This article is written by Shaily Garg, a Fourth year B.Com. LLB (Hons.) Student of University Institute of Legal Studies, Panjab University, Chandigarh.
The Transfer of Property Act, 1872 primarily deals with immovable property, although certain sections also cover movable property. Section 3 of the Act interprets what an immovable property is, however, the definition is not exhaustive because it only specifies what should not be included. It states Immovable Property does not include: Standing Timber, Growing Crops, and Growing Grass.
For a valid transfer of property, first of all, its nature must be known so that the prescribed procedure could be followed. Questions related to the nature of the property have been dealt with extensively in this case before Bombay High Court in 1958.
Facts of the Case: Smt. Shantabai v. State of Bombay
The petitioner’s husband on 26th April 1948, executed an unregistered document, in favor of his wife namely Smt. Shantabai. This deed gives her the right to enter a certain area in the zamindari to cut and take out bamboo, fuelwood, and teak for consideration of ₹26,000/- for 12 years from 1948 to 1960. Madhya Pradesh Abolition Proprietary Rights (Estates, Mahals, Alienated Lands) Act was passed in 1950 under which all proprietary rights in the land were vested in the State from 31st March 1951 onwards.
After that, the petitioner was stopped from cutting any more trees and therefore she applied to Deputy Commissioner and obtained permission under Section 6(2) of the Act to resume her work in that area. However, The Divisional Forest Officer acted against her for unlawful cutting and directed that her name be cancelled and that the cut materials be forfeited. The petitioner preferred a petition under Article 32, alleging that her fundamental rights under Article 19(1)(f) and 19(1)(g) have been interfered with, and therefore, the order passed by Divisional Forest Officer be declared illegal and be set aside.
Issues of the Case
- Whether the petitioner’s Fundamental Right is been infringed by the state to an unregistered document and whether the document is leased or profit prendre?
- Is tree an immovable property and what is the distinction between tree and standing timber?
Observations of the Court
The Court observed that the unregistered document doesn’t confer any proprietary right as there were no words of transfer or conveyance in the deed. The court opined that the document was not a lease but amounted to license to enter on the land coupled with a grant to cut certain trees on it and carry away the wood in other words, it was profit-a-prendre. The rights acquired by her would-be either like some profit-a-prendre or purely personal rights under a contract.
If it is a personal right, then the State of M.P. was not the party in such a contract and the contract on the state of M.P. is not binding. In a lease, one enjoys the property but has no right to take it away. In the case of profit-a-prendre, one has a license to enter on the land, not to enjoy it but to remove something. Thus, whether the deed is a lease or license deed it requires registration.
In case of lease of immovable property for more than one year it required registration. The remaining trees covered by the grant would be immovable property and as the total value was ₹ 26,000/- The deed required registration. Hence, in any of the cases, the petitioner cannot succeed.
Therefore, the Court held that first, the petitioner must make out that there has been an infringement of some Fundamental Right. In the present case, her Fundamental Right accrued from an unregistered document which is termed as “lease deed” and the nature of the rights claimed by the petitioner has to be ascertained on a proper interpretation of the said document.
A document related to immovable property requires registration and if not registered, it is invalid. The Court observed that to bring the claim under Art. 19(1)(f) or Art. 31(1), something more must be disclosed, namely, a right to property of which one is the owner or in which one has an interest apart from a purely contractual right. Therefore, the claim founded in the contract simply disappears.
Under section 3(26) of the General Clauses Act, 1897, it would be regarded as “immovable property” because it is a benefit that arises out of the land and also because trees are attached to the earth. It is referred to as profit-a-prendre under British law. On the other hand, the Transfer of Property Act, 1882 says in section 3 that standing timber is not Immovable property for that Act and so does section 2(6) of the Registration Act, 1908.
The question was which of these two definitions is to prevail. Now it was observed that “trees” are regarded as Immovable property because they are attached to or rooted in the earth because section 2(6) of the Registration Act, 1908 expressly says so and, though the Transfer of Property Act, 1882 does not define Immovable property beyond saying that it does not include “standing timber, growing crops or grass”, trees attached to earth (except standing timber) are immovable property, even under the Transfer of Property Act, because of section 3(26) of the General Clauses Act.
It was held that exclusion was only of “standing timber” and not of “timber trees”. In the absence of a special definition, the general definition must prevail. Therefore, trees (except standing timber) are Immovable property. Therefore, the Court held that a right to enter on land to cut and carry away timber standing on it is a benefit that arises out of the land‟. Now the court was confronted with the question that whether the subject matter of that unregistered document was immovable or movable property.
At this stage, the Court felt it necessary to differentiate between a Standing Timber and a Standing Tree because it was evident that both must be different as distinction has been made under The Transfer of Property Act, which only excludes “standing timber‟ and not “timber trees‟. The court even held that level of nourishment is also one of the criteria but not sole criteria, in order to consider whether a tree is a movable or immovable property.
The sapling planted will start taking nourishment from the soil and become a fully grown tree, but no person has contended that it should be cut in a reasonable frame of time. It will be treated as immovable property, as we are considering it as a timber tree and not a standing timber. And if you have developed an intention within a reasonable short period of time to cut it down and the tree itself has fully grown and ready for the timber purpose. Then the court will consider that timber tree as standing timber, and fall under the ambit of movable property.
It is evident the trees which are not fit for cutting today for timber purpose, might be fit after a period of 12 years but it is not a mere sale of trees as good, but rather it is more. The whole document has to be read together. It is not just a right to cut the tree but also to derive profit from the soil itself.
The trees below the height of 12 feet will in the next 12 years derive the nourishment from the soil to grow. In the shape of nourishment in the soil, goes to the tree. And hence an interest or benefit is being derived out of the land itself. This benefit arising out of the land is mention in the General Clauses Act, in the definition of immovable property. On this very logic, the court is saying that the right is in the immovable property.
It was concluded that trees are immovable property. There is a difference between a standing tree and a standing timber, wherein the former is an immovable property and the latter is a movable property. In case the nature of the tree is ambiguous, the courts apply the intention test. In the case of a lease, one enjoys the property but has no right to take it away. In a profit-a-prendre, one has a licence to enter on the land, not to enjoy it but for removing something. Deed for transferring the right requires registration and an unregistered deed confers no right.