Tutorial – I : Property Law

RESEARCH PAPER – ABSTRACT

A comparative analysis of TOPA and Benami

Transactions Act, 1988

Submitted by

Pranav Bhogaraju

18010324106

2018-2023 - “D”

To

Asst.Prof. Priyanka Mohod

SYMBIOSIS INTERNATIONAL (DEEMED) UNIVERSITY

SYMBIOSIS LAW SCHOOL, HYDERABAD

 Introduction

With the help of this research paper, we try to understand the similarities and differences
between Section 41 of the Transfer of Property Act and Benami Transfer Act. Before we begin
the critical analysis of those two, it is important for the readers to understand the primary and
outline definition and the relevant provisions under these two different laws. Both the acts deal
and administer a similar kind of outline which relates to transfer of property to a special kind of
party, who is referred as the ostensible owner. Before get into the detailed analysis of both these
acts, we will understand and establish a brief outline on both Transfer of Property Act and
Benami Transfer Act.

Section 41 of Transfer of Property Act

Section 41 of the Transfer of Property Act deals specifically about the transfer of property by an
ostensible owners. Ostensible owners are not the real owner but have all the characteristics that
of a real owner. The intention to own the property is not available with a ostensible owner. The
intention is more important than the financial ground to distinguish between a real owner and
ostensible owner. The role of an ostensible owner is to fulfill and carry on a third party’s aims
and wishes. This third party usually consists of the real owner of the said property. The definition
of Section 41 of the transfer of property act is defined as follows.

“Where, with the consent, express or implied, of the persons interested in immovable property, a
person is the ostensible owner of such property and transfers the same for consideration, the
transfer shall not be voidable on the grounds that the transferor was not authorized to make it,
provided that the transferee, after taking reasonable care to ascertain that the transferor had
power to make the transfer, has acted in good faith.

In simple words the following definition states that a property can be transferred to a third party
when there is some form of consent. That person t whom the property is transferred is referred as
an ostensible owner. This transfer of property will not be considered voidable on the grounds that
the transferor was not authorized as long as the transferee with reasonable care has ascertained
that the transferor had power to make such a transaction in good faith.
Benami Transaction Act 1988

Benami under the Hindu law is used to designate or assign a transaction of immovable property.
These transactions are made under a name that is fictitious in nature or a third party who acts as a
ostensible owner for the primary owner of the said property. The Benami Transaction Act is
applied or followed when the transaction involves a fictitious party. Benami Transaction Act
overlooks and administers such transactions to take place in good faith without disturbing the
rest of the legal administration of the country.

The act defines benami transactions as “any transaction in which property is transferred to one
person for a consideration paid or provided by another person.”

The act looks to prohibit any kind of benami transaction to take place and rectify the previous
transactions that involved the entity of benami as the party to a transaction. The act further
describes the various prohibitions is respect to different kinds of benami transactions that are
possible to take place. The involvement of fictitious character is considered to be of bad faith and
hence is prohibited under this law.

Research Objectives

1. To understand the working of both Transfer of Property Act and Benami Transaction Act
1988. To infer the role of these acts in the Indian legal system and to conclude by
understanding the effectiveness of these acts in the current society.
2. To analyze the landmark cases that continued to structure the acts and refine it to the
highest potential.
3. To understand the differences between the Transfer of Property Act and Benami
Transaction Act 1988 and the specific reason for two different laws to exist instead of
one combined law. To also identify the co-relations between the two laws in place.
4. Fds
 Research Questions

1. What are the various provisions under Transfer of Property Act and Benami Transaction
Act that differentiate both the acts from each other?
2. What are similarities between the Transfer of Property Act and Benami Transaction Act
1988?
3. Who is ostensible owner and why is his role highlighted under Section 41 of the Transfer
of Property Act?
4. How has the case Kannashi Vershi vs Ratanshi Nenshi defined the role of ostensible
owner and what was the judgment of the mentioned case.

Research Methodology

The research paper uses mostly doctrinal methods of research which mean mostly research work
from different relevant references. Online research and online articles were the primary source of
research. Subsequently the bare act and the property law reference books were used for the
comparative analysis between the Transfer of Property Act and Benami Transaction Act, 1988.
The reference of case laws were taken from online case search engines like manupatra and SCC.

Chapterisation

Chapter 1 introduces both, Transfer of Property Act and Benami Transaction Act, 1988. Chapter
1 discusses the definitions and basic outlines that these acts consist of. To help the readers get a
brief understanding on the acts.

Chapter 2 analyses Transfer of Property Act in a detailed manner discussing the various
provisions and clauses that it consists of. Various case laws are discussed to understand the act in
a better sense.
Chapter 3 talks about the Benami Transaction Act, 1988 and the gives a detailed analysis on the
act. This chapter also talks about the evolution and structure that the act took over the course of
time.

Chapter 4 talks about the comparative analysis between Transfer of Property Act and Benami
Transaction Act,1988 and draws differences on various aspects that are relevant.

Chapter 5 talks about the current stand in the society for both the laws and the suggestions that
can be made to make it more flexible in respect to the Indian Legal System

Chapter 6 acts as a conclusion which sums up the analysis in not more 700-800 words leaving
the reader with maximum knowledge on the said analysis.