In its true sense, the term "property" has a broad definition. It encompasses not only money but also other tangible items of value and any unquantifiable right regarded as a form of financing or wealth. A man's exclusive title and ownership in lands and chattels. It is the right to spend and dispose of certain items in whatever way he/she wishes if he/she does not use them in any illegal way.
When things are completely ours, or when others are forbidden from tampering with them, it is evident that no one other than the proprietor, who has this entirely separate right, can declare to use them, or prevent from getting rid of it wishfully. Thus, property (movable and immovable property), viewed as an exclusive right to things, includes not only the entitlement to use such things but the right to discard them, whether by swapping them for other things, selling them without compensation to anybody else, or even tossing them away.
Property is split into two categories: real property and personal property. When it comes to commodities and chattels, the property is likewise split into absolute and qualifying categories. Absolute property is what we possess without qualification. Property is split into corporeal & incorporeal categories once more. The former includes tangible property, including lands, houses, products, merchandise, and other similar categories, while the latter includes legal rights such as choices in action, easement, etc.
What is Property?
Property, in a broad sense, is any internal or external entity held by a person or a group of people. The right of which belongs to the property owner. Property has financial, socio-political, theological, and legal ramifications. The legal domain is where the concept of ownership is established, and the idea's basic premise is that an individual has complete control over anything. The term 'thing,' over which a person has authority for use, is the most fundamental component of the notion of ownership and property. The property can be consumed, sold, rented, mortgaged, transferred, and exchanged by the owner.
There are many meanings offered in the different acts as per their usage and demands. However, there is no precise definition of the term property in the most significant legislation that deals entirely with property and rights connected to property transfer, the Property Act of 1882. However, it is defined in another statute based on its intended purpose and requirement.
Property may be traced back to the beginning of law and government. Before the law, there was no such thing as property. Property is broadly classified into two types, which are as follows:
- Movable Property
- Immovable Property
What is movable and immovable property?
According to some relevant sources, moveable property refers to jewellery, timepieces, computers, funds, etc. Section 12(36) of the General Clause Act of 1847, as well as the Transfer of Property Act of 1882, has the word "movable property” being used in it. The Indian Penal Code (IPC) defines moveable property as any corporeal property other than land and items permanently connected to the ground, as defined in Section 22.
Real estate, such as a house, storehouse, manufacturing facility, or factory, is usually referred to as immovable property. Immovable property includes trees and plants that are rooted in the ground. In the case of real estate, they are subject to legal rules as well as taxation.
What is Immovable Property?
Several Central Acts use the term "immovable property." None of those Acts, however, fully define this word. The Transfer of Property Statute is the most significant action that deals with immovable property (T.P.Act). This word is specified in exclusive terms even in the T.P.Act.
Standing wood, growing crops, and grass are not considered "immovable property" under Section 3 of that Act. As a result, the Act defines the word by omitting specific things. "Buildings" are immovable property, and equipment must be considered a component of the structure and the ground on which it is located if it is embedded in the building for its productive use.
"Immovable property" "must comprise land, advantages arising from land, and anything fixed to the earth, or curtains to everything connected to the earth," according to Section 3(26) of such General Clauses Act 1897. This isn't a complete list of immovable property definitions. "Immovable Property" is defined as "land, buildings, hereditary allowances, rights to aspects, lights, ships, fisheries, or other potentially valuable from land, as well as things attached to the ground or permanently fastened to everything affixed to the earth, but excluding standing wood, crop cultivation, or grass."
According to real estate law, the immovable property has specific ownership rights that come with the title (partial or full) to such property. Building rights, rights to collect rent, inherited privileges, rights of routes, ferries, and fisheries are only a few examples. Grass, crops, and standing wood are typically excluded from the definition.
It's the same as "real property" in many civil law systems across the world; it's the property and any substantial feature or construction up or down the surface. Personal land ownership is prohibited in some nations, such as China. People in China can pay a fee to gain land rights for a set period.
These rights can be transferred legally, such as through a gift or a sale. They could own homes, buildings, or flats, but not the land on which they are built. Immovable property is also defined as a total estate in the United States and is also referred to as property in the United Kingdom.
The Transfer of Property Act of 1882 defines a transfer as "an operation by which a real person transmits property towards one or more other people who are alive, or oneself and one or more of these living persons, mostly in the present reality," and "to transmit the property" means "to do such act." A living person is defined as a corporation, organization, or a group of persons, whether they are incorporated.
The term "property" is not defined in the Act, but it has been given a broad definition encompassing all types of properties. Both tangible and intangible assets, such as copyrights, tenancies, and so on, are included in the definition of property.
Difference between movable and immovable property
- The movable property can be easily moved from one location to another while maintaining its capacity and quantity. An immovable property, on the other hand, cannot be readily transported from one location to another. If it is, it loses its uniqueness and transforms in shape, capability, or amount.
- Moveable property is not permanently linked to the ground and can be moved. Cars, books, and other tangible items are examples of mobile property; nevertheless, if mango trees are chopped and sold for lumber, they are deemed movable property. Immovable property is a property that is connected to the earth and cannot be relocated. If mango trees were sold for food and fruit, they were termed immovable property.
- The Indian Registration Act of 1908 makes registration of moveable property both voluntary and not required. If there is a conversion of immovable property whose subject worth exceeds Rs. 100 at any moment in time, it can register underneath the Indian Registration Act, 1908.
- Under the Andhra Pradesh General Sales Tax, 1957 and the Central Sales Tax, the mobile property is available for a fee, federal tax, or certain limitations, but the immovable property isn't subject to sales tax. Although stamp duty, as well as registration fees, must be paid under the relevant acts.
- When it comes to moveable property, the transfer is complete when the seller simply delivers it with the purpose to sell it. In the case of immovable property, the situation is different. In this case, merely delivering with the purpose to transfer does not qualify as a legitimate transfer. The acquired property must be documented in the transferee's name.
Rights of Immovable Property
- By renting out his land, a property owner is legally able to collect rent.
- The proprietor of the immovable property has the power to levy the dues if the property has also been leased out because another individual can develop it or utilize it to make money via his/her service.
- This is the commission's right to keep a vessel afloat on a water body to carry vehicles and people across one in consideration for an acceptable toll. A ferry can also be a roadway that runs from one side of a water body to the other.
- The probability of an heir-apparent inheriting an estate, the chance of a relative inheriting a legacy when a kinsman dies, or any other similar potential cannot be conveyed.
- A simple privilege of re-entry for breach of a future condition can only be passed to the property owner involved.
- An easement cannot be granted unless the dominant legacy is preserved.
- One cannot convey any interest in property that is confined in its consumption to him/her individually.
- The general principle of property transfer is that assets of any sort, whether mobile or immovable, may be exchanged. Any type of property can be passed from one party to the next.
Benefits, profits, maintenance, and so on are not transferable under the Transfer of Property Act because these are specific advantages that the individual receives and cannot be transferred to another person. If he does, the transfer will be nullified.
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Frequently Asked Questions (FAQ's)
Q-1: Is the buyer's residence status relevant in deciding whether Sec 194IA or 195 applies?
Ans – No, it is not. The seller's residence status must be determined. Sec 194IA is relevant if the seller is a citizen, while sec 195 is relevant if the seller is a non-resident.
Q-2: Is there any alternative tax rate at which you may deduct the tax?
Ans – The solution may be found in Section 195, subsections (2) and (3).
Q-3: What about the rights of a person living outside India?
Ans – Other than agricultural/plantation land or a farm home, an Indian living outside India does not need the authorization to purchase any immovable property in India.
Q-4: What about an Indian resident living outside India?
Ans – An Indian citizen who lives outside of India does not need the approval to convey immovable property to just an Indian citizen who lives in India.
Q-5: What is the permission required by an Indian?
Ans – A person of Indian ancestry living outside of India does not need the authorization to sell any immovable property in India, agricultural land, farm home, or plantation property, to a person living in India.