What is the difference in property, interest in property and immovable property?

The definition in section 205, Law of Property Act 1925, is “Property includes anything in action and any interest in real and personal property. “Property is not only a thing which is the subject matter of ownership but includes also dominion or the right of ownership or of partial ownership, and as Lord Langdale said, it is the most comprehensive of all terms which can be used inasmuch as it is indicative and descriptive of every possible interest which the part can have. Law as to rights in property is classified by a division on the basis of immoveable and moveable (real and personal) property. Rights in land described as “estate in land” do not always imply only absolute ownership but also rights which fall short of it and are limited to the life of the grantee or otherwise limited in respect of time and duration or use property in all these various forms are described as “estate”. Ownership of land is thus split up into estates distinguished in point of quality (e.g., into legal and equitable estates) and in point of duration (e.g., estates in fee simple, in tail, for life or in remainder.’

Interest in property: An ownership consists of a bundle of rights, the various rights and interests in different persons, e.g., a mortgagor and a mortgagee, a lessor and a lessee, or a tenant for life and a remainderman. Absolute ownership is an aggregate of component rights such as the right of possession, the right of enjoying the usufruct of land, and so on. Any transaction not involving the interest in property will make the transaction voidable at the instance of the parties and there shall be no effective transaction.

Immovable property: it is not defined in this Act. The Transfer of Property Act does not define what immovable property is; but it states that immovable property does not include standing timber, growing crops or grass. Section 3(26) of the GENERAL CLAUSES ACT, 1897 is not an exhaustive definition. It says that “Immovable property shall include land, benefits arising out of land and things attached to the earth, or permanently fastened to anything attached to the earth.” It specifies the following as immovable property.

  1. LAND. It encompasses the upper as well as the lower surface of the earth. Any interest in the same will be treated as that of immovable property. It would include wells, streams etc.
  2. BENEFITS ARISING OUT OF LAND. This category includes everything dealing with rights and interests in land as defined above. Right to collect rent or zamindari rights are two examples.
  3. THINGS ATTACHED TO EARTH. The nature of attachment is important. This clause is explained with reference to the following three points:
    1. Things rooted in the earth like trees, shrubs but not including standing timber, growing crops and grass. Mango trees are treated as immovable properties.
    2. Things embedded in the earth like buildings, minerals etc. By ‘embedded’ we refer to things that have their foundations laid well below the surface of the earth. An anchor of a ship is not immovable property in its normal usage.
    3. Things that have been permanently fastened to anything embedded in the earth for the purpose of permanent enjoyment. For example, ceiling fans, doors and windows. If the objects that have been attached are merely transitory or not permanent and do not contribute to the value and purpose of the thing attached to, they are not immovable properties.

To determine whether a fixture is permanent or not, the following points need to be considered:

  1. Mode of Annexation: Temporary, standing on its own weight or dug in to the earth, etc.
  2. Purpose or Object of Annexation:

A definition of immovable property is also found in the Indian Registration Act , where it is provided that immovable property includes

  1. Land ,
  2. Buildings ,
  3. Hereditary allowances ,
  4. Rights  to ways , lights , ferries , fisheries , or any other benefits to arise out of land and
  5. Things attached to the  earth but not standing timber, growing crops or grass . There is difference in between tree and standing timber. Tree means which is capable of vegetation. Standing timber means dried out tree which has stopped vegetation. Two important tests must be consider for the things attached to the earth;
    1. The extent of annexation and
    2. The object of annexation.

Thus, the determination of whether the property is movable or immovable becomes a facts and circumstances question and can be decided on the case to case basis.

 

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