An Exposition of Section 43 of the Transfer of Property Act, 1882: The Doctrine of Feeding the Estoppel in Indian Law

An Exposition of Section 43 of the Transfer of Property Act, 1882: The Doctrine of Feeding the Estoppel in Indian Law

Introduction

Section 43 of the Transfer of Property Act, 1882 (hereinafter "TPA") stands as a significant provision embodying the equitable doctrine of "feeding the estoppel" or "estoppel by deed." It addresses situations where a person, through a fraudulent or erroneous representation, purports to transfer immovable property to which they have no present title, but subsequently acquires an interest in that property. This article aims to provide a comprehensive analysis of Section 43, delving into its core principles, essential ingredients, and the nuances of its application as elucidated by the Indian judiciary. Drawing heavily upon landmark precedents and statutory language, this exposition will explore the scope, limitations, and enduring relevance of this provision in contemporary property law jurisprudence in India.

The Statutory Provision: Section 43 of the Transfer of Property Act, 1882

Section 43 of the Transfer of Property Act, 1882, reads as follows:

"43. Transfer by unauthorised person who subsequently acquires interest in property transferred.—Where a person [fraudulently or][1] erroneously represents that he is authorised to transfer certain immovable property and professes to transfer such property for consideration, such transfer shall, at the option of the transferee, operate on any interest which the transferor may acquire in such property at any time during which the contract of transfer subsists.

Nothing in this section shall impair the right of transferees in good faith for consideration without notice of the existence of the said option."[2]

The words "fraudulently or" were inserted by the Transfer of Property (Amendment) Act, 1929 (Act 20 of 1929), clarifying that the nature of the misrepresentation, whether innocent or deceitful, does not fundamentally alter the applicability of the section, provided the transferee has been misled.[3]

Core Principles and Essential Ingredients of Section 43

For Section 43 to be invoked, certain conditions must be met, which have been consistently affirmed by the judiciary.

Erroneous or Fraudulent Representation

The cornerstone of Section 43 is a representation made by the transferor. This representation must be that the transferor is "authorised to transfer certain immovable property."[4] It must be a representation of a present, transferable interest.[5] The Supreme Court in Jumma Masjid, Mercara v. Kodimaniandra Deviah clarified that the section applies whenever a person transfers property to which he has no title on a representation that he has a present and transferable interest therein.[6] Whether this representation is made fraudulently or merely erroneously is immaterial for the primary operation of the section, as long as the transferee acts upon it.[7] As observed in Ashok v. Annapurna, citing Ram Pyare v. Rama Narain, "It is only material to find out whether in fact the transferee has been misled."[3]

Professing to Transfer for Consideration

The transferor must "profess to transfer such property for consideration."[4] The existence of consideration is essential, distinguishing such transfers from gratuitous ones where this equitable doctrine might not extend with the same force. The transfer must be one that would be otherwise valid if the transferor had the authority they represented themselves to possess.

Subsequent Acquisition of Interest by Transferor

A critical element is that the transferor must "acquire in such property" an interest "at any time during which the contract of transfer subsists."[4] This subsequent acquisition "feeds" the estoppel, allowing the previously defective transfer to be perfected. The Supreme Court in TANU RAM BORA v. PROMOD CH DAS (DEAD) THR. LRS. explained that if the transferor subsequently acquires the right, title, or interest, and the contract of transfer subsists, the transfer becomes valid at the option of the transferee.[8] However, this subsequent acquisition must be by the transferor themselves. As held in Ajudhi v. Ram Bilash, citing Ban Sabodh v. Deputy Director of Consolidation, the statutory conferment of Bhumidhari rights upon the heir of a deceased transferor (who was a Sirdar at the time of transfer) would not enure to the benefit of the transferee under Section 43.[9]

Subsistence of the Contract of Transfer

The efficacy of Section 43 is contingent upon the contract of transfer remaining subsisting at the time the transferor acquires the interest. If the transferee has repudiated or cancelled the contract before such acquisition, they cannot later claim the benefit of this section.[6]

Option of the Transferee

The subsequent acquisition does not automatically perfect the transfer. The section provides that "such transfer shall, at the option of the transferee, operate on any interest which the transferor may acquire."[4] The transferee has the choice to affirm the transfer and claim the subsequently acquired interest. The transferor, having made the representation, cannot then challenge the transfer.[8]

Judicial Interpretation and Application

The Doctrine of "Feeding the Estoppel"

Section 43 embodies the "rule of feeding the estoppel."[10] As explained by the Supreme Court in Hardev Singh v. Gurmail Singh (Dead) By Lrs., this rule enacts that a person who makes a representation shall not be heard to allege the contrary as against a person who acts thereupon.[10] The equity of the section prevents the transferor from denying the validity of the transfer once they acquire the capacity to make it good.

Interplay with Section 6(a) - Transfer of Spes Successionis

A significant area of judicial discourse has been the relationship between Section 43 and Section 6(a) of the TPA, which prohibits the transfer of a mere spes successionis (the chance of an heir-apparent succeeding to an estate or any other mere possibility of a like nature). The Supreme Court in Jumma Masjid, Mercara v. Kodimaniandra Deviah definitively settled this, holding that Sections 6(a) and 43 operate in different fields and do not conflict.[6] Section 6(a) deals with the subject matter of the transfer, prohibiting the transfer of a mere expectancy as such. Section 43, on the other hand, deals with a representation as to present title. If a person represents that they have a present, transferable interest and transfers it, Section 43 applies, even if what they actually possessed at the time was only a spes successionis.[6] The Allahabad High Court in Shyam Narain v. Mangal Prasad[11] and Jagat Narain v. Laljee[12] also affirmed this view, stating that Section 6 cannot stand in the way of the applicability of Section 43. The Madras High Court in The Jumma Musjid, Mercara v. Kodimani Andra Devaiah (the High Court decision preceding the Supreme Court's landmark ruling) also engaged in a detailed discussion of this, highlighting earlier conflicting views before the position was crystallized.[13]

Knowledge of the Transferee and Good Faith

A crucial limitation on the applicability of Section 43 arises from the transferee's knowledge. If the transferee is aware of the defect in the transferor's title or that the representation is false, they cannot claim the benefit of Section 43. In Kartar Singh (Dead) By Lrs. And Others v. Harbans Kaur (Smt), the Supreme Court held that for Section 43 to apply, the transferee must have been misled by the transferor's representation and acted upon it in good faith, without notice of the defect in title.[14] Similarly, in Ashok v. Annapurna, the Karnataka High Court reiterated that "Where the transferee knew as a fact that the transferor did not possess the title which he represents he has, then he cannot be said to have acted on it when taking a transfer. S. 43 would then have no application..."[3]

The Allahabad High Court in Seth Parma Nand v. Champa Lal discussed the doctrine of estoppel by deed, noting that where the truth appears by the same instrument, there can generally be no estoppel. However, it also observed that if the deed is not otherwise invalid (e.g., prohibited by law or a fraud on third parties), knowledge of the truth by the transferee might not debar them from pleading estoppel if they paid good consideration in the hope of future title acquisition.[15] This suggests a nuanced approach, but the prevailing view from Supreme Court decisions like Kartar Singh emphasizes that the transferee must be misled.

Void v. Voidable Transfers and Transfers Prohibited by Law

The applicability of Section 43 to transfers that are void ab initio or prohibited by law is complex. In Kartar Singh, where a mother sold her minor son's share without legal necessity or permission, the Supreme Court held the sale of the minor's share to be void and found Section 43 inapplicable, as the transferee could not have been misled about the legal position concerning a minor's property.[14]

The Supreme Court in Hardev Singh v. Gurmail Singh stated that Section 43 successfully protected the transferee's interest because the transfer was "not void or contrary to public policy."[10] This implies that if a transfer is inherently void (e.g., due to a statutory prohibition based on public policy), Section 43 might not cure the defect. The Madras High Court in The Jumma Musjid, Mercara (1952) extensively discussed scenarios where transfers were prohibited by statute (e.g., service inams) and noted that Section 43 could not validate a transfer that was, on the date it was made, forbidden by law on grounds of public policy, particularly if there was no erroneous representation about the authority to transfer.[13]

However, a distinction arises if the representation itself is about a transferable interest, even if the transferor's actual underlying status makes such a transfer by them problematic. In Desh Raj And Others v. Lal Sahai Singh And Others, transferors who were Sirdars (with non-transferable rights under the U.P. Zamindari Abolition and Land Reforms Act) represented themselves as Bhumidhars (with transferable rights) and executed a sale deed. They subsequently acquired Bhumidhari rights. The Allahabad High Court held Section 43 applicable, reasoning that the sale deed was not, in fact, of Sirdari rights but of the represented Bhumidhari rights, and the transferees were misled by this representation.[16]

Transfers by Persons with Limited or No Title

Cases like Kartar Singh (involving a minor's property)[14] and Jagat Narain v. Laljee (Sirdar representing as Bhumidhar)[12] illustrate the application of Section 43 principles in varied contexts of defective title. The outcome often hinges on whether there was a misleading representation and whether the transferee acted upon it without knowledge of the true state of affairs.

Scope of "Property" and "Interest"

The Allahabad High Court in Jagat Narain v. Laljee clarified that the expression 'property' in Section 43 "does not mean, or at least does not necessarily mean, the physical object... but connotes interest in property."[12] This interpretation supports the application of Section 43 even when the transferor had some interest, but not the specific transferable interest they purported to convey.

Limitations and Exceptions to Section 43

Transferee's Knowledge of Defect in Title

As discussed, if the transferee knows the truth about the transferor's lack of title or defective authority, they cannot invoke Section 43. The essence of the provision is to protect a transferee who has been genuinely misled.[3][14]

Transfers Void Ab Initio or Prohibited by Law on Grounds of Public Policy

If the transfer itself is of a nature that is absolutely prohibited by law or is void ab initio on grounds of public policy (e.g., a contract opposed to public policy), Section 43 may not be able to validate such a transaction.[10][13][14] The focus is often on whether the transaction, as represented, was one that could be legally effected if the representation were true.

Subsequent Acquisition by Heirs, Not Transferor

The benefit of subsequent acquisition enures to the transferee only if the *transferor* acquires the interest. If the interest is acquired by the transferor's heirs after the transferor's death (especially by a separate statutory conferment), Section 43 may not apply to pass that interest to the original transferee.[9]

Rights of Bona Fide Transferees for Consideration Without Notice (Second Limb of Sec 43)

The second paragraph of Section 43 protects subsequent transferees: "Nothing in this section shall impair the right of transferees in good faith for consideration without notice of the existence of the said option."[4] This means if, after the original transferor acquires interest but before the original transferee exercises their option, the transferor further transfers the property to a second transferee who acts in good faith, for consideration, and without notice of the first transferee's option, the second transferee's rights are protected.[6][10]

Analysis of Key Precedents

Jumma Masjid, Mercara v. Kodimaniandra Deviah (SC, 1962)

This seminal judgment laid down the foundational principles of Section 43. It established that the section applies when a person transfers property without title based on a representation of having a present, transferable interest, and the transferee acts on this for consideration. It clarified the distinct operational spheres of Section 6(a) and Section 43, confirming that Section 43 can apply even to transfers of what was, in reality, a spes successionis, provided the representation was of a present title.[6] This case, also cited in CHANDAN RAMAMURTHI & ANR v. M.R KRISHNAMURTHI & ANR[17], remains the bedrock for understanding the section's scope.

Kartar Singh v. Harbans Kaur (SC, 1994)

This case underscored the requirement that the transferee must have been misled by the representation and acted in good faith. Where a mother, as a natural guardian, sold her minor son's property without court sanction or legal necessity, the sale of the minor's share was deemed void. The Court held Section 43 inapplicable because the transferee, dealing with a minor's property through a guardian, was expected to know the legal limitations and thus could not claim to have been misled by any representation of absolute ownership by the mother regarding the minor's share.[14]

Hardev Singh v. Gurmail Singh (SC, 2007)

Hardev Singh provided further clarity, distinguishing Section 43 from Section 41 (transfer by ostensible owner). It reiterated that Section 43 embodies the "rule of feeding the estoppel" and applies irrespective of whether the transferor's representation was bona fide or fraudulent, citing Jumma Masjid. Crucially, it upheld the applicability of Section 43 where the initial transfer was not void or contrary to public policy, and the transferee had acted in good faith without knowledge of pending litigation that affected the transferor's title.[10] The Karnataka High Court in Smt. Sharadamma And Another v. Sri. R. Vishwanath And Others also referred to similar principles while distinguishing Sections 41 and 43.[18]

Other Illustrative Cases

The Supreme Court in TANU RAM BORA v. PROMOD CH DAS (DEAD) THR. LRS. (2019) succinctly summarized the effect of Section 43: the transferor with a subsequently acquired title cannot challenge the transfer if the contract subsists and the transferee opts for it.[8] Cases like Jagat Narain v. Laljee (Allahabad HC, 1964)[12] and Desh Raj v. Lal Sahai Singh (Allahabad HC, 1972)[16] demonstrate the application of Section 43 in specific contexts of land tenure in Uttar Pradesh, where representations about superior (Bhumidhari) rights were made by those holding inferior (Sirdari) rights. The principle of estoppel was applied in Amur Krishna De v. Rajendra Kumar De (Calcutta HC, 1925) where the sale was of an interest the transferor "has or would have."[19] The case of Jharu Ram Roy v. Kamjit Roy And Others (SC, 2009) involved a contention regarding Section 43 where a son, governed by Dayabhaga law, sold property while his father (the owner) was alive; however, the provided material outlines the appellant's argument without detailing the Supreme Court's final adjudication on the Section 43 plea in that instance.[20]

Conclusion

Section 43 of the Transfer of Property Act, 1882, is a vital provision rooted in equity, designed to protect transferees who act upon representations of title made by their transferors. The doctrine of "feeding the estoppel" ensures that a transferor cannot benefit from their initial misrepresentation if they subsequently acquire the very interest they purported to convey. Judicial interpretations have meticulously carved out the scope and limitations of this section, emphasizing the necessity of a misleading representation, action by the transferee in good faith and for consideration, subsistence of the contract, and subsequent acquisition of interest by the transferor. The distinction from Section 6(a), the implications of the transferee's knowledge, and the treatment of void or prohibited transfers have been key areas of judicial scrutiny.

While the provision offers substantial protection, it is not absolute. The rights of subsequent bona fide purchasers for value without notice are safeguarded, and the transferee seeking to invoke Section 43 must themselves come with clean hands, having been genuinely misled. Section 43 thus strikes a crucial balance, upholding the sanctity of representations in property transactions while ensuring fairness and preventing unjust enrichment, thereby contributing significantly to the stability and predictability of property dealings in India.

References

  1. The words "fraudulently or" were inserted by the Transfer of Property (Amendment) Act, 1929 (Act 20 of 1929).
  2. Section 43, Transfer of Property Act, 1882. As quoted in Jharu Ram Roy v. Kamjit Roy And Others (Supreme Court Of India, 2009) and Jumma Masjid, Mercara v. Kodimaniandra Deviah And Others (Supreme Court Of India, 1962).
  3. Ashok v. Annapurna (Karnataka High Court, 2017), citing Ram Pyare v. Rama Narain and others (AIR 1985 SC 694).
  4. Section 43, Transfer of Property Act, 1882.
  5. Jumma Masjid, Mercara v. Kodimaniandra Deviah And Others (1962 AIR SC 847, Supreme Court Of India, 1962).
  6. Jumma Masjid, Mercara v. Kodimaniandra Deviah And Others (Supreme Court Of India, 1962) (second entry in provided materials, direct quote).
  7. Hardev Singh v. Gurmail Singh (Dead) By Lrs. . (2007 SCC 2 404, Supreme Court Of India, 2007).
  8. TANU RAM BORA v. PROMOD CH DAS (DEAD) THR. LRS. (Supreme Court Of India, 2019).
  9. Ajudhi v. Ram Bilash . (Board of Revenue, 1983), citing Ban Sabodh v. Deputy Director of Consolidation 1982 A.L.J 1252.
  10. Hardev Singh v. Gurmail Singh (Dead) By Lrs. . (2007 SCC 2 404, Supreme Court Of India, 2007) (both entries).
  11. Shyam Narain v. Mangal Prasad (1934 SCC ONLINE ALL 277, Allahabad High Court, 1934).
  12. Jagat Narain v. Laljee (Allahabad High Court, 1964).
  13. The Jumma Musjid, Mercara, By Its Muthavalli Khan Saheb A. Abdul Rahaman Khan, Mercara v. Kodimani Andra Devaiah And Others (1952 SCC ONLINE MAD 293, Madras High Court, 1952).
  14. Kartar Singh (Dead) By Lrs. And Others v. Harbans Kaur (Smt) . (1994 SCC 4 730, Supreme Court Of India, 1994).
  15. Seth Parma Nand v. Champa Lal (Allahabad High Court, 1955).
  16. Desh Raj And Others v. Lal Sahai Singh And Others (1972 SCC ONLINE ALL 270, Allahabad High Court, 1972).
  17. CHANDAN RAMAMURTHI & ANR v. M.R KRISHNAMURTHI & ANR (Delhi High Court, 2024).
  18. Smt. Sharadamma And Another v. Sri. R. Vishwanath And Others (Karnataka High Court, 2015).
  19. Amur Krishna De v. Rajendra Kumar De (Calcutta High Court, 1925).
  20. Jharu Ram Roy v. Kamjit Roy And Others (2009 SCC 4 60, Supreme Court Of India, 2009). The provided material outlines the appellant's contention regarding Section 43 but does not detail the Supreme Court's final ruling on this specific plea.

Disclaimer: This article is for informational and academic purposes only and does not constitute legal advice.