The Forfeited Deposits Act has been incorporated on 14th June 1850. In case of real estate business during Purchase of Land the buyer used to pay security deposits for the completion of the purchase and a part payment of purchase-money. In case of any breach of Contract or agreement the amount deposited will be refunded to the buyer which means Forfeited of Deposits. This Act deals with such forfeited deposits on sale of land.
This Act has been established for the Forfeiture of Deposits to the Government in pursuance to the incomplete sale of land. This Provision was made under the Regulation VII of The Bengal Code (The Bengal Patni Taluks Regulations, 1819).
Initially, the Tenure-Holders and Patnidars were taking pleasure in this Regulation deceitfully with this Regulation. They were thinking that the Forfeited Deposits were for arrears of rent and they started believing as though this applied to as purchase-money.
In order to keep a full stop to this deceitful enjoyment this Act has been enacted. This Regulation VIII of the 1819 Act permitted the Forfeited Deposits on land sale to be applied as purchase-money. But the enactment of this Act made it very clear that the Forfeited Deposits were to be used in pursuance to cost of sales and the remaining has to be forfeited to the Government.
This Act had lost its significance after Independence in 1947. They were repealed by the Repealing Act, 1870. The Law Commission recommended certain obsolete Laws which are of no use should be repealed immediately to the Minister of Law & Justice. In the list of Obsolete Laws in the Law Commission’s 248th report contains this Act.
by C.Srivenkatesh Prabhu