Transfer of Property Act MCQs for Judiciary, Page 3

Correct answer: A. Immovable property as the intention is continued vegetative growth

A fruit-bearing mango tree is classified as immovable property because the owner intends continued vegetative growth to produce fruits; there is no intent to cut it at a reasonably early date. Section 3 of the TPA includes "things rooted in the earth" as immovable property. The distinction between a tree (immovable) and standing timber (movable) depends on the intention regarding the tree. If the intention is to preserve the tree for its vegetative growth and produce, it is immovable property. If the intention is to cut it at a reasonably early date, it becomes standing timber and is movable. Shantabai v. State of Bombay (AIR 1958 SC 532) laid down that fruit-bearing trees planted for their fruit and not for wood are immovable property.

Source note: Section 3, TPA 1882; Shantabai v. State of Bombay, AIR 1958 SC 532

Correct answer: A. Growing crop of sugarcane

Growing crops, including sugarcane, are classified as movable property under Section 3 of the TPA and Section 2(7) of the Sale of Goods Act. Growing crops are excluded from the definition of immovable property in Section 3 because they are bound to be harvested at maturity and have no utility except their produce. An embedded electricity pole is immovable as it is a thing embedded in the earth. The right of fishery is immovable as it is a benefit arising from land (profit a prendre). A building on leased land is immovable property (though the ownership situation may be complex). Sugarcane, wheat, paddy, and all other agricultural crops on the field are movable property and are transferred as such.

Source note: Section 3, TPA 1882; Section 2(7), Sale of Goods Act 1930

Correct answer: C. The State could not impose sales tax as the contract was not a sale of goods; it was a grant of profit a prendre over immovable property exempt from goods-tax

The central dispute in Titaghur Paper Mills (AIR 1985 SC 1293) was whether the Bamboo Contract was a sale of movable goods attracting sales tax or a grant of profit a prendre (immovable property) exempt from goods-tax. The Supreme Court held: (1) bamboos continuously drew sustenance from soil over 14 years - not standing timber fit for immediate felling; (2) the contract could not be split into existing-bamboos sale plus future-goods contract; (3) it was entirely a grant of benefit to arise out of land = profit a prendre = immovable property; (4) NOT a sale of goods - the imposition of sales tax under the Orissa Sales Tax Act was therefore unconstitutional and ultra vires. The Court expressly overruled Orient Paper Mills and held the Bamboo Contract immune from sales tax as it dealt with immovable property.

Source note: State of Orissa v. Titaghur Paper Mills, AIR 1985 SC 1293

Correct answer: B. The equipment was under a hire-purchase agreement and not fully paid

The four specific factors identified by the AP High Court in Bamadev Panigrahi v. Monorama Raj (AIR 1974 AP 226) to hold cinema equipment movable were: (1) the business was "Kumar Touring Talkies" - the word "touring" itself indicated a temporary, peripatetic nature; (2) the licence for exhibiting shows was only for one year with no guarantee of renewal; (3) the person installing the equipment was NOT the owner of the land (they held it under possessory mortgage) - a non-owner would intend beneficial enjoyment of the chattel, not improvement of land; (4) the machinery was in fact subsequently removed from the land. The hire-purchase arrangement (option C) was mentioned as background fact but was NOT listed as one of the decisive determinants of movable character. The Court focused on purpose of annexation and ownership relationship with land.

Source note: Bamadev Panigrahi v. Monorama Raj, AIR 1974 AP 226

Correct answer: D. To have beneficial enjoyment of the machinery itself during the lease period

In Bamadev Panigrahi v. Monorama Raj (AIR 1974 AP 226), the AP High Court articulated an important presumption: "Where the building or land is taken on lease for a term by a lessee and he installs certain machinery on the property during the lease period, it has to be held that his object and purpose of installing the machinery was the beneficial enjoyment of the very machinery during the period of his lease." The Court reasoned that a lessee, being a temporary occupier not interested in the land itself, installs machinery for his own commercial benefit during the lease - not to permanently improve land belonging to another. A lessee would naturally remove the machinery at lease end. This presumption can be rebutted if contrary intention is proved, but the default inference is: lessee installation = enjoyment of chattel, not improvement of land.

Source note: Bamadev Panigrahi v. Monorama Raj, AIR 1974 AP 226

Correct answer: A. When the same person owns both the machinery and the land, the normal inference is installation was for permanent beneficial enjoyment of the property; when they are different persons, the inference is beneficial enjoyment of the chattel only

The AP High Court in Bamadev Panigrahi (AIR 1974 AP 226) synthesized the Madras authorities and extracted the key principle: "Where the machinery and the building or land on which it is installed are owned by one and the same person, normally it should be inferred that the object and purpose of installing the machinery is to have beneficial enjoyment of the entire building or land. However, where the machinery and the building or land belong to two different persons, the intendment must normally be presumed to be to exploit the benefit of the machinery alone, as he is not interested in the building or the land." Thus: owner-installer = presumed immovable (property benefit); non-owner tenant-installer = presumed movable (chattel benefit). This unifying principle explains the apparently contradictory Madras decisions.

Source note: Bamadev Panigrahi v. Monorama Raj, AIR 1974 AP 226; Subrahmaniam Firm v. Chindambaram, AIR 1940 Mad 527

Correct answer: C. Immovable property as it is a benefit arising out of land - an interest in immovable property

A Hindu widow's life interest in the income from her deceased husband's properties is recognized as immovable property. The LED Property Law Capsule lists it as an example: "Hindu widow's life-interest of the income of the husband's property" is immovable property. This falls within the category of "benefits arising out of land" - it is an interest in immovable property (right to derive income from land). Similarly classified as immovable: reversion in property leased, office of a hereditary priest of a temple, right to collect rent from land, equity of redemption in mortgaged property. These are all interests in or benefits from land. Contrast with a personal contractual right to receive money - that would be an actionable claim (movable). The widow's life interest has a direct nexus to specific immovable property and is therefore itself immovable.

Source note: Section 3, TPA 1882; LED Property Law Capsule

Correct answer: B. By showing the object of the annexation was the permanent beneficial enjoyment of the immovable property to which it was attached

The rule in Holland v. Hodgson (1872 7 CP 328) as articulated by Blackburn J. establishes two tests: (1) DEGREE/MODE OF ANNEXATION: if resting on own weight, presumed movable; if fixed, presumed immovable; (2) OBJECT/PURPOSE OF ANNEXATION: the dominant test in India. The presumption that things resting on their own weight are movable is rebutted by showing the OBJECT of placing the thing there was for the PERMANENT AND BENEFICIAL ENJOYMENT of the land or building (as opposed to the better enjoyment of the chattel itself). For example, a heavy stone ornament set without fixing in a garden - if placed for the permanent enhancement of the garden (land benefit), the movable presumption is rebutted. In India, the purpose test is dominant over the degree-of-annexation test, as consistently applied in Bamadev Panigrahi, Duncans Industries, and other cases.

Source note: Holland v. Hodgson, 1872 7 CP 328; Section 3, TPA 1882

Correct answer: D. Doors and windows of a building (attached to walls embedded in earth for the permanent enjoyment of the building)

Section 3 TPA defines "attached to earth" in three sub-categories: (i) Things ROOTED IN EARTH: trees, shrubs (not standing timber, growing crops, grass); (ii) Things EMBEDDED IN EARTH: buildings, walls, electricity poles; (iii) Things ATTACHED TO WHAT IS EMBEDDED FOR PERMANENT BENEFICIAL ENJOYMENT: this is the third category - things attached to buildings/walls (which are themselves embedded in earth) for the permanent beneficial enjoyment of those buildings. Classic examples: DOORS AND WINDOWS of a house are attached to the walls (embedded in earth) for the permanent enjoyment of the house = immovable. The LED Capsule states: "The doors and windows of a house are attached to the house for permanent enjoyment of the house." Contrast: electric fans or window blinds - attached NOT for permanent beneficial enjoyment of the building but for the enjoyment of the chattel itself = movable.

Source note: Section 3, TPA 1882

Correct answer: A. Section 14 restrains future interests in property; a renewal option is merely a personal contract right that does not create any interest in property.

In R. Kempraj v. Burton Son and Co. (AIR 1970 SC 1872): 'The rule against perpetuity is not concerned with the contracts as such. A contract for renewal of a lease is merely a contract and does not create any interest in the property.' Analysis: (1) The option to renew is a CONTRACT (personal right); (2) Does NOT create a present interest in the property; (3) When EXERCISED, creates a new lease for a definite 10-year period; (4) Section 14 applies to TRANSFERS creating FUTURE PROPERTY INTERESTS beyond the perpetuity period; an executory contract option is not a transfer of property. Same logic applied to pre-emption rights in Ram Baran Prasad v. Ram Mohit Hazra (AIR 1967 SC 744).

Source note: R. Kempraj v. Burton Son and Co., AIR 1970 SC 1872; Section 14, TPA 1882

Correct answer: D. Breaches an express condition of the lease, becomes insolvent, or denies the lessor's title

Section 111(g) of the TPA provides that a lease is forfeited in three circumstances: (i) the lessee breaks an express condition which provides that on breach thereof the lessor may re-enter; (ii) the lessee becomes insolvent and the lease provides that it shall be void on insolvency; and (iii) the lessee denies the title of the lessor. For forfeiture to take effect, the lessor must give notice to the lessee of his intention to determine the lease in the manner and at the time specified by the court. Section 114 and 114A provide the court with power to grant relief against forfeiture in appropriate circumstances. Mere non-payment of rent or subletting without permission do not by themselves constitute grounds for forfeiture unless there is an express condition to that effect.

Source note: Section 111(g), TPA 1882

Correct answer: A. A registered instrument executed by both the lessor and lessee

Section 107 of the TPA provides that a lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can only be made by a registered instrument. All other leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession. The registered instrument must be executed by both the lessor and lessee. In contrast, leases for less than one year can be created orally with delivery of possession. This requirement exists because long-term leases significantly affect property rights and merit the protection of formal documentation and registration for public notice.

Source note: Section 107, TPA 1882

Correct answer: D. Right to avoid the lease

Section 108(c) of the TPA (Section 108(b) in some editions) provides that if the lessor is aware of a material defect in the property at the time of the lease but does not disclose it to the lessee, the lessee may avoid the lease upon discovery of such defect. This is analogous to the seller's duty of disclosure under Section 55(1)(a). The defect must be material, known to the lessor, and not readily discoverable by the lessee in ordinary inspection. The lessee's remedy is avoidance (termination) of the lease, not merely damages. This provision reflects the principle that the lessor, having superior knowledge of the property, must disclose material defects that would affect the lessee's decision to enter into the lease.

Source note: Section 108, TPA 1882

Correct answer: D. A premium, rent, or a combination of both

Section 105 of the TPA defines a lease as the transfer of a right to enjoy immovable 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. The consideration can be a premium (paid at the start), rent (paid periodically), or both. The "lessor" is the person making the transfer, the "lessee" is the person accepting it, the "premium" is the price paid upfront, and the "rent" is the periodic consideration. A lease transfers only a right to enjoy, unlike a sale which transfers ownership.

Source note: Section 105, TPA 1882

Correct answer: C. The pre-1946 lease was unregistered and therefore void under Section 107 TPA read with Section 17(1)(d) Registration Act - it created no legal estate; the tenant's possession from 1940-1956 was under an invalid (void, unregistered) deed and therefore the tenant had no antecedent legal right predating the mortgage suit

In Supreme General Films Exchange v. Maharaja Brijnath (1975 SC), the Supreme Court's analysis: (1) The cinema tenant had possession since 1940 under an unregistered lease deed; this expired in 1946; (2) An unregistered lease for more than one year is VOID under Section 107 TPA read with Section 17(1)(d) Registration Act - it creates no legal estate; (3) From 1946 to 1956, the tenant had no fresh registered lease - their possession from 1940 was under a void document creating no legal right; (4) The 1956 registered lease was the FIRST legally effective interest created in the tenant's favour, but it was created AFTER the mortgage suit commenced in 1954 = pendente lite; (5) Therefore, the tenant had NO antecedent legal right predating the mortgage suit that could be used to resist the mortgagee's decree. The lis pendens doctrine bound the tenant to the suit's outcome.

Source note: Supreme General Films Exchange v. Maharaja Brijnath, 1975 SC; Sections 107, TPA 1882

Correct answer: A. Avoid the lease (treat it as terminated)

Section 108(b) of the TPA provides that 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 is wholly destroyed or rendered substantially and permanently unfit for the purposes for which it was let, the lessee may avoid (terminate) the lease. This right accrues to the lessee when: (i) a material part is affected; (ii) the destruction or damage is substantial and permanent; and (iii) it renders the property unfit for the purpose for which it was let. The right of avoidance is an option of the lessee, not an automatic determination. The lessee cannot claim compensation from the lessor for destruction by such natural or external forces as the lessor is not at fault.

Source note: Section 108(b), TPA 1882

Correct answer: C. Put the lessor into possession of the property

Section 108(q) (or 108(i) in some editions) of the TPA imposes a duty on the lessee to put the lessor into possession of the property on the termination of the lease. This is a fundamental obligation: once the lease ends, the lessee must restore possession to the lessor and not continue in unauthorized occupation. If the lessee fails to vacate and the lessor accepts rent, Section 116 (holding over) may apply to create a fresh implied tenancy. If the lessee remains without the lessor's consent, they are liable as a trespasser and for mesne profits. There is no automatic right to a month's notice (unless the lease so provides or statute requires it), and the lessee is not under a general obligation to remove structures erected with the lessor's permission.

Source note: Section 108, TPA 1882

Correct answer: A. Removable: machinery installed by a factory lessee (trade fixture); Non-removable: a wall or structural partition built by the lessee for permanent improvement of the premises

Section 108(i) TPA grants the lessee the right to remove "any crop, grass, or thing (other than a thing which was in existence at the time of the commencement of the lease, or is a fixture provided for permanent use with the property) which he has attached to the earth." The categories: (1) REMOVABLE by lessee: trade fixtures (machinery, shelving, brewing vessels installed for the lessee's business during the lease) - the Subrahmaniam Firm case (AIR 1940 Mad 527) confirms these are movable when installed by a tenant; ornamental fixtures attached for decoration; agricultural improvements. (2) NON-REMOVABLE by lessee: structural walls, partitions, permanent buildings constructed by the lessee that were intended to permanently improve the property for the permanent use of the premises. The test is whether the fixture was provided for the "PERMANENT USE" of the property or for the temporary use of the lessee's business/occupation.

Source note: Section 108(i), TPA 1882; Subrahmaniam Firm v. Chindambaram, AIR 1940 Mad 527

Correct answer: C. By the death of the lessor

Section 111 of the TPA enumerates eight modes of determination of a lease: (i) by efflux of time (for a fixed term); (ii) on the happening of a specified event (for a lease conditioned upon an event); (iii) on the termination of the lessor's interest (where the lessor's interest in the property ends); (iv) on the happening of an event where the lessee has an option to determine; (v) on the express surrender by the lessee; (vi) on implied surrender where incompatible new lease is accepted; (vii) by forfeiture (breach of express condition, insolvency, denial of title); and (viii) on the expiration of a notice to quit. The death of the lessor is NOT one of the modes. A lease is a property right that survives the lessor's death and binds the heirs and legal representatives.

Source note: Section 111, TPA 1882

Correct answer: A. The lessor must accept rent or otherwise assent to the lessee remaining in possession

Under Section 116 of the TPA, for holding over to create an implied new tenancy, two elements must coexist: (i) the lessee holds over - remains in possession after the lease ends; and (ii) the lessor accepts rent from the holding over lessee or otherwise assents to the lessee's continued possession. If the lessor accepts even a single payment of rent after the lease determination, an implied tenancy is created. Mere silence or failure to take immediate eviction proceedings does not constitute assent. No written notice or fresh lease deed is required. The implied new tenancy is month-to-month (for non-agricultural and non-manufacturing purposes) or year-to-year (for agricultural or manufacturing purposes), terminable by proper notice to quit.

Source note: Section 116, TPA 1882

Correct answer: B. A monthly tenancy or yearly tenancy depending on the purpose of the lease

Section 116 of the TPA provides that if a lessee or sublessee holds over after the determination of the lease and the lessor (or their legal representative) accepts rent from the lessee or otherwise assents to his continuing in possession, the lease is, in the absence of agreement to the contrary, renewed from year to year (if the lease was for agricultural/manufacturing purposes) or from month to month (for any other purpose). Holding over with acceptance of rent by the lessor creates a fresh implied tenancy. The key elements are: (i) the lessee remains in possession after the lease ends; and (ii) the lessor accepts rent or otherwise assents to continued possession. This implied tenancy is terminable by a proper notice to quit.

Source note: Section 116, TPA 1882

Correct answer: B. Be a continuation of original proceedings attracting lis pendens

In Dalip Kaur v. Jeewan Ram (1996 SC), the Supreme Court held that proceedings before the Supreme Court in a civil appeal, even when pursued under Article 136 (SLP), are a continuation of proceedings in the original suit. The doctrine of lis pendens and the principle of restitution apply to such proceedings. The mere fact that leave to appeal must be obtained under the Constitution does not remove the proceedings from the ambit of lis pendens. A transfer made while the matter is pending before the Supreme Court (whether as SLP or appeal) is subject to lis pendens. The policy basis is the same: preventing parties from disposing of property in ways that would interfere with the execution of the court's ultimate decree.

Source note: Dalip Kaur v. Jeewan Ram, 1996 SC; Section 52, TPA 1882

Correct answer: B. A fraudulent secret understanding between the plaintiff and defendant not to genuinely contest the litigation, for the purpose of defeating rights of third-party transferees

A collusive suit (excluding lis pendens) involves a fraudulent secret understanding between PARTIES TO THE SUIT (plaintiff and defendant) not to genuinely contest, to manufacture a lis that defeats third parties rights. Example: A and B secretly agree that B will file suit against A for property A intends to sell; A will not genuinely contest; during the pending suit A sells to C; when the fabricated decree is obtained it is used against C. Since the suit was collusive, Section 52 does not apply and C purchase is valid. IMPORTANT: the collusion must be between the parties to the suit; third-party manipulation does not make the suit collusive. A bona fide contested suit, even if partly to protect property from sale, is NOT collusive.

Source note: Section 52, TPA 1882

Correct answer: D. A transferee pendente lite takes the property subject to the litigation outcome; the doctrine operates regardless of whether the transferee had notice of the pending suit

In G.T. Girish v. Y. Subba Raju (2022 LiveLaw SC 61), the Supreme Court reaffirmed: (1) During pendency of a non-collusive suit directly questioning right to immovable property, no party can transfer so as to affect other parties rights; (2) A transferee pendente lite does NOT take better title than the transferor; (3) NOTICE IS IRRELEVANT: the doctrine operates regardless of whether the transferee had notice - this distinguishes lis pendens from notice-based doctrines; (4) The transfer is not void but the transferee takes SUBJECT TO the decree; if decree goes against transferor, the transferee is equally bound. The case firmly rejected arguments that proof of notice was essential for Section 52.

Source note: G.T. Girish v. Y. Subba Raju, 2022 LiveLaw SC 61; Section 52, TPA 1882