A house is said to be on Pagdi when it has a landlord and a tenant, just like the usual renting.
The differentiating factor is that the tenant becomes a part owner of the house (not land)He can sell the house but will have to give x% of the value to the landlord. Currently, the %age varies from 30-50%.
Under this rents are frozen and the landlord cannot evict a tenant without going through a long and cumbersome legal process. Also, tenancy is inheritable!
In your case the pagdi is on your grandfather's name.
Since your grandfather is alive there is no question of transfer of his tenancy rights to anyone during his lifetime.
Neither your father had any rights in it nor your father's sister is having any right in it.
Your grandfather has to decide about the tenancy rights but strictly speaking he cannot transfer the same to his daughter during his lifetime, but he may opt to sell the rights to her as per the prevailing atmosphere.
You are paying the rent and taxes since you are staying there but that will not confer any rights on you.
An amicable settlement shall have an answer to this question.