Right and liabilities of buyer and seller in Immovable property
Section 55 of transfer of property act 1882 describes right and liabilities of buyer and seller.
In any property transaction, buyers and sellers are subject to Right and liabilities. In the absence of a contract to the contrary, the buyer and the seller of immovable property respectively are subject to the liabilities, and have the rights, mentioned in the rules next following or such of them as are applicable to the property sold.
Liabilities of buyer :-
According to section 55(5) of transfer of property act 1882
- Liability to disclose facts– To disclose to the seller any fact as to the nature or extent of the seller’s interest in the property of which the buyer is aware, but of which he has reason to believe that the seller is not aware, and which materially increases the value of such interest. In the case of Hazi isha V/s Daya Bhai (A.I.R 1896 mumbai 522) it has been held that it is the duty of the buyer that he should provide all information related to ownership which he is in know, to the seller. This arrangement is based on the principle of equity and relations of believe between buyer and seller.
- Liability of payment of purchase money- To pay or tender, at the time and place of completing the sale, the purchase-money to the seller or such person as he directs: provided that, where the property is sold free from encumbrances, the buyer may retain out of the purchase-money the amount of any encumbrances on the property existing at the date of the sale, and shall pay the amount so retained to the persons entitled thereto.
- Liability to bear damages– where the ownership of the property has passed to the buyer, to bear any loss arising from the destruction, injury or decrease in value of the property not caused by the seller.
- Liability to pay due amount- where the ownership of the property has passed to the buyer, as between himself and the seller, to pay all public charges and rent which may become payable in respect of the property, the principal moneys due on any encumbrances subject to which the property is sold, and the interest thereon afterwards accruing due. In the case of Gangi V/s Govinda it was held that the buyer is liable to pay all the charges after sale. Due amount includes revenue, principal, interest etc.
Right of Buyer:-
According to section 55(6) of transfer of property act 1882
- Right to get Benefits, Rents- where the ownership of the property has passed to him, to the benefit of any improvement in, or increase in value of, the property, and to the rents and profits thereof; in “Achtak V/s Parmeshwar” it was decided that the buyer is entitled to get benefits of the maintenance done by seller.
- Right to get Interest-unless he has improperly declined to accept delivery of the property, to a charge on the property, as against the seller and all persons claiming under him, to the extent of the seller’s interest in the property, for the amount of any purchase-money properly paid by the buyer in anticipation of the delivery and for interest on such amount; and, when he properly declines to accept the delivery, also for the earnest (if any) and for the costs (if any) awarded to him of a suit to compel specific performance of the contract or to obtain a decree for its rescission.
An omission to make such disclosures as are mentioned in this section, paragraph (1), clause (a), and paragraph (5), clause (a), is fraudulent.
Liabilities of seller:-
According to section 55(1) of transfer of property act 1882
- Liability to Reveal Fault:- to disclose to the buyer any material defect in the property 1[or in the seller’s title thereto] of which the seller is, and the buyer is not, aware, and which the buyer could not with ordinary care discover; In the Case “Ganpat Ranglal V/s Mangilal Hiralal” High Court held that the seller is not bound to disclose such faults which is really known by buyer or otherwise he is in know of the information.
- Liability to Submit Document:- to produce to the buyer on his request for examination all documents of title relating to the property which are in the seller’s possession or power;
- Liability to Submit Document as to Entitlement:- to answer to the best of his information all relevant questions put to him by the buyer in respect to the property or the title thereto; in the case of Laxmidas & Company V/s D.J. Tata it has been held by the Mumbai high court that if the seller does not answer for such questions then the contract may be rescinded by the buyer.
- Liability to Excecute Conveyance:- 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;
- Liability to Protect Document:- between the date of the contract of sale and the delivery of the property, to take as much care of the property and all documents of title relating thereto which are in his possession as an owner of ordinary prudence would take of such property and documents.
- Liability to Deliver up Occupation:- to give, on being so required, the buyer, or such person as he directs, such possession of the property as its nature admits; in the case Darpan V/s Kedar Nath it has been held that if Seller does mistakes in delivering up to possession the buyer can file a suit against seller.
- to pay all public charges and rent accrued due in respect of the property up to the date of the sale, the interest on all encumbrances on such property due on such date, and, except where the property is sold subject to encumbrances, to discharge all encumbrances on the property then existing.
Right to Seller:-
According to section 55(4) of transfer of property act 1882
- Right to get Rent and Profit:- to the rents and profits of the property till the ownership thereof passes to the buyer.
- Right to get Interest on Unpaid buying money:-where the ownership of the property has passed to the buyer before payment of the whole of the purchase-money, to a charge upon the property in the hands of the buyer, any transferee without consideration or any transferee with notice of the non-payment, for the amount of the purchase-money, or any part thereof remaining unpaid, and for interest on such amount or part from the date on which possession has been delivered. In “Subba Rao V/s Vasudev Shastri” the A.P High Court decided that the seller is entitled to get interest on selling-money only when the possession of sold property is given to buyer.
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In this article
- Corporate Law
- Latest Law News & Updates
- Law Article
- Liabilities of seller
- Liabilities of buyer
- Right of Buyer
- section 55 1 a of transfer of property act
- section 55 4 )( b of transfer of property act
- Section 55 of transfer of property act 1882
- section 55(1) of TP act 1882
- section 55(1) of transfer of property act 1882
- section 55(4) of transfer of property act 1882
- section 55(5) of transfer of property act 1882
- section 55(6) of TP act 1882
- section 55(6) of transfer of property act 1882