Law: The Transfer of Property Act (IV of 1882)

Section: 55

Law: Transfer of Property (Pakistan) Ordinance (IV of 1947)

Section: 3

  (a) Transfer of Property Act (IV of 1882), S. 55-Transfer of Property (Pakistan) Ordinance (IV of 1947), S. 3-Vendee not bound to pay purchase price before vendor produces certificate from Income Tax authorities-Mere execution of sale-deed, without regis tration, not sufficient compliance with S. 55.   Held, that the vendee is not bound to pay the purchase price before a certificate from the, Income-tax authorities is obtained.   According to Ss. 3 and 4, Transfer of Property (Pakistan) Ordinance (IV of 1947) the amount of Income-tax becomes a charge on property which is to be transferred or which is transferred. The vendor is bound to discharge all burdens on the property which is to be transferred and therefore the vendee can demand before he accepts the property that either the amount of income-tax is paid or a security is furnished so that henceforth the amount is not liable to be recovered from the property transferred.   The vendor agreed to sell a building to the vendee at a price of Rs. 38,000, of which amount the vendee paid Rs. 3,800 as earnest money, the balance being receivable "within a fortnight". The vendor also undertook to "obtain the income-tax certificate" required under S. 3, Transfer of Property (Pakistan) Ordinance (IV of 1947). In a separate writing by way of a receipt of earnest money, the vendor set down the words "proper sale-deed will be executed at the time of full payment."   The vendor, however, did not obtain the income-tax certificate, but insisted on payment of the balance of purchase-price before he would be prepared to execute the sale-deed.   Held, that according to S. 55, Transfer of Property Act (IV of 1882), the seller is bound, inter alia, in the absence of a contract to the contrary, "on payment or tender of the amount due in respect of the price, to execute a proper conveyance of the property when the buyer tenders it to him for execution at a proper time and place." The words used here are "proper conveyance" which mean a conveyance which transfers title. As in the case of an ordinary contract, the passing of consideration by both the…