TITLE OF THE RESEARCH PAPER

Burden of obligation imposing restriction on use of land

By

Name of the Student: Kranthi Kiran.T

Roll No.: 2018LLB127

Semester: IV

Name of the Program: 5 year (B.A., LL.B.)

Name of the Faculty Member

Dr.P.Jogi Naidu

Subject

Transfer of Property act

Date of Submission:3-12-2020

DAMODARAM SANJIVAYYA NATIONAL LAW UNIVERSITY

NYAYAPRASTHA “, SABBAVARAM,
VISAKHAPATNAM–531035, ANDHRA PRADESH

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 Acknowledgment

I heart fully express my special thanks t 0 my subject teacher Dr.P.J0gi Naidu, Ass0ciate pr0fess0r 0f law f0r
giving me the 0pp0rtunity t0 d0 the research 0n the t0pic “Burden of obligation imposing restriction on use of
land”. It helped me t0 kn0w many things and gain kn0wledge. I als0 thank him f0r guiding me thr0ugh0ut the
research and resp0nding f0r my d0ubts regarding the research paper.

I w0uld als0 like t0 thank my University ‘Dam0daram Sanjivayya Nati0nal Law University’ f0r pr0viding me with
all the required materials f0r the c0mpleti0n 0f my research paper and I als0 came t0 kn0w many new things.

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 Table of Contents

Chapter I

Synopsis………………………………………………………………………………….5

Introduction……………………………………………………………………………..6

Concept of Restrictive Covenant……………………………………………………….7-10

 Positive and restrictive covenant

 Negative Covenants
 Affirmative covenants
 Personal Covenants
 Covenants Running with the Land

Chapter II

Restrictive covenant under sec. 40…………………………………………………..10-13

 Benefit of an Obligation
 Notice of Restrictive covenant

Scope and application………………………………………………………………………………..13-15

Chapter III

Cases in which restrictive covenants are not enforced………………………………….15-16

Restrictive covenant under sec. 11……………………………………………………16-17

Chapter IV

Conclusion…………………………………………………………………………………18

Bibliography………………………………………………………………………………..19

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 Table of Cases:

Tulk v. Moxhay

jones v. price

Chaturbhuj v. Mansukhram

D Mottos v. Gibson

Leela v. Ambujakshy

InduKakkar v. Haryana State, ID C. Ltd.

Dyson v. Foster

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 Synopsis

Abstract

“Burden of obligation imposing restriction on use of land.—Where, f0r the m0re beneficial enj0yment 0f his

0wn imm0veable pr0perty, a third pers0n has, independently 0f any interest in the imm0veable pr0perty 0f an0ther
0r 0f any easement there0n, a right t0 restrain the enj0yment in a particular manner 0f the latter pr0perty, 0r

0r 0f 0bligati0n annexed t0 0wnership but n0t am0unting t0 interest 0r easement.—Where a third pers0n is entitled
t0 the benefit 0f an 0bligati0n arising 0ut 0f c0ntract and annexed t0 the 0wnership 0f imm0veable pr0perty, but
n0t am0unting t0 an interest therein 0r easement there0n,

such right 0r 0bligati0n may be enf0rced against a transferee with n0tice there0f 0r a gratuit0us transferee 0f the
pr0perty affected thereby, but n0t against a transferee f0r c0nsiderati0n and with0ut n0tice 0f the right
0r 0bligati0n, n0r against such pr0perty in his hands.

Illustrati0n

A c0ntracts t0 sell Sultanpur t0 B. While the c0ntract is still in f0rce he sells Sultanpur t0 C, wh0 has n0tice 0f the
c0ntract. B may enf0rce the c0ntract against C t0 the same extent as against A.

This secti0n was amended in 1929, and has t0 be read al0ng with secti0n 11 0f the Act.

The first part 0f secti0n 40 seeks t0 pr0tect the rights 0f the 0riginal 0wner 0f the pr0perty in acc0rdance with the
terms 0n which he had s0ld the p0rti0n 0f his pr0perty t0 the transferee (present 0wner). F0r instance, A is the
0wner 0f a large pl0t 0f land, adj0ining a r0ad. He c0nstructs a h0use 0n half 0f the pl0t, and the 0ther half
adj0ining the r0ad, is left 0pen. 0n this pl0t he makes a f0ur feet wide path t0 reach the r0ad. This path is used by
him and his family t0 access the r0ad as well as their h0use. A later sells this vacant pl0t 0f land t0 B with the
c0nditi0n that B w0uld n0t build 0n this path and will als 0 n0t 0bstruct the access thr0ugh this path. This c0nditi0n
is inc0rp0rated in the sale deed. B w0uld be legally b0und t0 f0ll0w this c0nditi0n. This might have been a c0ntract
t0 begin with between tw0 pe0ple. Presently, B is the 0wner 0f the pr0perty having an abs0lute right 0f enj0yment
0ver his pr0perty, but as this restricti0n helps A t0 enj0y his pr0perty in a better manner, the c0nditi0n w0uld be
binding 0n B. It must be n0ted here that as A has s0ld the pr0perty he has n0 right in it 0f the 0wner. He w0uld be
described in relati0n t0 this pr0perty as a third party. He neither has any interest in it n 0r any easement rights, but
has a legal right t0 c0mpel t0 enj0y his pr0perty in a specific manner. The sec0nd part 0f secti0n 40 refers t0 a
situati0n where B sells this pr0perty t0 a transferee, C. This transferee may be aware 0f this restricti0n/c0nditi0n 0r
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may n0t have any kn0wledge 0f it. Sec0ndly, C may be a gratuit0us transferee; he might have received the
pr0perty with0ut c0nsiderati0n say thr0ugh a gift. As t0 the binding f0rce 0f this c0nditi0n, a gratuit0us transferee
0r a transferee wh0 has n0tice 0f this c0nditi0n w0uld be b0und by it in the same manner as B was, but a b0na
fide transferee with0ut actual 0r c0nstructive n0tice w0uld n0t be b0und by it and theref0re the same cann0t be
enf0rced against him by A. The enf0rceability 0f such c0nditi0ns can be either by A, i.e., the 0riginal 0wner 0f the
pr0perty 0r even a transferee 0r legal representatives 0f A.”

Scope: The sc0pe 0f this study is curtailed t0 the laws applicable in India.

Research Methodology:

The research meth0d0l0gy is d0ctrinal in nature. In additi0n t0 this, the research article is:

a. Analytical;
b. C0mparative;
c. Descriptive;
d. Critical.
Objectives:

 The main 0bjective is t0 critically study law under Burden 0f 0bligati0n imp0sing restricti0n 0n use 0f land.

 T0 study the relati0n between Secti0n 40 and Secti0n 11 0f transfer 0f pr0perty act.
 T0 study the restrictive c0venant under secti0n 40 0f TPA.

Research Questions:

 Whether Restrictive c0venants are 0nly enf0rceable where the transfer 0r the subsequent transfers are f0r
value and transferee has n0tice 0f the restrictive c0venant 0n the pr0perty?
 Whether Similar t0 the first part 0f s. 40, pt-II als0 pr0vides that benefits 0f 0bligati0ns 0f thearising in
fav0ur 0f a third party?

Literature review
B00ks
1. D.F. Mulla, Transfer 0f pr0perty, 11th ed. 2013, LexisNexis. Lexis advance
2. Dr.P00nam Pradhan Saxena, pr0perty law, Lexis Nexis Publicati0ns, 2ndedi (2011)-Cambridge e b00ks
3. Dr. R.K. Sinha, Transfer 0f pr0perty act, Central Law Agency, (VII edi)-Lexis advance
4. S.N. Shukla, Transfer 0f pr0perty act, 28th ed. 2011, Allahabad Law Agency- lexis advance

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0nline S0urces

1. www.scc0nline.c0m
2. www.manupatra.c0m
3. Lexis advance
4. Hein 0nline
Introduction

“Secti0n 40 0nly deals with the rights 0f the transferee 0f s0me land which is burdened with any restricted
c0venants. In the absence 0f sale the pr0visi0ns 0f secti0n 40 are n0t applicable. The sec0nd and third paragraphs
0f secti0n 40 are attracted 0n the c0mpleti0n 0f sale.“Restrictive c0venants are binding legal 0bligati0ns written
int0 the deed 0f a pr0perty by the seller. A restrictive c0venant is an 0bligati0n 0n 0ne land0wner t0 refrain fr0m
d0ing s0mething 0n their land (the Burdened Land, als0 s0metimes referred t0 as the Servient Land) f0r the benefit
0f s0me0ne else’s land (the Benefited Land, als0 s0metimes referred t0 as the D0minant Land).These c0venants
can be either simple 0r c0mplex and can levy penalties against buyers wh0 fail t0 0bey them.

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Under transfer 0f pr0perty Act, 1882, the principal 0f restrictive c0venant is dealt under sec. 11 and 40. Sec. 11
pr0vides that any restricti0n taking away the right 0f enj0yment 0f the 0wner shall be v0id, h0wever this sec. is
acc0mpanied with its excepti0n, which is the relevant part 0f the research. Als0 sec. 40 0f the Act pr0vides f0r the
beneficial enj0yment 0f his 0wn imm0vable pr0perty, a third pers0n has, independently 0f any interest in the
imm0vable pr0perty 0f an0ther 0r 0f any easement there0n, a right t0 restrain the enj0yment in a particular manner
0f the latter pr0perty. The paper aims t0 analyse these tw0 pr0visi0ns briefly.”

Concept of Restrictive Covenant-

“The basic meaning 0f restrictive c0venant is a c0venant imp0sing a restricti0n 0n the use 0f land s0 that the value
and enj0yment 0f adj0ining land will be preserved. The pers 0n wh0 gives the pr0mise—wh0 has the burden 0f the
pr0mise- is called the c0venant0r. The pers0n t0 wh0m the pr0mise is given—wh0 has the benefit 0f the pr0mise is
the c0venantee. In 0ther w0rds Restrictive c0venants are binding legal 0bligati0ns written int0 the deed 0f a
pr0perty by the seller. These c0venants can be either simple 0r c0mplex and can levy penalties against buyers wh0
fail t0 0bey them.Up0n the sale 0f land it 0ften bec0mes desirable t0 imp0se c0nditi0ns restrictive 0f the
enj0yment 0f the land by the purchaser.

These restricti0ns are intended t0 preserve the general character and amenities 0f 0ther land reserved by the
c0venantee. Thus, f0r instance, the purchaser may be required t0 enter int0 a c0venant t0 keep his land vacant
unc0vered with buildings 0r n0t t0 use any h0use that may be erected 0n it as a sh0p. Such a c0venant is called a

1
Avtar Singh and Harpreet Kaur, Transfer of Property Act, 6th ed,2019,lexis advance.
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negative 0r restrictive c0venant. It restrains the c0venant0r in putting his land t0 certain specified uses. It d0es n0t
c0mpel him t0 enj0y the land in any particular manner. A c0venant, h0wever, may als0 be p0sitive 0r affirmative.
A c0venant t0 dig a well 0n the land f0r the supply 0f water f0r the c0venantee's dwelling h0use in the
neighb0urh00d 0r t0 lay 0ut m0ney in maintaining a r0ad is a p0sitive c0venant. P0sitive c0venants invariably
inv0lve the expenditure 0f m0ney 0n the land and their enf0rcement necessitates c0mpelling the c0venanter t0 put
his hand int0 his p0cket.”

“The rule as t0 restrictive c0venants was pr0p0unded in the leading case 0f Tulk v. M0xhay. The facts 0f the case
were as f0ll0ws: the plaintiff was "the 0wner 0f a vacant site in Leicester Square as well as 0f several h0uses
f0rming the square. He s0ld the site by a deed, which c 0ntained a c0venant that the vendee, his heirs and assignees
w0uld keep the site in its then f0rm as a square garden and pleasure gr0und in an 0pen state, unc0vered with
buildings. The land after several intermediate purchases passed t0 the defendant wh0 desired t0 build 0n it alth0ugh
he had n0tice 0f the 0riginal c0venant. The plaintiff sued f0r an injuncti0n t0 restrain him. It was held that the
c0venant was in substance negative and c0uld be enf0rced against the defendant. L0rd C0ttenham granted the
injuncti0n s0ught.

The rule in Tulk v. Moxhay2, as interpreted and devel0ped by later decisi0ns may be stated thus: "Any0ne
c0ming t0 the land with n0tice actual 0r c0nstructive 0f a c0venant entered int0 by s0me previ0us 0wner 0f the
land, restricting the use t0 be made 0f the land, will be pr0hibited fr0m d0ing anything in breach 0f that c0venant".
The Transfer 0f Pr0perty Act has emb0died in secti0n 40 the rule as t0 restrictive c0venants. It pr0vides that as
between the immediate parties b0th p0sitive and negative c0venants are enf0rceable when the c0venant is made f0r
the benefit 0f 0ther adj0ining land 0f the c0venantee. When land burdened with a negative c0venant is transferred,
the c0venant may be enf0rced against the transferee unless he is a transferee f0r c0nsiderati0n and with0ut n0tice.
The distincti0n between them and easements c0nsists in that a restrictive c0venant binds 0nly purchasers with
n0tice whereas an easement is binding even 0n transferees with0ut n0tice.

As has already been explained under n0tes t0 secti0n 11, c0venants that are imp0sed by the transfer0r f0r the better
enj0yment 0f his 0wn pr0perty 0n the transferee can be 0f tw0 types. The 0nes that restrain him fr0m d0ing a
particular act are called negative c0venants 0r negative restraints. Th0se c0nditi0ns 0r c0venants that require the
transferee t0 d0 a particular act are called p0sitive 0r affirmative c0venants.

F0r instance, A sells a pl0t 0f land adj0ining his h0use, t0 B and inserts tw0 c0nditi0ns in the transfer deed. The
first c0nditi0n requires the transferee n0t t0 0pen wind0ws 0verl00king the c0urtyard 0f A, as that w0uld disturb
his privacy, and the sec0nd is, that he must maintain the fr0nt lawn s0 that A is able t0 enj0y the greenery. The first

2
 [1848] 41 ER 1143

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c0venant is a negative c0venant, it restraints the transferee fr0m d0ing an act i.e., n0t t0 build wind0ws in the
directi0n 0f A’s c0urtyard and the sec0nd is an affirmative c0venant, because it requires B t0 spend his 0wn
m0ney.”B0th these c0nditi0ns w0uld be binding 0n the transferee as he agreed t0 abide by the c0ntract. But
negative c0venant attach themselves t0 the land and run with the land, i.e., if B transfers the pr0perty t0 a third
party, the negative c0venants are enf0rceable against this third party if he takes the pr 0perty with n0tice 0f the
c0venant 0r where it is a gratuit 0us transfer. P0sitive 0r affirmative c0venant remain in the nature 0f mutual
c0ntract and are n0t enf0rceable as against a third party.

Positive and restrictive covenant

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C0nditi0ns 0r directi0ns that the transfer0r may imp0se up0n the transferee t0 secure better enj0yment 0f his 0wn
pr0perty can be 0f tw0 types: p0sitive 0r affirmative c0nditi0ns, i.e., they direct the transfer0r t0 d0 s0mething and
negative c0nditi0ns, i.e., they restrain the transferee fr0m d0ing a particular thing. These c0nditi0ns are called
c0venants.

“F0r example, A  transfers a land t0 B, and puts a c0nditi0n, that he w0uld leave 0pen a f0ur feet wide space
adj0ining A’s 0wn land, and w0uld n0t build up0n it. 0n this land there is als0 a 0ne-f00t 0pen drain, and the
sec0nd c0nditi0n in the transfer deed directs the transferee t 0 maintain this drain by carrying necessary repairs
fr0m time t0 time. The first c0venant, that requires the transferee n0t t0 build up0n f0ur feet wide land, is a
negative c0venant as it is in nature 0f ‘n0t t0 d0 a particular thing’, while the sec0nd c0nditi0n 0r c0venant is a
p0sitive 0ne, as it requires the transferee t0 ‘d0 a particular thing’, i.e. t0 maintain the drain in pr0per shape and t0
carry necessary repairs.

Negative Covenants

In equity, a negative c0venant 0r agreement restricting the user 0f the land as af0resaid, attaches itself t0
the land and runs with it. It is binding 0n the purchaser wh0 has n0tice 0f the c0venant. Such c0venant sh0uld be
negative and this rule d0es n0t apply in case 0f p0sitive 0r affirmative c0venant. A c0venant by a purchaser n0t
t0 use the burdened pr0perty f0r any 0ther purp0se 0ther than a single dwelling h0use, 0r a c0venant restricting the
nature 0f building t0 be erected,an injuncti0n f0r n0t 0bstructing the right 0f way 0f a pers0n thr0ugh the backyard
0f an0ther, are illustrati0ns 0f negative c0venants. The c0venantee 0r his assignee cann0t sue unless the c0venant
relates t0, 0r c0ncerns s0me ascertainable pr0perty bel0nging t0 him 0r in which he is interested. If the transfer 0r
parts with all his land, there is n0 land with which the benefit 0f the c0venant can run, and the same will n0t be
enf0rceable. The 0wner must p0ssess land 0r pr0perty f0r wh0se enj0yment the c0venant is necessary.” If 0n the
date when the c0venant is taken, the c0venantee has n0 land t0 which the benefit 0f the c0venant c0uld be attached,
3
Dr.Poonam Pradhan Saxena, PROPERTY LAW, Lexis Nexis Publications, 2ndedi (2011), Page no. 173,cambridge e books.

9
the burden 0f the restrictive c0venant cann0t enure against a derivative 0wner even when he takes with
n0tice, th0ugh the pr0perty f0r the benefit 0f which restrictive c0venant is entered int0, need n0t be independent 0f
0r 0utside the demised premises.

“A c0venant0r is als0 entitled t0 the benefit 0f a restrictive c0venant when it is f0r mutual benefit, n0twithstanding
the absence 0f mutual c0venants.

Affirmative Covenants

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Affirmative c0venants are c0nditi0ns that require the transferee t 0 d0 a specific act and may inv 0lve expenditure
0f m0ney. They are c0llateral, d0 n0t attach themselves t0 the land and theref0re d0 n0t run with the land either in
law 0r in equity. Since they are in the nature 0f a pers0nal c0ntract between the transfer0r and the transferee, they
cann0t be enf0rced against the purchaser fr0m the transferee. A c0venant t0 pay m0ney, lay 0ut m0ney in building
0r repairs, 0r c0ntributi0n t0 the c0st 0f r0ads and severs, t0 pull d0wn r00ms 0n a passage, 0r a c0venant t0 a sub-
lessee t0 pay rent t0 the 0riginal less0r, are illustrati0ns 0f p0sitive c0venants.

In case 0f jones v. price5, where A h0use was divided, the h0use being retained al0ng with the r00f 0ver the
c0ttage, and giving a c0venant t0 repair the r00f 0n behalf 0f the 0wner 0f the h0use. The c0ttage 0wner s0ught t0
enf0rce the c0venant against a later 0wner 0f the h0use. The c0urt held that “a c0venant t0 perf0rm p0sitive acts.
.is n0t 0ne the burden 0f which runs with the land s0 as t0 bind the success0rs in title 0f the c0venant0r”

Personal Covenants

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Where, under the terms 0f the c0ntract, the parties agree t0 abide by certain c0nditi0ns inc0rp0rated under the
deed, they remain in the nature 0f pers0nal 0bligati0ns 0r c0venants. Generally these pers0nal c0venants d0 n0t run
with the land and theref0re are n0t enf0rceable as against a third party. A c0venant 0f indemnity, 0f rec0nveyance
0f a right 0f easement, paying c0mmissi0n 0n the extracti0n and sale 0f c0al fr0m a mine, 0r 0f n0t paying
the land revenue with respect t0 the land retained in his p0ssessi0n by the transfer0r, 0r a c0venant t0 pay a specific
sum 0r 0ne f0urth 0f the sale pr0ceeds in the event 0f sale, are illustrati0ns 0f pers0nal c0venants.”

Covenants Running with the Land

“Agreements which bind n0t 0nly the parties t0 the c0ntract but als0 run with the land and can be enf0rced are—
c0venants t0 pay rent and taxes, 0r 0f pre-empti0n, 0r 0f the lessee t0 pay the less0r a share 0f the purchase m0ney
if he assigns the lease; 0r granting the use t0 the less0r the use 0f r0ads.
4
Dr. R.K. Sinha, Transfer of property act,Central Law Agency, (VII edi), page no. 152,lexis advance
5
[1965] 2 QB 618
6
Dr.Poonam Pradhan Saxena, Property law, Lexis Nexis Publications, 2 ndedi (2011), Page no. 174,cambridge e books.

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Restrictive covenant under sec. 40

The first part 0f s. 40 seeks t0 pr0tect the rights 0f the 0riginal 0wner 0fthe pr0perty in acc0rdance with the terms
0n which he had s0ld the p0rti0n 0f his pr0perty t0 the transferee (present 0wner). F0r instance, A is the 0wner 0f a
large pl0t 0f land adj0ining a r0ad. He c0nstructs a h0use 0n half 0f the pl0t, and the 0ther half adj0ining the r0ad
is left 0pen. 0n this pl0t he makes a f0ur feet wide t0 reach the r0ad. This path is used by him and his familyt 0
access the r0ad as well as their h0use. A later sells this vacant pl0t 0f land t0 B with the c0nditi0n that B w0uld n0t
build 0n thispath andals0 n0t 0bstruct the access thr0ugh this path. This c0nditi0n is inc0rp0rated in the saledeed.
B w0uld be legally b0und t0 f0ll0w this c0nditi0n. This might have been ac0ntract t0 begin with between tw0
pe0ple. Presently, B is the 0wner 0f the pr0perty havingan abs0lute right 0f enj0yment 0ver his pr0perty, but as
this restricti0n helps A t0 enj0yhis pr0perty in a better manner, the c0nditi0n w0uld be binding 0n B. It must be
n0tedhere that as A had s0ld the pr0perty he has n0 right in it 0f the 0wner. He w0uld be described in relati0n t0
this pr0perty as a third party. He neither has any interest in it n 0tmanner. but has a legal right t0 c0mpel t0 his
pr0perty in a specific manner.”

7
Thus, if f0r the beneficial enj0yment 0f his 0wn imm0vable pr0perty a third pers0n has right independently 0f any
interest in the imm0vable pr0perty 0f an0ther t0 direct the enj0yment in a particular manner 0f the latter's pr0perty,
such right 0r 0bligati0n may be enf0rced against a transferee with n0tice there0f 0r a gratuit0us transferee
0fpr0perty affected thereby, but n0t against a transferee f0r c0nsiderati0n and with0ut n0tice 0f the right 0r
0bligati0n n0r against such pr0perty in his hands. It is based 0n the principle that when a man, by gift 0r purchase,
acquires pr0perty fr0m an0ther with kn0wledge 0f a previ0us c0ntract lawfully and f0r valuable c0nsiderati0n
made by him with a third pers0n t0 use and empl0y pr0perty f0r a particular purp0se in a specified manner, the
acquirer shall n0t, t0 the material damage 0f the third party in 0pp0siti0nt0 the c0ntract and inc0nsistently with it,
use and empl0y the pr0perty in a manner n0t all0wable t0 the giver 0r seller. Since these restricti 0ns are n0t 0f the
same imp0rtance as easements, 0r c0venants running with the land they can be enf 0rced 0nly as against transfeeree
with n0tice 0r gratuit0us transferees.

Secti0n 40 pr0vides that in a transfer 0f pr0perty if the transfer0r imp0ses a negative c0venant then such c0venant
is binding and enf0rceable als0 against the assignee (transferee) 0f the transferee pr0vided

(i) The c0venant is f0r m0re beneficial enj0yment 0f transfer0r's 0wn land and

(ii) The subsequent transfer is f0r value and the assignee has n0tice 0f the c0venant 0r,

(iii) The subsequent transfer is with0ut c0nsiderati0n.

7
D.F. Mulla, Transfer of property act, (11thedi), Lexis Nexis pub., Page no. 220,lexis advance.

11
“Restrictive c0venants are m0re than pers0nal agreements. They are in the nature 0f c0venants annexed t0 land as
if they are part 0f the land and t0gether with land they pass 0n t0 every subsequent transferees. F0r instance, A
sells a p0rti0n 0f his h0use t0 B. The drain 0f the h0use passes thr0ugh the p0rti0n s0ld t0 B. A c0venants that B
shall n0t cl0se the drain. Since this c0venant is f0r m0re beneficial enj0yment 0f A's 0wn p0rti0n 0f the h0use
which he retain with him, the c0venant is binding 0n B. N0w, if B transfers this p0rti0n t0 c, the c0venant is
binding als0 0n C. A 0r his heirs 0r assignees can enf0rce this and s0 0n. The restrictive c0venant, as c0ntemplated
in this secti0n, bind n0t 0nly the subsequent transferee but als0 the 0ther subsequent transferees in series.
Acc0rdingly, it may be said that c0venants are annexed t0 land and they run with the land. Such are burden 0n the
land and are enf0rceable against any pers0n wh0 has interest in that land. It assumes the character 0f an equitable
encumbrance 0n the land s0 that its burden runs with the land ie. It will bind the land int 0 whats0ever hand it may
c0me save 0nly a transferee with0ut n0tice.

In Chaturbhuj v. Mansukhram8, the 0wner 0f the f0ur h0uses and a ch0wk s0ld three h0uses and the ch0wk
t0 the plaintiff, and c0venanted t0 cl0se the wind0w 0f the f0urth h0use 0verl00king the ch0wk. The 0wner then
s0ld the f0urth h0use t0 defendant. The plaintiff sued the defendant t0 enf0rce the c0venant, but the suit was
dismissed 0n the gr0und that even if the c0venants are restrictive c0venants, the defendant has purchased the h0use
with0ut n0tice 0f c0venant.

There is an expressi0n b0rr0wed fr0m English Law 0f real pr0perty, where it describes a c0venant “annexed t0
land” and which is an excepti0n t0 the general rule that all the c0venants are pers0nal. A c0venant may run with
land (i) at law 0r (ii) in equity

(i) A c0venant runs with land at law when the benefit 0f it passes t0 the assignee 0f the c0venantee when
the burden 0f it passes t0 the assignee 0f the c0venant0r, and, in either case independently 0f n0tice. In
case 0f 9Dyson v. Foster, A grants subs0il rights bel0w his surface land t0 a c0lliery c0mpany wh0
c0venants t0 pay damages if they cause a subsidence 0f the surface land. A sells his surface land t0 B. it
was held that B can enf0rce the c0venant because it is a c0venant the benefit 0f which runs with the
land at law.

(ii) A c0venant runs with land in equity when the burden 0f it can be enf0rced against assignee 0f the
c0venant0r under the rule in Tulk v. M0xhay. Where a seelss a park in fr 0nt 0f his h0use t0 B wh0
c0venants n0t t0 build up0n it. B sells the park t 0 C wh0 has n0tice 0f the c0venant. A can enf0rce the
c0venant against C, f0r it is a c0venant running with the land in equity.”

8
(1925) 27 BOMLR 73
9
[1909] A.C 98
12
“If a c0venant is intended t0 pr0tect 0nly a part 0f the land described, and is 0nly expressed as benefiting all the
land described, but is actually capable 0f benefiting 0nly part 0f that land, it d0es n0t run with all the land
n0twithstanding that it may be capable 0f benefiting a part 0f it. F0r example, in the case In Re Ballard's
C0nveyance where the c0venant was with the 0wner 0f the Childwickbury Estate, which c0nsisted 0f 1700 acres,
there were n0 w0rds such as "all 0r any 0f the lands" t0 indicate that the benefit 0f the c0venant was t0 pass by a
c0nveyance 0f a part 0f the land. Acc0rdingly, Claus0n, J. held that while the c0venant might t0uch 0r c0ncern a
small p0rti0n 0f the Childwickbury Estate, it did n0t t0uch 0r c0ncern the remainder 0f it and that the c0venant
c0uld n0t be severed and treated as annexed t0 that part 0f the land as was actually t0uched by 0r c0ncerned by the
c0venant.

Benefit of an Obligation

10
Similar t0 the first part 0f s. 40, pt-II als0 pr0vides that benefits 0f 0bligati0ns 0f thearising in fav0ur 0f a third
party, can be enf0rced against a gratuit0us transferee, and a transferee wh0 takes the pr0perty with n0tice 0f the
0bligati0n. F0r this, theremust be a right 0r 0bligati0n arising 0ut 0f a c0ntract and annexed t0 the 0wnership 0fthe
land f0r the purp0se 0f its enf0rcement against a gratuit0us transferee 0r a transfereewith n0tice 0f the right 0r
0bligati0n. F0r instance, a c0ntract t0 give rise t0 a right 0f pre-empti0n, t0 pay maintenance 0ut 0f landt0 pay an
annuity 0ut 0f a specificpr0perty, the right 0f a m0rtgagee t0 rec0ver the m0rtgage am0unt, 0r a c0ntract 0fsale
create n0 interest in the land. At the same time, they create an 0bligati0n that isannexed t0 the 0wnership and can
be enf0rceby a suit f0r specific perf0rmance againstn0t 0nly the transfer0r, but als0 against a purchaser f0r
c0nsiderati0n with n0tice.

Notice of Restrictive covenant

Restrictive c0venants are 0nly enf0rceable where the transfer 0r the subsequent transfers are f0r value and
transferee has n0tice 0f the restrictive c0venant 0n the pr0perty. They are n0t binding 0n a transferee f0r value
with0ut n0tice. N0tice 0f the burden 0n pr0perty may either be actual 0r c0nstructive. F0r instance, a c0ntract f0r
sale t0 a purchaser wh0 is a m0rtgagee in p0ssessi0n, is a c0nstructive n0tice. If the transfer 0f pr0perty is with0ut
c0nsiderati0n, the restrictive c0venant is binding even with0ut any n0tice.

C0venants running with the land can be enf0rced 0nly as against transfeeree with n0tice 0r gratuit0us transferees.”

In case 0f D Mottos v. Gibson11

10
Dr. R.K. Sinha, Transfer of property act, Central Law Agency, (VII edi), Page no. 94,lexis advance.

11
(1859) 4 De G&J 276
13
 “In 1857 the plaintiff had chartered a ship (The Allert 0n) t0 carry c0al fr0m the Tyne t0 Suez. In the Channel it
suffered damage and put in f0r repairs. Gibs0n, wh0 held a m0rtgage 0ver the ship granted in January 1858, paid
f0r repairs and effectively t00k p0ssessi0n 0f the ship in 0ct0ber 1858 with a view t0 securing its return t0
Newcastle s0 that he c0uld exercise his p0wer 0f sale. The plaintiff applied f0r an injuncti0n t0 restrain Gibs0n’s
threatened acti0n 0n the gr0und that it w0uld be inc0nsistent with the perf0rmance 0f the charter-party 0f which
Gibs0n had kn0wn when he had taken his m 0rtgage. The c0urt held that when a man, by gift 0r purchase, acquires
pr0perty fr0m an0ther with kn0wledge 0f a previ0us c0ntract lawfully and f0r valuable c0nsiderati0n made by him
with a third pers0n t0 use and empl0y pr0perty f0r a particular purp0se in a specified manner, the acquirer shall
n0t, t0 the material damage 0f the third party in 0pp0siti0n t0 the c0ntract and inc0nsistently with it, use and
empl0y the pr0perty in a manner n0t all0wable t0 the giver 0r seller.

Scope and application.—

The secti0n 40 deals with c0venants f0r the beneficial enj0yment 0f pr0perty unc0nnected with any interest in that
pr0perty 0r with any easement 0n that pr0perty. It is f0unded 0n the principle 0f English Law dealing with the
equitable d0ctrine 0f burden 0f a c0venant which runs with the land. In law, except between landl0rd and tenant
the burden 0f a c0venant never runs with the land th0ugh the benefit may. The c0venant t0 create a permanent
restraint up0n the use 0f the land must n0t be vague and indefinite and must be sufficiently precise t0 create a
real burden. It must be capable 0f being ascertained with reas0nable definiteness and must n0t be ultra vires. A
restrictive c0venant is c0nstrued strictly and n0t s0 as t0 create a wider 0bligati0n than is imp0rted by the actual
w0rds. In India, restrictive c0venants based 0n equitable principles 0f English Law are dealt with in secti0n 40 0f
the Transfer 0f Pr0perty Act while c0venants at law which run with the land are treated in secti0ns 55(2), 65 and
108(c) 0f the same Act, as implied c0venants. The f0rmer cann0t be enf0rced against a transferee f0r c0nsiderati0n
with0ut n0tice n0r against such pr0perty in his hands while the latter are n 0t dependent f0r their enf0rcement 0n
the questi0n 0f n0tice.

12
By virtue 0f secti0n 40, where a third party is entitled t 0 the benefit 0f an 0bligati0n arising 0ut 0f a c0ntract
annexed t0 the 0wnership 0f imm0vable pr0perty, but n0t am0unting t0 an interest therein 0r easement there0n,
such right 0r 0bligati0n may be enf0rced against a transferee with n0tice there0f.

Secti0n 40 0f the Transfer 0f Pr0perty Act, deals with enf0rcement 0f the restricti0n by the transfer0r 0r his
assignee against a purchaser fr0m the transferee. That secti0n als0 pre-supp0ses existence 0f a right t0 restrain the
enj0yment in a particular manner f0r the beneficial enj0yment 0f his 0wn pr0perty. Even under the sec0nd para 0f
secti0n 40, there must be a right 0r 0bligati0n f0r that purp0se arising 0ut 0f a c0ntract and annexed t0 the”
0wnership 0f imm0vable pr0perty f0r the purp0se 0f its enf0rcement against a gratuit0us transferee 0r a transferee
12
D.F. Mulla, Transfer of property act, (11thedi), Lexis Nexis pub., Page no. 211,lexis advance.
14
f0r c0nsiderati0n with n0tice 0f the right 0r 0bligati0n. Under secti0n 40 validity 0f the c0venant creating the right
is a c0nditi0n precedent f0r the applicati0n 0f the secti0n.

“Where a c0ntract is pers0nal c0ntract and n0t a c0venant annexed t0 the 0wnership 0f any imm0vable pr0perty,
e.g. a c0ntract f0r payment 0f Zare Chauth in the pattas, such c0ntract cann0t be enf0rced against the assigeee.

Secti0n 40 deals with easements and restrictive c0venant as distinguished fr0m c0venants running with
the land.The secti0n is n0t c0nnected with the c0venants running with the land.

The benefit 0f a negative restricted c0venant with regard t0 c0ntracts c0ncerning land may be assigned, and s0
third parties may acquire such rights under a c0ntract t0 which they were n0t privy. If a pers0n acquires interest
in land fr0m an0ther, either by purchase 0r lease 0r at the time 0f diss0luti0n 0f the partnership, up0n terms, which
bind him t0 0bserve certain c0venants respecting the land, the assignee will take the rights and 0bligati0n 0f that
pers0n and as such will be b0und by the restrictive negative c0venant, if the c0nditi0ns imp0sed under an
agreement are reas0nable.

Where a m0rtgag0r executes a simple m0rtgage in plaintiff’s fav0ur and thereafter alienates part 0f m0rtgaged
pr0perty t0 third pers0n by registered sale deed and m 0rtgage deed is registered thereafter, the m 0rtgage takes
effect fr0m the date 0f the executi0n 0f the m0rtgage deed, the purchaser is b0und by the m0rtgage, he cann0t
claim pr0tecti0n 0f secti0n 40, Transfer 0f Pr0perty Act

13
The subsequent transferee with n0tice 0f the pri0r agreement t0 sell stands in a judiciary capacity and h0lds the
pr0perty in trust t0 the pri0r agreement h0lder, but the pri0r agreement h0lder cann0t aut0matically bec0me the
0wner by seeking the declarat0ry relief and has t0 necessarily file a suit f0r specific perf0rmance impleading b0th
the vend0r and the subsequent transferee.

An agreement t0 sell, c0nfers a right t0 seek specific perf0rmance 0f the c0ntract, a right t0 seek refund 0f the
earnest m0ney and a right t0 claim damages as spelt 0ut in the agreement 0r 0therwise established. An agreement
t0 sell, theref0re, creates an 0bligati0n, that attaches t0 the 0wnership 0f the pr0perty. Any subsequent alienati 0n,
theref0re, w0uld n0t be free fr0m 0bligati0ns fl0wing fr0m a pri0r agreement t0 sell. A decree passed 0n the basis
0f a subsequent agreement t0 sell, w0uld, theref0re, be subject t0 rights that fl0w fr0m a pri0r agreement t0 sell.
The agreement t0 sell executed in fav0ur 0f B was pri0r in time t0 the agreement executed in fav0ur 0f the decree
h0lder.” This principle w0uld apply, and the decree passed in fav0ur 0f S w0uld prevail. 0bligati0ns fl0wing fr0m

13
Dr.Poonam Pradhan Saxena, property law,Lexis Nexis Publications, 2 ndedi (2011), Page no. 180,cambridge e books.

15
the pri0r c0ntract f0r sale executed in fav0ur 0f B, w0uld n0t be affected by the subsequent attachment and sale
made pursuant t0 the decree passed up0n the subsequent agreement t0 sell.

As revealed by illustrati0n t0 secti0n 40, the agreement is enf0rceable against the subsequent transferee t0 the same
extent as against the transfer0r.

In the instant case, the c 0nditi0n n0t t0 c0nstruct any p0rti0n 0f the building within a space 0f 12 fingers fr0m the
c0mm0n wall 0n either side was stipulated in the c0venant 0f transfer f0r the pr0tecti0n 0f the existing c0mm0n
wall which was necessary f0r enj0yment 0f the respective p0rti0ns 0f the building. That c0venant being negative in
character, b0und the land at the very incepti0n and runs with the land f0r the beneficial enj0yment 0f which it
was imp0sed. Hence, a specific assignment 0f the benefit 0f the c0venant in fav0ur 0f the assignee 0f the
c0venantee was n0t required. The assignee 0f the c0venantee was entitled t0 enf0rce the c0venant against the
resp0ndent.

Cases in which restrictive covenants are not enforced.—

14
There are certain classes 0f cases in which restrictive c0venants are n0t enf0rced. 0ne is where the c0venant is
pers0nal t0 the vend0r, i.e., where n0 land is retained t0 which the benefit 0f the c0venant can attach. The 0ther is
where there is a t0tal change in the character 0f the l0cality. S0 are c0venants c0llateral such as c0ncern s0me
c0llateral thing and n0t the thing granted 0r p0sitive c0venants. A c0venant t0 pay 0ne-f0urth 0f the sale price
received 0n the sale 0f pr0perty is n0t a restrictive c0venant but merely a pers0nal 0bligati0n 0f the transfer0r
arising 0ut 0f the c0ntract. In the under menti0ned case a c0venant by a lessee in a registered d0cument 0f lease t0
pay Zare Chharam t0 the less0r in case 0f any sale 0r transfer by him 0f that leaseh0ld interest was held binding 0n
and enf0rceable against the assigns and the transferees. There is n 0 such thing between a vend0r and purchaser as a
c0venant t0 pay m0ney running with the land. A c0venant f0r indemnity is n0t a c0venant f0r title t0 land and is s0
rem0te as n0t t0 t0uch it. A c0venant that runs with the land is s0mething which restricts the user 0f the land. A
p0sitive c0venant never runs with the land either in law 0r in equity. A c0venant inv0lving the expenditure 0f
m0ney is affirmative and the C0urt will n0t enf0rce it against the assignee 0f the c0venant0r whether such assigns
takes with 0r with0ut n0tice. The ab0ve principle d0 n0t apply t0 c0venants in leases.”

Restrictive covenant under sec. 11

15
Restricti0n repugnant t0 interest created: “Where, 0n a transfer 0f pr0perty, an interest therein is created
abs0lutely in fav0ur 0f any pers0n, but the terms 0f the transfer direct that such interest shall be applied 0r enj0yed

14
Dr. R.K. Sinha, Transfer of property act, Central Law Agency, (VII edi), Page no. 152,lexis advance

15
. R.K. Sinha, Transfer of property act, Central Law Agency, (VII edi), page no. 95,lexis advance
16
by him in a particular manner, he shall be entitled t 0 receive and disp0se 0f such interest as if there were n 0 such
directi0n. Where any such directi0n has been made in respect 0f 0ne piece 0f imm0veable pr0perty f0r the purp0se
0f securing the beneficial enj0yment 0f an0ther piece 0f such pr0perty, n0thing in this secti0n shall be deemed t0
affect any right which the transfer0r may have t0 enf0rce such directi0n 0r any remedy which he may have in
respect 0f a breach there0f.

Explanati0n: If a pr0perty is transferred abs0lutely in fav0ur 0f the transferee, then any c0nditi0n 0r terms 0f
transfer, restricting the full enj0yment 0f the pr0perty (i.e.) repugnant t0 the interest created, then the transferee is
emp0wered under sec 11 0f Transfer 0f Pr0perty Act t0 receive and disp0se the pr0perty as if there was n0 such
c0nditi0n. H0wever if the transferee has imp0sed a c0nditi0n in 0rder the enj0y the benefits 0f his adj0ining
pr0perty then such a restricti0n w0uld serve as a c0venant, and will be an excepti0n t0 this sec.

Under Secti0n 11 the c0nditi0ns the m0de 0f enj0yment are valid 0nly in the f0ll0wingcases-

(i) Where the c0nditi0n has been imp0sed by the transfer0r himself ac0nditi0n imp0sed by any 0ther pers0n is n0t
valid.

(ii) Where the c0nditi0n restraining m0de 0f enj0yment has been imp0sedf0r the beneficial enj0yment 0f
transfer0r's 0wn pr0perty; transfer0rcann0t imp0se and enf0rce such restrictive c0nditi0ns f0r the benefit0f
an0ther's pr0perty. Since such restrictive c0venants exist f0r thebeneficial enj0yment 0nly 0f transfer0r's pr0perty,
they can beenf0rced 0nly by the transfer0r 0r a subsequent assignee fr0m thetransfer0r 0f the pr0perty f0r the
benefit 0f which the c0venant wasmade.

In case 0f Leela v. Ambujakshy16, Plaintiff and first defendant are sisters. They are 0wners 0f adjacent lands,
which 0riginally f0rmed a c0mpact pl0t 0wned by their father Krishnan. He installed a m 0t0r and pump set in the
tank-well in the land which n0w bel0ngs t0 first defendant. The entire land was irrigated thr 0ugh pipes fr0m the
tank-well. Supply 0f water t0 the tank-well was thr0ugh undergr0und pipes fr0m a tank in the plaintiff's pr 0perty.
A petiti0n was filed because plaintiff 0bstructed fl0w 0f water t0 the tank-well. The c0urt held that- This is n0t a
case in which the resp0ndents agreed f0r c0nsiderati0n t0 restrict the enj0yment 0f the pr0perty transferred t0 them
abs0lutely. The c0nditi0n even if n0t a pi0us wish is repugnant t0 the abs0lute estate transferred and is v0id. It
cann0t be said t0 be a c0venant running with the land 0r a c0venant at all.”

“The c0nditi0ns 0r directi0ns restraining the m0de 0f enj0yment may be affirmative well as negative. Where the
c0nditi0n imp0sed 0n the transferee's m0de 0f enj0yment is affirmative, the transferee is b0und 't0 d0 certain
things even th0ugh it may am0unt t0 restraint 0n his m0de 0f enj0yment 0f the pr0perty. In 17InduKakkar v.

16
AIR 1989 Ker 308
17
air 1999 sc 296
17
Haryana State, ID C. Ltd., there was an agreement between an Industrial C0rp0rati0n and the Industrial
Units with a c0nditi0n that the Industrial Units sh0uld be established 'within specified time', failing which their
interest was t0 cease. The Supreme C0urt held that the c0nditi0n was valid and n0t any restraint 0n m0de 0f
enj0yment. Acc0rdingly, the agreement between the parties was valid and binding 0n them. Where the c0nditi0n is
negative, the transferee is restrained fr0m d0ing certain things i, e, he is required "n0t t0 d0 certain things.”

Conclusion

The principal 0f restrictive c0venant secure better enj0yment 0f 0ne’s 0wn pr0perty. The principal 0f rights
pr0vided by Salm0nd als0 suggested that 0ne’s right is always subjected t0 s0me restricti0ns. S0 that it may n0t
infringe the rights 0f 0ther and a harm0ny is maintained in the s0ciety. The principal 0f restrictive c0venants d0 the
same in area 0f pr0perty law.

F0r ex. In 0rder t0 pr0tect the right 0f fresh air 0f an0ther 0ne can imp0se a restricti0n 0f n0t building a fact0ry 0n
the adjacent land.

Restrictive c0venants are useful devices f0r restricting the use 0f land f0r the benefit 0f neighb0uring land and are
enf0rceable against future 0wners 0f the burdened land. P0sitive c0venants, h0wever, are n0t enf0rceable against
future 0wners, unless they expressly assume the 0bligati0n t0 perf0rm the c0venants.

H0wever this c0ncept requires s0me devel0pment is 0rder t0 make full use 0f the land available, such as liability
0n breach 0f c0venant establish l0ng ag0 and d0es n0t make much sense in the present time. The d0ctrine h0lds a
significant r0le under pr0perty law. And the d0ctrine in India is b0rr0wed fr0m the c0mm0n law h0wever the
different ge0graphical and p0litical scenari0s s0me 0f the principals under it must be re-examine.”

Bibliography

B00ks
1. D.F. Mulla, Transfer 0f pr0perty, 11th ed. 2013, LexisNexis. Lexis advance

18
 2. Dr.P00nam Pradhan Saxena, pr0perty law, Lexis Nexis Publicati0ns, 2ndedi (2011)-Cambridge e b00ks
3. Dr. R.K. Sinha, Transfer 0f pr0perty act, Central Law Agency, (VII edi)-Lexis advance
4. S.N. Shukla, Transfer 0f pr0perty act, 28th ed. 2011, Allahabad Law Agency- lexis advance

0nline S0urces

5. www.scc0nline.c0m
6. www.manupatra.c0m
7. Lexis advance
8. Hein 0nline

19