Subramaniam vs Perumal Reddi and Another

We are of opinion that what was sold by Exhibit A was a debt secured by a charge upon Immovable property. Such a debt is an actionable

claim and the assignee will be entitled to a personal decree for the debt as well as to the charge. u/s 8[1] of the Transfer of Property Act, the

operation of the transfer of the debt is to pass to the transferee the securities for the debt, but what is sold is primarily not the charge, but the debt.

So far as the sale creates a charge in favour of the plaintiff it is a charge for Rs. 70[2] only, and falls within the provisions of Section 18 of the

Registration Act. See Satra Kumaji v. Visram Hasgavada ILR 2 Bom. 97.

Though it is true that the term ""other intangible thing"" in Section 54[3] of the Transfer of Property Act might include a charge, the expression must

be construed with reference to its context and to the heading of the chapter. The chapter relates to ""sales of Immovable property,"" and the context

classes other intangible things"" with ""reversions"" in contradistinction to tangible Immovable property.

Though the language is not very clear it seems to us probable that the Legislature intended to distinguish between vested and contingent interests

in Immovable property. In the case of the latter all sales were made compulsorily registrable, but in the case of the former only sales of the value of

Rs. 100 and upwards. The effect of this was to preserve the distinction created by Sections 17 and 18 of the Registration Act, and Section 54 was

no doubt enacted with reference to those provisions.

It would be very anomalous if the transfer of an hypothecation should require registration when the original hypothecation did not require it.

Taking this view, we are of opinion that the registration of Exhibit A was not compulsory. We reverse the decrees of the Courts below and

remand the suit to the Court of First Instance bo be heard on the merits. The District Munsif will provide for all costs hitherto incurred in his final

decree.

[1]

[Section 8: Unless a different intention is expressed or necessarily implied, a transfer of

Operation of transfer property passes forthwith to the transferee all the interest

which the transferor is then capable of passing in the property,

and in the legal incidents thereof.

Such incidents include, where the property is land, the easements annexed thereto, the

rents and profits thereof accruing after the transfer, and all things attached to the earth;

and, where the property is machinery attached to the earth, the moveable parts thereof;

and, where the property is a house, the easements annexed thereto, the rent thereof

accruing after the transfer, and the locks, keys, bars, doors, windows and all other things

provided for permanent use therewith;

and, where the property is a debt or other actionable claim, the securities therefore

(except where they are also for other debts or claims not transferred to the transferee), but

not arrears of interest accrued before the transfer;

and, where the property is money or other property yielding income, the interest or

income thereof accruing after the transfer takes effect.]

[2]

[In (1906) P.R. 1 it was observed, ""In 18 Mad., 454 the original bond was for Rs. 87.

further, it is not clear whether Rs. 70 in that judgment is a misprint or clerical error for

Rs. 87. It is imposiible to support the view that what is sold is the debt and bot the charge

on property. What is assigned is an interest in Immovable property within the meaning of

section 17(b) of the registration Act.""]

[3]

[Section 54: ""Sale"" is a transfer of ownership in exchange for

Sale"" defined. a price paid or promised or part-paid and part-promised.

Such transfer, in the case of tangible immovables property of the value of one hundred

sale how made. rupees and upwards, or in the case of a reservsion or other

intengible thing, can be made only by a registered instrument.

In the case of tangible Immovable property of a value less than one hundred rupees,

such transfer may be made either by a registered instrument or by delivery of the property.

Delivery of tangible Immovable property takes place when the seller places the buyer

or such person as he directs, in possession of the property.

A conract for sale of Immovable property is a conract

Contract for sale that a sale of such property shall take place on terms settled

between the parties.

It does not, of itself, create any interest in or charge on such property.]