice  of  the 
severance. 

Nothing  in  this  section  applies  to  leases  for  agricultural  purposes  unless  and  until  the  State 

Government by notification in the Official Gazette so directs. 

Illustrations 

(a) A sells to B, C and D a house situated in a village and leased to E at an annual rent of Rs. 30 and delivery of one fat 
sheep, B having provided half the purchase-money and C and D one quarter each. E, having notice of this, must pay Rs. 15 to B, 
Rs. 7.50 to C, and Rs. 7.50 to D, and must deliver the sheep according to the Joint direction of B, C and D. 

(b)  In  the  same  case,  each  house  in  the  village  being  bound  to  provide  ten  days'  labour  each  year  on  a  duke  to  prevent 
inundation E had agreed as a term of his lease to perform this work for A. B, C and D severally require E to perform the ten days' 
work due on account of the house of each. E is not bound to do more than ten days' work in all, according to such directions as B, 
C and D may join in giving. 

38.  Transfer  by  person  authorised  only  under  certain  circumstances  to  transfer.—Where  any 
person, authorised only under circumstances in their nature variable to dispose of immoveable property, 
transfers  such  property  for  consideration,  alleging  the  existence  of  such  circumstances,  they  shall,  as 
between the transferee on the one part and the transferor and other persons (if any) affected by the transfer 
on the other part, be deemed to have existed, if the transferee, after using reasonable care to ascertain the 
existence of such circumstances, has acted in good faith. 

Illustration 

A, a Hindu widow, whose husband has left collateral heirs, alleging that the property held by her as such is insufficient for 
her  maintenance,  agrees,  for  purposes  neither  religious  nor  charitable,  to  sell  a  field,  part  of  such  property,  to  B.  B  satisfies 
himself by reasonable enquiry that the income of the property is insufficient for A's maintenance, and that the sale of the field is 
necessary, and acting in good faith, buys the field from A. As between B on the one part and A and the collateral heirs on the 
other part, a necessity for the sale shall be deemed to have existed. 

39. Transfer where third person is entitled to maintenance.—Where a third person has a right to 
receive  maintenance,  or  a  provision  for  advancement  or  marriage,  from  the  profits  of  immoveable 
property, and such property is transferred 1*** the right may be enforced against the transferee, if he has 
notice 2[thereof] or if the transfer is gratuitous; but not against a transferee for consideration and without 
notice of the right, nor against such property in his hands. 

1. The words “with the intention of defeating such right” omitted by Act 20 of 1929, s. 11. 
2. Subs. by s. 11, ibid., for “of such intention”. 

16 

 
                                                      
1* 

* 

* 

* 

* 

40.  Burden  of  obligation  imposing  restriction  on  use  of  land.—Where,  for  the  more  beneficial 
enjoyment  of  his  own  immoveable  property,  a  third  person  has,  independently  of  any  interest  in  the 
immoveable  property  of  another  or  of  any  easement  thereon,  a  right  to  restrain  the  enjoyment2[in  a 
particular manner of the latter property], or 

Or  of  obligation  annexed  to  ownership  but  not  amounting  to  interest  or  easement.—Where a 
third person is entitled to the benefit of an obligation arising out of contract and annexed to the ownership 
of immoveable property, but not amounting to an interest therein or easement thereon, 

such  right  or  obligation  may  be  enforced  against  a  transferee  with  notice  thereof  or  a  gratuitous 
transferee  of  the  property  affected  thereby,  but  not  against  a  transferee  for  consideration  and  without 
notice of the right or obligation, nor against such property in his hands. 

Illustration 

A contracts to sell Sultanpur to B. While the contract is still in force he sells Sultanpur to C, who has notice of the contract. 

B may enforce the contract against C to the same extent as against A. 

41.  Transfer  by  ostensible  owner.—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  violable  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. 

42.  Transfer  by  person  having  authority  to  revoke  former  transfer.—Where a person transfers 
any immoveable property, reserving power to revoke the transfer, and subsequently transfers the property 
for consideration to another transferee, such transfer operates in favour of such transferee (subject to any 
condition attached to the exercise of the power) as a revocation of the former transfer to the extent of the 
power. 

Illustration 

A lets a house to B, and reserves power to revoke the lease if, in the opinion of a specified surveyor, B should make a use of 
it detrimental to its value. Afterwards a, thinking that such a use has been made, lets the house to C. This operates as a revocation 
of B's lease subject to the opinion of the surveyor as to B's use of the house having been detrimental to its value. 

43.  Transfer  by  unauthorised  person  who  subsequently  acquires  interest  in  property 
transferred.—Where  a  person3[fraudulently  or]  erroneously  represents  that  he  is  authorised  to  transfer 
certain immovable property and professes to transfer such property for consideration, such transfer shall, 
at the option of the transferee, operate on any interest which the transferor may acquire in such property at 
any time during which the contract of transfer subsists. 

Nothing  in  this  section  shall  impair  the  right  of  transferees  in  good  faith  for  consideration  without 

notice of the existence of the said option. 

Illustration 

A,  a  Hindu  who  has  separated  from  his  father  B,  sells  to  C  three  fields, X,  Y  and  Z,  representing  that  A  is  authorised to 
transfer the same. Of these fields Z does not belong to A, it having been retained by B on the partition; but on B's dying A as heir 
obtains Z.C, not having rescinded the contract of sale, may require A to deliver Z to him . 

44.  Transfer  by  one  co-owner.—Where  one  of  two  or  more  co-owners  of  immoveable  property 
legally competent in that behalf transfers his share of such property or any interest therein, the transferee 
acquires  as  to  such  share  or  interest,  and  so  far  as  is  necessary  to  give,  effect  to  the  transfer,  the 
transferor's right to joint possession or other common or part enjoyment of the property, and to enforce a 
partition of the same, but subject to the conditions and liabilities affecting, at the date of the transfer, the 
share or interest so transferred. 

1. The Illustrations omitted by Act 20 of 1929, s. 11. 
2. Subs. by s. 12, ibid., for “of the latter property or to compel its enjoyment in a particular manner”. 
3. Ins. by s. 13, ibid. 

17 

 
 
 
 
 
 
 
 
 
                                                      
Where  the  transferee  of  a  share  of  a  dwelling-house  belonging  to  an  undivided  family  is  not  a 
member of the family, nothing in this section shall be deemed to entitle him to joint possession or other 
common or part enjoyment of the house. 

45. Joint transfer for consideration.—Where immoveable property is transferred for consideration 
to two or more persons and such consideration is paid out of a fund belonging to them in common, they 
are,  in  the  absence  of  a  contract  to  the  contrary,  respectively  entitled  to  interests  in  such  property 
identical, as nearly as may be, with the interests to which they were respectively entitled in the fund; and, 
where  such  consideration is  paid  out  of  separate  funds  belonging  to  them  respectively,  they  are,  in  the 
absence of a contract to the contrary, respectively entitled to interests in such property in proportion to the 
shares of the consideration which they respectively advanced. 

In the absence of evidence as to the interests in the fund to which they were respectively entitled, or 
as to the shares which they respectively advanced, such persons shall be presumed to be equally interested 
in the property. 

46. Transfer for consideration by persons having distinct interests.—Where immoveable property 
is  transferred  for  consideration  by  persons  having  distinct  interests  therein,  the  transferors  are,  in  the 
absence of a contract to the contrary, entitled to share in the consideration equally, where their interests in 
the property were of equal value, and, where such interests were of unequal value, proportionately to the 
value of their respective interests. 

Illustration 

(a) A, owing a moiety, and B and C, each a quarter share, of mauzaSultanpur, exchange an eighth share of that mauza for a 
quarter share of mauzaLalpura. There being no agreement to the contrary, A is entitled to an eighth share in Lalpura, and B and C 
each to a sixteenth share in that mauza. 

(b) A, being entitled to a life-interest in mauzaAtrali and B and C to the reversion, sell the mauza for Rs. 1,000. A's life-
interest is ascertained to be worth Rs. 600, the reversion Rs. 400. A is entitled to receive Rs. 600 out of the purchase-money. B 
and C to receive Rs. 4000. 

Illustrations 

(a) a Cowinga moiety, and B and C, each a quarter share, of mauzaSultanpur exchange an eighth share of that mauza for a 
quarter share of mauzaLalpura. There being no agreement to the contrary, A is entitled to an eighth share in Lalpura, and B and C 
each to a sixteenth share in that mauza. 

(b) A, being entitled to a life-interest in mauzaAtrali and B and C to the reversion, sell the mauza for Rs. 1,000. A's life-
interest is ascertained to be worth Rs. 600, the reversion Rs. 400. A is entitled to receive Rs 600 out of the purchase-money. B 
and C to receive Rs. 4000. 

47.  Transfer  by  co-owners  of  share  in  common  property.—Where  several  co-owners  of 
immoveable property transfer a share therein without specifying that the transfer is to take effect on 
any particular share or shares of the transferors, the transfer, as among such transferors, takes effect 
on such shares equally where the shares were equal, and where they were unequal, proprotionately to 
the extent of such shares. 

Illustration 

A, the owner of an eight-anna share, and B and C, each the owner of a four-anna share, in mauzaSultanpur, transfer a 
two-anna  share  in  the  mauza  to  D,  without  specifying  from  which  of  their  several  shares  the  transfer  is  made.  To  give 
effect to the transfer one-anna share is taken from the share of A, and half-an-anna share from each of the shares of B and 
C. 

48.  Priority  of  rights  created  by  transfer.—Where  a  person  purports  to  create  by  transfer  at 
different  times  rights  in  or  over  the  same  immoveable  property,  and  such  rights  cannot  all  exist  or  be 
exercised to their full extent together, each later created right shall, in the absence of a special contract or 
reservation binding the earlier transferees, be subject to the rights previously created. 

49. Transferee’s right under policy.—Where immoveable property is transferred for consideration, 
and such property or any part thereof is at the date of the transfer insured against loss or damage by fire, 
the transferee, in case of such loss or damage, may, in the absence of a contract to the contrary, require 
any  money  which  the  transferor  actually  receives  under  the  policy,  or  so  much  thereof  as  may  be 
necessary, to be applied in reinstating the property. 

50.  Rent  bona  fide  paid  to  holder  under  defective  title.—No  person  shall  be  chargeable  with 
any rents or profits of any immoveable property, which he has in good faith paid or delivered to any 

18 

 
person of whom he in good faith held such property, notwithstanding it may afterwards appear that the 
person to whom such payment or delivery was made had no right to receive such rents or profits. 

Illustration 

A lets a field to B at a rent of Rs. 50, and then transfers the field to C. B, having no notice of the transfer, in good faith pays 

the rent to A. B is not chargeable with the rent so paid. 

51.  Improvements  made  by  bona  fide  holders  under  defective  titles.—When  the  transferee  of 
immoveable  property  makes  any  improvement  on  the  property,  believing  in  good  faith  that  he  is 
absolutely entitled thereto, and he is subsequently evicted there from by any person having a better 
title, the transferee has a right to require the person causing the eviction either to have the value of the 
improvement estimated and paid or secured to the transferee, or to sell his interest in the property to the 
transferee at the then market value thereof irrespective of the value of such improvement. 

The amount to be paid  or secured in respect of such improvement shall be the estimated 

value thereof at the time of the eviction. 

When, under the circumstances aforesaid, the transferee has planted or sown on the property 
crops  which  arc  growing  when  he  is  evicted  therefrom,  he  is  entitled  to  such  crops  and  to  free 
ingress and egress to gather and carry them. 

52.  Transfer  of  property  pending  suit  relating  thereto.—During  the  1[pendency]  in  any 
Court having authority 2[3[within the limits of India excluding the State of Jammu and Kashmir] 
or established beyond such limits] by 4[the Central Government 5***] of 6[any] suit or proceeding 
7 [which  is  not  collusive  and]  in.  which  any  right  to  immoveable  property  is  directly  and 
specifically  in  question,  the  property  cannot  be  transferred  or  otherwise  dealt  with  by  any  party 
to the suit or proceeding so as to affect the rights of any other party thereto under any decree or 
order which may be made therein, except under the authority of the Court and on such terms as it 
may impose. 

8[Explanation.—For the purposes of this section, the pendency of a suit or proceeding shall be 
deemed  to  commence  from  the  date  of  the  presentation  of  the  plaint  or  the  institution  of  the 
proceeding  in a  Court  of  competent jurisdiction, and  to  continue  until  the  suit  or proceeding  has 
been disposed of by a final decree or order and complete satisfaction or discharge of such decree 
or order has been obtained, or has become unobtainable by reason of the expiration of any period 
of limitation prescribed for the execution thereof by any law for the time being in force.] 

9[53.  Fraudulent  transfer.—(1)Every  transfer  of  immoveable  property  made  with  intent  to 
defeat  or  delay  the  creditors  of  the  transferor  shall  be  voidable  at  the  option  of  any  creditor  so 
defeated or delayed. 

Nothing  in  this  sub-section  shall  impair  the  rights  of  a  transferee  in  good  faith  and  for 

consideration. 

Nothing  in  this  sub-section  shall  affect  any  law  for  the  time  being  in  force  relating  to 

insolvency. 

A  suit  instituted  by  a  creditor  (which  term  includes  a  decree-holder  whether  he  has  or  has 
not applied for execution of his decree) to avoid a transfer on the ground that it has been made 
with intent to defeat or delay the creditors of the transferor, shall be instituted on behalf of, or 
for the benefit of, all the creditors. 

(2)  Every  transfer  of  immoveable  property  made  without  consideration  with  intent  to  defraud  a 

subsequent transferee shall be voidable at the option of such transferee. 

1. Subs. by Act 20 of 1929, s.14, for “active prosecution”. 
2. Subs. by the A.O. 1950, for “in the Provinces or restablished beyond the limits of the Provinces”. 
3. Subs. by Act 3 of 1951, s. 3 and the Schedule, for “within the limits of Part A States and Part C States”              

(w.e.f. 1-4-1951). 

4. Subs. by the A.O. 1937, for “the Governor General in Council”. 
5. The words “or the Crown Representative” omitted by the A.O. 1948. 
6. Subs. by Act 20 of 1929, s. 14, for “a contentious 
7. Ins. by s. 14, ibid 
8. Added by 14, ibid. 
9. Subs. by s. 15, ibid., for section 53. 

19 

 
                                                      
 
For the purposes of this sub-section, no transfer made without consideration shall be deemed to have 

been made with intent to defraud by reason only that a subsequent transfer for consideration was made.] 

1 [53A.  Part  performance.—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 thereof, or the transferee, 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 2***, or, where there is an instrument of transfer, that the transfer has not 
been completed in the manner prescribed there for 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: 

Provided that 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.] 
CHAPTER III 
OF SALES OF IMMOVEABLE PROPERTY 

54.  “Sale”  defined.—“Sale” is a transfer of ownership in exchange for a price paid or promised 

or part-paid and part-promised. 

Sale  how  made.—Such transfer, in the case of tangible immoveable property of the value of one 
hundred rupees and upwards, or in the case of a reversion or other intangible thing, can be made only by a 
registered instrument. 

In  the  case  of  tangible  immoveable  property  of  a  value  less  than  one  hundred  rupees,  such  transfer 

may be made either by a registered instrument or by delivery of the property. 

Delivery of tangible immoveable property takes place when the seller places the buyer, or such person 

as he directs, in possession of the property. 

Contract  for  sale.—A  contract  for  the  sale  of  immoveable  property  is  a  contract  that  a  sale  of 

such property shall take place on terms settled between the parties. 

It does not, of itself, create any interest in or charge on such property. 

STATE AMENDMENTS 

Assam. 

Amendment  of  section  54  of  the  Central  Act  4  of  1882.—In  Section  54  of  the  principal  Act,  in     

para  2,  for  the  expression  “by  a  registered  instrument”  the  following  expression  shall  be  substituted,               
namely: — 

“by an instrument registered in the State of Assam, notwithstanding anything contained in the India 

Registration Act, 1908 (Act 16 of 1908) to the contrary.” 

[Vide Assam Act 10 of 1976, s. 2.] 
55.  Rights  and  liabilities  of  buyer  and  seller.—In the absence of a contract to the contrary, 
the buyer and the seller of immoveable property respectively are subject to the liabilities, and have the 
rights, mentioned in the rules next following, or such of them as are applicable to the property sold: 

(1) The seller is bound— 
(a)  to  disclose  to  the  buyer  any  material  defect  in  the  property 3[or  in  the  seller’s  title  thereto]  of 
which  the  seller  is,  and  the  buyer  is  not,  aware,  and  which  the  buyer  could  not  with  ordinary  care 
discover; 

1 . In s. b y Act 20  o f 19 29, s. 16 . 
2. The words “the contract though required to be registered, has not been registered, or” omitted by Act 48 of 2001, s. 10 (w.e.f. 

24-9-2001). 

3 . In s. b y Act 20  o f 19 29, s. 17 . 

20 

 
                                                      
(b) to produce to the buyer on his request for examination all documents of title relating to the 

property which are in the seller's possession or power; 

(c)  to  answer  to  the  best  of  his  information  all  relevant  questions  put  to  him  by  the  buyer  in 

respect to the property or the title thereto; 

(d)  on  payment  or  tender  of  the  amount  due  in  respect  of  the  price,  to  execute  a  proper 
conveyance of the property when the buyer tenders it to him for execution at a proper time and place; 

(e) between the date of the contract of sale and the delivery of the property, to take as much care 
of the property and all documents of title relating thereto which are in his possession, as an owner of 
ordinary prudence would take of such property and documents; 

(f) to give, on being so required, the buyer, or such person as he directs, such possession of the 

property as its nature admits; 

(g) to  pay  all  public  charges  and rent  accrued  due  in respect  of  the  property  up to the 
date of the sale, the interest on all incumbrances on such property due on such date, and, 
except where the property is sold subject to incumbrances, to discharge all incumbrances 
on the property then existing. 

(2)  The  seller  shall  be  deemed  to  contract  with  the  buyer  that  the  interest  which  the  seller 

professes to transfer to the buyer subsists and that he has power to transfer the same. 

Provided  that,  where  the  sale  is  made  by  a  person  ina  fiduciary  character,  he  shall  be 
deemed  to  contract  with  the  buyer  that  the  seller  has  done  no  act  whereby  the  property  is 
incumbered or whereby he is hindered from transferring it. 

The  benefit  of  the  contract  mentioned  in  this  rule  shall  be  annexed  to,  and  shall  go 
with,  the  interest  of  the  transferee  as  such,  and  may  be  enforced  by  every  person  in  whom 
that interest is for the whole or any part thereof from time to time vested. 

(3) Where the whole of the purchase-money has been paid to the seller, he is also bound to 
deliver  to  the  buyer  all  documents  of  title  relating  to  the  property  which  are  in  the  seller’s 
possession or power: 

Provided  that,  (a)  where  the  seller  retains  any  part  of  the  property  comprised  in  such 
documents,  he  is  entitled  to  retain them  all,  and,  (b)  where  the  whole  of  such  property  is  sold 
to different buyers the buyers, of the lot of greatest value is entitled to such documents. But in 
case  (a)  the  seller,  and  in  case (b) the  buyer  of  the  lot  of  greatest  value, is  bound,  upon  every 
reasonable request  by  the  buyer,  or  by  any  of  the  other  buyers,  as  the  case  may  be,  and  at  the 
cost  of  the  person  making  the  request,  to  produce  the  said  documents  and  furnish  such  true 
copies  thereof  or  extracts  therefrom  as  he  may  require; and  in  the  meantime,  the  seller,  or the 
buyer,  of  the  lot  of  greatest  value,  as  the  case  may  be,  shall  keep  the  said  documents  safe, 
uncancelled and undefaced, unless prevented from so doing by fire or other inevitable accident. 

(4) The seller is entitled— 

(a)  to  the  rents  and  profits  of  the  property  till  the  ownership  thereof  passes  to  the 

buyer; 

(b) where the ownership of the property has passed to the buyer before payment of the 
whole  of  the  purchase-money,  to  a  charge  upon  the  property  in  the  hands  of  the  buyer, 
1[any transferee  without consideration  or  any transferee,  with notice  of  the  non-payment,] 
for  the  amount  of  the  purchase-money,  or  any  part  thereof  remaining  unpaid,  and  for 
interest on such amount or part 1[from the date on which possession has been delivered]. 

(5) The buyer is bound— 

(a) to disclose to the seller any fact as to the nature or extent of the seller’s interest in the 
property of which the buyer is aware, but of which he has reason to believe that the seller is 
not aware, and which materially increases the value of such interest; 

1 . In s. b y Act 20  o f 19 29, s. 17 . 

21 

 
                                                      
(b) to pay or tender, at the time and place of completing the sale, the purchase-money to 
the seller or such person, as he directs: provided that, where the property is sold free from 
incumbrances,  the  buyer  may  retain  out  of  the  purchase-money  the  amount  of  any 
incumbrances on the property existing at the date of the sale, and shall pay the amount so retained to 
the persons entitled thereto; 

(c) where the ownership of the property has passed to the buyer, to bear any loss arising from the 

destruction, injury or decrease in value of the property not caused by the seller; 

(d) where the ownership of the property has passed to the buyer, as between himself and the 
seller, to pay all public charges and rent which may become payable in respect of the property, 
the  principal  moneys  due  on  any  incumbrances  subject  to  which  the  property  is  sold,  and  the 
interest thereon afterwards accruing due. 

(6) The buyer is entitled— 

(a) where the ownership of the property has passed to him, to the benefit of any improvement 

in, or increase in value of, the property, and to the rents and profits thereof; 

(b) unless he has improperly declined to accept delivery of the property, to a charge on the 
property,  as  against  the  seller  and  all  persons  claiming  under  him  1***  to  the  extent  of  the 
seller's  interest  in  the  property,  for  the  amount  of  any  purchase-money  properly  paid  by  the 
buyer  in  anticipation  of  the  delivery  and  for  interest  on  such  amount;  and,  when  he  properly 
declines to accept the delivery, also for the earnest (if any) and for the costs (if any) awarded to 
him  of  a  suit  to  compel  specific  performance  of  the  contract  or  to  obtain  a  decree  for  its 
rescission. 

An omission to make such disclosures as are mentioned in this section, paragraph (1), clause (a), and 

paragraph (5), clause (a), is fraudulent. 

2 [56.  Marshalling  by  subsequent  purchaser.—If  the  owner  of  two  or  more  properties 
mortgages  them  to  one  person  and  then  sells  one  or  more  of  the  properties  to  another  person,  the 
buyer  is,  in  the  absence  of  a  contract  to  the  contrary,  entitled  to  have  the  mortgage-debt  satisfied 
out  of  the  property  or  properties  not  sold  to  him,  so  far  as  the  same  will  extend,  but  not  so  as  to 
prejudice the rights of the  mortgagee  or persons claiming under him or any  other person  who  has 
for consideration acquired an interest in any of the properties.] 

Discharge of incumbrances on sale 

57. Provision by Court for incumbrances, and sale freed therefrom.—(a) Where immoveable 
property subject to any incumbrance, whether immediately payable or not, is sold by the Court or in 
execution of a decree, or out of Court, the Court may, if it thinks fit, on the application of any party 
to the sale, direct or allow payment into Court,— 

(1) in case of an annual or monthly sum charged on the property, or of a capital sum charged on a 
determinable interest in the property,—of such amount as, when invested in securities of the Central 
Government, the Court considers will be sufficient, by means of the interest thereof, to keep down or 
otherwise provide for that charge, and 

(2) in any other case of a capital sum charged on the property,—of the amount sufficient to meet 

the incumbrance and any interest due thereon. 

But  in  either  case  there  shall  also  be  paid  into  Court  such  additional  amount  as  the  Court 
considers will be sufficient to meet the contingency of further costs, expenses and interest, and any 
other contingency, except depreciation of investments, not exceeding one-tenth part of the original 
amount  to  be  paid  in,  unless  the  Court  for  special  reasons  (which  it  shall  record)  thinks  fit  to 
require a larger additional amount. 

(b)  Thereupon  the  Court  may,  if  it  thinks  fit,  and  after  notice  to  the  incumbrance,  unless  the 
Court, for reasons to be  recorded in writing, thinks fit to dispense with such notice, declare the 
property to be freed from the incumbrance, and make any order for conveyance, or vesting order, 

1. The words “with notice of the payment” omitted by Act 20 o f 19 29, s. 17. 
2. Subs. bys. 18, ibid., for section 56. 

22 

 
                                                      
 
proper  for  giving  effect  to  the  sale,  and  give  directions  for  the  retention  and  investment  of  the 
money in Court. 

(c)  After  notice  served  on  the  persons  interested  in  or  entitled  to  the  money  or  fund  in 
Court  the  Court  may  direct  payment  or  transfer  thereof  to  the  persons  entitled  to  receive  or 
give a discharge for the same, and generally may give directions respecting the application or 
distribution of the capital or income thereof. 

(d) An appeal shall lie from any declaration, order or direction under this section as if the same were 

a decree. 

(e)  In  this  section  “Court”  means  (1)  a  High  Court  in  the  exercise  of  its  ordinary  or 
extraordinary original civil jurisdiction, (2) the Court of a District Judge  within the local limits 
of  whose  jurisdiction  the  property  or  any  part  thereof  is  situate,  (3)  any  other  Court  which  the 
State  Government  may,  from  time  to  time,  by  notification  in  the  Official Gazette,  declare  to  be 
competent to exercise the jurisdiction conferred by this section. 

CHAPTER IV 
O F   M O R T G A G E S   O F   I M M I O V E AB L E   P R O P E R T Y   A N D   C H A R G E S  

58.  “Mortgage”,  “mortgagor”,  “mortgagee”,  “mortgage-money”  and  “mortgage-deed” 
defined.—(a)  A  mortgage  is  the  transfer  of  an  interest  in  specific  immoveable  property  for  the 
purpose  of  securing  the  payment  of  money  advanced  or  to  be  advanced  by  way  of  loan,  an 
existing or future debt, or the performance of an engagement which may give rise to a pecuniary 
liability. 

The  transferor  is  called a  mortgagor,  the  transferee  a  mortgagee;  the  principal  money  and 
interest  of  which  payment  is  secured  for  the  time  being  arc  called  the  mortgage-money,  and 
the instrument (if any) by which the transfer is effected is called a mortgage-deed. 

(b)  Simple  mortgage.—Where,  without  delivering  possession  of  the  mortgaged  property, 
the  mortgagor  binds  himself  personally  to  pay  the  mortgage-money,  and  agrees,  expressly  or 
impliedly, that, in the event of  his failing to pay  according to his contract, the  mortgagee shall 
have a right to cause the  mortgaged property to  be sold and the proceeds  of sale to be applied, 
so  far  as  may  be  necessary,  in  payment  of  the  mortgage-money,  the  transaction  is  called  a 
simple mortgage and the mortgagee a simple mortgagee. 

(c)  Mortgage  by  conditional  sale.—Where  the  mortgagor  ostensibly  sells  the  mortgaged 

property— 

on condition that on default of payment of the mortgage-money on a certain date the sale shall 

become absolute, or 

on condition that on such payment being made the sale shall become void, or 

on  condition  that  on  such  payment  being  made  the  buyer  shall  transfer  the  property  to 

the seller, 

the  transaction  is  called  a  mortgage  by  conditional  sale  and  the  mortgagee  a  mortgagee  by 
conditional sale: 

1[Provided  that  no  such  transaction  shall  be  deemed  to  be  a  mortgage,  unless  the  condition  is 

embodied in the document which effects or purports to effect the sale.] 

(d)  Usufructuary  mortgage.—Where  the  mortgagor  delivers  possession  2 [or  expressly  or  by 
implication  binds  himself  to  deliver  possession]  of  the  mortgaged  property  to  the  mortgagee,  and 
authorises him to retain such possession until payment of the mortgage-money, and to receive 
the  rents  and  profits  accruing  from  the  property 3[or  any  part  of  such  rents  and  profits  and  to 
appropriate  the  same]  in  lieu  of  interest,  or  in  payment  of  the  mortgage-money,  or  partly  in 
lieu  of  interest  4[or]  partly  in  payment  of  the  mortgage-money,  the  transaction  is  called  an 
usufructuary mortgage and the mortgagee an usufructuary mortgagee. 

1. A d d e d   b y   A c t   2 0   o f   1 9 2 0 ,   s .   1 9 .  
2 .   I n s .   b y   s .   1 9 ,   i b i d .  
3. Subs. by s. 19, ibid., for “and to appropriate them”. 
4. Subs. by s. 19, ibid., for “and”. 

23 

 
                                                      
(e)  English  mortgage.—Where  the  mortgagor  binds  himself  to  repay  the  mortgage-money  on  a 
certain date, and transfers the mortgaged property absolutely to the mortgagee, but subject to a proviso 
that  he  will  re-transfer  it  to  the  mortgagor  upon  payment  of  the  mortgage-money  as  agreed,  the 
transaction is called an English mortgage. 

1[(f)  Mortgage  by  deposit  of  title-deeds.—Where  a  person  in  any  of  the  following  towns, 
namely,  the  towns  of  Calcutta,  Madras  2[and  Bombay],  3***  and  in  any  other  town  which  the 
4[State Government concerned] may, by notification in the Official Gazette, specify in this behalf, 
delivers to a creditor or his agent documents of title to immoveable property, with intent to create 
a security thereon, the transaction is called a mortgage by deposit of title-deeds. 

(g)  Anomalous  mortgage.—A  mortgage  which  is  not  a  simple  mortgage,  a  mortgage  by 
conditional  sale,  an  usufructuary  mortgage,  an  English  mortgage  or  a  mortgage  by  deposit  of 
title-deeds within the meaning of this section is called an anomalous mortgage.] 

59.  Mortgage  when  to  be  by  assurance—Where  the  principal  money  secured  is  one  hundred 
rupees  or  upwards,  a  mortgage 5[other  than  a  mortgage  by  deposit  of  title-deeds],  can  be  effected 
only by a registered instrument signed by the mortgagor and attested by at least two witnesses. 

Where  the  principal  money  secured  is  less  than  one  hundred  rupees,  a  mortgage  may  be 
effected  either  by 6[a  registered  instrument]  signed  and  attested  as  aforesaid,  or  (except  in  the 
case of a simple mortgage) by delivery of the property. 

* 

7* 
8[59A.  References  to  mortgagors  and  mortgagees  to  include  persons  deriving  title  from 
them.—Unless  otherwise  expressly  provided,  references  inthis  Chapter  to  mortgagors  and 
mortgagees  shall  be  deemed  to  include  references  to  persons  deriving  title  from  them 
respectively.] 

* 

* 

Rights and liabilities of mortgagor 

60. Right of mortgagor to redeem.—At any time after the principal money has become 9[due], 
the  mortgagor  has  a  right,  on  payment  or  tender,  at  a  proper  time  and  place,  of  the  mortgage-
money,  to  require  the  mortgagee(a)  to  deliver  10 [to  the  mortgagor  the  mortgage-deed  and  all 
documents  relating  to  the  mortgaged  property  which  are  in  the  possession  or  power  of  the 
mortgagee],  (b)  where  the  mortgagee  is  in  possession  of  the  mortgaged  property,  to  deliver 
possession  thereof  to  the  mortgagor,  and  (c)at  the  cost  of  the  mortgagor  either  to  re-transfer  the 
mortgaged property to him  or to such third  person as  he  may  direct, or to execute and (where the 
mortgage  has  been  effected  by  a  registered  instrument)  to  have  registered  an  acknowledgement  in 
writing that any right in derogation of his interest transferred to the mortgagee has been extinguished: 

Provided that the right conferred by this section has not been extinguished by act of the parties or by 

11[decree] of a Court. 

The right conferred by this section is called a right to redeem, and a suit to enforce it is called a suit 

for redemption. 

Nothing in this section shall be deemed to render invalid any provision to the effect that, if 
the time fixed for payment of the principal money has been allowed to pass or no such time has 
been  fixed.  the  mortgagee  shall  be  entitled  to  reasonable  notice  before  payment  or  tender  of 
such money. 

1. Added b y Act 20 of 1929, s. 19. 
2. Subs. by the A.O. 1948, for “Bo mbay and Karachi”. The word “and” had been ins. b y the A.O. 1937. 
3. The words “Ran goon, Moulmein, Bassein and Akyab ” omitted b y the A.O. 1937. 
4. The  words “Governor  General in Council” successively  amended  by the  A.O. 1937  and  the  A.O. 1950  to  read 

as above. 

5. Ins. by Act 20 of 1929, s. 20. 
6. Subs. by Act 6 of 1904, s. 3, for “an instrument”. 
7. Third paragraph omitted by Act 20 of 1929, s. 20. 
8. In s. b y s. 21 , ibid. 
9. Subs. by s. 22, ibid., for “payable”. 
10. Subs. by s. 22, ibid., for “the mortgage-deed, if any, to the mortgagor”. 
11. Subs. by Act 20 of 1929, s. 22, for  “order”. 

24 

 
 
 
 
 
 
 
 
 
 
                                                      
 
Redemption  of  portion  of  mortgaged  property.—Nothing  in  this  section  shall  entitle  a 
person  interested  in  a  share  only  of  the  mortgaged  property  to  redeem  his  own  share  only,  on 
payment  of  a  proportionate  part  of  the  amount  remaining  due  on  the  mortgage,  except 1[only] 
where a mortgagee, or, if there are more mortgagees than one, all such mortgagees, has or have 
acquired, in whole or in part, the share of a mortgager. 

2[60A.  Obligation  to  transfer  to  third  party  instead  of  retransference  to  mortgagor.—
(1)Where a mortgagor is entitled to redemption, then, on the fulfilment of any conditions on the 
fulfilment of which he would be entitled to require a re-transfer, he may require the mortgagee, 
instead  of  re-transferring  the  property,  to  assign  the  mortgage-debt  and  transfer  the  mortgaged 
property to such third person as the mortgagor may direct; and the mortgagee shall be bound to 
assign and transfer accordingly. 

(2) The rights conferred by this section belong to and may be enforced by the mortgagor or 
by  any  encumbrancer  notwithstanding  an  intermediate  encumbrance:  but  the  requisition  of  any 
encumbrancer shall prevail over a requisition of the mortgagor and, as between encumbrancers, 
the requisition of a prior encumbrancer shall prevail over that of a subsequent encumbrancer. 

(3)  The  provisions  of  this  section  do  not  apply  in  the  case  of  a  mortgagee  who  is  or  has  been  in 

possession. 

60B. Right to inspection and production of documents.—A mortgagor, as long as his right 
of  redemption  subsists,  shall  be  entitled  at  all  reasonable  times,  at  his  request  and  at  his  own 
cost,  and  on  payment  of  the  mortgagee’s  costs  and  expenses  in  this  behalf,  to  inspect  and  make 
copies  or  abstracts  of,  or  extracts  from,  documents  of  title  relating  to  the  mortgaged  property 
which arc in the custody or power of the mortgagee.] 

3[61.  Right  to  redeem  separately  or  simultaneously.—A  mortgagor  who has executed two 
or  more  mortgages  in  favour  of  the  same  mortgagee  shall,  in  the  absence  of  a  contract  to  the 
contrary,  when  the  principal  money  of  any  two  or  more  of  the  mortgages  has  become  due,  be 
entitled  to  redeem  any  one  such  mortgage  separately,  or  any  two  or  more  of  such  mortgages 
together.] 

62.  Right  of  usufructuary  mortgagor  to  recover  possession.—In  the  case  of  a  usufructuary 
mortgage, the mortgagor has a right to recover possession of the property 4[together with the mortgage-
deed and all documents relating to the mortgaged property which are in the possession or power of the 
mortgagee].—  

(a)  where  the  mortgagee  is  authorised  to  pay  himself  the  mortgage-money  from  the 

rents and profits of the property.—when such money is paid: 

(b)  where  the  mortgagee  is  authorised  to  pay  himself  from  such  rents  and  profits 5[or 
arty part thereof a part only of the mortgage-money,]—.when the term (if any), prescribed 
for the payment of the mortgage-money has expired and the mortgagor pays or tenders to 
the  mortgagee  6[the  mortgage-money  or  the  balance  thereof]  or  deposits  it  in  Court  as 
hereinafter provided. 

63. Accession to mortgaged property.—Where mortgaged property in possession of the 
mortgagee  has,  during  the  continuance  of  the  mortgage,  received  any  accession,  the  mort-
gagor,  upon  redemption,  shall,  in  the  absence  of  a  contract  to  the  contrary,  be  entitled  as 
against the mortgagee to such accession. 

1. Ins. by Act 20 of 1929, s. 22. 
2. Sections 60A and 60B ins. by s. 23, ibid. 
3. Subs. by s. 24, ibid., for s. 61. 
4. Ins. by s. 25, ibid. 
5. Subs. by s. 25, ibid., for “the interest of the principal money”. 
6. Subs. by s. 25, ibid., for “the principal money”. 

25 

 
                                                      
 
Accession  acquired  in  virtue  of  transferred  ownership.—Where  such  accession  has 
been  acquired  at  the  expense  of  the  mortgagee,  and  is  capable  of  separate  possession  or 
enjoyment  without  detriment  to  the  principal  property,  the  mortgagor  desiring  to  take  the 
accession must pay to the mortgagee the expense of acquiring it. If such separate possession 
or  enjoyment  is  not  possible,  the  accession  must  be  delivered  with  the  property;  the 
mortgagor being liable, in the case of an acquisition necessary to preserve the property from 
destruction, forfeiture or sale, or made with his assent, to pay the proper cost thereof, as an 
addition  to  the  principal  money,  1 [with  interest  at  the  same  rate  as  is  payable  on  the 
principal, or, where no such rate is fixed, at the rate of nine per cent. per annum]. 

In  the  case  last  mentioned  the  profits,  if  any,  arising  from  the  accession  shall  be  credited  to  the 

mortgagor. 

Where the mortgage is usufructuary and the accession has been acquired at the expense 
of  the  mortgagee,  the  profits,  if  any,  arising  from  the  accession  shall,  in  the  absence  of  a 
contract  to  the  contrary,  be  set  off  against  interest,  if  any,  payable  on  the  money  so 
expended. 

2[63A. Improvements to mortgaged property.—(1) Where mortgaged property in posses-
sion  of  the  mortgagee  has,  during  the  continuance  of  the  mortgage,  been  improved,  the 
mortgagor, upon redemption, shall, in the absence of a contract to the contrary, be entitled to 
the  improvement;  and  the  mortgagor  shall  not,  save  only  in  cases  provided  for  in  sub-section 
(2),be liable to pay the cost thereof. 

(2)Where  any  such  improvement  was  effected  at  the  cost  of  the  mortgagee  and  was 
necessary  to  preserve  the  property  from  destruction  or  deterioration  or  was  necessary  to 
prevent  the  security  from  becoming  insufficient,  or  was  made  in  compliance  with  the 
lawful  order  of  any  public  servant  or  public  authority,  the  mortgagor  shall,  in  the  absence 
of a contract to the contrary, be liable to, pay the proper cost thereof as an addition to the 
principal  money  with interest  at  the same  rate  as  is  payable  on the  principal,  or,  where  no 
such rate is fixed, at the rate  of  nine  per cent. per annum,  and the  profits, if any, accruing 
by reason of the improvement shall be credited to the mortgagor.] 

64.  Renewal  of  mortgaged  lease.—Where  the  mortgaged  property  is  a  lease 3***,  and 
the mortgagee obtains a renewal of the lease, the mortgagor, upon redemption, shall, in the 
absence of a contract by him to the contrary, have the benefit of the new lease. 

65. Implied contracts by mortgagor.—In the absence of a contract to the contrary, the 

mortgagor shall be deemed to contract with the mortgagee,— 

(a)  that  the  interest  which  the  mortgagor  professes  to  transfer  to  the  mortgagee 

subsists, and that the mortgagor has power to transfer the same; 

(b)  that  the  mortgagor  will  defend,  or,  if  the  mortgagee  be  in  possession  of  the 

mortgaged property, enable him to defend, the mortgagor’s title thereto; 

(c)  that  the  mortgagor  will,  so  long  as  the  mortgagee  is  not  in  possession  of  the 

mortgaged property, pay all public charges accruing due in respect of the property; 

(d) and, where the mortgaged property is a lease 4***, that the rent payable under the lease, 
the  conditions  contained  therein,  and  the  contracts  binding  on  the  lessee  have  been  paid, 
performed  and  observed  down  to  the  commencement  of  the  mortgage;  and  that  the  mortgagor 
will,  so  long  as  the  security  exists  and  the  mortgagee  is  not  in  possession  of  the  mortgaged 
property,  pay  the  rent  reserved  by  the  lease,  or,  if  the  lease  be  renewed,  the  renewed  lease, 
perform  the  conditions  contained  therein  and  observe  the  contracts  binding  on  the  lessee,  and 

1. Subs. by Act 20 of 1929, s. 26, for “at the same rate of interest”. 
2. Ins. bys. 27, ibid. 
3. The words “for a term of years” omitted by s. 28, ibid. 
4. The words “for a term of years” omitted by s. 29, ibid. 

26 

 
                                                      
 
indemnify the mortgagee against all claims sustained by reason of the non-payment of the said 
rent or the a non-performance or non-observance of the said conditions and contracts; 

(e)  and,  where the  mortgage  is a  second  or  subsequent incumbrance  on the  property, that 
the mortgagor will pay the interest from time to time accruing due on each prior incumbrance 
as and when it becomes due, and will at the proper time discharge the principal money due on 
such prior incumbrance. 
1* 

*. 

* 

* 

* 

The benefit of the contracts mentioned in this section shall be annexed to and shall go with the 
interest  of the  mortgagee  as  such, and  may  be  enforced  by  every  person  in  whom  that interest is 
for the whole or any part thereof from time to time vested. 

2[65A. Mortgagor’s power to lease.—(1) Subject to the provisions of sub-section (2), a mortgagor, 
while lawfully in possession of the mortgaged property, shall have power to make leases thereof which 
shall be binding on the mortgagee. 

(2) (a) Every such lease shall be such as would be made in the ordinary course of management of the 

property concerned, and in accordance with any local law, custom or usage. 

(b)  Every  such  lease  shall  reserve  the  best  rent  that  can  reasonably  be  obtained,  and  no  premium 

shall be paid or promised and no rent shall be payable in advance. 
(c) No such lease shall contain a covenant for renewal. 
(d) Every such lease shall take effect from a date not later than six months from the date on which it 

is made. 

(e)  In  the  case  of  a  lease  of  buildings,  whether  leased  it  or  without  the  land  on  which  they 
stand, the duration of the lease shall in no case exceed three years, and the lease shall contain a 
covenant for payment of the rent and a condition of re-entry on the rent not being paid within a 
time therein specified. 

(3)  The  provisions  of  sub-section  (1)  apply  only  if  and  as  far  as  a  contrary  intention  is  not 
expressed in the mortgage-deed; and the provisions of sub-section (2) may be varied or extended by 
the mortgage-deed and, as so varied and extended, shall, as far as may be, operate in like manner and 
with all like incidents, effects and consequences, as if such variations or extensions were contained in 
that sub-section.] 

66.  Waste  by  mortgagor  in  possession.—A  mortgagor  in  possession  of  the  mortgaged 
property is not liable to the mortgagee for allowing the property to deteriorate; but he must not 
commit  any  act  which  is  destructive  or  permanently  injurious  thereto,  if  the  security  is 
insufficient or will be rendered insufficient by such act. 

Explanation.—A security is insufficient within the meaning of this section unless the value of the 
mortgaged property exceeds by one-third, or, if consisting of buildings, exceeds by one-half, the amount 
for the time being due on the mortgage. 

Rights and liabilities of mortgagee 

67. Right to foreclosure or sale.—In the absence of a contract to the contrary, the mortgagee 
has, at any time after the mortgage-money has become 3[due] to him, and before a decree has been 
made  for  the  redemption  of  the  mortgaged  property,  or  the  mortgage-money  has  been  paid  or 
deposited as hereinafter provided, a right to obtain from the Court 4[a decree] that the mortgagor 
shall be absolutely debarred of his right to redeem the property, or 4[a decree] that the property be 
sold. 

A suit to obtain  4[a decree] that a mortgagor shall be absolutely debarred of his right to redeem the 

mortgaged property is called a suit for foreclosure. 

1. Certain words omitted by Act 20 of 1929, s. 29. 
2. Ins. by s. 30, ibid. 
3. Subs. by s. 31, ibid., for “payable”. 
4. Subs. by s. 31, ibid., for “an order”. 

27 

 
 
 
 
 
 
 
 
 
                                                      
Nothing in this section shall be deemed— 

1 [(a)  to  authorise  any  mortgagee,  other  than  a  mortgagee  by  conditional  sale  or  a 
mortgagee under an anomalous mortgage by the terms of which he is entitled to foreclose, to 
institute  a  suit  for  foreclosure,  or  an  usufructuary  mortgagee  as  such  or  a  mortgagee  by 
conditional sale as such to institute a suit for sale; or] 

(b)  to  authorise  a  mortgagor  who  holds  the  mortgagee's  rights  as  his  trustee  or  legal 
representative, and who may sue for a sale of the property, to institute a suit for foreclosure; 
or 

(c) to authorise the mortgagee of a railway, canal or other work in the maintenance of which the 

public are interested, to institute a suit for foreclosure or sale; or 

(d)  to  authorise  a  person  interested  in  part  only  of  the  mortgage-money  to-institute  a  suit 
relating  only  to  a  corresponding  part  of  the  mortgaged  property,  unless  the  mortgagees  have, 
with the consent of the mortgagor, severed their interests under the mortgage. 
2[67A. Mortgagee when bound to bring one suit on several inortgages.—A mortgagee who 
holds two or more mortgages executed by the same mortgagor in respect of each of which he has a 
right to obtain  the  same  kind  of decree  under section  67,  and  who sues  to obtain such  decree  on 
any one of the mortgages, shall, in the absence of a contract to the contrary, be bound to sue on all 
the mortgages in respect of which the mortgage-money has become due.] 

3[68.  Right  to  sue  for  mortgage-money.—(1) The  mortgagee  has a right  to  sue  for the  mortgage-

money in the following cases and no others, namely:—  

(a) where the mortgagor binds himself to repay the same; 

(b)  where,  by  any  cause  other  than  the  wrongful  act  or  default  of  the  mortgagor  or 
mortgagee, the mortgaged property is wholly or partially destroyed or the security is rendered 
insufficient  within  the  meaning  of  section  66,  and  the  mortgagee  has  given  the  mortgagor  a 
reasonable  opportunity  of  providing  further  security  enough  to  render  the  whole  security 
sufficient, and the mortgagor has failed to do so; 

(c) where the mortgagee is deprived of the whole or part of his security by or in consequence of 

the wrongful act or default of the mortgagor; 

(d) where, the mortgagee being entitled to possession of the mortgaged property, the mortgagor 
fails to deliver the same to him, or to secure the possession thereof to him without disturbance by the 
mortgagor or any person claiming under a title superior to that of the mortgagor: 

Provided that, in the case referred to in clause (a), a transferee from the mortgagor or from 

his legal representative shall not be liable to be sued for, the mortgage-money. 

(2) Where a suit is brought under clause (a) or clause (b) of sub-section (1), the Court  may, 
at  its  discretion,  stay  the  suit  and  all  proceedings  therein,  notwithstanding  any  contract  to  the 
contrary,  until  the  mortgagee  has  exhausted  all  his  available  remedies  against  the  mortgaged 
property  or  what  remains  of  it,  unless  the  mortgagee  abandons  his  security  and,  if  necessary,             
re-transfers the mortgaged property.] 

69.  Power  of  sstie  when  valid.— 4[(1)]  5[ 6***  a  mortgagee,  or  any  person  acting  on  his 
behalf, shall, subject to the provisions of this section, have power to sell or ,concur in selling the 
mortgaged  property,  or  any  part  thereof,  in  default  of  payment  of  the  mortgage-money,  without 
the intervention of the Court, in the following cases and in no others, namely:—] 

1. Subs. by Act 20 of 1929, s. 31, for clause (a). 
2. Ins. by s. 32, ibid. 
3. Subs. by s. 33, ibid., for section 68. 
4. Section 69 numbered as sub-section (1) of that section by Act 20 of 1929, s. 34. 
5. Subs. by s. 34, ibid., for certain words. 
6. The words “Notwithstanding anything contained in the Trustees’ and Mortagees’ Powers act, 1899 (28 of 1866)” omitted by 

Act 48 of 1952, s. 3 and the Second Schedule. 

28 

 
                                                      
(a)  where  the  mortgage  is  an  English  mortgage,  and  neither  the  mortgagor  nor  the 
mortgagee  is  a  Hindu,  Muhammad  an  or  Buddhist 1[or  a  member  of  any  other  race,  sect, 
tribe  or  class  from  time  to  time  specified  in  this  behalf  by 2[the  State  Government],  in  the 
Official Gazette]; 

(b)  where 3[a  power  of  sale  without the  intervention  of the  Court is expressly  conferred 

on the mortgagee by the mortgage-deed, and] the mortgagee is 4[the Government]; 

(c) where  3[a power of sale without the intervention of the Court is expressly conferred 
on  the  mortgagee  by  the  mortgage-deed,  and]  the  mortgaged  property  or  any  part  thereof 
5[was,  on  the  date  of  the  execution  of  the  mortgage-deed,]  situate  within  the  towns  of 
Calcutta,  Madras,  Bombay,  6 ***  7 [or  in  any  other  town  or  area  which  the  State 
Government may, by notification in the Official Gazette, specify’ in this behalf]. 
8[(2)]  9*** No such power shall be exercised unless and until— 

10 [(a)]  notice  in  writing  requiring  payment  of  the  principal  money  has  been  served  on  the 
mortgagor, or, one of several mortgagors, and default has been made in payment of the  principal 
money, or of part thereof, for three months after such service; or 

11[(b)]  some  interest  under  the  mortgage  amounting  at  least  to  five  hundred  repees  is 

in arrear and unpaid for three months after becoming due.  
12[(3)]  When  a  sale  has  been  made  in  professed  exercise  of  such  a  power,  the  title  of  the 
purchaser  shall not  be  impeachable on the  ground  that  no case had arisen to authorize the sale, 
or  that  due  notice  was  not  given,  or  that  the  power  was  otherwise  improperly  or  irregularly 
'exercised;  but  any  person  damnified  by  an  unauthorised,  or  improper,  or  irregular'  exercise  of 
the power shall have his remedy in damages against the person exercising the power. 

13[(4)] The  money  which is  received  by the  mortgagee, arising from  the sale, after  discharge  of 
prior incumbrances, if any, to which the sale is not made subject, or after payment into Court under 
section 57 of a sum to meet any prior incumbrance, shall, in the absence of a contract to the contrary, 
be  held  by  him  in  trust  to  be  applied  by  him,  first,  in  payment  of  all  costs,  charges  and  expenses 
properly incurred by him as incident to the sale or any attempted sale; and, secondly, discharge of the 
mortgage-money and costs and other money, if any, due under the mortgage; and the residue of the 
money  so  received  shall  be  paid  to  the  person  entitled  to  the  mortgaged  property,  or  authorised  to 
give receipts for the proceeds of the sale thereof. 

14[(5)  Nothing  in  this  section  or  in  section  69A  applies  to  powers  conferred  before  the  first  day  of 

July, 1882.] 
15*  

* 

* 

* 

* 

1. Ins. by Act 3 of 1885, s. 5. 
2. The words “the L.G., with the previous sanction of the G. G. in C.” successively adapted by the A.O. 1937 and the A.O. 1950 

to read as above. 

3. Ins. by Act 20 of 1929, s. 34. 
4. The words “the Secretary of State for India in Council” successively amended by the A.O. 1937 and the A.O. 1950 

to read as above. 

5. Subs. by Act 20 of 1929, s. 34, for “is”. 
6. The word “Karachi” omitted by the A.O. 1948. 
7. The words “or Rangoon” have been successively amended by Acts 6 of 1904, 11 of 1915, 20 of 1929, the A.O. 1937 and the 

A.O. 1950 to read as above. 

8. Second paragraph numbered as sub-section (2) by Act 20 of 1929, s. 34. 
9. The word “'But” omitted by s. 34, ibid. 
10. Clause (1) was lettered (a) by s. 34, ibid. 
11. Clause (2) was lettered (b) by s. 34, ibid. 
12. Third paragraph numbered as sub-section (3) by s. 34, ibid. 
13. Fourth paragraph numbered as sub-section (4) by Act 20 of 1929, s. 34. 
14. Subs. by s. 34, ibid., for fifth paragraph. 
15. The last paragraph of this section omitted by s. 34, ibid.  

29 

 
 
 
 
 
 
 
 
                                                      
 
1[69A.  Appointment  of  receiver.—(1)  A  mortgagee  having  the  right  to  exercise  a  power  of 
sale  under  section  69  shall,  subject  to  the  provisions  of  sub-section  (2),be  entitled  to  appoint,  by 
writing signed by him or on his behalf, a receiver of the income of the mortgaged property or any 
part thereof. 

(2) Any person who has been named in the mortgage-deed and is willing and able to act as receiver 

may be appointed by the mortgagee. 

If no person has been so named, or if all persons named are unable or unwilling to act, or are 
dead,  the  mortgagee  may  appoint  any  person  to  whose  appointment  the  mortgagor  agrees;  failing 
such  agreement,  the  mortgagee  shall  be  entitled  to  apply  to  the  Court  for  the  appointment  of  a 
receiver,  and any person appointed by the Court shall  be deemed to have  been duly  appointed by 
the mortgagee. 

A  receiver  may  at  any  time  be  removed  by  writing  signed  by  or  on  behalf  of  the  mortgagee 

and the mortgagor, or by the Court on application made by either party and on due cause shown. 

A  vacancy  in  the  office  of  receiver  may  be  filled  in  accordance  with  the  provisions  of  this                    

sub-section. 

(3) A receiver appointed under the powers conferred by this section shall be deemed to be the agent 
of the mortgagor; and the mortgagor shall be solely responsible for the receiver's acts or defaults, unless 
the mortgage-deed otherwise provides or unless such acts or defaults arc due to the improper intervention 
of the mortgagee. 

(4)  The  receiver  shall  have  power  to  demand  and  recover  all  the  income  of  which  he  is 
appointed receiver, by suit, execution or otherwise, in the name either of the mortgagor or of the 
mortgagee  to  the  full  extent  of  the  interest  which  the  mortgagor  could  dispose  of,  and  to  give 
valid  receipts  accordingly  for  the  same,  and  to  exercise  any  powers  which  may  have  been 
delegated to him by the mortgagee in accordance with the provisions of this section. 

(5) A person paying money to the receiver shall not be concerned to inquire if the appointment of the 

receiver was valid or not. 

(6) The receiver shall be entitled to retain out of any money received by him, for his remuneration, 
and in satisfaction of all costs, charges and expenses incurred by him as receiver, a commission at such 
rate  not  exceeding  five  per  cent.  on  the  gross  amount  of  all  money  received  as  is  specified  in  his 
appointment,  and,  if  no  rate  is  so  specified,  then  at  the  rate  of  five  per  cent.  on  that  gross 
amount, or at such other rate as the Court thinks fit to allow, on application made by him for 
that purpose. 

(7)  The  receiver  shall,  if  so  directed  in  writing  by  the  mortgagee,  insure  to  the  extent,  if 
any,  to  which  the  mortgagee  might  have  insured,  and  keep  insured  against  loss  or  damage  by 
fire, out of the money received by him, the mortgaged property or any part thereof being of an 
insurable nature. 

(8)  Subject  to  the  provisions  of  this  act  as  to  the  application  of  insurance  money,  the 

receiver shall apply all money received by him as follows, namely:— 

(i)  in  discharge  of  all  rents,  taxes,  land  revenue,  rates  and  outgoings  whatever  affecting  the 

mortgaged property; 

(ii)  in  keeping  down  all  annual  sums  or  other  payments,  and  the  interest  on  all 

principal sums, having priority to the mortgage in right whereof he is receiver; 

(iii)  in  payment  of  his  commission,  and  of  the  premiums  on  fire,  life  or  other 
insurances,  if  any,  properly  payable  under  the  mortgage-deed  or  under  this  Act,  and  the 
cost of executing necessary or proper repairs directed in writing by the mortgagee; 

(iv) in payment of the interest falling due under the mortgage; 

1. Ins. by Act 20 of 1929, s. 35. 

30 

 
                                                      
(v)  in  or  towards  discharge  of  the  principal  money,  if  so  directed  in  writing  by  the 

mortgagee; 

and shall pay the residue, if any, of the money received by him to the person who, but for the 
possession  of  the  receiver,  would  have  been  entitled  to  receive  the  income  of  which  he  is 
appointed receiver, or who is otherwise entitled to the mortgaged property. 

(9) The provisions of sub-section (1) apply only if and as far as a contrary intention is not 
expressed in the mortgage-deed; and the provisions of sub-sections (3) to (8) inclusive may be 
varied or extended by the mortgage-deed, and, as so varied or extended, shall, as far as may be, 
operate  in  like  manner  and  with  all  the  like  incidents,  effects  and  consequences,  as  if  such 
variations or extensions were contained in the said sub-sections. 

(10) Application  may be  made,  without the institution of a suit, to the Court for its opinion, 
advice  or  direction  on  any  present  question  respecting  the  management  or  administration  of  the 
mortgaged property, other than questions of difficulty or importance not proper in the opinion of 
the Court for summary disposal. A copy of such application shall be served upon, and the hearing 
thereof  may  be  attended  by,  such  of  the  persons  interested  in  the  application  as  the  Court  may 
think fit. 

The costs of every application under this sub-section shall be in the discretion of the Court. 

(11)In this section, “the Court” means the Court which would have jurisdiction in a suit to enforce the 

mortgage.] 

70. Accession to mortgaged property.—If, after the date of a mortgage, any accession is 
made  to the  mortgaged property,  the  mortgagee,  in  the  absence  of a  contract  to  the contrary, 
shall, for the purposes of the security, be entitled to such accession. 

Illustrations 

(a)  A  mortgages  to  B  a  certain  field  bordering  on  a  river.  The  field  is  increased  by  alluvion.  For  the  purposes  of  his 

security, B is entitled to the increase. 

(b)  A  mortgages  a  certain  plot  of  building  land  to  B  and  afterwards  erects  a  house  on  the  plot.  For  the  purposes  of  his 

security, B is entitled to the house as well as the plot. 

71.  Renewal  of  mortgaged  lease.—When  the  mortgaged  property  is  as  lease 1***,  and  the 
mortgagor  obtains  a  renewal  of  the  lease,  the  mortgagee,  in  the  absence  of  a  contract  to  the 
contrary, shall, for the purposes of the security, be entitled to the new lease. 

72.  Rights  of  mortgagee  in  possession.—2[A  mortgagee]  may  spend  such  money  as  is 

necessary— 

3* 
(b) for  4[the preservation of the mortgaged property] from destruction, forfeiture or 

* 

* 

* 

* 

sale; 

(c) for supporting the mortgagor's title to the property; 

(d) for making his own title thereto good against the mortgagor; and 

(e) when the mortgaged property is a renewable lease-hold, for the renewal of the lease; 

and  may,  in  the  absence  of  a  contract  to  the  contrary,  add  such  money  to  the  principal 
money,  at  the  rate  of  interest  payable  on  the  principal,  and,  where  no  such  rate  is  fixed,  at 
the rate of nine per cent. per annum: 

1. The words “for a term of years” omitted by Act 20 of 1929, s. 36. 
2. Subs. by s. 37, ibid., for certain words. 
3. Clause (a) omitted by s. 37, ibid. 
4. Subs. by s. 37, ibid., for “its preservation”. 

31 

 
 
 
 
 
 
 
 
 
 
                                                      
 
1[Provided  that  the  expenditure  of  money  by  the  mortgagee  under  clause  (b)  or  clause 
(c)shall  not be deemed to be necessary  unless the  mortgagor  has  been called upon and has 
failed to take proper and timely steps to preserve the property or to support the title.] 

Where  the  property  is  by  its  nature  insurable,  the  mortgagee  may  also,  in  the  absence 
of  a  contract  to  the  contrary,  insure  and  keep  insured  against  loss  or  damage  by  fire  the 
whole or any pant of such property; and the premiums paid for any such insurance shall be 
2[added to the principal money with interest at the same rate as is payable on the principal 
money  or,  where  no  such  rate  is  fixed,  at  the  rate  of  nine  per  cent.  per  annum].  But  the 
amount  of  such  insurance  shall  not  exceed  the  amount  specified  in  this  behalf  in  the 
mortgage-deed  or  (if  no  such  amount  is  therein  specified)  two-thirds  of  the  amount  that 
would be required in case of total destruction to reinstate the property insured. 

Nothing  in  this  section  shall  be  deemed  to  authorise  the  mortgagee  to  insure  when  an 
insurance of the property is kept up by or on behalf of the mortgagor to the amount in which 
the mortgagee is hereby authorised to insure. 

3[73. Right to proceeds of revenue sale or compensation on acquisition.—(1)Where the 
mortgaged  property  or  any  part  thereof  or  any  interest  therein  is  sold  owing  to  failure  to  pay 
arrears of revenue or other charges of a public nature or rent due in respect of such property, 
and  such  failure  did  not  arise  from  any  default  of  the  mortgagee,  the  mortgagee  shall  be 
entitled  to  claim  payment  of  the  mortgage-money,  in  whole  or  in  part,  out  of  any  surplus  of 
the  sale-proceeds  remaining  after  payment  of  the  arrears  and  of  all  charges  and  deductions 
directed by law. 

(2)  Where  the  mortgaged  property  or  any  part  thereof  or  any  interest  therein  is  acquired 
under the Land Acquisition Act, 1894 (1 of 1894), or any other enactment for the time being 
in  force  providing  for  the  compulsory  acquisition  of  immoveable  property,  the  mortgagee 
shall  be  entitled  to  claim  payment  of  the  mortgage-money,  in  whole  or  in  part,  out  of  the 
amount due to the mortgagor as compensation. 

(3) Such claims shall prevail against all other claims except those of prior encumbrances, and 

may be enforced notwithstanding that the principal money on the mortgage has not become due.] 

74. [Right  of subsequent mortgagee to  pay  off  prior  mortgagee.] Rep.  by the Transfer  of 

Property (Amendment) Act, 1929 (20 of 1929), s. 39. 

75.  [Rights  of  mesne  mortgagee  against  and  subsequent  mortgagees.]  Rep.  by  s.  39, 

ibid. 

76.  Liabilities  of  mortgagee  in  possession.—When,  during  the  continuance  of  the  mortgage,  the 

mortgagee takes possession of the mortgaged property,—  

(a) he must manage the property as a person of ordinary prudence would manage it if it were his 

own; 

(b) he must use his best endeavours to collect the rents and profits thereof; 
(c)  he  must, in the  absence of a contract  to  the contrary, out  of the  income of the  property, 
pay the Government-revenue, all other charges of a public nature 4[and all rent] accruing due in 
respect  thereof  during  such  possession,  and  any  arrears  of  rent  in  default  of  payment  of  which 
the- property may be summarily sold; 

(d) he must, in the absence of a contract to the contrary, make such necessary repairs of the 
property as he can pay for out of the rents and profits thereof after deducting from such rents and 
profits the payments mentioned in clause (c)and the interest on the principal money; 

(e) he must not commit any act which is destructive or permanently injurious to the property; 
(f) where he has insured the whole or any part of the property against loss or damage by fire, 
he  must,  in  case  of  such  loss  or  damage,  apply  any  money  which  he  actually  receives  under  the 

1. Ins. by Act 20 of 1929, s. 37. 
2. Subs. by s. 37, ibid., for certain words. 
3. Subs. by s. 38, ibid., for section 78. 
4. Ins. by s. 40, ibid. 

32 

 
                                                      
policy, or. so much thereof as may be necessary, in reinstating the property, or, if the mortgagor so 
directs, in reduction or discharge of the mortgage-money; 

(g) he must keep clear, full and accurate accounts of all sums received and spent by him as 
mortgagee, and, at any time during the continuance of the mortgage, give the mortgagor, at his 
request  and  cost,  true  copies  of  such  accounts  and  of  the  vouchers  by  which  they  are 
supported; 

(h) his receipts from the mortgaged property, or, where such property is personally occupied 
by  him.  a  fair  occupation-rent  in  respect  thereof  shall,  after  deducting  the  expenses 1[properly 
incurred for the management of the property and the collection of rents and profits and the other 
expenses]  mentioned  in  clauses  (c)  and  (d),  and  interest  thereon,  be  debited  against  him  in 
reduction of the amount (if any) from time to time due to him on account of interest 2*** and, so 
far  as  such  receipts  exceed  any  interest  due,  in  reduction  or  discharge  of  the  mortgage-money;  the 
surplus, if any, shall be paid to the mortgagor; 

(i)  when the  mortgagor  tenders,  or deposits in  manner  hereinafter  provided, the amount  for  the 
time  being  due  on  the  mortgage,  the  mortgagee  must,  notwithstanding  the  provisions  in  the  other 
clauses .of this section, account for his 3*** receipts from the mortgaged property from the date of 
the tender or from the earliest time when he could take such amount out of Court, as the case may be 
[and shall not be entitled to deduct any amount therefrom on account of any expenses incurred after 
such date or time in connection with the mortgaged property]. 

Loss  occasioned  by  his  default.—If  the  mortgagee  fail  to  perform  any  of  the  duties  imposed 
upon  him  by  this  section,  he  may,  when  accounts  are  taken  in  pursuance  of  a  decree  made 
under this Chapter, be debited with the loss, if any, occasioned by such failure. 

77. Receipts in lieu of interest.—Nothing in section 76, clauses (b), (d), (g) and (h), applies 
to  cases  where  there  is  a  contract  between  the  mortgagee  and  the  mortgagor  that  the  receipts 
from the mortgaged property shall, so long as the mortgagee is in possession of the property, be 
taken in lieu of interest on the principal money, or in lieu of such interest and defined portions of 
the principal. 

Priority 

78.  Postponement  of  prior  mortgagee.—Where,  through  the  fraud,  misrepresentation  or 
gross  neglect  of  a  prior  mortgagee,  another  person  has  been  induced  to  advance  money  on  the 
security  of  the  mortgaged  property,  the  prior  mortgagee  shall  be  postponed  to  the  subsequent 
mortgagee. 

79. Mortgage to secure uncertain amount when maximum is expressed.—If a mortgage 
made to secure future advances, the performance of an engagement or the balance of a running 
account,  expresses  the  maximum  to  be  secured  thereby,  a  subsequent  mortgage  of  the  same 
property  shall,  if  made  with  notice  of  the  prior mortgage,  be  postponed to  the  prior  mortgage 
in respect of all advances or debits not exceeding the maximum, though made or allowed with 
notice of the subsequent mortgage. 

Illustration 

A mortgages Sultanpur to his bankers, B & Co., to secure the balance of his account with them to the extent 
of  Rs.  10,000.  A  then  mortgages  Sultanpur  to  C,  to  secure  Rs.  10,000;  C  having  notice  of  the  mortgage  to  B  & 
Co., and C gives notice to B & Co. of the second mortgage. At the date of the second mortgage, the balance due to 
B  & Co.  does  not  exceed  Rs. 5,000.  B  &  Co.  subsequently  advance  to  A  sums  making  the  balance of  the  account 
against him exceed the sum of Rs. 10,000. B & Co. are entitled to the extent of Rs. 10,000, to priority over C. 

80.  [Tacking  abolished.]  Rep.  by  the  Transfer  of  Property  (Amendment)  Act,  1929  (20  of 

1929),  s. 41. 

1. Ins. by Act 20 of 1929, s. 40. 
2. The words “on the mortgage-money” omitted by s. 40, ibid. 
3. The word “gross” omitted by s. 40, ibid. 

33 

 
 
                                                      
Marshalling and Contribution 

1[81. Marshalling securities.—If the owner of two or more properties mortgages them to 
one person and then mortgages one or more of the properties to another person, the subsequent 
mortgagee is, in the absence of a contract to the contrary, entitled to have the prior mortgage-
debt  satisfied  out  of  the  property  or  properties  not  mortgaged  to  him,  so  far  as  the  same  will 
extend, but not so as to prejudice the rights of the prior mortgagee or of any other person who 
has for consideration acquired an interest in any of the properties.] 

82.  Contribution  to  mortgage-debt.—2[Where property subject to a  mortgage belongs to 
two  or  more  persons  having  distinct  and  separate  rights  of  ownership  therein,  the  different 
shares  in  or  parts  of  such  property  owned  by  such  persons  are,  in  the  absence  of  a  contract  to 
the  contrary,  liable  to  contribute  rateably  to  the  debt  secured  by  the  mortgage,  and,  for  the 
purpose  of  determining  the  rate  at  which  each  such  share  or  part  shall  contribute,  the  value 
thereof  shall  be  deemed  to  be  its  value  at  the  date  of  the  mortgage  after  deduction  of  the 
amount of any other mortgage or charge to which it may have been subject on that date.] 

Where, of two properties belonging to the same owner, one is  mortgaged to secure one 
debt and then both are mortgaged to secure another debt, and the former debt is paid out of 
the former property, each property is, in the absence of a contract to the contrary, liable to 
contribute rateably to the latter debt after deducting the amount of the former debt from the 
value of the property out of which it has been paid. 

Nothing in this section applies to a property liable under section 81 to the claim of the 3[subsequent] 

mortgagee. 

Deposit in Court 

83.  Power  to  deposit  in  Court  money  due  on  mortgage.—At any time  after the principal 
money 4[payable  in  respect  of  any  mortgage  has  become  due]  and  before  a  suit  for  redemption 
of the mortgaged property is barred, the mortgagor, or any other person entitled to institute such 
suit, may deposit, in any Court in which he might have instituted such suit, to the account of the 
mortgagee, the amount remaining due on the mortgage. 

Right to money deposited by mortgagor.—The Court shall thereupon cause written notice 
of the deposit to be served on the mortgagee, and the mortgagee  may, on presenting a petition 
(verified  in  manner  prescribed  by 5law  for  the  verification  of  plaints)  stating  the  amount  then 
due on the mortgage, and his willingness to accept the money so deposited in full discharge of 
such  amount,  and-on  depositing  in  the  same  Court  the  mortgage-deed 6[and  all  documents  in 
his possession or power relating to the  mortgaged property], apply for and receive the  money, 
and  the  mortgage-deed, 7[and  all  such  other  documents],  so  deposited  hail  be  delivered  to  the 
mortgagor or such other person as aforesaid. 

7[Where  the  mortgagee  is  in  possession  of  the  mortgaged.  property,  the  Court  shall,  before 
paying to him the amount so deposited direct him to deliver possession thereof to the mortgagor 
and at the cost of the mortgagor either to re-transfer the mortgaged property to the mortgagor or 
to  such  third  person  as  the  mortgagor  may  direct  or  to  execute  and  (where  the  mortgage  has 
been effected by a registered instrument) have registered an acknowledgment in writing that any 
right  in  derogation  of  the  mortgagor's  interest  transferred  to  the  mortgagee  has  been 
extinguished.] 

84.  Cessation  of  interest.—When  the  mortgagor  or  such  other  person  as  aforesaid  has 
tendered  or  deposited  in  Court  under  section  83  the  amount  remaining  due  on  the  mortgage, 

1. Subs. by Act 20 of 1929, s. 42, for s. 81. 
2. Subs by s. 43, ibid., for the first paragraph. 
3. Subs. bys. 43, ibid., for “second”. 
4. Subs. by s. 44, ibid., for “has become payable”. 
5. See the Code of Civil Procedure, 1908 (5 of 1908), Sch. I, Order VI, rule 15. 
6. Subs. by Act 20 of 1929, s. 44, for 'if then in his possession or power”. 
7. Ins. by s. 44, ibid. 

34 

 
                                                      
 
interest  on  the  principal  money  shall  cease  from  the  date  of  the  tender  or 1[in  the  case  of  a 
deposit, where no previous tender of such amount has been made,] as soon as the mortgagor or 
such other person as aforesaid has done all that has to be done by him to enable the mortgagee 
to  take  such  amount  out  of  Court, 2[and  the  notice  required  by  section  83  has  been  served  on 
the mortgagee: 

Provided  that,  where  the  mortgagor  has  deposited  such  amount  without  having  made  a 
previous tender thereof and has subsequently withdrawn the same or any part thereof, interest 
on the principal money shall be payable from the date of such withdrawal]. 

Nothing  in  this  section  or  in  section  83  shall  be  deemed  to  deprive  the  mortgagee  of  his 
right  to  interest  when  there  exists  a  contract  that  he  shall  be  entitled  to  reasonable  notice 
before  payment  or  tender  of  the  mortgage-money 3[and  such  notice  has  not  been  given  before 
the making of the tender or deposit, as the case may be]. 

Suits for foreclosure, sale or redemptions4 

85.[Parties to suits for foreclosure, sale and redemption] Rep. by the Code of Civil Procedure, 1908 

(5 of 1908), s. 156 and the Fifth Schedule. 

Foreclosure and sale4 

86. [Decree of foreclosure suit.] Rep. by the Code of Civil Procedure, 1908 (5 of 1908),  

s. 156 and the Fifth Schedule. 

87. [Procedure in case of payment of amount due.] Rep. by s. 156 and the fifth Schedule, 

ibid. 

88. [Decree of sale.] Rep. by s. 156 and the fifth Schedule, ibid. 

89. [Procedure when defendant pay amount due.] Rep. by s. 156 and the fifth Schedule, 

ibid. 

90. [Recovery of balance due on mortgage.] Rep. by s. 156 and the fifth Schedule, ibid. 

Redemption 

5[91. Persons who may sue for redemption.—Besides the mortgagor, any of the following persons 

may redeem, or institute a suit for redemption of, the mortgaged property, namely:—  

(a)  any  person  (other  than  the  mortgagee  of  the  interest  sought  to  be  redeemed)  who  has  any 

interest in, or charge upon, the property mortgaged or in or upon the right to redeem the same; 

(b) any surety for the payment of the mortgage-debt or any part thereof; or 

(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.] 
6[92.  Subrogation.—Any of the persons referred to in section 91 (other than the mortgagor) and 
any  co-mortgagor  shall,  on  redeeming  property  subject  to  the  mortgage,  have,  so  far  as  regards 
redemption, foreclosure or sale of such property, the same rights as the mortgagee whose mortgage he 
redeems may have against the mortgagor or any other mortgagee. 

The right conferred by this section is called the right of subrogation, and a person acquiring the same 

is said to be subrogated to the rights of the mortgagee whose mortgage he redeems. 

A person who has advanced to a mortgagor money with which the mortgage has been redeemed 
shall  be  subrogated  to  the  rights  of  the  mortgagee  whose  mortgage  has  been  redeemed,  if  the 
mortgagor has by a registered instrument agreed that such persons shall be so subrogated. 

1. Ins. by Act 20 of 1929, s. 45. 
2. Subs. by s. 45, ibid., for “as the case may be”. 
3. Added by s. 45, ibid. 
4. For the repealed provisions, as re-enacted. see (Act 5 of 1908), Sch. I, Order XXXIV. 
5. Subs. by Act 20 of 1929, s. 46, for section 91. 
6. Ins. by s. 47, ibid. Original ss. 92 to 94 were rep. by Act 5 of 1908, s. 156 and the fifth Schedule. 

35 

 
                                                      
 
Nothing in this section shall be deemed to confer a right of subrogation on any person unless 

the mortgage in respect of which the right is claimed has been redeemed in full. 

93.  Prohibition  of  tacking.—No  mortgagee  paying  off  a  prior  mortgage,  whether  with  or 
without  notice  of  an  intermediate  mortgage,  shall  thereby  acquire  any  priority  in  respect  of  his 
original  security;  and,  except  in  the  case  provided  for  by  section  79,  no  mortgagee-  making  a 
subsequent  advance  to  the  mortgagor,  whether  with  or  without  notice  of  an  intermediate  mortgage, 
shall thereby acquire any priority in respect of his security for such subsequent advance. 

94. Rights of mesne mortgagee.—Where a property is mortgaged for successive debts to successive 
mortgagees,  a  mesne  mortgagee  has  the  same  rights  against  mortgagees  posterior  to  himself  as  he  has 
against the mortgagor.] 

1 [95.  Right  of  redeeming  co-mortgagor  to  expenses.—Where  one  of  several  mortgagors 
redeems  the  mortgaged  property,  he  shall,  in  enforcing  his  right  of  subrogation  under  section  92 
against  his  co-mortgagors,  be  entitled  to  add  to  the  mortgage-money  recoverable  from  them  such 
proportion of the expenses properly incurred in such redemption as is attributable to their share in the 
property. 

96.  Mortgage  by  deposit  of  title-deeds.—The provisions hereinbefore contained which apply to a 

simple mortgage shall, so far as may be, apply to a mortgage by deposit of title-deeds.] 

297. [Application of proceeds.] Rep. by the Code of Civil Procedure, 1908 (5 of 1908), s. 156 and the 

Fifth Schedule. 

Anomalous mortgages 

98. Rights and liabilities of parties to anomalous mortgages.—In the case of 3[an anomalous 
mortgage] the rights and liabilities of the parties shall be determined by their contract as evidenced 
in the mortgage-deed, and, so far as such contract does not extend, by local usage. 

Attachment of mortgaged property4 

99. [Attachment of mortgaged property.] Rep. by the Code of Civil Procedure, 1908 (5 of 1908), s. 

156 and the Fifth Schedule. 

Charges 

100. Charges.—Where immoveable property of one person is by act of parties or operation of law 
made security for the payment of money to another, and the transaction does not amount to a mortgage, 
the latter person is said to have a charge on the property; and all the provisions hereinbefore contained 
5[which apply to a simple mortgage shall, so far as may be, apply to such charge]. 

Nothing  in  this  section  applies  to  the  charge  of  a  trustee  on  the  trust  property  for  expenses 
properly incurred in the execution of his trust, 6[and, save as otherwise expressly provided by any 
law for the time being in force, no charge shall be enforced against any property in the hands of a 
person  to  whom  such  property  has  been  transferred  for  consideration  and  without  notice  of  the 
charge]. 

7[101. No merger in case of subsequent encumbrance.—Any mortgagee of, or person having 
a charge upon, immoveable property, or any transferee from such Mortgagee or charge-holder, may 
purchase or otherwise acquire the rights in the property of the mortgagor or owner, as the case may 
be,  without  thereby  causing  the  mortgage  or  charge  to  be  merged  as  between  himself  and  any 
subsequent  mortgagee  of,  or  person  having  a  subsequent  charge  upon,  the  same  property;  and  no 
such  subsequent  mortgagee  or  charge-holder  shall  be  entitled  to  for  close  or  sell  such  property 
without redeeming the prior mortgage or charge, or otherwise than subject thereto.] 

1. Subs. by Act 20 of 1929, s. 48, for section 95. Original s. 96 was rep. by Act 5 of 1908, s. 156 and Sch. V. 
2. For the repealed provisions, as re-enacted, see (Act 5 of 1908), Sch. I, Order XXXIV, rules 12 and 13. 
3. Subs. by Act 20 of 1929, s. 49, for certain words. 
4. For the repealed provisions, as re-enacted, see (Act 5 of 1908), Sch. I, Order XXXIV, rule 14. 
5. Subs. by Act 20 of 1929, s 50, for certain words. 
6. Added by s. 50, ibid. 
7. Subs. by s. 51, ibid., for section 101. 

36 

 
 
 
                                                      
 
Notice and tender 

102. Service or tender on or to agent.—Where the person on or to whom any notice or tender 
is  to  be  served  or  made  under  this  Chapter  does  not  reside  in  the  district  in which  the  mortgaged 
property  or  some  part  thereof  is  situate,  service  or  tender  on  or  to  an  agent  holding  a  general 
power-of-attorney  from  such  person  or  otherwise duly  authorised  to  accept  such  service  or  tender 
shall be deemed sufficient. 

1[Where no person or agent on whom such notice should be served can be found or is known] to 
the  person  required  to  serve  the  notice,  the  latter  person  may  apply  to  any  Court  in  which  a  suit 
might  be  brought  for  redemption  of  the  mortgaged  property,  and  such  Court  shall  direct  in  what 
manner such notice shall be served, and any notice served in compliance with such direction shall 
be deemed Sufficient: 

2[Provided that, in the case of a notice required by section 83, in the case of a deposit, the application 

shall be made to the Court in which the deposit has been made.] 

3[Where  no  person  or  agent  to  whom  such  tender  should  be  made  can  be  found  or  is 
known] to the person desiring to make the tender, the latter person may deposit, 4[in any Court in which 
a suit might be brought for redemption of the mortgaged property] the amount sought to be tendered, and 
such deposit shall have the effect of a tender of such amount. 

103.  Notice,  etc.,  to  or  by  person  incompetent  to  contract.—Where, under the provisions of 
this Chapter, a notice is to be served on or by, or a tender or deposit made or accepted or taken out 
of Court by, any person incompetent to contract, such notice may be served 5[on or by], or tender or 
deposit made, accepted or taken, by the legal curator of the property of such person; but where there 
is no such curator, and it is requisite or desirable in the interests of such person that a notice should 
be served or a tender or deposit made under the provisions of this Chapter, application may be made 
to  any  Court  in  which  a  suit  might  be  brought  for  the  redemption  of  the  mortgage  to  appoint  a 
guardian  ad  litem  for  the  purpose  of  serving  or  receiving  service  of  such  notice,  or  making  or 
accepting such tender, or making or taking out of Court such deposit, and for the performance of all 
consequential acts which could or ought to be done by such person if he were competent to contract; 
and the provisions of 6[Order XXXII in the First Schedule to the Code of Civil Procedure, 1908 (5 of 
1908)]  shall,  so  far  as  may  be,  apply  to  such  application  and  to  the  parties  thereto  and  to  the 
guardian appointed thereunder. 

104.  Power  to  make  rules.—The  High  Court  may,  from  time  to  time,  make  rules  consistent 
with  this  Act  for  carrying  out,  in  itself  and  in  the  Courts  of  Civil  Judicature  subject  to  its 
superintendence, the provisions contained in this Chapter. 

CHAPTER V 

OF LEASES OF IMMOVEABLE PROPERTY 

105. Lease defined.—A lease of immoveable property is a transfer of a right to enjoy such property, 
made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, 
or  of  money,  a  share  of  crops,  service  or  any  other  thing  of  value,  to  be  rendered  periodically  or  on 
specified occasions to the transferor by the transferee, who accepts the transfer on such terms. 

Lessor, lessee, premium and rent defined.—The transferor is called the lessor, the transferee is called 
the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered 
is called the rent. 

1. Subs. by Act 20 of 1929, s. 52, for certain words. 
2. Ins. by s. 52, ibid. 
3. Subs. by Act 20 of 1929, s. 52, for certain words. 
4. Subs. by s. 52, ibid., for “in such Court as last aforesaid”. 
5. Ins. by s. 53, ibid. 
6. Subs. by s. 53, ibid., for “Chapter XXXI of the Code of Civil Procedure”. 

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1[106.  Duration  of  certain  leases  in  absence  of  written  contract  or  local  usage.—(1)  In  the 
absence of a contract or local law or usage to the contrary, a lease of immovable property for agricultural 
or manufacturing purposes shall be deemed to be a lease from year to year, terminable, on the part of 
either lessor or lessee, by six months’ notice; and a lease of immovable property for any other purpose 
shall be deemed to be a lease from month to month, terminable, on the part of either lessor or lessee, by 
fifteen days’ notice. 

(2)  Notwithstanding  anything  contained  in  any  other  law  for  the  time  being  in  force,  the  period 

mentioned in sub-section (1) shall commence from the date of receipt of notice. 

(3)  A  notice  under  sub-section  (1)  shall  not  be  deemed  to  be  invalid  merely  because  the  period 
mentioned therein falls short of the period specified under that sub-section, where a suit or proceeding is 
filed after the expiry of the period mentioned in that sub-section. 

(4) Every notice under sub-section (1) must be in writing, signed by or on behalf of the person giving 
it, and either be sent by post to the party who is intended to be bound by it or be tendered or delivered 
personally to such party, or to one of his family or servants at his residence, or (if such tender or delivery 
is not practicable) affixed to a conspicuous part of the property.] 

107. Leases how made.— A lease of immoveable property from year to year, or for any term 

exceeding one year, or reserving a yearly rent, can be made only by a registered instrument. 

2[All other leases of immoveable property may be made either by a registered instrument or by oral 

agreement accompanied by delivery of possession. 

3 [Where  a  lease  of  immoveable  property  is  made  by  a  registered  instrument,  such 
instrument  or,  where  there  are  more  instruments  than  one,  each  such  instrument  shall  be 
executed by both the lessor and the lessee:] 

Provided  that  the  State  Government  may,  4***  from  time  to  time,  by  notification  in  the 
Official Gazette, direct that leases of immoveable property,  other than leases from  year to  year, 
or for any term exceeding one  year, or reserving  a  yearly rent, or any class of such leases,  may 
be made by unregistered instrument or by oral agreement without delivery of possession.] 

108.  Rights  and  liabilities  of  lessor  and  lessee.—  In  the  absence  of  a  contract  or  local 
usage to the contrary, the lessor and the lessee of immoveable property, as against one another, 
respectively,  possess  the  rights  and  are  subject  to  the  liabilities  mentioned  in  the  rules  next 
following, or such of them as are applicable to the property leased:— 

(A) Rights and liabilities of the lessor 

(a) the lessor is bound to disclose to the lessee any material defect in the property, with reference 
to its intended use, of which the former is and the latter is not aware, and which the latter could not 
with ordinary care discover: 

(b) the lessor is bound on the lessee’s request to put him in possession of the property: 
(c) the lessor  shall  be  deemed to contract  with the lessee that, if the latter  pays  the rent 
reserved  by  the  lease  and  performs  the  contracts  binding  on  the  lessee,  he  may  hold  the 
property during the time limited by the lease without interruption. 

The benefit of such contract shall be annexed to and go with the lessee’s interest as such, and may 
be enforced by every person in whom that interest is for the whole or any part thereof from time to 
time vested; 

(B) Rights and liabilities of the lessee 

(d) if during the continuance of the lease any accession is made to the property, such accession 
(subject to the law relating to alluvion for the time being in force) shall be deemed to be comprised in 
the lease: 

(e)  if  by  fire,  tempest  or  flood,  or  violence  of  an  army  or  of  a  mob,  or  other  irresistible 
force,  any  material  part  of  the  property  be  wholly  destroyed  or  rendered  substantially  and 

1. Subs. by Act 3 of 2003, s. 2, for section 106 (w.e.f. 31-12-2002). 
2. Subs. by Act 6 of 1904, s. 5, for the Second paragraph. 
3. Ins. by Act 20 of 1929, s. 55. 
4.  Th e words “with th e p reviou s san ction  o f th e Go verno r Gen eral in  Coun cil” o mitted b y th e A. O. 1 937. 

38 

 
                                                      
 
permanently  unfit  for  the  purposes  for  which  it  was  let,  the  lease  shall,  at  the  option  of  the 
lessee, be void: 

Provided  that,  if  the  injury  be  occasioned  by  the  wrongful  act  or  default  of  the  lessee, 

he shall not be entitled to avail himself of the benefit of this provision: 

(f) if the lessor neglects to make, within a reasonable time after notice, any repairs which 
he  is  bound  to  make  to  the  property,  the  lessee  may  make  the  same  himself,  and  deduct  the 
expense of such repairs with interest from the rent, or otherwise recover it from the lessor: 

(g) if the lessor neglects to make any payment which he is bound to make, and which if not 
made by him, is recoverable from the lessee or against the property, the lessee may make such 
payment  himself,  and  deduct  it  with  interest  from  the  rent,  or  otherwise  recover  it  from  the 
lessor: 

(h) the lessee may 1[even after the determination of the lease] remove, at any time 2[whilst he is 
in possession of the property leased but not afterwards,] all things which he has attached to the earth: 
provided he leaves the property in the state in which he received it: 

(i) when a lease of uncertain duration determines by any means except the fault of the lessee, he 
or his legal representative is entitled to all the crops planted or sown by the lessee and growing upon 
the property when the lease determines, and to free ingress and egress to gather and carry them: 

(j) the lessee may transfer absolutely or by way of mortgage or sub-lease the whole or any part of 
his interest in the property, and any transferee of such interest or part may again transfer it. The lessee 
shall not, by reason only of such transfer, cease to be subject to any of the liabilities attaching to the 
lease: 

nothing  in  this  clause  shall  be  deemed  to  authorise  a  tenant  having  an  untransferable  right  of 
occupancy, the farmer of an estate in respect of which default has been made in paying revenue, or 
the  lessee  of  an  estate  under  the  management  of  a  Court  of  Wards,  to  assign  his  interest  as  such 
tenant, farmer or lessee: 

(k) the lessee is bound to disclose to the lessor any fact as to the nature or extent of the interest 
which  the  lessee  is  about  to  take,  of  which  the  lessee  is,  and  the  lessor  is  not,  aware,  and  which 
materially increases the value of such interest: 

(l) the lessee is bound to pay or tender, at the proper time and place, the premium or rent to the 

lessor or his agent in this behalf: 

(m) the lessee is bound to keep, and on the termination of the lease to restore, the property 
in as good condition as it was in at the time when he was put in possession, subject only to the 
changes caused by reasonable wear and tear or irresistible force, and to allow the lessor and his 
agents,  at  all  reasonable  times  during  the  term,  to  enter  upon  the  property  and  inspect  the 
condition  thereof  and  give  or  leave  notice  of  any  defect  in  such  condition;  and,  when  such 
defect has been caused by any act or default on the part of the lessee, his servants or agents, he 
is bound to make it good within three months after such notice has been given or left: 

(n)  if  the  lessee  becomes  aware  of  any  proceeding  to  recover  the  property  or  any  part 
thereof,  or  of  any  encroachment  made  upon,  or  any  interference  with,  the  lessor’s  rights 
concerning such property, he is bound to give, with reasonable diligence, notice thereof to the 
lessor: 

(o) the lessee may use the property and its products (if any) as a person of ordinary prudence 
would use them if they were his own; but he must not use, or permit another to use, the property 
for  a  purpose  other  than  that  for  which  it  was  leased,  or  fell  1[or  sell]  timber,  pull  down  or 
damage  buildings  1[belonging  to the  lessor  or]  work  mines or quarries  not  open  when the lease 
was granted, or commit any other act which is destructive or permanently injurious thereto: 

1. Ins. by Act 20 of 1929, s. 56. 
2. Subs. by s. 56, ibid., for “during the continuance of the lease”. 

39 

 
                                                      
(p)  he  must  not,  without  the  lessor’s  consent,  correct  on  the  property  any  permanent  structure, 

except for agricultural purposes: 

(q) on the determination of the lease, the lessee is bound to put the lessor into possession of the 

property. 

109. Rights of lessor’s transferee.— If the lessor transfers the property leased, or any part thereof, or 
any part of his interest therein, the transferee, in the absence of a contract to the contrary, shall possess all 
the rights and, if the lessee so elects, be subject to all the liabilities of the lessor as to the property or part 
transferred so long as he is the owner of it; but the lessor shall not, by reason only of such transfer, cease 
to be subject to any of the liabilities imposed upon him by the lease, unless the lessee elects to treat the 
transferee as the person liable to him: 

Provided that the transferee is not entitled to arrears of rent due before the transfer, and that, 
if  the  lessee,  not  having  reason  to  believe  that  such  transfer  has  been  made,  pays  rent  to  the 
lessor, the lessee shall not be liable to pay such rent over again to the transferee. 

The  lessor,  the  transferee  and  the  lessee  may  determine  what  proportion  of  the  premium  or 
rent  reserved  by  the  lease  is  payable  in  respect  of  the  part  so  transferred,  and,  in  case  they 
disagree, such determination may be made by any Court having jurisdiction to entertain a suit for 
the possession of the property leased. 

110.  Exclusion  of  day  on  which  term  commences.—Where  the  time  limited  by  a  lease  of 
immoveable  property  is  expressed  as  commencing  from  a  particular  day,  in  computing  that  time  such 
day shall be excluded. Where no day of commencement is named, the time so limited begins from the 
making of the lease. 

Duration of lease for a year.—Where the time so limited is a year or a number of years, in 
the  absence  of  an  express  agreement  to  the  contrary,  the  lease  shall  last  during  the  whole 
anniversary of the day from which such time commences. 

Option  to  determine  lease.—Where  the  time  so  limited  is  expressed  to  be  terminable  before  its 
expiration,  and  the  lease  omits  to  mention  at  whose  option  it  is  so  terminable,  the  lessee,  and  not  the 
lessor, shall have such option. 

111. Determination of lease.—A lease of immoveable property determines— 

(a) by efflux of the time limited thereby: 

(b) where such time is limited conditionally on the happening of some event—by the happening 

of such event: 

(c) where the interest of the lessor in the property terminates on, or his power to dispose of 

the same extends only to, the happening of any event—by the happening of such event: 

(d) in case the interests of the lessee and the lessor in the whole of the property become vested at 

the same time in one person in the same right: 

(e) by express surrender; that is to say, in case the lessee yields up his interest under the lease to 

the lessor, by mutual agreement between them: 

(f) by implied surrender: 

(g) by forfeiture; that is to say, (1)in case the lessee breaks an express condition which provides 
that, on breach thereof, the lessor may re-enter 1***; or (2) in case the lessee renounces his character 
as  such  by  setting  up  a  title  in  a  third  person  or  by  claiming  title  in  himself; 2[or  (3)  the  lessee  is 
adjudicated an insolvent and the lease provides that the lessor may re-enter on the happening of such 

1. Th e wo rd s “o r th e lease sh all b eco me void ” o mitted  b y Act 20 o f 1929 , s. 57. 
2. Ins. by s. 57, ibid. 

40 

 
                                                      
 
event]; and in 1[any of these cases] the lessor or his transferee 2[gives notice in writing to the lessee 
of] his intention to determine the lease: 

(h)  on  the  expiration  of  a  notice  to  determine  the  lease,  or  to  quit,  or  of  intention  to  quit,  the 

property leased, duly given by one party to the other. 

Illustration to clause (f) 

A  lessee  accepts  fro m  his  lessor  a  new  lease  o f  the  property  leased,  to  take  effect  during  the 
continuance  o f  th e  existin g  lease.  This  is  an  implied  surrender  o f  the  former  lease,  and  su ch  lease 
determines thereupon. 

112.  Waiver  of  forfeiture.—A  forfeiture  under  section  111,  clause  (g)  is  waived  by 
acceptance of rent which has become due since the forfeiture, or by distress for such rent, or by 
any other act on the part of the lessor showing an intention to treat the lease as subsisting: 

Provided that the lessor is aware that the forfeiture has been incurred: 

Provided  also  that,  where  rent  is  accepted  after  the  institution  of  a  suit  to  eject  the  lessee  on  the 

ground of forfeiture; such acceptance is not a waiver. 

113. Waiver of notice to quit.—A notice given under section 111, clause (h), is waived, with the 
express or implied consent of the person to whom it is given, by any act on the part of the person giving 
it showing an intention to treat the lease as subsisting. 

Illustrations 

(a) A, the lessor, gives B, the lessee, notice to quit the property leased. The notice expires, B tenders, and A 
accepts,  rent  which  has  become  due  in  respect  of  the  property  since  the  expiration  of  the  notice.  The  notice  is 
waived. 

(b)  A,  the  lessor,  gives  B,  the  lessee,  notice  to  quit  the  property  leased.  The  notice  expires,  and  B 

remains in possession. A gives to B as lessee a second notice to quit. The first notice is waived. 

114.  Relief  against  forfeiture  for  non-payment  of  rent.—Where  a  lease  of  immoveable 
property  has  determined  by  forfeiture  for  non-payment  of  rent,  and  the  lessor  sues  to  eject  the 
lessee,  if,  at  the  hearing  of  the  suit,  the  lessee  pays  or  tenders  to  the  lessor  the  rent  in  arrear, 
together  with  interest  thereon  and  his  full  costs  of  the  suit,  or  gives  such  security  as  the  Court 
thinks sufficient for making such payment within fifteen days, the Court may, in lieu of making a 
decree  for  ejectment,  pass  an  order  relieving  the  lessee  against  the  forfeiture;  and  thereupon  the 
lessee shall hold the property leased as if the forfeiture had not occurred. 

3[114A. Relief against forfeiture in certain other cases.—Where a lease of immoveable property 
has determined by forfeiture for a breach of an express condition which provides that on breach thereof 
the lessor may re-enter, no suit for ejectment shall lie unless and until the lessor has served on the lessee 
a notice in writing—  

(a) specifying the particular breach complained of; and 

(b) if the breach is capable of remedy, requiring the lessee to remedy the breach; 

and the lessee fails, within a reasonable time from the date of the service of the notice, to remedy the 
breach, if it is capable of remedy. 

Nothing  in  this  section  shall  apply  to  an  express  condition  against  the  assigning,  under-
letting,  parting  with  the  possession,  or  disposing,  of  the  property  leased,  or  to  an  express 
condition relating to forfeiture in case of non-payment of rent.] 

115. Effect of surrender and forfeiture on under-leases.— The surrender, express or implied, 
of  a  lease  of  immoveable  property  does  not  prejudice  an  under-lease  of  the  property  or  any  part 
thereof previously  granted by the lessee, on terms and conditions substantially the same (except as 
regards the amount of rent) as those of the original lease; but, unless the surrender is made for the 
purpose of obtaining a new lease, the rent payable by, and the contracts binding on, the under-lessee 
shall be respectively payable to and enforceable by the lessor. 

1. Subs. by Act 20 o f 1929, s. 57, for “eith er case”. 
2. Subs. by s. 57, ibid., for “does some act showing”. 
3. Ins. by s. 58, ibid. 

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The  forfeiture  of  such  a  lease  annuls  all  such  under-leases,  except  where  such  forfeiture  has  been 
procured by the lessor in fraud of the under-lessees, or relief against the forfeiture is granted under section 
114. 

116.  Effect  of  holding  over.—If  a  lessee  or  under-lessee  of  property  remains  in  possession 
thereof  after  the  determination  of  the  lease  granted  to  the  lessee,  and  the  lessor  or  his  legal 
representative accepts rent from the lessee or under-lessee, or otherwise assents to his continuing in 
possession, the lease is, in the absence of an agreement to the contrary, renewedfrom year to year, or 
from month to month, according to the purpose for which the property is leased, as specified in section 
106. 

Illustrations 

(a) A lets a house to B for five years. B underlets the house to C at a monthly rent of Rs. 100. The five years 
expire,  but  C  continues  in  possession  of  the  house  and  pays  the  rent  to  A.  C's  lease  is  renewed  from  month  to 
month. 

(b) A lets a farm to B for the life of C. C dies, but B continues in possession with A's assent. B's lease is renewed from 

year to year. 

117.  Exemption  of  leases  for  agricultural  purposes.—None  of  the  provisions  of  this 
Chapter  apply  to  leases  for  agricultural  purposes,  except  in  so  far  as  the  State  Government 
1 ***  may  by  notification  published  in  the  Official  Gazette,  declare  all  or  any  of  such 
provisions to be so applicable 2[in the case of all or any such leases], together with, or subject 
to, those of the local law, if any, for the time being in force. 

Such  notification  shall  not  take  effect  until  the  expiry  of  six  months  from  the  date  of  its 

publication. 

CHAPTER VI  
OF EXCHANGES 

118. “Exchange” defined.—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  manner 

provided for the transfer of such property by sale. 

3 [119.  Right  of  party  deprived  of  thing  received  in  exchange.—If  any  party  to  an 
exchange or any person claiming through or under such party is by reason of any defect in the 
title  of  the  other  party  deprived  of  the  thing  or  any  part  of  the  thing  received  by  him  in 
exchange, then, unless a contrary intention appears from the terms of the exchange, such other 
party is liable to him or any person claiming through or under him for loss caused thereby, or 
at  the  option  of  the  person  so  deprived,  for  the  return  of  the  thing  transferred,  if  still  in  the 
possession  of  such  other  party  or  his  legal  representative  or  a  transferee  from  him  without 
consideration.] 

120.  Rights  and  liabilities  of  parties.—Save  as  otherwise  provided  in  this  Chapter, 
each  party  has  the  rights  and  is  subject  to  the  liabilities  of  a  seller  as  to  that  which  he 
gives, and the rights and is subject to the liabilities of a buyer as to that which he takes. 

121.  Exchange  of  money.—On  an  exchange  of  money,  each  party  thereby  warrants 

the genuineness of the money given by him. 

1. The words “with the previous sanction of the Governor General in Council” omitted by Act 38 of 1920, s. 2 and 

the First Schedule. 

2. Ins. by Act 6 of 1904, s. 6. 
3. Subs. by Act 20 of 1929, s. 59, for section 119. 

42 

 
 
 
                                                      
CHAPTER VII 

OF GIFTS 

122.  “Gift”  defined.—“Gift” 

transfer  of  certain  existing  moveable  or 
immoveable  property  made  voluntarily  and  without  consideration,  by  one  person,  called 
the donor, to another, called the donee, and accepted by or on behalf of the donee. 

the 

is 

Acceptance  when  to  be  made.—Such  acceptance  must  be  made  during  the  lifetime  of 

the donor and while he is till capable of giving, 

If the donee dies before acceptance, the gift is void. 

123.  Transfer  how  effected.—For  the  purpose  of  making  a  gift  of  immoveable 
property, the transfer must be effected by a 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  moveable  property,  the  transfer  may  be  effected 

either by a registered instrument signed as aforesaid or by delivery. 

124. Gift of existing and future property.—A girt comprising both existing and future 

property is void as to the latter. 

125.  Gift  to  several,  of  whom  one  does  not  accept.—A  gift  of  a thing  to  two  or  more 
donees,  of  whom  one  does  not  accept  it,  is  void  as  to  the  interest  which  he  would  have 
taken had he accepted. 

126.  When  gift  may  be  suspended  or  revoked.—The  donor  and  done  may  agree  that 
on the happening of any specified event which does not depend on the will of the donor a it 
shall be suspended or revoked; but a gift which the parties agree shall be revocable wholly 
or in part at the mere well of the donor is void wholly or in part, as the case may be. 

A  gift  also  be  revoked  in  any  of  the  cases  (save  want  or  failure  of  consideration)  in 

which, if it were a contract, it might be rescinded. 

Save as aforesaid, a gift cannot be revoked. 

Nothing  contained  in  this  section  shall  be  deemed  to  affect  the  rights  of  transferees  for 

consideration without notice. 

Illustrations 

(a)  a  gives  a  field  to  B,  reserving  to  himself,  with  B’s  assent,  the  right  to  take  back  the  field  in  case  B 

and his descendants dies before A, B dies without descendants in A’s lifetime. A may take back the field. 

(b)  A  gives  a  lakh  of  rupees  to  B,  reserving  to  himself,  with  B’s  assent,  the  right  to  take  back  at 
pleasure  Rs.  10,  000  out  of  the  lakh.  The  gift  holds  good  as  to  Rs.  90,  000,  but  is  void  as  to  Rs.10,  000, 
which continue to belong to A. 

127.  Onerous  gifts.—Where a gift is in the form of a single transfer to the same person 
of  several  things  of  which  one  is,  and  the  others  are  not,  burdened  by  an  obligation,  the 
done can take nothing by the gift unless he accepts it fully. 

Where  a  gift  is  in  the  form  of  two  or  more  separate  and  independent  transfers  to  the 
same  person  of  several  things,  the  done  is  at  liberty  to  accept  one  of  them  and  refuse  the 
others, although the former may be beneficial and the latter onerous. 

Onerous  gift  to  disqualified  person.—A done not competent to contract and accepting 
property burdened by any obligation is not bound by his acceptance. But if, after becoming 
competent  to  contract  and  being  aware  of  the  obligation,  he  retains  the  property  given,  he 
becomes so bound. 

(a) A has shares in X, a prosperous joint stock company, and also shares in Y, a joint stock company, in 
difficulties.  Heavy  calls  are  expected  in  respect  of  the  shares  in  Y.  A  given  B  all  his  shares  in  joint  stock 
companies. B refuses to accept the shares in Y. He cannot take the shares in X. 

Illustrations 

43 

 
(b) A, having a lease for a term of  years of a house at a rent which he and his representatives are bound 
to  pay  during  the  term,  and  which  is  more  than  the  house  can  be  let  for,  given  to  B  the  lease,  and  also,  as  a 
separate  and  independent  transaction,  a  sum  of  money.  B  refuses  to  accept  the  lease.  He  does  not  by  his 
refusal forfeit the money. 

128.  Universal  donee.—Subject  to  the  provisions  of  section  127,  where  a  gift  consists 
of  the  donor’s  whole  property,  the  done  is  personally  liable  for  all  the  debts  due  by  1[and 
liabilities  of]  the  donor  at  the  time  of  the  gift  to  the  extent  of  the  property  comprised 
therein. 

129.  Saving  of  donations  mortis  causa  and  Muhammadan  law.—Nothing  is  this 
Chapter  related  to  gifts  of  moveable  property  made  in  contemplation  of  death,  or  shall  be 
deemed to affect any rule of Muhammadan law 2***. 

3[CHAPTER VIII 

OF TRANSFERS OF ACTIONABLE CLAIMS 
130.  Transfer  of  actionable  claim.—(1) The transfer of an actionable claim 4[whether with 
or  without  consideration]  shall  be  effected  only  by  the  execution  of  an  instrument  in  writing 
signed  by  the  transferor  or  his  duly  authorised  agent, 5***  shall  be  complete  and  effectual  upon 
the  execution  of  such  instrument,  and  thereupon  all  the  rights  and  remedies  of  the  transferor, 
whether by way of damages or otherwise, shall vest in the transferee, whether such notice of the 
transfer as is hereinafter provided be given or not: 

Provided  that  every  dealing  with  the  debt  or  other  actionable  claim  by  the  debtor  or  other 
person  from  or  against  whom  the  transferor  would,  but  for  such  instrument  of  transfer  as 
aforesaid,  have  been  entitled  to  recover  or  enforce  such  debt  or  other  actionable  claim,  shall 
(save where the debtor or other person is a party to the transfer or has received express notice 
thereof as hereinafter provided) be valid as against such transfer. 

(2)  The  transferee  of  an  actionable  claim  may,  upon  the  execution  of  such  instrument  of 
transfer  as  aforesaid,  sue  or  institute  proceedings  for  the  same  in  his  own  name  without 
obtaining  the  transferor's  consent  to  such  suit  or  proceedings  and  without  making  him  a  party 
thereto. 

Exception.—Nothing  in  this  section  applies  to  the  transfer  of  a  marine  or  fire  policy  of 

insurance  6[or affects the provisions of section 38 of the Insurance Act, 1938 (4 of 1938)]. 

Illustrations 

(i)  A  owes  money  to  B,  who  transfers  the  debt  to  C.  B  then  demands  the  debt  from  A,  who,  not  having 
received notice of the transfer, as prescribed in section 131, pays B. The payment is valid, and C cannot sue A for 
the debt. 

(ii)  A  effects  a  policy  on  his  own  life  with  an  Insurance  Company  and  assigns  it  to  a  Bank  for  securing  the 
payment of an existing or, future debt. If A dies, the Bank is entitled to receive the amount of the policy and to sue on 
it  without  the  concurrence  of  A's  executor,  subject  to  the  proviso  in  sub-section  (1)  of  section  130  and  to  the 
provisions of section 132. 

7[130A.  Transfer  of  policy  of  marine  insurance.]  Rep.  by  the  Marine  Insurance  Act,  1963  (11  of 

1963), s. 92 (w.e.f. 1-8-1963). 

131.  Notice  to  be  in  writing,  signed.—Every notice of transfer of an actionable claim shall 
be in writing, signed by the transferor or his agent duly authorised in this behalf, or, in case the 

1. Ins. by Act 20 of 1929, s. 60. 
2. The words and figures “or, save as provided by section 123, any rule of Hindu or Buddhist law” omitted by Act 20 of 

1929, s. 61. 

3. Subs. by Act 2 of 1900, s. 4, for the original Chapter VIII. 
4. Ins. by Act 20 of 1929, s. 62. 
5. The words and figures “and notwithstanding anything contained in section 123” ins. by Act 38 of 1925, s. 2, omitted 

by Act 20 of 1929, s. 62. 

6. Added by Act 4 of 1938, s. 121 (w.e.f. 1-7-1939). 
7. Ins. by Act 6 of 1944, s. 2. 

44 

 
                                                      
 
transferor refuses to sign, by the transferee or his agent, and shall state the name and address of 
the transferee. 

132. Liability of transferee of actionable claim.—The transferee of an actionable claim shall 
take  it  subject  to  all  the  liabilities  and  equities  to  which  the  transferor  was  subject  in  respect 
thereof at the date of the transfer. 

Illustrations 

(i)  A  transfers  to  C  a  debt  due  to  him  by  B,  A  being  then  indebted  to  B.  C  sues  B  for  the  debt  due  by  B  to  A.  

such suit B is entitled to set off the debt due by A to him; although C was unaware of it at the date of such transfer. 

(ii)  A  executed  a  bond  in  favour  of  B  under  circumstances  entitling  the  former  to  have  it  delivered  up  and 
cancelled.  B  assigns  the bond  to C  for  value  and  without notice of  such  circumstances. C  cannot  enforce the bond 
against A. 

133. Warranty of solvency of debtor.—Where the transferor of a debt warrants the solvency of 
the debtor, the warranty, in the absence of a contract to the contrary, applies only to his solvency at 
the time of the transfer, and is limited, where the transfer is made for consideration, to the amount or 
value of such consideration. 

134.  Mortgaged  debt.—Where  a  debt is transferred  for  the  purpose  of  securing  an  existing  or 
future  debt,  the  debt  so  transferred,  if  received  by  the  transferor  or  recovered  by  the  transferee,  is 
applicable, first, in payment of the costs of such recovery; secondly, in or towards satisfaction of the 
amount for the time being secured by the transfer; and the residue, if any, belongs to the transferor 
or other person entitled to receive the same. 

1 [135.  Assignment  of  rights  under  policy  of  insurance  against  fire.—Every  assignee  by 
endorsement or other writing, of a policy of insurance against fire, in whom the property in the subject 
insured shall be absolutely vested at the date of the assignment, shall have transferred and vested in him 
all rights of suit as if the contract contained in the policy had been made with himself.] 

2[135A. [Assignment of rights under policy of marine insurance.] Rep. by the Marine Insurance Act, 

1963 (11 of 1963), s. 92 (w.e.f. 1-8-1963). 

136.  Incapacity  of  officers  connected  with  Courts  of  Justice.—No  Judge,  legal  practitioner,  or 
officer connected with any Court of Justice shall buy or traffic in, or stipulate for, or agree to receive, any 
share of, or interest in, any actionable claim, and no Court of Justice shall enforce, at his instance, or at 
the  instance  of  any  person  claiming  by  or  through  him,  any  actionable  claim  so  dealt  with  by  him  as 
aforesaid. 

137.  Saving  of  negotiable  instruments,  etc.—Nothing  in  the  foregoing  sections  of  this 
Chapter applies to stocks, shares or debentures, or to instruments which are for the time being, by 
law or custom, negotiable, or to any mercantile document of title to goods. 

Explanation.—The expression “mercantile document of title to goods” includes a bill of lading, 
dock-warrant,  warehouse-keeper's  certificate,  railway  receipt,  warrant  or  order  for  the  delivery  of 
goods, and any other document used in the ordinary course of business as proof of the possession or 
control of goods, or authorising or purporting to authorise, either by endorsement or by delivery, the 
possessor of the document to transfer or receive goods thereby represented.] 

1. Subs. by Act 6 of 1944, s. 3, for section 135. 
2. Ins. by s. 4, ibid. 

45 

 
 
 
                                                      
 
THE SCHEDULE 
(a) STATUTES 

Year and Chapter 
27 Hen Year VIII, c. 

10 

Subject 
Uses.   .   . 

Eliz.,  c.  5.. 
Eliz.,  c.  4..    .    . 

13 
27 
4  Win, and Marry, c. 16 

  .  .    

Fraudulent conveyances 
Fraudulent conveyances 

Clandestine mortgages 

Extent of repeal 

The whole. 
The whole. 
The whole. 
The whole. 

(b) ACTS OF THE GOVERNOR GENERAL IN COUNCIL 

Number and year 
IX of 1842 …… 

XXXI of 1854…. 

XI of 1855… 

Subject 
Lease and release .  
The whole. 
Modes of conveying land  Section 17. 

Extent of repeal 

Mesne profits and 
improvements. 

XXVII of 1866….. 

Indian Trustee Act 

IV of 1872…… 

Punjab Laws Act 

XX of 1875…. 

Central Provinces Laws 
Act  

XVIII of 1876 ….. 

Oudh Laws Act 

I  of 

1877…… 

Specific Relief 

Section 1; in the title, the words 
“to mesne profits and”, and in 
the preamble “to limit the 
liability for mesne profit-and”. 
Section 31. 
far 
So 
to 

as 
Bengal 

it relates

Regulations I of 1798 and XVII of 
1806. 

So 

asitrelates 

far 
Bengal Regulations I of 

to

1798 and XVII of 1806. 

So 

it
Bengal 

far 
as 
relates  to 
Regulation XVIII of 1806. 
In sections 35 and 36, the word. 
“in writing”. 

Number and year 
Bengal Regulation I of 
1798 

Bengal Regulation 
XVII of 1806. 

Bombay Regulation V  
of 1827. 

(c) REGULATIONS 

Subject 

Extent of repeal 

Conditional sales  

The whole Regulation. 

Redemption 

The whole Regulation. 

Acknowledgment of 
debts; Interest; 
Mortgagees in 
possession. 

Section 15. 

_____________ 

46 

 
 
 
 
 
 
 
 
 
 
 
 
