Transfer Of Property: Various Types

Often, there is confusion between the terms sale, transfer, exchange, lease, mortgage and charge. Many times, these terms are used interchangeably. However, there are distinct differences between these terms. 

Transfer 
In common term, transfer of property refers to giving over the possession of property by one person to another. The Transfer of Property Act contains specific provisions regarding what constitutes transfer and the conditions attached. As per the Act, 'transfer of property' means an act by which a living person conveys property to living person/s, or to himself and other living person/s. 

The may be done in the present or scheduled for some future date. Further, a living person may include an individual, company, association, or body of individuals, whether incorporated or not. Under the Act, property of any kind may be transferred. 

Every person who is competent to execute a contract is competent to transfer property either wholly or in part. He should have title of transferable property, or authorized to do a transaction on property which is not his own. The right may be either absolute or conditional. A transfer of property may be made without writing in cases where a written document is not expressly required by law. It can be transferred either absolutely or conditionally. Such transfer can be only to the extent, and in a manner allowed and prescribed by law. The property may be movable or immovable, in present or at some future time. 

Unless a different intention is expressed or necessarily implied, transfer of property passes forthwith to the transferee all the interest which the transferor is authorized of passing within legal framework. 

Sale of immovable property

Sale is a transfer of ownership in exchange for a price paid, promised, or part-paid and part-promised. Such transfer in case of tangible immovable property of value of Rs 100 or more can be made only by a registered instrument. Delivery of tangible immovable property is made when a buyer completes all steps like documentation & payment/payment promise from seller, or such person as he directs, in possession of the property. Thus, delivery of immovable property can only be by handing over actual possession to the buyer or to a person authorized by the buyer. 

Lease of immovable property 

A lease of immovable property is a transfer of a right to use the property, made for a certain time, express or implied, or in perpetuity. Such transfer of right should be in consideration of a price paid or promised to the transferor by the transferee, who accepts the transfer on such terms. Lease of property from year to year or for any term exceeding one year can be made only by a registered instrument. 

Mortgage 
Mortgage is the transfer of an interest in specific immovable property for the purpose of securing payment of money advanced or to be advanced, by way of loan or an existing or future debt. The transferor is called a mortgagor, the transferee a mortgagee, the principal money and interest of which payment is secured are called 'mortgage money', and the instrument by which transfer is effected is called a mortgage deed. Mortgage can be simple mortgage, mortgage by conditional sale, or mortgage by deposit of title deeds. 

Charge 
Where immovable property of one person is made security for 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. This can be by act of parties or by operation of law. The provisions in respect of simple mortgage will apply to such a charge.