If you are stuck in such a situation, here is what to do.

Mr. Sameer recently reached out with a common but important query regarding inherited property. His father, Mr. Verma, passed away a few years ago, leaving behind a residential flat in the city of Navanagar. After his father’s demise, the family obtained a letter of heirship from the Navanagar Development Authority. Consequently, the flat’s ownership was officially recorded in the joint names of Mr. Sameer, his sister Ms. Priya, and their mother, Mrs. Verma.

Now, both Mr. Sameer and Ms. Priya wish for their mother to be the sole and absolute owner of the property. They want to transfer their respective shares to her. They are unsure about the most appropriate and efficient legal method to achieve this. The primary confusion lies in choosing between executing a Release Deed (also known as a Relinquishment Deed) or a Gift Deed.

Advice in such cases

When legal heirs who are co-owners of a property wish to transfer their share to another co-owner, they have a couple of options. Understanding the difference is key to making an informed decision.

• Release Deed (Relinquishment Deed): This legal instrument is used when one co-owner of a property wants to release or relinquish their share in favour of the other co-owners. Since Mr. Sameer and Ms. Priya are already co-owners along with their mother, this is a very suitable option. In many states, a Release Deed executed in favour of a close family member (like a mother or sibling) attracts nominal or significantly lower stamp duty compared to a Gift Deed.
• Gift Deed: A Gift Deed is used to transfer ownership of a property from one person to another without any payment or consideration. While this is also a valid method, it is a general instrument for transferring property. The stamp duty for a Gift Deed is typically calculated on the market value of the property being gifted. Although some states provide concessions for gifts between close relatives, a Release Deed is often the more direct and cost-effective route in a co-ownership scenario like this one.
• Recommendation: In this specific situation, a Release Deed is generally the preferred choice. It specifically addresses the scenario of a co-owner exiting their claim, which is precisely what Mr. Sameer and Ms. Priya intend to do.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

Applicable Sections of Law

The transfer of immovable property in India is governed by a well-defined legal framework. Key statutes applicable to this case include:

• The Transfer of Property Act, 1882: This Act governs the transfer of property. Sections concerning ‘Gifts’ are particularly relevant if that route is chosen.
• The Indian Succession Act, 1925: This Act dictates how the property of a deceased person devolves upon their legal heirs in the absence of a will (intestate succession).
• The Registration Act, 1908: Section 17 of this Act makes it compulsory to register documents like Release Deeds and Gift Deeds that create, declare, or extinguish any right, title, or interest in an immovable property. An unregistered deed has no legal validity.
• State-Specific Stamp Acts: Stamp duty is a state subject, and the amount payable on a Release Deed or Gift Deed varies significantly from one state to another. The applicable Stamp Act of the state where the property is located will determine the financial implications.

If you are the complainant

In this context, “complainant” refers to the individuals initiating the transfer, i.e., Mr. Sameer and Ms. Priya. If you are in their position, here are the steps to follow:

• Have a clear and mutual agreement with all co-owners involved.
• Gather all necessary property documents, including the original title deed and the letter of heirship.
• Decide on the legal instrument (preferably a Release Deed in this case) after discussing the stamp duty implications.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.
• The lawyer will draft the deed, which must be executed by the releasing parties (the children) and the beneficiary (the mother) in the presence of two witnesses.
• Proceed with the registration of the deed at the Sub-Registrar’s office.

If you are the victim

Here, “victim” can be understood as the beneficiary of the transfer, i.e., Mrs. Verma. If you are the one receiving the property share, your role is equally important:

• Ensure you are a party to the deed and understand its contents and implications fully.
• Be present during the execution and registration of the deed, along with the other parties and witnesses.
• Your identity and address proof will be required for the registration process.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.
• After registration, obtain the registered deed and apply for mutation of the property records at the local municipal or development authority to have the property recorded solely in your name.

How the police behave in such cases

The police have no role or jurisdiction in legitimate civil transactions like the transfer of property between family members through a Release Deed or Gift Deed. This is purely a matter for the parties involved and the civil authorities, specifically the office of the Sub-Registrar for registration and the municipal body for record-keeping. Police intervention would only be warranted if there were allegations of a criminal nature, such as fraud, forgery, coercion, or criminal intimidation related to the property transfer, none of which are present in this scenario.

FAQs people normally have

Here are some frequently asked questions in such situations:

• Is a Release Deed legally binding?
  Yes, once a Release Deed is properly executed on appropriate stamp paper, signed by all relevant parties and two witnesses, and registered with the Sub-Registrar, it is a legally valid and binding document.
• Are there any tax implications?
  For the recipient (the mother), receiving property from close relatives (like children) is exempt from income tax under the Income Tax Act. For the children releasing their share, there is no capital gains tax as this is a transfer within the family without consideration, stemming from an inheritance. However, stamp duty and registration fees are mandatory costs.
• Can a Release Deed be challenged later?
  A registered deed can only be challenged in a court of law on specific grounds like fraud, misrepresentation, or coercion. If it is done with the free consent of all parties, it is very difficult to challenge successfully.

What evidence is required?

To execute and register a Release Deed, you will typically need the following documents:

• The original Sale Deed or Title Deed of the property.
• The death certificate of the original owner (the father).
• The Letter of Heirship or Succession Certificate that established the joint ownership.
• Identity proofs (like Aadhaar Card, Voter ID) of all parties involved (the mother, son, and daughter).
• Address proofs of all parties.
• PAN cards of all parties.
• Recent property tax payment receipts.
• Passport-sized photographs of all parties.

How long will the investigation take?

The term “investigation” is not applicable here; it’s a procedural timeline. The process of transferring the property involves several steps:

• Deed Drafting: A lawyer can draft the deed in 1-2 working days once all information is provided.
• Stamp Duty Payment and Registration: This involves purchasing stamp paper, paying the duty online, and booking an appointment at the Sub-Registrar’s office. The actual registration process on the appointed day usually takes half a day.
• Mutation of Records: After the deed is registered, an application must be made to the local municipal corporation or development authority to update the property records. This process, known as mutation, can take anywhere from a few weeks to a couple of months, depending on the efficiency of the local body.

Advocate Sudhir Rao, Supreme Court of India