Diwan Advocates

Transfer of Property Act Practice

A family buys a flat in Delhi. They pay the full consideration, take possession, and move in. Three years later, a stranger appears with a power of attorney and a sale deed from someone who sold the same flat to them six months before. Both buyers have documents. Only one can win the title suit. The question of who wins depends on who had knowledge of the prior transaction and whether both sales were registered. The Transfer of Property Act settles exactly this kind of dispute, and has done so for over 140 years.

Property law in India is older, more detailed, and more litigated than almost any other area of civil law. The Transfer of Property Act, 1882 governs how immovable property changes hands: by sale, mortgage, lease, exchange, gift, and assignment of actionable claims. It defines what must be done for a transfer to be valid, what rights the transferee gets, and what happens when multiple people claim the same property. Every property transaction in India, whether a flat purchase, a commercial mortgage, a long-term lease, or a gift to a family member, is governed by it.

At Diwan Advocates, we advise on property transactions from due diligence through registration, handle the disputes that arise when transactions go wrong, and represent clients in title suits, specific performance claims, redemption suits, partition proceedings, and RERA complaints. We act for individual buyers, developers, lenders, and commercial landlords.

Sale of Immovable Property

Section 54 of the Transfer of Property Act, 1882 defines a sale as a transfer of ownership in exchange for a price paid, promised, or part-paid. For tangible immovable property valued above Rs 100, the sale must be by a registered instrument. An oral sale of such property passes no title. The sale deed must be executed on properly stamped paper, signed by the seller, and registered with the Sub-Registrar of the district in which the property is situated.

Title Due Diligence

Before any sale deed is executed, the title of the seller must be verified. This means tracing ownership through all prior documents for at least 30 years: sale deeds, gift deeds, court decrees, succession certificates, mutation entries in revenue records, and encumbrance certificates from the registrar's office. A bank or NBFC lending against the property will require a formal title opinion. We conduct title due diligence and issue title opinions that identify defects, missing links in the chain, encumbrances, and litigation risks.

Agreement to Sell and Section 53A

Before execution of the sale deed, parties typically enter an agreement to sell specifying the price, payment schedule, and completion date. An agreement to sell does not transfer title but gives the buyer an equitable interest. Where the buyer has paid part of the consideration, taken possession, and performed their obligations, Section 53A protects them from being dispossessed by the seller even if the sale deed has not been executed. This doctrine of part performance is India's equivalent of the English equitable doctrine, but with an important difference: under Indian law, Section 53A is only a shield, not a sword. The buyer in part performance can resist dispossession but cannot sue to enforce the agreement as a transfer of title. For that, they must file for specific performance.

Specific Performance After the 2018 Amendment

The Specific Relief (Amendment) Act, 2018 changed the law significantly. Before 2018, specific performance of a contract for immovable property was discretionary. Courts could award damages instead if they considered that adequate. After 2018, specific performance is the general rule. A court must order specific performance of a contract for immovable property unless the contract itself has become impossible to perform or the plaintiff has not been ready and willing to perform. This amendment strengthened the position of buyers whose sellers backed out, and has resulted in a significant increase in specific performance suits.

Mortgage: Types, Rights, and Enforcement

Section 58 of the Transfer of Property Act defines a mortgage as the transfer of an interest in specific immovable property to secure the payment of money advanced or to be advanced. The TPA recognises six types of mortgage, each with different legal characteristics and different enforcement mechanisms.

Simple Mortgage

The mortgagor binds themselves personally to pay the mortgage money and agrees that on default, the mortgagee shall have the right to cause the mortgaged property to be sold. No possession passes. Enforcement requires a court decree for sale. This is the most common form used in institutional lending where the security is clearly identified and the lender is comfortable with the court process.

Mortgage by Conditional Sale

The mortgagor ostensibly sells the property to the mortgagee with a condition that on default the sale becomes absolute and on payment the sale is void and the mortgagee re-transfers the property. Courts look carefully at whether a transaction structured as a conditional sale is in substance a mortgage, because the consequences differ significantly for the parties.

Usufructuary Mortgage

The mortgagor delivers possession to the mortgagee, who is entitled to receive the rents and profits from the property and to appropriate them in lieu of interest, or in payment of mortgage money, or both. No right of personal action for the debt arises. The mortgage is discharged when the rents and profits received equal the mortgage money and interest.

English Mortgage

The mortgagor binds themselves to repay the mortgage money on a specified date and transfers the property absolutely to the mortgagee, with a condition that the mortgagee will re-transfer on repayment. This gives the mortgagee power of sale without requiring a court decree, making it attractive for commercial lenders. It is less commonly used in India but is specifically recognised by the TPA.

Mortgage by Deposit of Title Deeds

Created by delivering title documents to the lender with intent to create a security. No written instrument or registration is required to create this mortgage, which is why it is the dominant form used by banks in urban lending. The absence of a registered document does not affect validity, but does mean the mortgage does not appear on the encumbrance certificate. SARFAESI enforcement of a mortgage by deposit of title deeds is available to qualifying secured creditors.

Right of Redemption

Every mortgagor has a right to redeem the mortgage by paying the mortgage money at any time before the mortgage is extinguished by a court decree of foreclosure or by a valid sale under SARFAESI or court process. This right cannot be clogged or fettered by any condition in the mortgage deed. Any clause in the mortgage that purports to prevent or delay redemption beyond what the TPA permits is void. The limitation period for a suit to redeem a mortgage is 30 years from the date when the right to redeem accrues.

Lease of Immovable Property

Section 105 of the TPA defines a lease as a transfer of a right to enjoy immovable property for a specified time in consideration of a price paid or promised, or of money, share of crops, service, or any other thing of value. The person who transfers the right is the lessor. The person to whom it is transferred is the lessee.

Leases Requiring Registration

Under the Registration Act, 1908, a lease for a term exceeding one year must be by registered instrument. A lease for a year or less may be by oral agreement or unregistered writing. In practice, most commercial leases, even those for terms under a year, are documented in writing to avoid disputes about terms. An unregistered lease for a term exceeding one year is admissible in evidence only to show the commencement of a tenancy at will, not to enforce the specific terms.

Rights and Obligations

The lessor is bound to disclose material defects in the property, to put the lessee in possession, and to allow quiet enjoyment. The lessee is bound to pay the rent, to keep the property in the condition received, not to make permanent alterations without consent, and to give notice before vacating. On expiry of the lease, the lessee must deliver the property in the same condition as received, subject to fair wear and tear.

Determination of Lease and Forfeiture

A lease is determined by efflux of time, by surrender, by merger, by expiry of notice to quit, or by forfeiture. Forfeiture arises where the lessee breaches the conditions of the lease, including non-payment of rent, denial of the lessor's title, or permanent alienation of the property without consent. Before a court will enforce forfeiture, it considers whether the breach is capable of remedy and whether the lessee should be given an opportunity to remedy it.

Rent Control and Landlord-Tenant Disputes

Many residential and older commercial tenancies in Delhi and other cities are governed not only by the TPA but also by state rent control legislation, which gives tenants security of tenure and limits the rent that can be charged. Eviction of a protected tenant requires proof of specific statutory grounds, which vary by state. We advise landlords and tenants on the interaction between the TPA framework and the applicable rent control legislation in their state, and we appear in rent control tribunals and civil courts in eviction and arrears proceedings.

Gift and Exchange

Gift of Immovable Property

Section 122 of the TPA defines a gift as a transfer of ownership of existing movable or immovable property made voluntarily without consideration. A gift of immovable property must be accepted by or on behalf of the donee during the lifetime of the donor and while the donor is still capable of giving. A gift of immovable property must be made by a registered instrument signed by or on behalf of the donor and attested by two witnesses. An unregistered gift deed of immovable property is void. Under the Hindu Succession Act, 1956, gifts of ancestral property by a coparcener are restricted to their undivided share and require the consent of other coparceners in certain situations.

Exchange

An exchange under Section 118 of the TPA is a mutual transfer of ownership of one property for another, neither being money. Each party is simultaneously transferor and transferee. The rules applicable to sale apply to each party in their capacity as transferor. Exchange deeds are registered instruments attracting stamp duty on the higher value of the two properties exchanged.

Easements and Licences

The Indian Easements Act, 1882 governs the rights of owners of land to use the land of another for a specified purpose. Common easements include the right of way over another's land, the right of light and air from adjacent property, and the right of support. Easements can arise by grant, by prescription after 20 years of open and continuous use, by necessity, or by custom.

Easement disputes are among the most bitterly contested property disputes in urban areas, particularly in older neighbourhoods where properties have been subdivided and built over without formal documentation of access rights. We advise on the existence and enforceability of claimed easements and represent clients in suits for injunctions to prevent obstruction of easements and for declarations of easementary rights.

A licence, unlike an easement, does not create an interest in land. It is a personal permission that can be revoked. The distinction matters because a licensee evicted by the licensor has no right to remain, whereas an easement holder has a right enforceable against the owner and successors in title.

Title Suits, Partition, and Property Disputes

Title Suits

A title suit is a civil action to establish that the plaintiff is the owner of a property and to recover possession from a person in wrongful occupation. The burden of proof lies on the plaintiff to establish a better title than the defendant, not an absolute or perfect title. Courts look at the documents, the revenue records, the history of possession, and the conduct of the parties. The limitation period for a suit to recover possession of immovable property is 12 years from the date of dispossession.

Partition

Where immovable property is co-owned and the co-owners cannot agree on its management or use, any co-owner can sue for partition. The court divides the property in kind where possible, assigning each co-owner a defined portion. Where division in kind is not possible without significantly diminishing the value of the property, the court orders a sale and distribution of the proceeds. Partition suits in joint family property frequently involve questions of Hindu succession law alongside the TPA framework.

Injunctions in Property Disputes

Where a party is about to create a third-party interest in disputed property, construct a structure that would affect the other's rights, or deal with property in a way that would make a future decree futile, an urgent injunction application is the immediate legal response. Courts grant interim injunctions in property matters where the plaintiff establishes a prima facie case of right, balance of convenience in their favour, and irreparable harm if the injunction is refused. We file urgent injunction applications and appear at ex parte hearings in property disputes across the civil courts and High Courts.

RERA: Rights of Buyers Against Developers

The Real Estate (Regulation and Development) Act, 2016 created a dedicated regulatory and dispute resolution framework for real estate transactions. Every project above a prescribed size must be registered with the state RERA authority before launch. Developers must maintain 70 percent of amounts collected from buyers in a dedicated escrow account to ensure project completion. The developer cannot alter the plans or specifications without the written consent of at least two-thirds of the allottees.

Buyer Remedies Under RERA

A buyer whose developer has delayed possession, failed to deliver the agreed specifications, or refused to execute a registered sale agreement can file a complaint before the RERA authority. The authority can order refund of amounts paid with interest at the prescribed rate, compensation for the delay, and in some cases cancellation of the allotment. Complaints before RERA are resolved faster than civil court suits and the interest rates awarded on delayed refunds are significant.

RERA and Concurrent Court Proceedings

RERA does not bar a buyer from also pursuing remedies under the Consumer Protection Act, 2019 for deficiency of service, or from filing a civil suit for specific performance of the agreement. The choice of forum depends on the nature of the relief sought and the stage of the project. We advise buyers on the most effective combination of remedies in their specific situation and pursue them in parallel where that produces the best outcome.

Why Diwan Advocates for Property Law?

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Property disputes are among the longest and most consequential a person will face.

Getting the legal advice right at the beginning costs far less than fixing it later.

Diwan Advocates gets it right from the start.

Diwan Advocates  |  Delhi, India