PROPERTY LAW

RESEARCH PAPER

DOCTRINE OF FEEDING THE GRANT BY ESTOPPEL

SUBMITTED BY: SUBMITTED TO:

JYOTI MAURYA MR. UTKARSH VERMA
ROLL NO.: 866 ASSISTANT PROFESSOR
SEMESTER: V ‘A’

NATIONAL UNIVERSITY OF STUDY AND RESEARCH IN LAW,

RANCHI

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 I. INTRODUCTION

The doctrine of feeding the grant by estoppel is based on the Latin maxim ‘nemo dat quod non
habet which means that no one can give to another, which he himself does not possess’. It
prevents a person who promises more than what he can perform from claiming his
incompetency as a legitimate excuse to avoid his liabilities in a situation when he acquires
competency to fulfil his promise. In English law the principle of feeding the grant by estoppel
was set out in Rajapakse v. Fernando1, the privy council observed that

“where a grantor has purported to grant an interest in land which he did not at the time
possess, but subsequently acquires, the benefit of his subsequent acquisition goes
automatically to the benefit of the earlier grantee, or, as it is usually expressed, ‘feeds the
estoppel’.”

The doctrine is based on two common law principle, principle of estoppel by deed and
equitable principle. The first principle prevents a person from denying what is done or said
and the later confirms that such a person is compelled to make good his promise when he
becomes competent to perform it. In fact, without any further act of his, the transfer becomes
good the moment he acquires competency to do so. Under common law, if a person
misrepresents to another that he is competent to transfer the good title and professes to do so
for consideration, and make the other to enter into a contract with him acting on this
representation, on the transferor subsequently acquiring a good title to the property, the
property instantaneously passes to the transferee.

The above doctrine is incorporated in section 432 of transfer of property act, the apex court in
Renu Devi vs. Mahendra Singh and Ors.3 observed that though there is some doubt whether
the common law doctrine of 'the estate instantly passes' is applicable in India but there is no
doubt that the doctrine of feeding the estoppel applies in India. In Jumma Masjid v.
Kodimaniandra deviah4, court while explaining the section states that:

"Considering the scope of the section on its terms, it clearly applies whenever a person
transfers property to which he has no title on a representation that he has a present and
transferable interest therein, and acting on that representation, the transferee takes a transfer

1
1920 AC 892.
2
The Transfer of Property Act, 1882 (Act No. 4 of 1882), S. 43.
3
MANU/SC/0112/2003.
4
1962 AIR 847.

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for consideration. When these conditions are satisfied, the section enacts that if the transferor
subsequently acquires the property, the transferee becomes entitled to it, if the transfer has not
meantime been thrown up or cancelled and is subsisting”.

II. SECTION 43 OF TRANSFER OF PROPERTY ACT.

On the perusal of section 43 of the transfer of property act, it is clear that to bring the case
under the ambit of section 43, it is should be proved that (i) the transferor makes a
representation to the effect that he is competent to transfer a particular piece of immovable
property; (ii) this representation may be erroneous or fraudulent; (iii) this representation is
not true; (iv) the transferee believes or is made to believe that the representation is correct and
the transferor is competent to transfer the property, i.e., he does not know the defect in title or
lack of capacity on part of the transferor; (v) the transferor professes to transfer the property
for a consideration; (vi) the transferee acts on the representation and enters into the contract;
(vii) the transferor subsequently acquires competency to transfer the same property; (viii) the
contract is subsisting; (ix) the property is still with the transferor, i.e., he has not transferred
it to a bona fide purchaser who takes it without actual or constructive notice of this earlier
contract between the transferor and the transferee; (x) the transferee exercises the option to
signify his intention to go ahead with the contract.

II.I. SECTION 43 AND ABSENCE OF REPRESENTATION

The representation under the Act may be fraudulent or even erroneous. Whether it is erroneous
is a question of fact.5 In Parma Nand v. Champa Lal And Ors.6, court observed that the
erroneous representation is not based on the fact that the person to whom it is made knows it
to be false but simply depend upon if it is true or false and in the same manner fraudulent
representation does not cease to be fraudulent if the person to whom it is made knows it to be
false; if it is made with the intent to deceive it will be said to be a fraudulent representation.

However, the term ‘fraudulent’ was inserted by the Amending Act, 1929 to extend the
application of section 43 to the cases of fraud also.

Representation is one of the requisites of the section, in the absence of the representation the
doctrine does not apply7 but that does not mean that if the transferor is silent about his capacity,

5
Jagat Narain And Anr. vs Laljee And Ors., AIR 1965 All 504.
6
AIR 1956 All 225.
7
Ram Bharosey v Bhagwan Din, AIR 1954 SC 704.

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when there is a duty to speak, he cannot escape the applicability of rule of estoppel as against
him.8 Representation can be expressed or implied, even in the cases where transferor is
incompetent to transfer but without making any representation made such transfer, it is to be
presumed that when the person says “he will transfer the property”, it means that what he is
conveying to the other is that he is authorised to do so, and in such cases also rule of estoppel
will attract.9

In Hardev Singh v. Gurmail Singh10, husband transferred the property to his wife in lieu of
maintenance and later sold the said property to third person without taking his wife’s consent
and she challenges its validity in the court but dies during its pendency and the husband inherits
the same as her legal heir, the Apex Court held that if a person pretends to be the owner of the
property and subsequently becomes the owner, the transfer by him conveys a good title.

Moreover, the expression ‘fraudulent and erroneous’ shows that the lack of knowledge on the
part of the transferor about his own incompetency to transfer the material is immaterial.11 It is
irrelevant whether the transferor acts bona fide or fraudulently in making the representation.12

II.II. KNOWLEDGE ON PART OF THE TRANSFEREE.

Knowledge on part of the transferee may be actual or constructive. If the circumstances are
such that as a reasonable, prudent person, the transferee, to safeguard his own interests had
made sufficient inquiries that he ought to have made, or had been vigilant and upon doing so,
he could have detected the lack of title, he would be deemed to have constructive notice of the
lack of title, and section 43 would not apply.

In Kartar Singh v.Harbans Kaur13, Hon’ble Supreme Court has overruled a plethora of cases
and held that the section 43 of the transfer of property act impose ‘duty to take care’ on the
transferee. The court opined that

“The material time at which the knowledge has to be proved is the time of the conclusion of
the contract. When we analyse the issue as to whether the transferee who is now seeking the
beneficial protection of s. 43, had knowledge or notice of the incompetency of transferor or
not, we must take note of the fact that even constructive notice on his part would bring the case

8
Poonam Pradhan Saxena: Property Law, 3rd ed (2020).
9
Ram Lal v Shiama Lal, AIR 1931 All 275.
10
AIR 2007 SC 1058.
11
Supra note 8.
12
Supra note 6.
13
1994 SCC (4) 730.

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under s. 6 (a). If by making some inquiries or verifying certain facts, as a normal reasonable
prudent person, the transferee could have detected the incompetency of the transferor to
transfer the property, but he failed to do that, law would impute constructive notice of the same
on him, and as the consequences of actual and constructive notice are identical, in case of
imputation of constructive notice also, the plea of misrepresentation, erroneous or fraudulent
would not be accepted by the court. In such a case, s. 6(a) would be applicable under which
this transfer would be considered void, and s. 43 will not apply.”

II.III. TRANSFER OF PROPERTY MUST BE A VALID ONE.

Validation of the transferred property under the representation of unauthorized representation

is one of the requisites of the section 43. This contract, in the first place, should not have been
contrary to the statute in any manner whatsoever, i.e., not only should the parties be legally
qualified to enter into a contract, but the object of the contract should also be lawful,14 and not
opposed to public policy,15 or to defeat the rights of creditors or a provision of law,16 etc.

It is based on the principle that nothing can be pleaded in contradiction of law, this "rule of
feeding the estoppel" shall apply only in absence thereof. In Jharu Ram Roy v Kamjit Roy,17
court held that "where a grantor has purported to grant an interest in land which he did not at
the time possess, but subsequently acquires, the benefit of his subsequent acquisition, goes
automatically to the earlier grantee, or as it is usually expressed, feeds the estoppel".

Moreover, Ramkali v State of Uttar Pradesh,18 court observed that in a case property is declared
to inalienable under the statute, section 43 is not attracted.

II.IV. TRANSFER OF PROPERTY MUST BE FOR CONSIDERATION.

Consideration is one of essential factors to be considered in transfers by unauthorised

transferors on misrepresentations under section 43.19 Ganga Baksh v Madho Singh,20 the court
held that though it is not necessary to show that some monetary consideration has already
passed from the transferee to the transferor, but the transfer in essence is one involving

14
Ram Bhawan Singh v Jagdish, (1990) 4 SCC 309.
15
Ramayya v Jagannadhan, AIR 1921 Mad 410.
16
Veeraswami v Durga Venkata Subbarao, AIR 1957 AP 288.
17
(2009) 4 SCC 60.
18
AIR 2009 (NOC) 190 (All).
19
Sadhu Saran v Sheo Prasad,
20
AIR 1955 All 587.

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consideration, and there is a liability on part of the transferee to pay it. Section 43, therefore,
does not apply to gratuitous transfers like gifts, etc.

II.V. INTEREST IN THE PROPERTY HAS TO BE ACQUIRED DURING THE ONE’S

LIFETIME.

In Jumma Masjid v K Deviah,21 the court held that transferee is entitled to the benefit of this
doctrine only when the transferor subsequently acquires an interest in the property that he
originally represented as his. If the transferor does not acquire a further interest in the property
transferred,22 or if such further interest is acquired not by the transferor but by his successor in
interest,23 or where the heirs of the transferor acquire property in their own right and not as
heirs of the transferor,24 this section has no application.

III. DOCTRINE OF FEEDING THE GRANT BY ESTOPPEL IN INDIAN

SCENARIO

The doctrine provides an additional remedy to the transferee besides a claim for damage, and
enables him to get the property itself.25 The transfer shall become valid only when the transferee
exercises the option to validate it and is capable to do the same. "At the option of the transferee"
means that the validation of the transfer depends purely on the transferee's will and the
transferor cannot force a transfer on him, after he acquires competency. If the transferee so
desires, he can avoid this transfer which in the first place, was brought about by a
misrepresentation. However, the court in Krishnadhan Chandra v Kanialal Ghose,26 held that
there is no automatic validation of the transfer, as no rights are vested in the transferee from
the inception of this transfer. The option must be exercised by the transferee. There is no
specific form of exercise of option and any indication is sufficient. It can be done verbally,
through sending a notice to the transferor to execute a transfer deed in favour of the transferee
or even by instituting a suit in a court of law to that effect. It is not necessary that a demand
should be made.27

21
AIR 1962 SC 847.
22
Ramkrishan v Anasuyabai, AIR 1924 Bom 300.
23
Ramdeo v Deputy Director, AIR 1968 All 262.
24
Anand Padhan v Dhuba Mohanty, AIR 1979 Ori 5.
25
Ganesdas v Kamalabai, AIR 1952.
26
AIR 1973 Cal 422.
27
Arulayi v Jagadeesiah, AIR 1964 Mad 122

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The aforesaid validation of the transfer depends on the exercise of the option by the transferee
and in the situation when the property is available. If the property is transferred before the
option can be exercised by the transferee to another person, who takes it for consideration and
without actual or constructive notice of the rights of the earlier transferee over it, the rights of
the earlier transferee will be defeated. In Sundariya v Ramashastri,28 court considered that the
doctrine does not impair the right of transferees in good faith for consideration, without notice
of the existence of the said option.

IV. SECTION 43 VIS-À-VIS DOCTRINE OF FEEDING THE GRANT BY

ESTOPPEL

In English statute, the consequent estate shall be transferred to the transferee without any
intervention by the transferor. Although in two ways, it departs from the English doctrine.
Firstly, the estate would not pass automatically, but at the discretion of the transferee. Under
English law, the transfer is validated immediately, without the need for any further intervention
by either the transferee or the transferor. Under Indian rule, the transferee must exercise the
opportunity to confirm the transferee, for which three requirements must be met; the contract
should remain in place; the property should be available and the transferee should be ready to
continue with the transfer. Secondly, the transferee could have defeated a purchase for value
without warning. In compliance with English rule, when the initial transfer is perfected as soon
as the transferor acquires the competence to transfer the property and the transfer is confirmed
instantaneously, the reach of the property which is not possible on account of the chances of
admission of the transferee in bona fide for consideration does not occur.

The court in Parma Nand vs Champa Lal And Ors.,29

“This is the first matter in respect of which the Indian law differs from the English law and the
second matter in respect of which it differs is that it does not apply the doctrine of feeding the
estoppel so as to impair the rights of subsequent transferee in good faith for consideration
without notice of the existence of the option in the prior transferee. Both these deviations in the
Indian law have no bearing upon the question whether the state of knowledge of the first
transferee is material.”

28
AIR 1955 Mys 8.
29
1962 AIR 847.

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 V. CONCLUSION

The Estoppel Law points out precisely what happens when a transfer is made by an illegitimate
party who then acquires the authority to transfer the same the theory does not apply in such
cases where the transferee has rescinded the contract or is fully aware of the reality that the
transfer is illegal. This provision not only preserves the right of the first transferee, but also the
right of the second transferee to comply with the obligation to act in good faith, because the
transferee has the right to invoke section 43 of the Transfer of Property Act in the event that
the transferee is misrepresented by the transferor.

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