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Section 46: Transfer for consideration by persons having distinct interests

Transfer of Property Act • Official Statutory Text & Practice Guide

Statutory Regulation
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Act 1882
Section 45 All 137 Sections of Transfer of Property Act Section 47

Legal Commentary & Landmark Judgments: Section 46

Section 46 regulates transfers for consideration by persons having distinct interests in property, providing that the consideration is divided in proportion to the value of their respective interests.

  • Distinct Interests Transfer: Where persons having distinct interests in property transfer their shares together for a single lump-sum consideration.
  • Proportionate Share in Consideration: The transferors are, in the absence of a contract to the contrary, entitled to share in the consideration equally where their interests were of equal value, and where such interests were of unequal value, proportionally to the value of their respective interests.
  • Actuarial Valuation: Typically applied where a life estate holder and a remainderman join together to sell unencumbered fee simple title to a third party.
Key Landmark Precedents:
  • Raja Bajrang Bahadur Singh v. Thakurain Bakhtraj Kuer, AIR 1953 SC 7: The Supreme Court noted that when a life tenant and remainderman execute a joint conveyance, Section 46 governs the equitable division of sale consideration based on actuarial value of the life estate.
  • Badri Narain Prasad Choudhary v. Kundan Kumar Choudhary, (2006) 9 SCC 327: Affirmed the application of Section 46 in dividing joint alienation proceeds.
Courtroom Practice & Strategic Litigation Guidance:

When life estate holders and remaindermen unite to sell property, execute an ancillary agreement fixing their respective shares of the sale proceeds to prevent Section 46 valuation litigation.

Section 45 All 137 Sections of Transfer of Property Act Section 47