The Hon’ble High Court of Kerala vide judgement dated 05.08.2020 clarified various points of contentions regarding Transfer of Property Act 1882 (hereinafter referred as “Act”) and also stated that Section 57 of the Act  permits the court to declare a property free of encumbrance even against the will of the encumbrancer.

The judgement was passed in respect of an appeal filed by one M.P. Varghese, against an order of the Additional District Court, Ernakulam, disallowing the Appellant’s plea for discharge of encumbrance on his property under Section 57 of the Transfer of Property Act 1882, for effecting sale.

The Appellant’s property bore a charge of Rs. 500/- (Rupees Five Hundred Only), payable to his sister, the Respondent. This amount was charged on the property in favour of his sister in the partition deed executed by his father.

The dispute arose as the Appellant wished to sell the encumbered property so as to obtain resources for the marriage of his adopted daughter and thereby entered into an agreement for sale of the property obtained by him under the Partition Deed but that on account of the charge of Rs. 500/- on it, was unable to execute the sale deed.

Therefore, the Appellant approached the District Court, Ernakulum volunteering to deposit the amount of Rs.500/- in favour of the Respondent, so as to obtain a declaration from the said court that the property was free of encumbrance.

The District Court rejected the application filed by Appellant under Section 57 of the said Act, holding that the provision cannot be applied where a direction for payment in a partition deed was sought to be enforced.

After taking up the present matter on 15.07.2020, the Hon’ble High Court asked the Respondent if she was unwilling to accept the amount of Rs. 500/- (Rupees Five Hundred Only) from the Appellant and if so, why, to which the Respondent filed an affidavit averring that she was unwilling to accept the amount from the Appellant since there were other personal issues between them and because it had not been offered by the Appellant within the time granted in the Partition Deed.

The single bench of Justice Devan Ramchandra clarified that Section 57 of Transfer of Property Act 1882 was enacted to assist any party in the sale of an immovable property, which was subject to an encumbrance, to fructify the sale for its fair value. “Prima facie, the object of the whole of S.57 is not to disturb any vested or other rights more than is necessary, but to enable a sale to be effected and the property to be transferred to the purchaser notwithstanding there may be on the land a liability for payment of a future sum which would, but for the provisions of the section, clearly have prevented the sale of the land free from encumbrance.“, stated the Single Bench.

It was also held that Section 57 of the Act provides for sale of immovable property, both ‘by a court’ or ‘out of court’ as also ‘in execution of a decree’, and that the Act permitted the court to declare a property free of encumbrance even against the will of the encumbrancer.

Rejecting the Respondent’s reasoning in the present case and holding that the Appellant could not be put to a disadvantage merely based on the Respondent’s “personal disputes” the Hon’ble High Court held as follows, “she has no case that their personal disputes casts any obligation or encumbrance over the property of the appellant. Further, she only says that ‘her conscience is not willing to accept the money’; however, without showing any cause against its tender or deposit by the appellant.”

The present application was therefore allowed, setting aside the order passed by the District Judge; consequently, permitting the Appellant to tender the amount of Rs.500/-(Rupees Five Hundred Only) to the Respondent, by depositing it in the District Court; in which event, the same would be entitled to be withdrawn by her. It was also held that, on such payment by the Appellant, the schedule property will stand freed from the charge on it, created as per the terms of the Partition Deed.

Order: MFA.No.47 OF 2020