Exchanges MCQ Quiz - Objective Question with Answer for Exchanges - Download Free PDF

The correct answer is Option 4.

Key PointsSection 118 of the Transfer of Property Act, 1882:
“Exchange” defined.—
When two persons mutually transfer the ownership of one thing for the ownership of another, neither thing or both things being money only, the transaction is called an “exchange”. A transfer of property in completion of an exchange can be made only in manner provided for the transfer of such property by sale. 

The correct answer is 'Both (A) and (B)'

Key Points

• Charge under the Transfer of Property Act:
  • A charge is an interest or right created over a property to secure the payment of money or the performance of an obligation.
  • It is not the same as a mortgage, as a charge does not transfer the property interest to the charge holder.
  • Charges can be created by the act of parties or by operation of law.

Additional Information

• Act of parties:
  • This occurs when individuals or entities intentionally create a charge through an agreement or contract.
  • For example, a borrower and lender may agree to create a charge over a property as security for a loan.
• Operation of Law:
  • A charge can also be created automatically by law without any agreement between parties.
  • For instance, statutory charges are imposed by laws such as tax liens or charges for unpaid municipal dues.
• Incorrect Options:
  • Option 1 (Act of parties): This is partially correct but does not cover the entire scope as charges can also be created by operation of law.
  • Option 2 (Operation of Law): This is also partially correct but does not consider charges created by the act of parties.
  • Option 4 (Neither (A) nor (B)): This is incorrect as both methods are valid ways to create a charge.

Key Points

•  Section 118 deals with the definition of 'exchange'.
• According to Section 118, an "exchange" occurs when two persons mutually transfer the ownership of one thing for the ownership of another. In this transaction, neither thing or both things can be money only. Therefore, option B correctly represents the definition provided in Section 118.
• Example: Person A owns a piece of land, and Person B owns a residential house. They decide to exchange their properties. According to the Transfer of Property Act, when Person A transfers the ownership of their land to Person B, and Person B transfers the ownership of their residential house to Person A, this transaction is considered an "exchange" under the Act.

The correct answer is Section 121.

Key Points

• Section 121 of the Transfer of Property Act, 1882, provides for the Exchange of money.
• It states that —On an exchange of money, each party thereby warrants the genuineness of the money given by him. 

The correct answer is Section 121.

Key Points

• Section 121 of the Transfer of Property Act deals with exchange of money.
• It states that on an exchange of money, each party thereby warrants the genuineness of the money given by him.

Key Points

•  Section 118 deals with the definition of 'exchange'.
• According to Section 118, an "exchange" occurs when two persons mutually transfer the ownership of one thing for the ownership of another. In this transaction, neither thing or both things can be money only. Therefore, option B correctly represents the definition provided in Section 118.
• Example: Person A owns a piece of land, and Person B owns a residential house. They decide to exchange their properties. According to the Transfer of Property Act, when Person A transfers the ownership of their land to Person B, and Person B transfers the ownership of their residential house to Person A, this transaction is considered an "exchange" under the Act.

The correct answer is Section 121.

Key Points

• Section 121 of the Transfer of Property Act, 1882, provides for the Exchange of money.
• It states that —On an exchange of money, each party thereby warrants the genuineness of the money given by him. 

The correct answer is Chapter VI

Key PointsSection 118 “Exchange” defined
When two persons mutually transfer the ownership of one thing for the ownership of another neither thing or both things being money only, the transaction is called an "exchange".
A transfer of property in completion of an exchange can be made only in manner provided for the transfer of such property by sale.]

 Additional InformationSection 119. Right of party deprived of thing received in exchange.
Section 120. Rights and liabilities of parties.
Section 121. Exchange of money. 

Key Points

•  Section 118 deals with the definition of 'exchange'.
• According to Section 118, an "exchange" occurs when two persons mutually transfer the ownership of one thing for the ownership of another. In this transaction, neither thing or both things can be money only. Therefore, option B correctly represents the definition provided in Section 118.
• Example: Person A owns a piece of land, and Person B owns a residential house. They decide to exchange their properties. According to the Transfer of Property Act, when Person A transfers the ownership of their land to Person B, and Person B transfers the ownership of their residential house to Person A, this transaction is considered an "exchange" under the Act.

The correct answer is Section 121.

Key Points

• Section 121 of the Transfer of Property Act, 1882, provides for the Exchange of money.
• It states that —On an exchange of money, each party thereby warrants the genuineness of the money given by him. 

The correct answer is Section 121.

Key Points

• Section 121 of the Transfer of Property Act deals with exchange of money.
• It states that on an exchange of money, each party thereby warrants the genuineness of the money given by him.

The correct answer is Exchange of money – S. 120

Key Points

• Exchange of money – Section 120 Incorrectly matched.
• Section 120 of the Transfer of Property Act, 1882 does not deal with exchange of money.
• It actually deals with unfulfilled conditions in a gift.
• Exchange of money is not specifically covered under this section.

Additional Information

• Direction for accumulation – Section 17 Correctly matched.
• Section 17 talks about limiting the time for which income from property can be directed to accumulate.
• Mortgagor’s power to lease – Section 65-A Correctly matched.
• It provides that the mortgagor in possession has limited power to lease the mortgaged property, subject to conditions.
• Transfer by one co-owner – Section 44 Correctly matched.
• This section explains that a co-owner can transfer his share in the immovable property, and the transferee gains the same rights.

The correct answer is Option 4.

Key PointsSection 118 of the Transfer of Property Act, 1882:
“Exchange” defined.—
When two persons mutually transfer the ownership of one thing for the ownership of another, neither thing or both things being money only, the transaction is called an “exchange”. A transfer of property in completion of an exchange can be made only in manner provided for the transfer of such property by sale. 

The correct answer is 'Both (A) and (B)'

Key Points

• Charge under the Transfer of Property Act:
  • A charge is an interest or right created over a property to secure the payment of money or the performance of an obligation.
  • It is not the same as a mortgage, as a charge does not transfer the property interest to the charge holder.
  • Charges can be created by the act of parties or by operation of law.

Additional Information

• Act of parties:
  • This occurs when individuals or entities intentionally create a charge through an agreement or contract.
  • For example, a borrower and lender may agree to create a charge over a property as security for a loan.
• Operation of Law:
  • A charge can also be created automatically by law without any agreement between parties.
  • For instance, statutory charges are imposed by laws such as tax liens or charges for unpaid municipal dues.
• Incorrect Options:
  • Option 1 (Act of parties): This is partially correct but does not cover the entire scope as charges can also be created by operation of law.
  • Option 2 (Operation of Law): This is also partially correct but does not consider charges created by the act of parties.
  • Option 4 (Neither (A) nor (B)): This is incorrect as both methods are valid ways to create a charge.

The correct answer is By Sale.

Key Points

• The provision regarding the exchange of property is governed by Section 118 of the Transfer of Property Act, 1882. An exchange involves the mutual transfer of ownership of one property for another, where neither transfer is money alone.
• The completion of a transfer in an exchange must follow the same manner prescribed for the transfer of such property under a sale. For instance:
  • If the property is immovable and its value is ₹100 or more, the transfer must be completed through a registered instrument.
  • If the property is movable, it may be transferred by delivery of possession or as per other applicable laws.
  • This ensures that the legal formalities and requirements for a valid transfer in an exchange align with those applicable to a sale transaction.
• The modes listed in the other options (mortgage, gift, lease) are separate forms of transfer and do not apply to the completion of an exchange.