Analysis of Section 53A of Transfer of Property Act, 1882 in

relation to the Land Development Agreement(LDA)/ Joint

Development Agreement(JDA).

Land Development Agreement(LDA)/Joint Development Agreement(JDA)

A Real Estate/Land/Joint Development Agreement (“Agreement”) is an agreement between an

individual and a construction company, city or builder to develop a parcel of land for the
individual’s personal or commercial use. The Agreement involves the submission of a
development plan by the Developer to the owner of the property. The development plan
sketches out the project and lays down the ground rules of the build, such as the time frame,
property limits etc. Once the owner approves the plan, the developer may start on the project.
The agreement contains details regarding the responsibilities of the developer and owner,
provisions regarding subcontracting, details of the work to be carried out in different phases,
etc. Further, the Agreement stipulates the duties pertaining to the keeping f books and records,
insurance, cash flow projections, etc. The developer has to develop a detailed plan for owner’s
review and approval. The plan should be made in accordance with the specific requirements of
the owner regarding the development of the property. The owner can review the plan within a
stipulated period and return to the developer for any modifications, developer shall create,
maintain and deliver the accounts, records and reports pertaining to the agreement. Prior to
commencing work, the developer has to discuss with the owner about matters relating to land
use entitlements affecting the Property. Developer may delegate or subcontract portions of its
obligations to architects, engineers, expediters, market researchers and consultants.

Section 53A of Transfer of Property Act, 1882

The Transfer of Property Act, 1982 came into force on the 1st July, 1882. The provision of
Section 53A envisages situation where under a contract for transfer of immovable property, the
purchaser has paid the price and has taken possession of the property even though the transfer
deed or conveyance has not been registered. In such cases the transferor is debarred from
agitating his title to the property against the purchaser.
53A. Part Performance. - where any person contracts to transfer for consideration any
immovable property by writing signed by him or on his behalf from which the terms necessary
to constitute the transfer can be ascertained with reasonable certainty, and the transferee has,
in part performance of the contract, taken possession of the property or any part thereof, or the
transferee, being already in possession, continues in possession in part performance of the
contract and has done some act in the furtherance of the contract, and the transferee has
performed or is willing to perform his part of the contract, then, notwithstanding that where
there is an instrument of transfer, that the transfer has not been completed in the manner
prescribed therefore by the law for the time being in force, the transferor or any person claiming
under him shall be debarred from enforcing against the transferee and the persons claiming
under him any right in respect of the property of which the transferee has taken or continued
in possession, other than a right expressly provided by the terms of the contract.
PROVIDED that nothing in this section shall affect the rights of the transferee for consideration
who has no notice of the contract or the part performance threreof.

Critical Analysis of LDA in relation to the Income-Tax Act, 1961.

The section 53A of the Transfer of Property Act, 1882 created a lots of confusion in relation to
the section 45 of Income tax Act 1961. Nowadays lots of Land/Joint Development Agreement
is being signed by the Owner and the Developer.