Section 17 Of Transfer Of Property Act 1882 Direction Of Accumulation

Section 17 Of Transfer Of Property Act 1882 Direction Of Accumulation

Where the terms of a property direct that the income arising from the property shall be accumulated either wholly or in part during a period longer then the life of the transferor , or a period of eighteen years from the date of the transfer , such direction shall , save as hereinafter provided , be void to the extent to which the period during which the accumulations is directed , exceeds the longer of the aforesaid periods, and at the end of such last mentioned period the property and the income thereof shall be disposed of as if the period during which the accumulation has been directed to be made had elapsed.



Direction Of Accumulation

When The Property Is Transferred With Out Consideration Or By way Of Gift
When Property Is Transferred For Consideration but they party Agreed To Accumulate the income for certain period in the deed.

This Section is an exception Of Section 11

If The Property Is Transferred With out consideration then The Donor  Can Imposed a condition relating to accumulation of the income holly or partially , For a term not more then 18 years , Or till the Donor lives .

If It is for consideration then the Accumulation will be make according to contract .

For Example 

A transfers property to b in 1940 with the direction that the income arising out of the property is to be accumulated till 1970 , for 30 years , A Dies in 1965 . the period during which the transferor is alive is more than 18 years from the date of the transfer , but Being the longer of the two periods the direction is valid till 1965 , if , however , the transferor dies in 1950 , then the longer period would be 18 years and accordingly the direction would remain valid till 1958




There are Further Exception to this Rule ,

 if the transfer is made without consideration and for
the following purpose
For the payment of the debt of the Donor  or any interest holder.
For The maintenance of his child or child of any other person who have interest over there
For the protection and maintenance of the property
are valid conditions

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