Actionable claim

As defined under section 3 of Transfer of Property Act, 1882, “actionable claim” is a claim on which action can be initiated in a court of law for relief. It can be interpreted in this way also that it is a right of a person to initiate action in a court of law to secure his claim over a property both movable and immovable. However under the same section certain categories of claims have been excluded such as claims which have already been adjudicated and /or decreed, claims secured by any charge such as mortgage, pledge or hypothecation of property.

Strictly speaking this claim relates to only such debts or any beneficial interest in movable property which is not in actual or constructive possession of the claimant and /or is not secured by charge (pledge, mortgage, hypothecation) of movable or immovable property. It can be inherited and transferred by sale, mortgage and gift, just like other property. Transfer of this claim either by sale, mortgage or gift can be completed by simply execution of an instrument in writing to this effect. Such instrument does not need to be registered.

Examples of “Actionable Claim:-“The following claims are “actionable claims”:-

  1. Claim for arrear rent;
  2. Claim for rent to fall due in future.
  3. An option offered to repurchase the property once sold.
  4. Benefit of a contract giving option to purchase the land.
  5. When a contract for purchase of goods is endorsed by the purchaser, by writing on the back of the contract under his signature, that he has sold all his rights and interest in the goods purchased under the said contract to a certain person who is named and properly identified in such endorsement.

However the following claims are not “Actionable claims”:-

  1. A claim which is decreed.
  2. Relinquishment of interest of a member retiring from joint Hindu Family business in favor of the members who continue to be co-parceners of the same.
  3. “Right to Sue”, though it is a right but not an actionable claim.
  4. A claim for main profits.indianpropertylawyers

This article is contributed by IndianPropertyLawyers.com, simplifying property legal services. Kindly do post your comments and queries below.

Comments

  1. Respected Sir/Mam

    My question is whether though the right to sue for damages for breach of contract is a “mere right to sue”, as soon as the contractual damages are decreed by a court, they become an “actionable claim”, transferable under S. 130 TPA?

  2. iI have a query regarding actionable claim. Some of the e-commerce company provide points on purchase of products. There points can be used as cash against next purchase. My question is whether these points would qualify as actionable claim ?

  3. Anand Reddy says:

    Dear Sir/Madam,
    I have filed a Petition in Bombay High Court in the year 2011. I have exhausted all my financial resources in fighting this case over the past 6 years. My close friend who is aware of all the details of the case has offered to make a one time lumpsum payment to me and step into my shoes and carry on with the litigation started by me as he finds merit in my case and he has agreed to bear all the future costs hereinafter to secure the petition property.
    Qes. 1) Is this permitted in law?
    Qes. 2) If permitted, What should be the instrument/document that needs to be executed between me and my friend and Registered before the Sub Registrar?
    Qes. 3) What is the formal procedure that has to be complied with and adopted before the High Court?

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