Property has a far broader definition. It also covers any intangible right regarded as a source or component of income or wealth, in addition to money and other tangible objects of value. the exclusive right and interest that a man possesses in lands and other property. As long as he doesn’t use those items in any way that is against the law, he has total freedom to enjoy and dispose of those things however he pleases.
The transfer of ownership in exchange for money is referred to as a “sale” in Section 54 of the Transfer of Property Act, 1882. The word “price” must be understood as a cost expressed in monetary terms only. A transfer is not a sale if any other form of consideration is involved. The section also stipulates that the price need not be paid at the same time as the transfer. The price may be fully paid, partially paid, or partially promised and partially paid. In all three scenarios, the transfer will be regarded as finished. So, the reference as to when and how the payment is to be made, not the instant payment, is what is important.
Two precise ways to make and carry out a sale are provided in this section. This section states that a “registered instrument” may be used to conclude a sale if:
- transfer of intangible immovable property, transfer due to reversion, or transfer of tangible immovable property valued at $100 or more.
- Some situations, including the sale of tangible immovable property with a value of less than Rs 100, allow for either a “registered instrument” or “delivery of property” to be used to complete the transaction. When the seller transfers ownership to the buyer or the individual he designates, delivery is considered to have occurred in accordance with this Section.
Contract for Sale
A contract for the sale of real estate specifies the conditions under which the sale of the subject property will occur. It in no way constitutes a charge against or an interest in such property in and of itself. As a result, the property’s title only becomes transferable upon delivery of possession or registration paperwork. Some equity does develop in a contract for sale in the transferee’s favour.
Difference between Sale and Contract for Sale
A transfer of ownership occurs when immovable property is sold under TPA. A simple agreement that a future property transaction will occur on conditions agreed upon by the parties constitutes a contract for the sale of immovable property. A right in rem is produced by a TPA sale. A contract for sale creates a right in personam.
Buyer and Seller’s Rights and Liabilities:
Seller:
(a) must reveal to the buyer any significant flaw in the asset or the seller’s ownership of it that neither party is aware of and that neither could have found with reasonable diligence;
(b) must provide all title documents for the property that are in the seller’s possession or control to the buyer upon request for review;
(c) to respond to all pertinent inquiries from the buyer on the property or its title in the best way possible;
(d) To take reasonable care of the property and all title documents related to it that are in his possession between the date of the contract of sale and the delivery of the property, just as a prudent owner would.
(e) When ownership of the property has transferred to the buyer before full payment of the purchase price, the buyer, any transferee without consideration, or any transferee with notice of the non-payment, are subject to a charge against the property in their possession for the amount of the purchase price, or any part thereof, remaining unpaid, as well as for interest on such amount or part from the date on which possession has been delivered.
Buyer:
- to pay or tender the purchase money to the seller or the person he designates at the time and location of finalising the sale. The buyer may deduct the cost of any encumbrances on the property that were present at the time of the sale from the purchase money, provided that the property is sold free of encumbrances, and shall pay the sum so deducted to the people entitled thereto;
- to take responsibility for any losses incurred as a result of the property’s destruction, damage, or decline in value after ownership has transferred to the buyer.
- Unless he has improperly refused to accept delivery of the property, there is a charge against the property as against the seller and all persons claiming under him, to the extent of the seller’s interest in the property, for the amount of any purchase money responsibly paid by the buyer in anticipation of the handover and for interest on such value; and, when he properly declines to accept the delivery, also for the total seriousness (if any) and for the costs.
Case laws:
Nahar Lal V. Brijnath, In this instance, the court determined that a document cannot be considered to have been legally registered if the registration was carried out in violation of the Registration Act’s rules.
Raheja University Ltd. v. NAC Ltd. The court rules that a contract for the sale of real estate or an agreement to buy and sell real estate constitutes a contract that stipulates how the property will be sold. This does not, by itself, give rise to any charge or interest on the subject property.
