I am in the process of acquiring an empty plot of land, specifically site number 257, in Bangalore. However, there is an issue concerning the Property schedules. The neighbouring site, site number 256, is currently the subject of a dispute between the landlord and the allottee, and the matter is being heard in the Karnataka High Court. If the court ruling favors the landlord, the property schedules will be altered, and site number 256 will be assigned a different number. The society responsible for the layout has indicated their willingness to provide a rectification deed in the event that the disputed site is awarded to the landlord. In light of these circumstances, I am considering whether or not to proceed with the purchase of this site. However, I am concerned about potential issues that may arise when I decide to sell the property in the future. The aforementioned property is a joint property owned by the husband and wife. After the wife's death, the property is inherited by her two children, one of whom is a minor of 15 years and the other is 21 years old, as well as the husband. The seller, who is the husband, is willing to include all the children as parties in the sale deed. However, since the children are currently studying, they would like their share to be paid to their father, and this arrangement will be mentioned in the sale deed. Now, there are questions to consider: 1. Considering the schedule problem, do you recommend proceeding with the purchase of the site? 2. However, I am concerned about potential issues that may arise when I decide to sell the property in the future due to Property schedules. 3. Is it permissible to pay the entire amount to the father? 4. Can the complete TDS (Tax Deducted at Source) amount be paid to the father? According to my lawyer, although the entire amount can be paid to the father, the TDS amount must be paid to the respective PAN numbers, including the minor who needs to have a minor PAN. I would appreciate hearing your thoughts on this matter.
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1) if one of legal heirs is minor court permission is necessary to sell his share
2) court would direct you to place his share of sale proceeds in a fixed deposit in a nationalised bank
3) if you dont obtain court permission minor can within 3 yers of attaining majority file suit to set aside sale deed
4) you cannot pay entire amount to father
5) regarding TDS act as per your CA advise
Dear Client,
1. There's minor's right involved in this property. Court permission is necessary to sell minor's share in the property. Hence it's not recommended without looking at the papers. However get the papers evaluated by any Lawyer, before proceeding further. The problem in respect of schedule of the property is a different issue, which can be tackled later.
2. Since the Housing Society has assured you that it's ready to execute a Rectification Deed if there's change in circumstances, you, as a prospective buyer has to think of the minor's share in the property to be bought.
3. If the adult son gives in writing, then the entire consideration amount can be paid to father.
4. As per Section 194 1A of Income Tax Act, the buyer has to deduct 1% of the sale consideration, which has to be paid to Income Tax department, in the name of father and his children.
I am writing to discuss the matter concerning the sale of the minor's share in the property. The seller has expressed their disagreement with the idea of seeking Court permission to proceed with the sale, primarily due to concerns regarding the Court's requirement to deposit the sale amount in a bank. Instead, the seller intends to reinvest the funds back into the property. To better understand the situation, I kindly request clarification on the following points: In general, does the Court typically allow sellers to utilize the sale proceeds for purposes other than depositing them in a bank? Is it mandatory to deposit the amount in a bank . Are there any alternative solutions or workarounds that can address this issue without the need for seeking Court permission? I would greatly appreciate your guidance and insights on these matters. Please let me know if there is any additional information or documentation required to further facilitate the discussion.
Court would insist that sale proceeds of minor share be placed in a fixed deposit
2) don’t take the risk of purchase of property if seller is not willing to obtain court permission
3) as mentioned earlier of court permission is not obtained minor can on attaining majority file suit to set aside sale deed
1. Court allows utilisation of funds by the natural guardian to be spent for the welfare of the minor child, such as for getting admitted to higher education, hostel, food expenses, etc.
2. If there were to be any leftover money after spending for the minor child's education, etc, then the residual amount has to be deposited in the Bank.
No there is no such mandatory direction or rule
1. If there is any dispute apprehended to this property also, then it would be better you wait for the court's decision or ignore the idea of buying this property which may land into any litigation in future.
2. The seller has to obtain court permission to sell the share of property of the minor legal heir and also to obtain a power of attorney from the son who is major by age to sell the property on his behalf. This will provide the details of the legally valid and proper transaction in respect of this property.
3. On the basis of authorisation of the major son, he may collect the sale consideration amount, but on behalf of the minor so, he has to obtain permission from court.
4. The TDS is to be made on the sale consideration amount to be paid to the seller, you cn decide the quantum etc at tht time.
The share of minor son can be sold by the guardian father only after obtaining permission from court, if not then it would be an illegal act.
If the seller is refusing then you do not have to insist on it or remain attached to this issue, you can just ignore it and look for some other property.
If you are considering buying a property that is partially owned by a minor, there are a few things you need to keep in mind. First, the seller will need to obtain court permission to sell the minor's share of the property. They will also need to obtain a power of attorney from the major son to sell the property on his behalf. This will ensure that the transaction is legally valid.
Once the seller has obtained the necessary permissions, they will be able to collect the sale consideration amount from you. However, they will need to obtain court permission to do so on behalf of the minor son.
You will also need to pay TDS on the sale consideration amount. The amount of TDS will be determined at the time of the sale.
If the seller is refusing to obtain the necessary permissions, you should not insist on buying the property. Instead, you should look for another property that does not involve a minor.