Are you curious to know what is relinquishment deed? You have come to the right place as I am going to tell you everything about relinquishment deed in a very simple explanation. Without further discussion let’s begin to know what is relinquishment deed?
A relinquishment deed is a legal document that might not be as well-known as a sale deed or a gift deed, but it holds immense significance in matters of property and inheritance. In this blog, we will explore what a relinquishment deed is, why it’s used, and how it impacts property ownership and inheritance.
What Is Relinquishment Deed?
A relinquishment deed is a legal instrument used in India to transfer an individual’s share or interest in a property, usually in favor of another co-owner or family member. This deed is most commonly associated with ancestral or jointly-owned properties, where multiple family members hold a stake in the real estate.
Key Elements Of A Relinquishment Deed:
- Relinquisher: The person who voluntarily gives up or relinquishes their share or interest in the property is referred to as the “relinquisher.”
- Relinquishee: The individual who receives the relinquished share or interest is termed the “relinquishee.”
- Property Details: The relinquishment deed should contain a comprehensive description of the property, including its location, dimensions, and any related documentation like title deeds or survey numbers.
- Share Percentage: The document must specify the percentage of the share being relinquished by the party.
- Consideration: Although it is often used for a gift, a relinquishment deed may involve consideration or a monetary exchange, in which case the amount should be mentioned.
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Why Use A Relinquishment Deed?
Relinquishment deeds serve several essential purposes:
- Division of Inherited Property: In joint or ancestral properties, multiple legal heirs may own a share. If one or more legal heirs wish to give up their stake to another co-owner, a relinquishment deed allows for an organized transfer of ownership.
- Resolving Property Disputes: In some cases, a relinquishment deed can help settle disputes among co-owners. For example, if one sibling does not want to retain ownership and voluntarily gives up their share to another, this can avoid lengthy legal battles.
- Tax Implications: Relinquishing a property share through a deed may have specific tax implications, which should be considered when making the decision.
- Succession Planning: As part of estate planning, individuals might use a relinquishment deed to pass on their property shares to specific family members or beneficiaries, allowing for a smoother transition of property ownership after their demise.
The Legal Process
Creating a relinquishment deed typically involves these steps:
- Drafting: The relinquishment deed should be drafted, detailing the property, the relinquisher, the relinquishor, the reason for the relinquishment, and the terms of the agreement.
- Stamp Duty and Registration: The deed must be executed on a non-judicial stamp paper, the value of which varies based on state laws. After drafting, it should be registered with the Sub-Registrar of Assurances in the area where the property is located.
- Witnesses: The deed should be signed in the presence of two witnesses, who should also sign the document.
- Delivery: After execution, the relinquishment deed should be delivered to the relinquishor.
Conclusion
A relinquishment deed is an invaluable legal instrument that simplifies the process of property transfer, settlement of disputes, and inheritance planning, particularly in situations involving jointly-owned properties. It provides a structured and legally recognized way for individuals to give up their share in favor of other co-owners or beneficiaries. However, the creation and execution of a relinquishment deed should be carried out with careful consideration of the legal, financial, and familial implications to ensure a smooth and lawful transfer of property interests.
FAQ
Is Relinquishment Deed Enough To Sell Property?
A release deed would be governed by the Transfer of Property Act, 1882. A release deed, also known as a relinquishment deed, for an immovable property is a valid, legitimate document recognized under law in India.
Is Relinquishment Deed Mandatory?
Relinquishment deed is an essential legal document that is mandatory to get registered at the concerned sub-registrar office under “Section 17 of the Registration Act, 1908”. An heir can transfer or release his constitutional right of the inherited property through the Relinquishment deed (legal document).
Is Relinquishment Deed Valid?
A Relinquishment deed is a legal document created when any co-owners of an inherited property want to give up their rights and claims on the property and transfer it to another co-owner. It must be registered in court to be legally valid.
What Happens After Relinquishment Deed?
In a registered relinquishment deed, legal heirs relinquish their share of the property and other assets in favor of another legal heir(s). Gupta says, “Making a registered relinquishment deed involves payment of stamp duty and registration fees. The charges vary from state to state.”
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