• Can a person who is not mentioned in release deed be included in sale deed when selling?

I am purchasing a BDA property in Bangalore. Here are the details about the property.

Family Tree:
1. Ram
2. Lakshman (brother)
3. Late Geeta (sister) - Expired
4. Nitha (sister)

Both their parents (father and mother) are expired.

The property was allotted to Ram and registered to him by BDA. He expired in 2018. His brother Lakshman got a release deed from his sister Nitha and daughter of Geeta (expired) and registered in his (Lakshman) name.

Now he is selling the property to me. I and my sister are buying it jointly. Lakshman asked to mention his sister Nitha's name as well in the Sale Deed and take a Demand Draft of 30L each and pay TDS of 1% (30k) each. He said he wanted to pay 50% to his sister.

I want to know these details:
1. Can include both Lakshman and Nitha in the Sale Deed even though the release deed was done and registered in Lakshman's name alone?
2. If so, since I and My sister are buying jointly, should we get 4 TDS forms
 a. I will pay TDS for both Lakshman (15k) and Nitha (15k)
 b. My sister will pay TDS for both Lakshman (15k) and Nitha (15k)

Thank you!
Asked 4 years ago in Property Law
Religion: Hindu

3 answers received in 30 minutes.

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6 Answers

Name of Nitha cannot be included in sale deed as she has no right , title , interest in said property 

 

2) deduct TDS from sale consideration and pay balance amount to Lakshman 

Ajay Sethi
Advocate, Mumbai
99965 Answers
8159 Consultations

Dear Client,

                 There are two ways in which the owner can add a joint owner to his property. He can either create a sale deed or a gift deed.

Sale deed: This transaction takes the form of a typical sale. In this process, a new sale deed must be created, clearly mentioning the portion of the property that is being transferred in the name of the co-owner. As with all sale deeds, this deed must be registered at the sub-registrar’s office of the area concerned. Stamp duty and registration charges would be applicable at the time of registration of the new sale deed.

Gift deed: Property ownership can also be shared by way of gifting a portion of the asset to the intended beneficiary. In this process, a deed of gift must be executed and duly registered at the sub-registrar’s office of the area concerned. Stamp duty and registration charges would be applicable at the time of registration of the gift deed.

An owner who wants to add a co-owner to his property, will have to do so by way of creating a new deed altogether. This new deed must also be registered at the sub-registrar's office, to attain a legal validity under the Transfer of Property Act.

Thanks & Regards

Anik Miu
Advocate, Bangalore
11054 Answers
125 Consultations

First of all who was the original owner of the property",

if it was Ram, then whether he is alive or deceased now?

How is Ram related to Lakshman?

If Ram is the brother of Lakshman and Geetha and Nitha, then what about his own family members?
For example, if a Hindu male dies intestate leaving behind his widow and children behind all of them will inherit his property  simultaneously because all of them are heirs in the Class I.

Whether Ram was an unmarried person at the time of his death?

In case wherein a male Hindu dies, unmarried, and is not survived by any class I heir, the property shall devolve among class II heirs.

wherein an heir in the first entry is preferred over an heir in second category in the Class II and similarly, any heir in a higher entry shall be preferred over an heir in a lower category.

Entry I –
a) Father.
Entry II –
a) Son’s daughter’s son.
b) Son’s daughter’s daughter. (Now Class I, After Amendment Act of 2005)
c) Brother.
d) Sister.
Entry III –
a) Daughter’s son’s son.
b) Daughter’s son’s daughter. (Now Class I, After Amendment Act of 2005)
c) Daughter’s daughter’s son. (Now Class I, After Amendment Act of 2005)
d) Daughter’s daughter’s daughter. (Now Class I, After Amendment Act of 2005)
Entry IV –
a) Brother’s son.
b) Brother’s daughter.
c) Sister’s son.
d) Sister’s daughter

and so on; 

 

As per the above schedule, if Ram is presumed to be an unmarried Hindu and reportedly died intestate, then the property left behind in the absence of his parents shall devolve equally upon his surviving siblings alone.

Therefore, if another cosharer i.e., sister of Lakshmanan had relinquished her rights in this property by a registered release deed making a proper mention about this proeprty as a schedule of property in the  release deed, then there is no necessity to include his sister's name in the sale deed to be executed now in your favor.

Since this property has already been encumbered by the said registered release deed, besides that has been shown in the deed, there is no question of the sister to execute a joint registered sale deed, if at all her brother wants to divide the sale consideration amount between him and his sister, let him obtain the sale consideration amount on his name and he can give the same as a gift to her.

You may have to deduct tax while making payment towards the sale consideration amount out of the said payment and not that you have to pay them that amount.

TDS means tax deducted at source and not paid at source. 

You are required to pay the deducted tax to government within a stipulated time from the date of such deduction.

Instead of getting into legal complication, it is advisable that you better you ask the brother Lakshmanan to execute the registered sale deed singly in favor of the joint purchasers.

If he insists for the execution of sale by both of them then you can ask him to get the encumbrance removed by executing a registered cancellation deed cancelling the registered release deed executed by her sister in his favor. 

T Kalaiselvan
Advocate, Vellore
90166 Answers
2505 Consultations

  1. Whether Ram left any legal heirs?
  2. Whether sister Geeta has left any legal heirs?
  3. There are two surviving legal heirs brother Lakshaman and sister Nitha.

If there are no legal heirs of deceased family members, obtain consent from legal heirs of surviving family members if there are any.

  1. Releaser (Nitha) has transferred property to Lakshaman, she is not your seller, only Lakashman is your seller registering property to you.
  2. TDS to be paid only for Lakashman by both purchasers contributing equal share.

   

Ravi Shinde
Advocate, Hyderabad
5133 Answers
42 Consultations

1. Yes if they are legal heirs

2. Yes

3. Yes

4 yes

 

Prashant Nayak
Advocate, Mumbai
34653 Answers
249 Consultations

1. If Nitha has released her share in favour of Laxman by way of a registered deed , then Laxman is the sole owner of the property , and hence legally Nitha cannot be vendor in the sale deed , however you can mention the true facts regarding how Laxman become the single owner of the property in the sale deed. 

2. No

3. Only for Laxman, 

Mohammed Shahzad
Advocate, Delhi
15836 Answers
243 Consultations

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