VOL. VIII-B


9


THE TRANSFER OF PROPERTY ACT, 1882


ACT NO. 4 OF 1882


[17th February, 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  transfer of  property by  act of  parties; It is
hereby enacted as follows:--


CHAPTER I


PRELIMINARY


                              CHAPTER I

                             PRELIMINARY


1.


Short title. Commencement.


     1. Short title. Commencement.-This Act may be called the Transfer
of Property Act, 1882.

     It shall come into force on the first day of July, 1882.

Extent.

     1*[It extends2*  in  the  first  instance to  the whole  of India
except 3*[the  territories which, immediately before the 1st November,
1956,
---------------------------------------------------------------------
1    Subs. by the A. O. 1950 for the original third paragraph.
2    The application  of  this  Act  was  barred  in  the  Naga  Hills
District,  including   the  Mokokchang   Sub-Division,  the  Dibrugarh
Frontier Tract, the North Cachar Hills, the Garo Hills, the Khasia and
Jaintia Hills and the Mikir Hills Tract, by notification under s. 2 of
the Assam Frontier Tracts Regulation, 1880 (2 of 1880).

     The Act  has been declared to be in force in Panth Piploda by the
Panth Piploda  Laws Regulation,  1929 (1 of 1929), s. 2, and continued
in force,  with modifications,  in the  territory transferred to Delhi
Province by  the Delhi  Laws Act, 1915 (7 of 1915), s. 3 and Sch. III.
It has  also been  partially extended  to Berar by the Berar Laws Act,
1941 (4 of 1941).

     The Act  has been extended with effect from 1st January, 1893, to
the whole  of the  territories, other  than the  Scheduled  Districts,
under the administration of the Govt. of Bombay.

     Ss. 54, 107 and 123 have been extended from 6th May, 1935, to all
Municipalities in  the Punjab  and to  all notified areas declared and
notified under  s. 241  of the  Punjab Municipal  Act, 1911 (Pun. 3 of
1911), see  Punjab Gazette,  Extraordinary, 1925, p. 27. Those ss. and
s. 129  have been  extended to  certain areas  in Delhi  Province, see
notifications No.  198/38-III, dated 30th May, 1939, Gazette of India,
1939, Pt.  I, p.  918, and No. 61/40-Judl., dated 16th November, 1940,
Gazette of India, 1940, Pt. I, p. 1639, respectively.

     The Act  has been  extended to  Manipur by  the Union Territories
(Laws) Amendment Act, 1956 (68 of 1956).

     It has been rep. as to Government Grants by the Government Grants
Act, 1895 (15 of 1895) and rep. or modified to the extent necessary to
give effect  to the  provisions of  the Madras City Tenants Protection
Act, 1921  (Mad. 3  of 1921), in the City of Madras; see s. 13 of that
Act.

     It has  been amended  in Bombay  by Bombay Act 14 of 1939, and in
Uttar Pradesh by Uttar Pradesh Act 24 of 1954.

The Act has been extended to-

(i) Laccadive, Minicoy and Amindivi Islands (w.e.f.  1-10-1967):  vide
Reg.  8 of 1965, s.  3 & Sch.;

(ii) Goa, Daman and Diu by Reg. 11 of 1963, s. 3 & Sch.;

(iii) Union territory of Pondicherry by Act 26 of 1968, s. 3 & Sch.;

The Act has been extended to and brought into force in Dadra and Nagar
Haveli (w.e.f.  1-7-1965), by Re.  6 of 1963, s.  2 & Sch.I.

The Act as been amended in-

(i) Bombay by Bombay Act 57 of 1954;

(ii) Uttar Pradesh by U.P. Act 14 of 1970 (57 of 1970);

(iii) Assam by Assam Act 10 of 1976.

The Act sall come into force in the State of Sikkim on 1-9-1984 vide
Notification No.643(E), dated 24-8-1984, Gaz. of India, Exry., Pt.II,
Sec.3 (ii).

3    Subs. by  the Adaptation of Laws (No. 2) Order, 1956, for "Part B
States".
----------------------------------------------------------------------

10

were comprised  in Part  B States or in the States of], Bombay, Punjab
and Delhi.]

     1*[But this  Act or  any part  thereof may by notification in the
Official Gazette  be extended  to the whole or any part of the 2*[said
territories] by the State Government concerned.]

     3*[And any  State  Government  may 4*** 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.]

     5*[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,
6*[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.


     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 be 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 are 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:
---------------------------------------------------------------------
1    Subs. by the A. O. 1937 for the original para.
2    Subs. by  the Adaptation  of Laws  (No. 2) Order, 1956, for "said
     States".
3    Subs. by Act 3 of 1885, s. 1, for the original para.
4    The words "with the previous sanction of the G. G. in C." omitted
     by Act 38 of 1920, s. 2 and Sch. I.
5    Added by Act 3 of 1885, s. 2 (with retrospective effect).

     S. 54, paras. 2  and 3,  and ss.  59, 107 and 123 extend to every
     cantonment-see s. 287 of the Cantonments Act, 1924 (2 of 1924).
6    Subs. by Act 20 of 1929, s. 2, for "1877".
----------------------------------------------------------------------

11

and nothing  in the  second chapter  of this  Act shall  be deemed  to
affect any rule of 1*** Muhammadan 2*** law.


3.


Interpretation-clause.


     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:

          3*["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   acknowledgment  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  4*[5*[any  part  of  the
               territories] to which this Act extends] under the 6*law
               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:
---------------------------------------------------------------------
1    The word "Hindu" omitted by Act 20 of 1929, s. 3.
2    The words "or Buddhist" omitted by s. 3, ibid.
3    Ins. by  Act 27 of 1926, s. 2, as amended by Act 10 of 1927, s. 2
     and Sch. I.
4    Subs. by  Act 3  of 1951, s. 3 and Sch., for "a Part A State or a
     Part C State" (w.e.f. 1-4-1951).
5    Subs. by  the Adaptation  of Laws  (No. 2)  Order, 1956, for "any
     State".
6    See the Indian Registration Act, 1908 (16 of 1908).
---------------------------------------------------------------------

12

          1*["actionable claim"  means a claim to any debt, other than
               a debt secured by mortgage of 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 recognize as affording
               grounds for  relief, whether  such debt  or  beneficial
               interest  be   existent,   accruing,   conditional   or
               contingent:]

          2*["a person  is said  to have  notice" of  a fact  when  he
               actually knows  that fact,  or  when,  but  for  wilful
               abstention from  an inquiry or search which he ought to
               have made, or gross negligence, he would have known it.

                    Explanation I.--Where  any transaction relating to
               immoveable 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, 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 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
---------------------------------------------------------------------
1    Ins. by Act 2 of 1900, s. 2.
2    Subs. by Act 20 of 1929, s. 4, as amended by Act 5 of 1930, s. 2,
     for the original paragraph.
---------------------------------------------------------------------

13

                    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.


     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).

     1*[And sections  54, paragraphs 2 and 3, 59, 107 and 123 shall be
read as  supplemental to the Indian  Registration Act, 2*[1908] (16 of
1908).]


CHAPTER II


OF TRANSFERS OF PROPERTY BY ACT OF PARTIES


                            CHAPTER II 3*

              OF TRANSFERS OF PROPERTY BY ACT OF PARTIES

       (A) Transfer of Property, whether moveable or immoveable


5.


"Transfer of property" defined.


     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, 4*[or to himself] and one or more other living
persons; and "to transfer property" is to perform such act.

     4*[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
---------------------------------------------------------------------
1    Added by Act 3 of 1885, s. 3.
2    Subs. by Act 20 of 1929, s. 5, for "1877".
3    Nothing in  Chapter II  is to  be deemed  to affect  any rule  of
Muhammadan Law--see section 2, supra.
4    Ins. by Act 20 of 1929, s. 6.
---------------------------------------------------------------------

14

transfer of  property to  or by  companies, associations  or bodies of
individuals.]


6.


What may be transferred.


     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.

     1*[(dd) A  right to  future  maintenance,  in  whatsoever  manner
arising, secured or determined, cannot be transferred.]

     (e) A mere right to sue 2*** 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 3*[,naval],  4*[air-force] and
civil pensioners  of 5*[Government]  and political  pensions cannot be
transferred.

     (h) No transfer can be made (1) in so far as it is opposed to the
nature of  the interest  affected thereby,  or (2)  6*[for 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.

7*[(i)  Nothing in this section shall be deemed to authorize 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
---------------------------------------------------------------------
1    Ins. by Act 20 of 1929, s. 6.
2    The words  "for compensation  for a  fraud or  for harm illegally
caused", omitted by Act 2 of 1900, s. 3.
3    Ins. by Act 35 of 1934, s. 2 and Sch.
4    Ins. by Act 10 of 1927, s. 2 and Sch. I.
5    The word  "Government" successively  subs. by  the A. O. 1937 and
the A. O. 1950 to read as above.
6    Subs. by Act 2 of 1900, s. 3, for "for an illegal purpose".
7    Added by Act 3 of 1885, s. 4.
---------------------------------------------------------------------

15

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.


     7. Persons  competent  to  transfer.-Every  person  competent  to
contract and  entitled to  transferable  property,  or  authorized  to
dispose of transferable property not his own, is competent 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.


8.


Operation of transfer.


     8.  Operation   of  transfer.-Unless  a  different  intention  is
expressed or  necessarily  implied,  a  transfer  of  property  passes
forthwith to  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
accrued 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.


     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.


     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),

16

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.


     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.


     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.


     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.

                             Illustration

     A transfers property of which he is the owner to B in trust for A
and his  intended wife  successively 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.


     14. Rule  against perpetuity.-No transfer of property can operate
to create  an interest  which is to take effect after the life-time 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.
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 8, for the original paragraph.
---------------------------------------------------------------------

17


15.


Transfer to class some of whom come under sections 13 and 14.


    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, such interest fails 1*[in regard to those persons only and not
in regard to the whole class].


16.


Transfer to take effect on failure of prior interest.


     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.


     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.


     18.  Transfer   in  perpetuity   for   benefit   of   public.-The
restrictions in  sections 14, 16 and 17 shall 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.]
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 9, for "as regards the whole class".
2    Subs. by s. 10, ibid., for the original sections 16 to 18.
---------------------------------------------------------------------

18


19.


Vested interest.


     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 merely  from 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 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.


     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.


     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.


     22. Transfer  to members of a class who attain a particular age.-
Where, on  a transfer  of 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.

19


23.


Transfer contingent on happening of specified uncertain event.


     23. Transfer  contingent  on  happening  of  specified  uncertain
event.-Where,  on a  transfer of  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 of exist.


24.


Transfer to  such of  certain persons  as survive  at some  period not
specified.


     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.


     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) 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 on condition that she shall murder
C. The transfer is void.

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


26.


Fulfilment of condition precedent.


     26. Fulfilment  of condition  precedent.-Where  the  terms  of  a
transfer of  property impose  a condition  to be  fulfilled  before  a
person can  take an  interest in  the property, the condition shall be
deemed to  have been  fulfilled if  it has 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.

20

     (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.


27.


Conditional transfer to one person coupled with transfer to another on
failure of prior disposition.


     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  of
specified event.


     28. Ulterior  transfer conditional  on happening or not happening
of 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.


Fulfilment of condition subsequent.


     29. Fulfilment  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.


     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.

21

                             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.


     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 not be invalid.


     32. Such condition must not 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 being specified
for performance.


     33. Transfer  conditional on  performance of  act, no  time being
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.


     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-fulfilment of
which the  interest is  to pass from 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-
fulfilment  of  the  condition  rendered  impossible  or  indefinitely
postponed, the  condition shall  as against him be deemed to have been
fulfilled.

22

                               Election


35.


Election when necessary.


     35. 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

23

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 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.

                            Apportionment


36.


Apportionment of  periodical payments  determination  of  interest  of
person entitled.


     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 apportionable accordingly, but
to be payable on the days appointed for the payment thereof.


37.


Apportionment of benefit of obligation on severance.


     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

24

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 situate 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 1/2 to C, and
Rs. 7  1/2 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 dyke 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.

                 (B) Transfer of Immoveable Property


38.


Transfer by  person authorised  only under  certain  circumstances  to
transfer.


     38.  Transfer   by   person   authorised   only   under   certain
circumstances to  transfer.-Where  any person,  authorized 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.

25


39.


Transfer where third person is entitled to maintenance.


     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.

     3*                  *                *                *             *


40.


Burden of obligation imposing restriction on use of land,


     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  enjoyment  4*[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.


     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  voidable on  the
ground that  the transferor  was not  authorized 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.
---------------------------------------------------------------------
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".
3    The illustration omitted by s. 11, ibid.
4    Subs. by  s. 12,  ibid., for "of the latter property or to compel
its enjoyment in a particular manner".
---------------------------------------------------------------------

26


42.


Transfer by person having authority to revoke former transfer.


     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  unauthorized person who subsequently acquires interest in
property transferred.


     43. Transfer  by unauthorized  person who  subsequently  acquires
interest in  property  transferred.-Where a person 1*[fraudulently or]
erroneously represents  that he  is  authorized  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 authorized 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.


     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.

     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.
---------------------------------------------------------------------
1    Ins. by Act 20 of 1929, s. 13.
---------------------------------------------------------------------

27


45.


Joint transfer for consideration.


     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.


     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  interest in  the property were of
equal  value,  and,  where  such  interests  were  of  unequal  value,
proportionately to the value of their respective interests.

                            Illustrations

     (a) A,  owing a  moiety, and  B and  C, each  a quarter share, of
mauza Sultanpur,  exchange an eighth share of that mauza for a quarter
share of mauza Lalpura. 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 mauza Atrali 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. 400.


47.


Transfer by co-owners of share in common property.


     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,  proportionately  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 mauza Sultanpur, 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.

28


48.


Priority of rights created by transfer.


     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.


     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.


     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 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.


     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 therefrom
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  are growing when he is
evicted therefrom,  he is  entitled to  such crops and to free ingress
and egress to gather and carry them.

29


52.


Transfer of property pending suit relating thereto.


     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.

     7*[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.]


53.


Fraudulent transfer.


     8*[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.
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 14, for "active prosecution".
2    Subs. by  the A.  O. 1950, for "in  the Provinces  or established
beyond the limits of the Provinces".
3    Subs. by  Act 3 of 1951, s. 3 and Sch., 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 G. G. in C."
5    The words "or the Crown Representative" rep. by the A. O. 1948.
6    Subs. by Act 20 of 1929, s. 14, for "a contentious".
7    Ins. by s. 14, ibid.
8    Subs. by s. 15, ibid., for the original section.
---------------------------------------------------------------------

30

     (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.

     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.]


53A.


Part performance.


     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 the  contract, though  required to be
registered, has  not been registered, or, where there is an instrument
of transfer,  that the  transfer has  not been completed in the manner
prescribed therefor  by the  law for  the time  being  in  force,  the
transferor or  any person  claiming under  him shall  be debarred from
enforcing against  the transferee and persons  claiming under  him any
right in  respect of the property of which the transferee has taken or
continued in  possession, other than a right expressly provided by the
terms of the contract:

     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


                             CHAPTER III

                   OF SALES OF IMMOVEABLE PROPERTY


54.


"Sale" defined. Sale how made. Contract for sale.


     54. "Sale"  defined. Sale  how  made.-"Sale"  is  a  transfer  of
ownership in  exchange for  a price  paid or promised or part-paid and
part-promised.
---------------------------------------------------------------------
1    Ins. by Act 20 of 1929, s. 16.
---------------------------------------------------------------------

31

Sale  how  made.-1*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.

     1*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 immovable 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.


55.


Rights and liabilities of buyer and seller.


     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 2*[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;

          (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
---------------------------------------------------------------------
1    As to limitation to the territorial operation of paragraphs 2 and
3 of  s. 54,  see s.  1,  supra.  These  paragraphs  extend  to  every
cantonment see s. 287 of the Cantonments Act, 1924 (2 of 1924).
2    Ins. by Act 20 of 1929, s. 17.
---------------------------------------------------------------------

32

               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 in a 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  buyer 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.

33

     (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;

          (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;
---------------------------------------------------------------------
1    Ins. by Act 20 of 1929, s. 17.
---------------------------------------------------------------------

34

          (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.


56.


Marshalling by subsequent purchaser.


     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 of 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.


    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.
---------------------------------------------------------------------
1    The words "with notice of the payment" omitted by Act 20 of 1929,
s. 17.
2    Subs. by s. 18, ibid., for the original section.
---------------------------------------------------------------------

35

     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 large
additional amount.

     (b) Thereupon  the Court  may, if it thinks fit, and after notice
to the  incumbrancer, 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, 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


OF MORTGAGES OF IMMOVEABLE PROPERTY AND CHARGES


                              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.   Mortgage   when  to  be   by
assurance.


     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  are called the mortgage-money, and the instrument (if any)
by which the transfer is effected is called a mortgage-deed.

36

Simple  mortgage.-(b)  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.

Mortgage by conditional sale.-(c) 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.]

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

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

Mortgage  by  deposit of title-deeds.-4*[(f) Where a person in any  of
the  following  towns, namely, the towns of Calcutta,  Madras,  5*[and
Bombay], 6*** and in any other
---------------------------------------------------------------------
1    Ins. by Act 20 of 1929, s. 19.
2    Subs. by s. 19, ibid., for "and to appropriate them".
3    Subs. by s. 19, ibid., for "and".
4    Added by s. 19, ibid.
5    Subs.  by  the A. O. 1948,  for  "Bombay  and  Karachi". The word
"and" had been ins. by the A. O. 1937.
6    The words  "Rangoon, Moulmein,  Bassein and Akyab" omitted by the
A. O. 1937.
---------------------------------------------------------------------

37

1*town which  the 2*[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.

Anomalous  mortgage.-(g) 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.


     3*59. Mortgage when to be by assurance.-Where the principal money
secured is  one hundred  rupees or upwards, a mortgage 4*[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  5*[a  registered
instrument] signed  and attested  as aforesaid, or (except in the case
of a simple mortgage) by delivery of the property.

     6*                *               *                 *          *.


59A.


References to  mortgagors and  mortgagees to  include persons deriving
title from them.


     7*[59A.  References  to  mortgagors  and  mortgagees  to  include
persons deriving title from them.-Unless otherwise expressly provided,
references in  this Chapter  to mortgagors  and  mortgagees  shall  be
deemed to  include references  to persons  deriving  title  from  them
respectively.]
---------------------------------------------------------------------
1    For notifications relating to the towns of--
          Ahmedabad, see Gazette of India, 1935, Pt. I, p. 936.
          Bandra, Kurla  and Ghatkoper-Kirol,  see Gazette  of  India,
               1924, Pt. I, p. 1064.

          Cawnpore, Allahabad and Lucknow, see Gazette of India, 1933,
               Pt. I, p. 158.

          Coimbatore, Madura,  Cocanada and  Cochin,  see  Gazette  of
               India, 1935, Pt, I, p. 526.

Delhi  and New Delhi:  see Notifn.  No.  GSR 1551, dt.  13-11-62  Gaz.
of India, Pt.  II, Sec.  3(i), p.  1884.  (w.e.f.  1-12-62).

     Delhi (Cantonment),  see Notifn. No. GSR 893, dt. 20-5-1963, Gaz.
of India, Pt. II, Sec. 3(i), p. 1020.

2    The words  "G. G.  in C."  successively amended by the A. O. 1937
and the A. O. 1950 to read as above.
3    As to limitation to the territorial operation of s. 59, see s. 1,
supra,  S.   59  extends  to  every  cantonment--see  s.  287  of  the
Cantonments Act, 1924 (2 of 1924).
4    Ins. by Act 20 of 1929, s. 20.
5    Subs. by Act 6 of 1904, s. 3, for "an instrument".
6    The third paragraph was omitted by Act 20 of 1929, s. 20.
7    Ins. by s. 21, ibid.
---------------------------------------------------------------------

38

                        Rights and Liabilities of Mortgagor


60.


Right  of  mortgagor  to redeem.  Redemption of portion  of  mortgaged
property.


     60. Right of mortgagor to redeem. At any time after the principal
money has  become 1*[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 2*[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 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  acknowledgment 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 3*[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.

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  4*[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 mortgagor.


60A.


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


     5*[60A. Obligation  to transfer  to third  party instead  of  re-
transference 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 retransferring the property, to
assign the  mortgage-debt and  transfer the mortgaged property to such
third person as the
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 22, for "payable".
2    Subs. by  s. 22,  ibid., for  "the mortgage-deed,  if any, to the
mortgagor".
3    Subs. by s. 22, ibid., for "order".
4    Ins. by s. 22, ibid.
5    Ss. 60A and 60B ins. by s. 23, ibid.
---------------------------------------------------------------------

39

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.


     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 are in the
custody or power of the mortgagee.]


61.


Right to redeem separately or simultaneously.


     1*[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.


     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 2*[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 authorized  to pay  himself the
               mortgage-money  from  the  rents  and  profits  of  the
               property,--when such money is paid;

          (b) where  the mortgagee  is authorized  to pay himself from
               such rents  and profits  3*[or any  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 4*[the mortgage-money or the balance thereof]
               or deposits it in Court as hereinafter provided.
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 24, for the original section.
2    Ins. by s. 25, ibid.
3    Subs. by s. 25, ibid., for "the interest of the principal money".
4    Subs. by s. 25, ibid., for "the principal money".
---------------------------------------------------------------------

40


63.


Accession  to  mortgaged  property.  Accession acquired in  virtue  of
transferred ownership.


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

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.


63A.


Improvements to mortgaged property.


     2*[63A. Improvements  to mortgaged  property.-(1) Where mortgaged
property in possession 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.]
---------------------------------------------------------------------
1    Subs. by  Act 20  of 1929,  s.  26, for  "at  the  same  rate  of
interest".
2    Ins. by s. 27, ibid.
---------------------------------------------------------------------

41


64.


Renewal of mortgaged lease.


     64. Renewal of mortgaged lease.-Where the mortgaged property is a
lease 1***, 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.


     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 2***, 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  indemnify  the  mortgagee
               against all  claims sustained  by reason  of  the  non-
               payment of the said rent or the 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.

          3*                *                *                *       *

     The benefit  of the  contracts mentioned in this section shall be
annexed to and shall go with the interest of the mortgagee as such,
---------------------------------------------------------------------
1    The words "for a term of years" omitted by Act 20 of 1929, s. 28.
2    The words "for a term of years" omitted by s. 29, ibid.
3    Certain words omitted by s. 29, ibid.
---------------------------------------------------------------------

42

and may  be enforced  by every person in whom that interest is for the
whole or any part thereof from time to time vested.


65A.


Mortgagor's power to lease.


     1*[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 with 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.


     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.
---------------------------------------------------------------------
1    Ins. by Act 20 of 1929, s. 30.
---------------------------------------------------------------------

43

                 Rights and Liabilities of Mortgagee


67.


Right to foreclosure or sale.


     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  1*[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 2*[a  decree] that the mortgagor shall be absolutely debarred of
his right to redeem the property, or 2*[a decree] that the property be
sold.

     A  suit  to  obtain  2*[a  decree]  that  a  mortgagor  shall  be
absolutely debarred  of his  right to redeem the mortgaged property is
called a suit for foreclosure.

     Nothing in this section shall be deemed--

          3*[(a) to  authorize 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  authorize 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  authorize 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  authorize 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.


67A.


Mortgagee when bound to bring one suit on several mortgages.


     4*[67A. Mortgagee  when  bound  to  bring  one  suit  on  several
mortgages.-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.]
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 31, for "payable".
2    Subs. by s. 31, ibid., for "an order".
3    Subs. by s. 31, ibid., for the original cl.
4    Ins. by s. 32, ibid.
---------------------------------------------------------------------

44


68.


Right to sue for mortgage-money.


     1*[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 sale when valid.


     69. Power of sale when valid.-2*[(1)] 3*[4*** 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:--]

          (a) where  the mortgage  is an English mortgage, and neither
               the mortgagor nor the mortgagee is a Hindu,
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 33, for the original section.
2    S. 69  was numbered as sub-section (1) of that section, by s. 34,
ibid.
3    Subs. by s. 34, ibid., for certain original words.
4    The words  and figures "Notwithstanding anything contained in the
Trustees' and Mortgagees' Powers Act, 1866" omitted by Act 48 of 1952,
s. 3 and Sch. II.
---------------------------------------------------------------------

45

               Muhammadan 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 8* town or area
               which the  State Government may, by notification in the
               Official Gazette, specify in this behalf].

     9*[(2)] 10*** No such power shall be exercised unless and until--

          11*[(a)]  notice   in  writing   requiring  payment  of  the
               principal money has been served on the mortgagor, or on
               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
---------------------------------------------------------------------
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  amended 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    For notifications relating to the towns of--
     Ahmedabad, see Gazette of India, 1935, Pt. I, p. 936.
     Bandra, Kurla  and Ghatkoper-Kirol,  see Gazette  of India, 1924,
Pt. I, p. 1064.
     Cawnpore, Allahabad  and Lucknow, see Gazette of India, 1933, Pt.
I. p. 158.
     Coimbatore, Madura,  Cocanada and  Cochin, see  Gazette of India,
1935, Pt. I, p. 526.
     Delhi (Cantonment),  see Gazette  of India, 1963, Pt. II, Section
3, Sub-section (i), p. 1020.
9    Second paragraph  numbered as  sub-section (2) by Act 20 of 1929,
s. 34.
10   The word "But" omitted by s. 34, ibid.
11   Cl. (1) was lettered (a) by s. 34, ibid.
---------------------------------------------------------------------

46

          1*[(b)] some  interest under the mortgage amounting at least
               to five  hundred rupees  is in  arrear and  unpaid  for
               three months after becoming due.

     2*[(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 unauthorized or
improper or  irregular exercise  of the power shall have his remedy in
damages against the person exercising the power.

     3*[(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, in 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.

     4*[(5) Nothing  in this  section or  in section  69A  applies  to
powers conferred before the first day of July, 1882.]

    5*        *               *                 *               *


69A.


Appointment of receiver.


     6*[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
---------------------------------------------------------------------
1    Cl. (2) was lettered (b) by Act 20 of 1929, s. 34.
2    Third paragraph numbered as sub-section (3) by s. 34, ibid.
3    Fourth paragraph numbered as sub-section (4) by s. 34, ibid.
4    Subs. by s. 34, ibid., for the original fifth paragraph.
5    Original last paragraph omitted by s. 34, ibid.
6    Ins. by s. 35, ibid.
---------------------------------------------------------------------

47

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  are  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;

48

          (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;

          (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.


     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.

49

     (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.


     71. Renewal  of mortgaged lease.-When the mortgaged property is a
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.


     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:

     5*[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 part of such
property; and  the premiums  paid for  any  such  insurance  shall  be
6*[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
---------------------------------------------------------------------
1    The words "for a term of years" omitted by Act 20 of 1929, s. 36.
2    Subs. by  s. 37,  ibid., for "When, during the continuance of the
mortgage, the  mortgagee takes  possession of  the mortgaged property,
he".
3    Cl. (a) omitted by s. 37, ibid.
4    Subs. by s. 37, ibid., for "its preservation".
5    Ins. by s. 37, ibid.
6    Subs. by s. 37, ibid., for certain original words.
---------------------------------------------------------------------

50

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  authorize  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 authorized to insure.


73.


Right to proceeds of revenue sale or compensation on acquisition.


     1*[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 encumbrancers, and may be enforced notwithstanding that
the principal money on the mortgage has not become due.]


74.


[Repealed.]


     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.


[Repealed.]


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


76.


Liabilities of mortgagee in possession.


     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,
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 38, for the original section.
---------------------------------------------------------------------

51

               all other  charges of  a public nature 1*[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  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
               managment 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 mortgage must, notwithstanding the
---------------------------------------------------------------------
1    Ins. by Act 20 of 1929, s. 40.
2    The words "on the mortgage-money" omitted by s. 40, ibid.
---------------------------------------------------------------------

52

              provisions  in  the   other  clauses  of  this  section,
              account for  his 1*** receipts from the mortgaged prope-
              rty  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 2*[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.


     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.


     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.


     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.
---------------------------------------------------------------------
1    The word "gross" omitted by Act 20 of 1929, s. 40.
2    Ins. by s. 40, ibid.
---------------------------------------------------------------------

53


80.


[Repealed.]


     80.  [Tacking  abolished.]  Rep.  by  the  Transfer  of  Property
(Amendment) Act, 1929 (20 of 1929), s. 41.

                     Marshalling and Contribution


81.


Marshalling securities.


     1*[81. Marshalling  securities.-If  the  owner  of  two  or  more
properties mortgages them to one person and them 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.


     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 reteably 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.


     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
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 42, for the original section.
2    Subs. by s. 43, ibid., for the original paragraph.
3    Subs. by s. 43, ibid., for "second".
4    Subs. by s. 44, ibid., for "has become payable".
---------------------------------------------------------------------

54

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  law  1* 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 2*[and all  documents  in  his
possession or power relating to the mortgaged property], apply for and
receive  the  money,  and  the mortgage-deed  3*[and  all  such  other
documents]  so  deposited shall be delivered to the mortgagor or  such
other person as aforesaid.

     3*[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.


     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, interest on the principal
money shall  cease from  the date of the tender or 4*[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, 5*[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.]
---------------------------------------------------------------------
1    See the  Code of  Civil Procedure, 1908  (Act 5 of 1908), Sch. I,
Order VI, rule 15.
2    Subs. by Act 20 of 1929, s. 44, for "if then in his possession or
power".
3    Ins. by s. 44, ibid.
4    Ins. by s. 45, ibid.
5    Subs. by s. 45, ibid., for "as the case may be".
---------------------------------------------------------------------

55

     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 1*[and such notice has not been given
before the making of the tender or deposit, as the case may be].

             2* Suits for Foreclosure, Sale or Redemption


85.


[Repealed.]


     85. [Parties to suits for foreclosure, sale and redemption.] Rep.
by the Code of Civil Procedure, 1908 (Act 5 of 1908), s. 156 and Sch.
V.

                        2* Foreclosure and Sale


86 to 90.


[Repealed.]


     [86 to  90.] Rep.  by the Code of Civil Procedure, 1908 (Act 5 of
1908), s. 156 and Sch. V.

                              Redemption


91.


Persons who may sue for redemption.


     3*[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.]


92.


Subrogation.


     4*[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.
---------------------------------------------------------------------
1    Added by Act 20 of 1929, s. 45.
2    For the repealed provisions, as re-enacted, see the Code of Civil
Procedure, 1908 (Act 5 of 1908), Sch. I, Order XXXIV.
3    Subs. by Act 20 of 1929, s. 46, for the original section.
4    Ins. by  s. 47, ibid. Original ss. 92 to 94 were rep. by Act 5 of
1908, s. 156 and Sch. V.
---------------------------------------------------------------------

56

     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.

     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.


     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.


     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.]


95.


Right of redeeming co-mortgagor to expenses.


     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.


     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.]


97.


[Repealed.]


     2* 97.  [Application of  proceeds.] Rep.  by the  Code  of  Civil
Procedure, 1908 (Act 5 of 1908), s. 156 and Sch. V.
---------------------------------------------------------------------
1    Subs. by  Act 20 of 1929, s. 48, for the original s. 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 the Code of Civil
Procedure, 1908 (Act 5 of 1908), Sch. I, Order XXXIV, rules 12 and 13.
---------------------------------------------------------------------

57

                         Anomalous Mortgages


98.


Rights and liabilities of parties to anomalous mortgages.


     98. Rights  and liabilities of parties to anomalous mortgages.-In
the case  of 1*[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.


99.


[Repealed.]


     2* 99.  [Attachment of  mortgaged property.]  Rep. by the Code of
Civil Procedure, 1908 (Act 5 of 1908), s. 156 and Sch. V.

                               Charges


100.


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 3*[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, 4*[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].


101.


No merger in case of subsequent encumbrance.


     5*[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
foreclose or sell such property
---------------------------------------------------------------------
1    Subs. by  Act 20  of 1929,  s. 49,  for "a  mortgage, not being a
simple mortgage,  a mortgage  by  conditional  sale,  an  usufructuary
mortgage or  an English  mortgage or  a combination  of the  first and
third, or the second and third, of such forms".
2    For the  repealed provisions as re-enacted, see the Code of Civil
Procedure, 1908 (Act 5 of 1908), Sch. I, Order XXXIV, rule 14.
3    Subs. by  Act 20 of 1929, s. 50, for "as to a mortgagor shall, so
far as may be, apply to the owner of such property, and the provisions
of ss.  81 and  82 shall, so far as may be, apply to the person having
such charge".
4    Added by s. 50, ibid.
5    Subs. by s. 51, ibid., for the original section.
---------------------------------------------------------------------

58

without redeeming  the prior  mortgage or  charge, or  otherwise  than
subject thereto.]

                          Notice and Tender


102.


Service or tender on or to agent.


     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
authorized  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.


     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 contact, 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
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 52, for "Where the person or agent on
whom such  notice should  be  served  cannot  be  found  in  the  said
district, or is unknown".
2    Ins. by s. 52, ibid.
3    Subs. by  s. 52,  ibid., for  "Where the  person or agent to whom
such tender  should be  made cannot be found within the said district,
or is unknown".
4    Subs. by s. 52, ibid., for "in such Court as last aforesaid".
5    Ins. by s. 53, ibid.
---------------------------------------------------------------------

59

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 1*; and the
provisions of  2*[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.


     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


                              CHAPTER V

                   OF LEASES OF IMMOVEABLE PROPERTY


105.


Lease defined. Lessor, lessee, premium and rent defined.


     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.


106.


Duration of  certain leases  in absence  of written  contract or local
usage.


     106. Duration of certain leases in absence of written contract or
local usage.-In the absence of a contract or local law or usage to the
contrary,  a   lease  of   immoveable  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  expiring with  the end of a year of the tenancy; and a
lease of  immoveable 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 expiring with the end of a
month of the tenancy.
---------------------------------------------------------------------
1    As to  persons competent  to contract,  see ss.  11 and 12 of the
Indian Contract Act, 1872 (9 of 1872).
2    Subs. by  Act 20 of 1929, s. 53, for "Chapter XXXI of the Code of
Civil Procedure".
---------------------------------------------------------------------

60

     Every notice  under this section must be in writing, signed by or
on behalf  of the  person giving  it, and 1*[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.


     2* 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.

     3*[All other  leases of immoveable property may be made either by
a registered  instrument or  by oral agreement accompanied by delivery
of possession.

     4*[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, 5*** 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.


     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
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 54, for "tendered or delivered either
personally to the party who is intended to be bound by it".
2    As to  limitation to  the territorial operation of s. 107, see s.
1, supra.  S. 107  extends to  every cantonment--see  s.  287  of  the
Cantonments Act, 1924 (2 of 1924).
3    Subs. by Act 6 of 1904, s. 5 for the original paragraph.
4    Ins. by Act 20 of 1929, s. 55.
5    The words "with the previous sanction of the G. G. in C." omitted
by the A. O. 1937.
---------------------------------------------------------------------

61

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

62

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  authorize a  tenant
having an  un-transferable 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;

63

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:

     (p) he  must not,  without the  lessor's consent,  erect  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.


     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.  Duration of lease  for  a
year.  Option to determine lease.


     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.

---------------------------------------------------------------------
1 Ins.  by Act 20 of 1929, s.  56.
---------------------------------------------------------------------

64

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.


     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 event]; and in 3*[any
               of these  cases] the  lessor or his transferee 4*[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 from  his lessor  a new  lease of  the property
leased, to  take effect  during the continuance of the existing lease.
This is  an implied  surrender of  the former  lease, and  such  lease
determines thereupon.
---------------------------------------------------------------------
1    The words  "or the  lease shall become void" omitted by Act 20 of
1929, s. 57.
2    Ins. by s. 57, ibid.
3    Subs. by s. 57, ibid., for "either case".
4    Subs. by s. 57, ibid., for "does some act showing".
---------------------------------------------------------------------

65


112.


Waiver of forfeiture.


     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.


     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.


     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.


114A.


Relief against forfeiture in certain other cases.


     1*[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;
---------------------------------------------------------------------
1    Ins. by Act 20 of 1929, s. 58.
---------------------------------------------------------------------

66

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.


     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.

     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.


     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,  renewed from  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.


     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
---------------------------------------------------------------------
1    The words "with the previous sanction of the G. G. in C." omitted
by Act 38 of 1920, s. 2 and Sch. I.
2    Ins. by Act 6 of 1904, s. 6.
---------------------------------------------------------------------

67

or any  of 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


                              CHAPTER VI

                             OF EXCHANGES


118.


"Exchange" defined.


     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.


119.


Right of party deprived of thing received in exchange.


     1*[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.


     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 has the
rights and  is subject  to the liabilities of a buyer as to that which
he takes.


121.


Exchange of money.


     121. Exchange  of  money.-On an  exchange of  money,  each  party
thereby warrants the genuineness of the money given by him.


CHAPTER VII


OF GIFTS


                             CHAPTER VII

                               OF GIFTS


122.


"Gift" defined. Acceptance wen to be made.


     122. "Gift"  defined.-"Gift"  is the 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.
---------------------------------------------------------------------
1    Subs. by Act 20 of 1929, s. 59, for the original section.
---------------------------------------------------------------------

68

Acceptance  when to be made.-Such  acceptance must be made during  the
lifetime of the donor and while he is still capable of giving.

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


123.


Transfer how effected.


     1* 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.

     Such delivery  may be  made in  the same way as goods sold may be
delivered.


124.


Gift of existing and future property.


     124. Gift of existing and future property.-A gift comprising both
existing and future property is void as to the latter.


125.


Gift to several, of whom one does not accept.


     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.


     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 gift shall be suspended or revoked;
but a  gift which  the parties  agree shall  be revocable wholly or in
part, at the mere will of the donor, is void wholly or in part, as the
case may be.

     A gift  may 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 die
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.
---------------------------------------------------------------------
1    As to  limitation to  the territorial operation of s. 123, see s.
1, supra.  S. 123  extends to  every cantonment--see  s.  287  of  the
Cantonments Act, 1924 (2 of 1924).
---------------------------------------------------------------------

69


127.


Onerous gifts. Onerous gift to disqualified person.


     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 donee 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 donee
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 donee 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.

                            Illustrations

     (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 gives B all his shares in
joint stock  companies. B refuses to accept the shares in Y. He cannot
take the shares in X.

     (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, gives 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 this refusal forfeit the
money.


128.


Universal donee.


     128. Universal donee.-Subject  to the  provisions of section 127,
where a  gift consists  of the  donor's whole  property, the  donee 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.


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


CHAPTER VIII


OF TRANSFERS OF ACTIONABLE CLAIMS


                           3*[CHAPTER VIII

                  OF TRANSFERS OF ACTIONABLE CLAIMS


130.


Transfer of actionable claim.


     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
---------------------------------------------------------------------
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 s. 61, ibid.
3    Subs. by Act 2 of 1900, s. 4, for the original Chapter.
4    Ins. by Act 20 of 1929, s. 62.
---------------------------------------------------------------------

70

instrument in  writing signed by the transferor or his duly authorized
agent, 1*** 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  2*[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.


130A.


[Repealed.]


     3* 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.


     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 authorized  in this behalf, or, in case the transferor
refuses to  sign, by  the transferee or his agent, and shall state the
name and address of the transferee.
---------------------------------------------------------------------
1    The words  and figures "and notwithstanding anything contained in
s. 123"  ins. by  Act 38  of 1925, s. 2, omitted by Act 20 of 1929, s.
62.
2    Added by Act 4 of 1938, s. 121 (with effect from 1-7-1939).
3    Ins. by Act 6 of 1944, s. 2.
---------------------------------------------------------------------

71


132.


Liability of transferee of actionable claim.


     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. In 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.


     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.


     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.


135.


Assignment of rights under policy of insurance against fire.


     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.]


135A.


[Repealed.]


     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.


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

72

person claiming  by or through him, any actionable claim so dealt with
by him as aforesaid.


137.


Saving of negotiable instruments, etc.


     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,  warehousekeeper'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  authorizing or
purporting to  authorize, either  by endorsement  or by  delivery, the
possessor of  the  document  to  transfer  or  receive  goods  thereby
represented.

73


SCHEDULE I


(a) STATUTES


                             THE SCHEDULE

                             (a) STATUTES

---------------------------------------------------------------------
  Year and chapter           Subject                Extent of repeal
---------------------------------------------------------------------
27 Hen. VIII, c. 10 .    Uses      .    .   .   . The whole.

13 Eliz., c. 5  .   .    Fraudulent conveyances . The whole.

27 Eliz., c. 4  .   .    Fraudulent conveyances . The whole.

4 Wm. and Mary, c. 16    Clandestine mortgages  . The whole.
---------------------------------------------------------------------

             (b) ACTS OF THE GOVERNOR GENERAL IN COUNCIL
---------------------------------------------------------------------
Number and year              Subject                Extent of repeal
---------------------------------------------------------------------
IX of 1842 .    .   .    Lease and release  .   .   The whole.

XXXI of 1854    .   .    Modes of conveying land    Section 17.

XI of 1855 .    .   .    Mesne profits and improve- Section 1; in the
                         ments.                     title, the words
                                                    "to mesne profits
                                                    and", and in the
                                                    preamble "to limit
                                                    the liability for
                                                    mesne profits
                                                    and".

XXVII of 1866   .   .    Indian Trustee Act .   .   Section 31.

IV of 1872 .    .   .    Punjab Laws Act    .   .   So far as it
                                                    relates to
                                                    Bengal Regulations
                                                    I of 1798 and XVII
                                                    of 1806.

XX of 1875 .    .   .    Central Provinces Laws     So far as it
                         Act.                       relates to Bengal
                                                    Regulations I of
                                                    1798 and XVII of
                                                    1806.

XVIII of  1876  .     .  Oudh Laws Act      .   .   So far as it
                                                    relates to bengal
                                                    Regulation
                                                    XVII of 1806.

I of 1877  .    .   .    Specific Relief.   .   .   In sections 35 and
                                                    36, the words "in
                                                    writing".

                         (c) REGULATIONS

Bengal Regulation        Conditional sales  .   .   The whole Regula-
I of 1798.                                          tion.

Bengal Regulation        Redemption     .   .   .   The whole Regula-
XVII of 1806.                                       tion.

Bombay Regulation V      Acknowledgment of debts:   Section 15.
of 1827.                 Interest; Mortgagees in
                         possession.
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