This article is written by Anshal Dhiman, pursuing BA.LLB (Hons.). The article talks about relinquishment deeds, their basics, and when the need for such deeds may arise.
Table of Contents
Introduction
Relinquishment is an act where a co-owner of an inherited property gives up his rights, shares, claims or any position related to that particular inherited property. Relinquishment deed is a legal instrument or a legal document through which any individual can emancipate or release his legal rights on an ancestral inherited property to another co-owner of the same property. These deeds can only be executed for ancestral inherited properties, and it is also necessary that such property should be immovable in nature, as defined under Section 2(6) of the Indian Registration Act, 1908. It is necessary for a relinquishment deed to be registered under Section 17 of the Indian Registration Act, 1908.
Suppose there is Mr. A who owns a property in Delhi. After his death, the property was inherited by Mr. B and Ms. C as legal heirs. But Mr. A is not as much interested in the property as Ms. C is. So Mr. B can execute a relinquishment deed. Here Mr. B will be the executor/releasor of the rights while Ms. C will be the beneficiary/release for the same rights under the same property. It is also important to know that once such a deed is made or executed, then it cannot be revoked under the Indian Registration Act, 1908.
It is also important to note that a relinquishment can be executed only by a person who is the owner or a co-owner of the property, and the rights can also be relinquished to only such individuals who either have shares in the same property, and/or are co-owners. A deed which releases rights in favour of someone who does not have any previous shares in the property is called a gift deed and maybe differentiated from relinquishment deeds. The High Court of Delhi, in the matters of Tripta Kaushik v Sub Registrar VI-A, Delhi & Anr and Ramesh Sharma v Government of N.C.T. of Delhi & Ors. provided a distinction test to differentiate whether a deed is a relinquishment deed or a gift deed. It was held by the court that, in matters where there are more than two co-owners, if under a deed an individual relinquishes his rights in favor of only one co-owner and not all of them, then such a deed will be recognized as a gift deed and not a relinquishment deed.
When does the need for relinquishment deeds arise?
Relinquishment deeds involve ancestral properties, and cases involving ancestral properties and inheritance of such properties has always been a controversial matter in India which has caused many family problems. Now it cannot be defined practically in which particular situations a relinquishment deed may be executed, but this article will try to provide a few reasons or situations where co-owners of the property feel the need to emancipate their rights to a particular property. Relinquishment deeds are often used as a measure to divide rights by the co-owners to a property who may or may not be interested in a particular property, to avoid interference of courts in such matters, who have the powers to third person agents to act as executors.
Relinquishment deeds in matters where a co-owner is not interested in the property
It is already shown that for a relinquishment deed to be executed the property to be relinquished must be a parental/ancestral inherited property, and there must be joint ownership amongst the people who are to be part of the relinquishment deed. When two or more legal heirs inherit ancestral property after the death of the original owner has passed away, they become co-owners of the particular property and enjoy their rights or shares on the property as divided by either the will or through succession in any other way through application of succession below, as are discussed below in the article. However, in cases where any recipient of an heir to a particular property is not interested in that property, he may relinquish his rights to that property to the other co-owners. It is necessary in such cases for the deed to meet all the requirements of a valid relinquishment deed to be enforceable. It is cited above about the test Delhi High Court has established to determine whether a deed should be termed a gift deed or a relinquishment deed.
Suppose Mr. A and Mr. B are receivers of a particular property as legal heirs of Mr. C who is now deceased. The property is in Mumbai. Mr. A lives in Mumbai and Mr. B lives in Sweden. When Mr. B comes to know about his rights or co-ownership of that particular property, he expresses his disinterest in the property and wants to surrender his rights to the property. At his choice, he can sign a relinquishment deed with Mr. A to give up or surrender his rights to the ancestral property. Another question that arises here is where will the registration of the deed be done, since in this particular situation Mr. B lives outside India.
In such cases a party can take help of ‘power of attorney’, for which provisions are given in Section 32 and Section 33 of the Indian Registration Act, 1908, and in the current example, since Mr. A is in Mumbai and the property is in Mumbai too, Mr. B can authorize anyone he knows through power of attorney to register the deed on his behalf, as the executor himself is not present at the situation. In Amrit Narayan vs. Gaya Singh, guardian of a minor held a compromise with the female holder under which the properties were relinquished to other members of the family. The minor had reversion over the properties. By a suit by him, it was held by the court that he had no interest in the property until the holder was alive, and that his right was solid only after the death of the holder, and the compromise between the guardian and the female holder was held to be void.
Relinquishment deeds in matters where the owner of the property dies without a valid will
A will is an important part of a succession. In cases where there is no will or where there is a will but it cannot be executed due to any reason, then the succession is completed through intestate succession. Succession in such cases may be determined through either Indian Succession Act, or any personal law (Hindu, Muslim etc.) which are different for different families and different religions. In such cases, the court jumps in and decides the division of assets of the deceased party. A court can distribute assets of the deceased through a letter of administration. The estate can be divided amongst either one legal heir or more in case they make application to the authorized court. But it is important to know that not always the division done by the court will be satisfactory to the heirs. In cases where heirs are not satisfied with the court’s distribution they can execute a relinquishment deed amongst themselves to divide the shares of the properties that have been left by the deceased.
Suppose Mr. A from the example given above dies without a written will and no executor (or if the executor of the will is deceased at the time as well), the legal heirs approach the court to claim their rights over the assets held by Mr. A. If they are unsatisfied by the ownership rights as divided by the courts, they can sign a relinquishment deed by themselves to emancipate as much rights to the property as they may deem fit. As stated above, such a relinquishment deed can be executed only in the matters of immovable property, and it cannot be used to transfer the title of the property to anyone other than the ancestral inheritors or legal heirs. In the matter of Kuppuswamy Chettiar Vs. A.S.P.A.Arumugam Chettiar and another, the Supreme Court held that a relinquishment deed cannot transfer title of the property to someone else, and that the renunciations in such deeds should be in favor of a person who already had a legal title with respect to that property, and that such renunciations cannot be used to create a new legal title where such title did not exist before.
Similarly in the matter of Lalitha James and others vs. Ajit Kumar and others, P.S Chauhan was an unmarried man who held many properties to his name. He died unmarried, and through a gift deed, relinquished the title of his properties to his two sisters, Mrs. Dayabai and Mrs. Gracebai, without any partition. However, Gracebai was survived by appellant 1 and respondent 3 of this particular case while Dayabai was survived by appellants 2, 3, 4. The land was divided amongst the formers, before respondent 3 sold her rights to respondent 2, who started digging the land to build a structure, which was objected to by the appellants, and consequently led to a suit being filed by respondent 2. The trial court dismissed the suit saying the sale did give any title to the vendor. The Madhya Pradesh High Court however, said that purchaser from co-owner from part of an unpartitioned land was entitled to joint ownership and not exclusive, and the appeal was allowed.
Relinquishment deeds in cases of female claims under Hindu Succession Act
Earlier under the Hindu Succession Act, 1956, a girl could claim her rights to a part of the property of her parents equally as her brothers, except for when the father of the female has prepared a will and divided his assets accordingly. The amendment to the Act in 2005 allowed women born before 2005 to claim their rights to the property. However in India, girls don’t in all situations demand a part in the property of their father, and in such circumstances the share of the girl child to the property can be divided amongst other family members through division of assets, as was discussed in the above section. A sister or daughter of a family can relinquish her rights to an ancestral property by signing a Non-Objection certificate to clarify that she doesn’t have any objections to relinquishing away her rights to the particular property, and then by signing a relinquishment deed by which she can officially give up or surrender her rights to the property while making it clear that she has objections to that particular act.
A Non-Objection certificate is an important document also in the sense that in cases where there is no will drawn up by the deceased whose property is up for division, an NOC signed by the female is required to transfer property of the deceased. Usually when a person dies, his property is obtained by his legal heir or legal heirs, either by the will that might be drawn by that particular person or through intestate succession, as was mentioned above in the article. But however, especially in this case, where a person is not interested in the property that is invested in her through her heirship, then such uninterested person is bound to sign an NOC and then further go on to sign the relinquishment deed. The relinquishment deed here is also used to and needed to get mutation done in the favor of the heir for official government records.
Conclusion
Relinquishments deeds are an important document which can be used by a party to relinquish themselves of rights to a certain property that they are not interested in. It is also necessary for such property to be ancestral in nature, and all such deeds can be executed only amongst co-owners of the property. Relinquishment deeds must be registered and should follow the format structured for them specifically so as to differentiate themselves from other similar forms of property deeds. The article talks about some situations where relinquishments are needed and can be used by parties to surrender their rights. The situations provided in the article are obviously not exhaustive and there may be other situations in real life practicality where relinquishment deeds are needed.
References
- https://www.argus-p.com/updates/updates/delhi-high-court-lays-down-tests-to-determine-whether-an-instrument-can-be-considered-as-a-releaserelinquishment-deed-or-gift-1/
- http://14.139.60.114:8080/jspui/handle/123456789/10543
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