Subject – Transfer of Property Act, 1882

Topic – Restraint and kinds of restraint on transfer of

Property in light of Sections 10 & 11 of the Transfer of
Property Act, 1882

Introduction
The Transfer of Property Act, 1882 is an Act laying down the rules and regulations regarding the
transfer of property among persons in India. It explains how a transfer of property is completed and
the conditions under which transfer may be carried out. An understanding of the basic terms of this
Act along with exploring alienation and its history would be important in understanding the
conditions and exceptions involved in the restraint of alienation.

Restraint
Section 10 of Transfer of Property Act, 1882
Where property is transferred subject to the condition or a 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 the limitation is void, except in the case of 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,
Muhammadan or Buddhist), so that she shall not have power during her marriage to transfer or
charge the same or her beneficial interest therein.

Types of restraints
Absolute Restraints
An absolute restraint is such a restraint which completely takes away the right of the transferee to
alienate or dispose of the property. The transferee can now no longer transfer his interest in the
property to another person and he has no freedom to do what he wants with the property in his
capacity as the owner of the property.

Section 10 stipulates that any condition imposed on the transferee which would amount to an
absolute restraint on the right of the transferee to dispose of his interest in the property shall be
void. The property must be transferred to the transferee subject to the condition.
Partial Restraints
A partial restraint is a condition which partially takes away the right of the transferee to dispose of
his interest in the property. Here, the right is not taken away substantially. Section 10 does not
explicitly talk about partial restraints. A condition imposing partial restriction is valid.

Case Laws
In Rosher v. Rosher (1884) 26 Ch D 801, A made a gift of a house to B, and gave a condition that if B
decides to sell the house during the lifetime of A’s wife, she should have the option of purchasing it
for Rs 10000, while the market value of the house was set at Rs 10,00,000. This condition was held to
be an absolute restraint and was declared void.

In Kannamal v. Rajeshwari, AIR 2004 NOC 8 (Mad), a life estate was to be created in favour of ‘M’, but
the transferor gave an absolute restriction along with the property transfer to M, whilst divesting
himself of all his interests in the property. This restraint was held to be void as there was an absolute
transfer.

In Mata Prasad v. Nageshwar Sahai (1927) 47 All 484, there was a dispute regarding succession
between nephew and widow. A compromise was formed that the widow had possession of the
property while the title for the same was given to the nephew with the condition that he was
restricted from alienating the property during the widow’s lifetime. It was held that the compromise
and the condition were valid and prudent in the present case.

Conclusion
In order to govern the free transfer of property in India, the Transfer of Property Act, 1882 was came
into existence. This transfer may take place in present and future but it should be amongst living
people. This assignment further addresses that restrictions which are absolutely or partially placed
on transferring property and also the conditions. Provisions of section 10, 11 and 12 contains certain
condition under which the transferer's alienation of property is void. There are also exceptions when
certain conditions may be relevant.

References
[1] https://www.lawctopus.com/academike/restraints-on-transfer/#_edn40

[2] https://www.legalbites.in/restraints-transfer-section-10/

[3] https://www.lawctopus.com/academike/alienation-of-property/