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The doctrine of election is stated in Sec. 35 of the Transfer of Property Act alongside
Section 180 to 190 of the Indian Succession Act.
It states that when a party transfers a property over which he does not hold any right
of transfer and entailed in that transaction is the benefit conferred upon the original
owner of the property, such title-holder must elect his option to either validate such
transfer of property or reject it; upon rejection, the benefit shall be relinquished back
to the transferor subject nevertheless :
Where the transfer has been through gratuitous means and the transferor
has become incapable of making a new transfer.
EXCEPTIONS
When the owner who is considering the election between retaining the property and
accepting a particular benefit, chooses the former, he is not bound to relinquish any
extraneous benefit that he gains through the transaction.[iii]
The acceptance of the benefit by the original owner shall be deemed to be as
election by him to validate the transfer, if he is aware of his responsibilities and the
circumstances that might influence a prudent man into making an election. [iv]
This knowledge of the circumstances can be assumed if the person who gains the
benefit enjoys it for a period of more than two years. Further discussion over this has
been made under the heading of Modes of Election.
If the original owner does not elect his option within a year of the transfer of property,
the transferor would require him to elect his choice. Even after the reasonable time, if
he still does not also still elect, the original owner shall be assumed to have elected
the validation of the property transfer as his choice.[v]
In context of a minor, the period of election shall be stalled till the individual attains
majority unless he is represented by a guardian[vi].
As a part of the same transaction, he must confer some benefit on the owner
of the property and
Such owner must elect either to confirm such transfer or to dissent from it.
Donors Intention
In order to create a situation of election, it is important that the intention of the
testator should be clear with regard to disposing of the property which he does not
own. [xviii] Parol evidence is not acceptable and thus the intention must be prima
facie clear. [xix] [xx]
Indirect Benefit
The benefit that the original owner is conferred with has to be direct in nature and if
indirect, he does not need to elect.[xxi] This principle is explained in Section 184 of
Indian Succession Act, 1925 and states that when the devisee who claims
derivatively through another does not take under the deed, and is not bound by the
equity attaching thereto.[xxii]
Difference in Capacity
An individual can in one capacity utilize a benefit while can dissent or reject that
benefit in another capacity[xxiii]. It means to explain that it is possible to facilitate two
roles of an individual wherein he can for example, accept legacy for an estate while
in his personal competence, he could retain the property.[xxiv]
Modes of Election
The election by the owner can either be direct or indirect. In direct election, it is
simply through communication about the elected choice or option. Though, in case of
an indirect election, the acceptance of the benefit by the original owner is subject to
two conditions:
1. He has to be aware of his duty to elect, and
2. There must be proof of knowledge of circumstances which would influence the
judgment of a reasonable man in making an election : [xxv]
Enjoyment for two years of the benefit by the person on whom it is conferred with any
dissent.[xxvi]
The election shall be presumed when the donee acts in such a manner with the
property gifted to him that it becomes impossible to return it to the original owner in
its original state.[xxvii]
Difference between English Law and the Indian Law Perspective
The English law depends upon the principle of compensation which means that if the
original owner does not choose to validate the transfer, he can keep the property and
also the benefit accrued, subject to compensation provided to the donee, to the
extent of the property he had suffered a loss for.
But in the Indian law context, this doctrine is influenced by the principle of forfeiture
which states that if the original owner does not choose to validate the transfer, the
donee incurs a forfeiture of the conferred benefit which goes back to the transferor.
[xxviii]
COMPENSATION
Estimated cost of the property which is attempted to be transferred towards the
transferee is the approximation of the compensation that he shall receive. However,
in context of immovable properties, there arises the issue of changing value of the
property according to the lapse of time. Thus, this valuation is to take place at the
date of the instrument becoming operational rather than at the time of election[xxix].
CONCLUSION
Section 35 of the Transfer of Property Ac, 1882 explains the concept of the Doctrine
of Election. This project tries to deal with the various nuances involved in the doctrine
through the usage of various landmark judgments. Herein, special emphasis has
been placed upon providing a clear understanding of the conditions necessary for
the election by the original owner to take place. The differences between the Indian
Law perspective as well as the English Law perspective is brought out through
critical analysis of the provisions i.e.
[vii] Darashaw J. Vakil, The Transfer of Property Act ( 2nd Edn. Wadhwa Nagpur
2004) 334.
[viii] Ibid.
[ix] Beepathuma ( C ) v. VS Kadambolithiya [1964] 5SCR 836,850, AIR 1965 SC 241;
Codrington v. Codrington (1857) 7 HL 854, 861.
[x] Nihar v. Anath Nath, AIR 1956 Pat 223 (226) (DB) : 1956 BLJR 177.
[xi] Ibid.
[xii] Dhanpatti v. Devi Prasad 1970 (3) SCC 776 (778)
[xiii] Mst Dhanpatti v. Devi Prasad (1970) 3 SCC 779; Mohomed Ali v Nissar Ali
(1927) 109 IC 835, AIR 1928 Oudh 67, 82
[xiv] Salil Paul, Mulla the Transfer of Property Act ( 9th Edn. Butterworths 2005) 249.
[xv] B.B Mitra, Transfer of Property Act (18th edn, Kamal Law House 2007) 204.
[xvi] AIR 1922 Mad 357 (358) : 64 IC 481
[xvii] 36 MLJ 507; 49 IC 527
[xviii] Rancliffe v. Parkins 6 Dow 179
[xix] Stratton v Best 1 Ves 185
[xx] B.B Mitra, Transfer of Property Act (18th edn, Kamal Law House 2007) 205.
[xxi] G.C.V SubbaRao, Law of Transfer of Property (4th edn, Universal Law
Publishing 2010) 744.
[xxii] ibid
[xxiii] Grissel v. Swinoe (1869) 7 Eq. 291 = 17 W.R. 438
[xxiv] G.C.V SubbaRao, Law of Transfer of Property (4th edn, Universal Law
Publishing 2010) 744.
[xxv] B.B Mitra, Transfer of Property Act (18th edn, Kamal Law House 2007) 206.
[xxvi] Spread v. Webster, (1974) 2 Ves. 367 ; 30 ER 676
[xxvii] .B Mitra, Transfer of Property Act (18th edn, Kamal Law House 2007) 207.
[xxviii] G.C.V SubbaRao, Law of Transfer of Property (4th edn, Universal Law
Publishing 2010) 740.
[xxix] Re Hancock. Hancock v. Pawson (1905) 1 Ch. 16