I

ICFAI University, Dehradun Property Law

A PROJECT
ON

CONDITION RESTRAINING ALIENATION

SUBMITTED TO:
Mr. Avishek Raj
Assistant Professor, Propety Law

SUBMITTED BY:
Twinkle Rajpal
ENROLLMENT NO. 175

ICFAI LAW SCHOOL,

THE ICFAI UNIVERSITY, DEHRADUN
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ICFAI University, Dehradun Property Law

TABLE OF CONTENTS

Acknowledgement ………………………………….…………………………………..…...III
List of Abbreviations………………………..…………………………………………………IV

RESEARCH AND METHODOLOGY………………………………………………………..V

CHAPTER-I:

Introduction……………………………….………………………………………….......1

CHAPTER-II:

Section 10……………………………………….………………………………………..3
CHAPTER-III:
Exceptions to the general rule……………………..……………………………………………...4
CHAPTER-IV:
Judicial Opinion on Section 10………….………………………………………………………..6
CHAPTER-V:
Absolute and partial restriction…………………………………………………………….……..8
CHAPTER-VI:
Provision in India………………………………………………………………………..…..…..10
CHAPTER-VII:
Difference between section 10 and section 11……..…………………………..….…………….11
CHAPTER-VIII:
Conclusion………………………………………………………………………………………12
BIBLIOGRAPHY………………………………………………………………...……………13
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ICFAI University, Dehradun Property Law

ACKNOWLEDGEMENT

I take this opportunity to thank everyone who helped me out in completing my project directly
or indirectly. I show a special token of gratitude towards our Mr. Avishek Raj, our Property
Law teacher, without whose guidance and support, it would have been pretty difficult to
complete this project. I would also like to thank ICFAI’s virtual library, which helped me a lot
in the construction of this project. At the end I would also like to thank my parents for their
endless support and true guidance.
I acknowledge that without their help this project would not have been seen this day.

Twinkle Rajpal
2020 B.A. LL.B. 175
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ICFAI University, Dehradun Property Law

LIST OF ABBREVIATIONS

Abbreviation Used Used in place of

& and

AIR All India Reporter

All. Allahabad High Court

Cal. Calcutta High Court

CJ. Chief Justice

J. Justice

Mad. Madras High Court

P&H Punjab & Haryana

PC Privy Council

SC Supreme Court of India

SCR Supreme Court Reporter

Sec. Section

v. versus

Vol. Volume
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ICFAI University, Dehradun Property Law

RESEARCH AND METHODOLOGY

Source of data:
In dealing with the topic, I have referred to relevant provisions The Transfer of Property Act,
1882 notably wherever necessary. I have read many e-books, websites, Arts. and books to obtain
the right information, which is relevant to this project work. The data and information given in
this project is based on my research upon various gathered books and websites.

Method of research
The research methodology that has been adopted is purely doctrinal and analytical in nature.
Various noted texts, articles, primary legislations have been studied and a comparative analysis
have been made. All the material referred has been duly being acknowledged. I created this
project after analyzing and investigating every aspect of relevant facts.

Time
It took 1 to2 weeks to collect all the relevant data and information.

Title of the Assignment

“Restraint in Alienation”
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ICFAI University, Dehradun Property Law

CHAPTER-I: INTRODUCTION

Responsibility for property conveys with it certain essential rights, for example, an option to
have the title to the property, an option to have and appreciate it to the rejection of every other
person, and an option to estrange it without being directed to, spare as per an arrangement of law.
A flat out option to discard the property demonstrates that the proprietor can sell it for thought or
can give it for strict or magnanimous purposes he may blessing it to anybody, contract it or put it
up for rent. Spare with the assistance of law, no other individual can meddle with this force or
right of the proprietor or direct to him, what should be the way of distance, should he estrange or
not, or even what sort of utilization it should be put to. So, this privilege of estrangement, that is
one of the essential privileges of the proprietor, can't be absurdly infringed upon by anybody
through a private arrangement his overall standard is relevant in spite of there being an express
agreement in actuality, and keeps the transferor from controlling the intensity of distance of the
transferee once the interest in the property is transferred. he degree to which an individual
moving genuine or individual property may restrict its ensuing aura by the transferee has for
quite a long time been an issue alarming the courts. "Limitations upon the grantees option to
move the property, whenever, to whomsoever he may pick, and in whatever way he may choose,
are called restrictions on distance.

"Ongoing improvements in the field of genuine property security law have revived a premium
%in one of the most antiquated and significant milestones of the law the degree to which the law
ought to ensure free alienability of genuine property and strike down endeavors to limit or punish
a proprietor's capacity to move his property. The setting in which the present-day battle emerges
is a long ways from the feudalistic culture existing in England when the limitations on
estrangement precept was grown, yet the materials which follow proof unmistakably that the
legal function in articulating and implementing the teaching is starting once again."
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ICFAI University, Dehradun Property Law

CHAPTER-II: SECTION 10 OF THE TRANSFER OF PROPERTY ACT, 1882

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 women (not being a Hindu,
Muslim or Buddhist), so that she shall not have power during her marriage to transfer or charge
the same or her beneficial interest therein.

Explanation:
If any property is transferred, there can be no condition restraining alienation, except in the case
of lease or for the protection and benefit of a Christian Women until the period of her marriage.
If a transfer made, has a condition or limitation which restricts alienation for the purpose other
than lease or for the benefit of a Christian women, the condition or limitation is deemed to be
void.

Alienation means conveyance or transfer of property to another. Public policy requires that
property should be freely alienable. A right of alienation is incidental to and inseparable from the
beneficial ownership of property. Consequently, a transferor should not be allowed to put a clog
or restriction on the right of a transferee so as to be repugnant to the absolute interest of the
transferee in the estate Section 10lays down the rule in this regard as follows;

Restraint on alienation of property is of two types:-

A) Absolute
B) Partial
Restraints on alienation can appear in the following ways:
 Restraints on transfer for a particular time.
 Restraints directing control over consideration/money.
 Restraints with respect to persons/transferee.
 Restraints with respect to sale for particular purposes or use of property.
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The part depends on the rule that the intensity of distance is one of the main occurrences of
property. In the event that all out restrictions were not disallowed, this significant standard would
be revoked by private understanding. On a similar guideline, an arrangement in an understanding
among the individuals from a joint Hindu family that they would not appreciate the pay of the
joint family properties and that they would no guarantee segment, would be void, however
segment isn't estrangement.

The segment must be perused with Section 12 as the two of them manage restrictions on forces
of distance. While an absolute limitation on the intensity of estrangement is void, fractional
restrictions [7] might be acceptable. For instance, a condition that the transferee will not
exchange his advantage for a time of 3 years, or a condition that the transferee will not exchange
the property to any individual from a specific individual's family. However, the assurance where
a condition adds up to an aggregate or incomplete restriction relies on the substance and not the
structure. For instance, an arrangement keeping the transferee from moving his property to
anybody but to the transferor or his beneficiaries, and that as well in the event that they are
happy to get it at a fixed cost, is in substance an outright restriction.

Condition for the benefit of the lessor

The indebtedness special case has been made to keep a transferee from cheating his loan bosses
in such inevitability by permitting the property to return to the grantor through such a condition.
By and by, there is a special case for this standard on account of a rent, which permits a lessor to
force such a condition for his advantage in the rent. This infers that a lessor may specify that if a
tenant should become bankrupt, the rent might be relinquished and the lessor may return the
rented property. Hence, a pledge deciding a rent in case of the indebtedness of the renter is
substantial, however in the event that the tenant relegates the rent and, at that point becomes
ruined, the condition doesn't matter. Consequently, despite the fact that there are general
principles that forbid any limitations from being forced on the delight in the interest in the
property after an exchange are made; there are sure special cases for it. The majority of these
spin around move of leases since the lessor holds critical interests in the property even after the
rent understanding is executed.
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ICFAI University, Dehradun Property Law

CHAPTER-III: EXCEPTIONS TO THE GENERAL RULE

Section 10 gives two special cases for the standard against inalienability. To start with, Section
10 doesn't restrict conditions or limitations on account of a rent, which are valuable to the lessor
or those asserting under him. Second, property might be transferred for the advantage of a lady
who is certifiably not a Hindu, a Muslim, or a Buddhist, with the end goal that she will not have
the ability to move the property or change her advantage in that during her marriage. This
exception depends on the teaching of coverture that worked in England in the nineteenth century.
There, ladies could be given property for their happiness without the option to estrange the
property during her marriage. The standard secured ladies from being compelled to distance their
property for their husbands. However, in spite of the cancelation of the principle of covertures in
England, this special case keeps on leftover on the resolution books in India.

Lease
Conditional transfer is substantial on account of rent where the condition is to help the lessor or
those asserting under him. Rent is an exchange of a restricted interest where the lessor
(transferor) holds the possession and moves just the privilege of delight to the renter (transferee).
A lessor can force a condition that the resident won't dole out his advantage or sub-rent the
property to some other individual. Such a condition will be legitimate. This exemption is
material to lasting leases as well. The Supreme Court has held that this segment doesn't cut out
any special case concerning interminable or lasting lease. In this way, any condition controlling
the renter from estranging leasehold property1 isn't invalid.

A condition in the facilitate that the renter will not rent or allocate his advantage to anybody
during the residency of the rent is legitimate. Also, a specification in the agreement of rent that
the tenant would not rent the premises and on the off chance that he does, he would need to pay a
fourth of the thought as nazaar to the lessor, is legitimate and enforceable. A condition in the rent
deed that the renter would necessarily need to give up the rent in the occasion the lessor needs to
sell the property again is legitimate.

1
Rama Rao v Thimappa, AIR 1925 Mad 732
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ICFAI University, Dehradun Property Law

Married women
Restrictions on the intensity of distance in attitudes for wedded lady, who are not Hindu,
Mohammedans or Buddhists, will be legitimate. This stipulation was acquainted with fill a
comparative need as English law in such manner. The English Courts perceived the standard that
it was available to the pioneer or transferor to embed a condition in the deed of settlement or
move, by method of a limitation on expectation, that is, to control her from foreseeing the future
pay of the property and from hindering it or estranging it while she is under spouse's assurance
and sanctuary.

The segment is sanctioned to watch that the transferor will not force a flat out limitation on the
ability to distance that interest or right which was moved to the transferee. Thusly, a restricted
interest in property can be made for a transferee, yet a limitation on the ability to distance that
restricted interest will be invalid.

Positive and negative conditions or covenants

Conditions or bearings that the transferor may force upon the transferee to make sure about
better satisfaction in his own property can be of two sorts: positive or confirmed conditions, i.e.,
they direct the transferor to accomplish something and negative conditions, i.e., they limit the
transferee from doing a specific thing. These conditions are called pledges.

For instance, An exchanges a land to B, and puts a condition, that he would leave open a four
feet wide space bordering An's own property, and would not expand upon it. On this land there is
additionally a one-foot open channel, and the second condition in the exchange deed guides the
transferee to keep up this channel via conveying fundamental fixes every now and then. The
primary agreement, that requires the transferee not to expand upon four feet wide land, is a
negative contract for what it's worth in nature of 'not to do a specific thing', while the subsequent
condition or pledge is a positive one, as it requires the transferee to 'do a specific thing', for
example to keep up the channel fit as a fiddle and to convey essential fixes.
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ICFAI University, Dehradun Property Law

CHAPTER-IV: JUDICIAL OPINION ON SECTION 10

In ROSHER V. ROSHER2,
An individual, A died giving up his better half W and a child S. He left his whole property to S,
under his Will. The will given that S needed to initially offer the property available to be
purchased and furthermore needed to sell her at L 3000 while the market cost was L 15000. The
court held that these limitations added up to an outright restriction on S's and his beneficiary's
capacity of estrangement and were in this way void.

In GAYASHI RAM V. SHAHABUDDIN3,

The deal deed contained a proviso that the transferee would not exchange the property to any
individual either by method of offer, blessing or even home loan aside from the transferor or his
beneficiaries. The court held that this condition is void and hence invalid.

In MANOHAR SHIVRAM SWAMI V. MAHADEO GURULING SWAMI4,

A and B were first cousins. A made a Will of his property for B. On A's passing, B procured the
title of the property and offered it to C, who was likewise the sibling of A. The deal deed
contained a condition that if C needed to sell the property, he would offer it to the merchant's
Jangam (position) family and not to any other individual. The court held that the condition fused
in the deal deed totally controlled C from leaving behind his advantage in the property and
accordingly was void. The court maintained the legitimacy of offer influenced by C. This choice
of Bombay High Court comes as a shock as the condition here truth be told was not to sell out of
the family, which in various cases has been held to be a halfway limitation, and official on the
gatherings.

In ZOROASTRIAN CO-EMPLOYABLE HOUSING SOCIETY LTD V. AREA

REGISTRAR CO-USABLE SOCIETIES 5 , A general public with the object of developing
houses for private purposes had a bye law which expressed that no one but Parsis can be

2
(1884) 26 Ch. D. 801
3
AIR 1935 All 493
4
AIR 1988 Bom 116
5
(2005) 5 SCC 632
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ICFAI University, Dehradun Property Law

individuals from the general public. There was additionally a condition that no part could
distance the house to non-parsis. The Supreme Court held that when an individual acknowledges
the enrollment of a co-employable society by submitting himself to its byelaws and spots on
himself a certified limitation on his entitlement to move property by specifying that equivalent
would be moved with earlier agree of society to an individual qualified to be an individual from
the general public it couldn't be held to be an outright restriction on estrangement insulting
Section 10 of the Transfer of Property Act

In K MUNISWAMY V. K VENKATASWAMY6 ,
A family segment was affected albeit one condition in the parcel deed gave that the mother and
the dad were to appreciate the properties just during their lifetime and after their demises, this
property was to be apportioned similarly among the two children. This production of life interest
implied that the guardians had no capacity to estrange the property during their lifetime. The
guardians offered their property to one child. Other child tested the legitimacy of offer. The court
held that a limitation restricting them totally from moving the property added up to an outright
restriction on distance and was thusly terrible in eyes of law.

In DUGDALE V. DUGDALE7 ,
It was noticed: The obligation of the home to be appended by leasers on a liquidation or
judgment is an episode of the domain, and no endeavor to deny it of that occurrence by direct
denial would be substantial... An occurrence of the domain given, which can't be
straightforwardly removed or forestalled by the giver, can't be removed in a roundabout way by a
condition which would make the home return to the contributor, or by a contingent constraint or
agent gadget which would make it move to someone else.
These perceptions show that loan bosses may have made advances on the quality of property the
transferee has. They ought not be denied of their security in light of a statement in the exchange
of which they know nothing. Henceforth, this standard has been authorized as a special case for
the overall guideline epitomized in Section 31 and 32 that an interest might be made with the
condition superadded that the interest will stop on the incident of a dubious occasion.

6
AIR 2001 Ker 246
7
[2001] EWCA Civ. 1754
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ICFAI University, Dehradun Property Law

CHAPTER-V: ABSOLUTE AND PARTIAL RESTRICTION

The conditions or restriction on distance may d be either absolute or partial. Total limitations are
pronounced void under Section 10; anyway halfway restrictions might be permitted.

Regardless of whether a condition adds up to an aggregate or fractional relies on the substance,

i.e., the genuine impact of the condition and not the type of words setting out the condition. A
flat out limitation is one that removes the intensity of estrangement totally or significantly, while,
halfway limitation is one that forces some limitation on the intensity of distance yet the cable car
is generously allowed to distance property in different manners.

In RENAND V. TOURANGEAON8 , it was held that a condition that transferee will not
exchange the property for a time of twenty years is a flat out limitation and subsequently void.
On the off chance that it were a condition that transferee will not exchange the property for a
time of 3 years, it would be a fractional restriction and hence legitimate.

Illustrations
(I) A condition that transferee will not exchange the property by method of blessing, is an
incomplete restriction and in this manner legitimate.

(ii) A condition that transferee will not exchange the property family/or to a specific individual
in particular, is a fractional limitation and consequently legitimate.

Then again, if a transferor A moved a field to moved B, with a condition that in the event that he
sold it he should offer to C (A specific individual) and no one else. The limitation was held to be
total and consequently void.

(iii) A specification in a deal deed that the vendee could sell-back the property to the merchant
just, and to nobody else, is in excess of a simple halfway restriction, and along these lines
invalid.

8
(1867). LR 2 PC 4
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ICFAI University, Dehradun Property Law

(iv) A trade off by method of settlement of family debates has been held to be legitimate, despite
the fact that it includes an understanding in limitation of estrangement.

In MATA PRASAD V. NAGESHERA SAHAL9 , a debate identifying with progression

between a widow and the nephew was settled on terms that the widow was to hold ownership
forever while the title of the nephew was conceded with a condition limiting him from estranging
during her life-time. The trade off was held to be legitimate.

9
(1925) 47 All 884
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ICFAI University, Dehradun Property Law

CHAPTER-VI: THE DILEMMA OF PARTIAL AND ABSOLUTE RESTRAINTS IN

INDIA

Indian Courts have been over and over upset with the issue of deciding if a specific restriction is
incomplete or supreme in nature. The general set of laws licenses for a halfway limitation which
are deserving of being classified as both reasonable and sensible.

Certain driving Indian cases that develop a line of outline among incomplete and outright
limitation based on the realities would be currently talked about as delineations:

 SHRI RAMCHANDRA BHAKTA V. SHRI KRUSHA CHANDRA BHAKTA AND

ORS. (1999)- in the given case the transferee was just permitted to offer the property to
someone in particular on the off chance that he consents to get it in the principal occurrence.
The Court held this condition to be halfway and not outright and consequently Section 10
irrelevant.

 MOHD. REZA V. ABBAS BANDI–Privy Council applying the English principle held that
a limitation disallowing distance of property to outsiders, permitting it just to the relatives
was an incomplete restriction. A comparative decision was given out on account of
Zoroastrian Co-usable… v. Region Registrar Co-usable (2005).

 MUNISWAMY V. K. VENKATASWAMY, (2001)– forestalling free dissemination of

property, considering sound public strategy, was held void and lying under the ambit of
Section 10.
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ICFAI University, Dehradun Property Law

CHAPTER-VII: SECTION 10 AND SECTION 11: DIFFERENCES

Section 11 discussions about limitation offensive to intrigue made. The contrast between Section
10 and Section 11 is that the previous arrangements with an instance of a flat out forbiddance
against estrangement of an interest made by an exchange and the last arrangements with the
supreme exchange of an interest followed by a limitation on its free satisfaction. That is, under
Section 10, whatever interest was passed on, huge or little, restricted or limitless, such interest
can't be made totally basic by the transferee. Under Section 11, when once an interest has been
made totally for an individual, no chains can be forced on its full and free satisfaction. Where,
nonetheless, the interest made is itself restricted, its happiness should likewise be restricted; for
instance, when a widow's advantage under Hindu Law is conceded to a lady, a course that she
ought to appreciate just the usufruct without either hindering the corpus or submitting
demonstrations of waste would be legitimate. In any case, a condition in a deed denying a co-
proprietor of their case to parcel in regard of the normal property would be terrible, on the
grounds that, the option to segment is a basic element of co-possession.
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ICFAI University, Dehradun Property Law

CHAPTER-VIII: CONCLUSION

Section 10 sets out that where property is moved dependent upon a condition totally limiting the
transferee from leaving behind his advantage in the property, the condition is void. The rule
fundamental this segment is that a privilege of move is accidental to, and indivisible from, the
responsibility for property. The standard that a state of outright limitation is void is established
likewise on the rule of public arrangement permitting free dissemination and demeanor of
property. It is just a condition which totally controls the transferee from discarding the interest
that is delivered void. A condition forcing incomplete limitation might be substantial. The test is
whether the condition removes the entire intensity of distance considerably; it is an issue of
substance and not of simple structure. The part gives two special cases; one if there should arise
an occurrence of wedded ladies and other for lessor. Also, every resident has a right, under
Article 300A of the Constitution of India, to property and quite a privilege isn't to be denied
besides as per law. Much under Article 19 of the Constitution of India the resident has a crucial
option to dwell and settle down in any piece of the Indian Territory. In the event that there is a
law made by the proper assembly, the equivalent should be analyzed from the outlook of whether
it is sensible limitation or something else.
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REFERENCES
Books Referred:
 Mulla, The Transfer of Property Act, 9th Ed., LexisNexis Butterworths,2004.

 Nandi, N., The Transfer of Property Act, 1882, 2nd Ed., Dwivedi Law Agency, Allahabad,
2010.

 Row, Sanjiva, The Transfer of Property Act, 4th Ed., Vol. 1, The Law Book Company (P)
Ltd., Allahabad,1989.

 Sinha, Dr.R.K. The Transfer of Property Act, 11th Ed., Central Law Agency, Allahabad,
2010.

Sites Referred:
 https://dictionary.law.com/
 https://www.law.cornell.edu/
 https://www.lawctopus.com/
 https://lawshelf.com/