Contingent interest
Section 21 of the Transfer of Property Act, 1882 deals with contingent interest. Where, on a transfer of property, an interest therein is created in favour of a person to take effect only on the happening of a specified uncertain event, or if a specified uncertain event shall not happen, such person thereby acquires a contingent interest in the property. The Act came into force on 01 Jul 1882.
Where, on a transfer of property, an interest therein is created in favour of a person to take effect only on the happening of a specified uncertain event, or if a specified uncertain event shall not happen, such person thereby acquires a contingent interest in the property. Such interest becomes a vested interest, in the former case, on the happening of the event, in the latter, when the happening of the event becomes impossible.
Exception.-- Where, under a transfer of property, a person becomes entitled to an interest therein upon attaining a particular age, and the transferor also gives to him absolutely the income to arise from such interest before he reaches that age, or directs the income or so much thereof as may be necessary to be applied for his benefit, such interest is not contingent.
Section 21, The Transfer of Property Act, 1882 (Act 4 of 1882).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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P. K. Mohanram vs B. N. Ananthachary
Court's Decision & Legal Precedent
Where a document, styled as a settlement deed and describing itself as such, transfers property to beneficiaries with unequivocal language indicating immediate vesting of rights in praesenti ('From this day onwards...'), and contains an express and irrevocable prohibition against the settlor's right to cancel or alter the terms ('I shall have no right whatever to cancel this settlement deed for any reason whatsoever or to alter these terms'), such document creates vested interests in the beneficiaries despite postponement of absolute enjoyment until after the settlor's death. The postponement of enjoyment does not render the interests contingent under Section 21 of the Transfer of Property Act, 1882, but rather indicates the settlor retained a life interest while irrevocably transferring the remainder. The nature of the instrument is determined by examining the substance of the document as a whole, not its form or nomenclature, and courts must apply a presumption in favour of vested interests unless the intention to the contrary is definite and clear. Such a settlement deed cannot be revoked or altered by subsequent instruments (revocation deed or will) because the irrevocable language demonstrates the settlor divested themselves of all right to revoke, making the transfer effective in law immediately upon execution.
On this section: Court distinguished that contingent interests arise only when rights depend on the happening of a specified uncertain event. In this case, the settlement was not contingent on any uncertain event but was immediate, with postponement of enjoyment due to the settlor's life interest only.
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P. K. Mohanram vs B. N. Ananthachary
Court's Decision & Legal Precedent
A document creating immediate rights in favor of beneficiaries in praesenti, coupled with an explicit prohibition against revocation by the settlor, constitutes a settlement deed and not a will, even if the enjoyment of the property is postponed until after the settlor's death. The substance and intention of the document, as gathered from a comprehensive view of all its terms, is determinative of its character, not its nomenclature or form. An interest created in a settlement deed is vested, not contingent, when the beneficiary acquires a present right to future enjoyment, and such vested interest is not defeated by postponement of enjoyment or by the death of the beneficiary before obtaining possession.
On this section: Court used this section to distinguish contingent interests (dependent on uncertain events) from vested interests. The court found that the interests created in the settlement deed were vested, not contingent, because they were not dependent on uncertain events but on the certain event of the settlor's death.
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Usha Subbarao vs B. E. Vishveswariah
Court's Decision & Legal Precedent
Where a testator makes a bequest of property to his sons with postponement of enjoyment and partition but directs that the income from the properties be applied for the benefit of the sons and their mother, and the sons are under an obligation to maintain their mother, the bequest constitutes a vested interest in the sons on the testator's death, not a contingent interest. The vesting of the interest is not defeated by the postponement of enjoyment or partition, and the interest passes to the legal representatives of a son who dies before the time of enjoyment. The presumption in favor of early vesting of testamentary gifts applies, and the court should not infer an intention to create a contingent interest unless such intention is definite and clear from the terms of the Will.
On this section: Defines contingent interest as an interest created to take effect only on the happening of a specified uncertain event. The Court used this definition to distinguish the bequest in the Will from a contingent interest.
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Questions about Section 21
What have the courts held on Section 21 of the Transfer of Property Act?
P. K. Mohanram vs B. N. Ananthachary (15 Mar 2010) is the leading judgment on this section among those set out below: Court distinguished that contingent interests arise only when rights depend on the happening of a specified uncertain event. In this case, the settlement was not contingent on any uncertain event but was immediate, with postponement of enjoyment due to the settlor's life interest only. Another 2 judgments on this section are set out below, all of them from the Supreme Court. They run from 1996 to 2010.
How do I find court cases under Section 21 of the Transfer of Property Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: TP Act 21, section 21 TP Act, section 21 of the Transfer of Property Act. People searching for it also type tampa 21 day forecast. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 3 reported judgments on this section are set out on this page, beginning with P. K. Mohanram vs B. N. Ananthachary (15 Mar 2010).
What should I read with Section 21 of the Transfer of Property Act, and has it changed?
1 other provision in this corpus refers back to it.
When did Section 21 of the Transfer of Property Act come into force?
Section 21 of the Transfer of Property Act, cited as TP Act 21, came into force on 01 Jul 1882, having been enacted on 17 Feb 1882. It is in force as at the date shown on this page.
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Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.