All about Relinquishment Deed
It’s always good to make a will while you are alive to avoid any legal dispute after death. However, for those who die intestate i.e. without making a will is governed by separate rules and regulation. After the division of the property, if any of the people wishes to give away his right in favor of another person, he/ she can do so by way executing the Relinquishment deed between the two concerned parties.
What is Relinquishment Deed?
A relinquishment deed is a legal tool whereby the legal heir releases his legal rights which he/she inherited in parental property, in favor of another legal heir who could be anybody but a co-owner or such person having share in the property be it his/her mother, son, daughter, brother, sister, etc.
Relinquishment means giving up on something, in legal terms, it refers to the abandonment of the rights, title, and interest, by one co-owner of the property in favor of another co-owner/s. Hence thereby this results in the emergence of new property shares which is increased one of those of beneficiaries.
The Relinquishment Deed is made with Respect to the following:
- Freehold plots
- Residential house
- Builder floor
- Apartment flats
- Commercial Shop
- DDA and L&DO
Characteristics of Relinquishment Deed:
- To legally execute and give effect to the intention of the transfer or release of inherited property right form one co-owner to another, one needs to execute the relinquishment deed which is a legal document.
- The Relinquishment deed is an irrevocable agreement. it can be made even without consideration.
- A relinquishment deed must be executed in the case where it is owned by more than one
- No third party can avail the benefit of Relinquishment as it cannot be done in favor of a party other that co-owner or such person having a share in the said property. A relinquishment of property can be made in favor of a person who is a co-owner only. If a relinquishment is made in the favor of a person who is not a co-owner, such transactions are treated as a gift. In order to have a valid relinquishment deed, the person in whose favor such relinquished property is to be made must be a legal heir.
- The relinquishment deed must be made in an expressed form specifically in cases involving immovable property needs to be done only in a written document called relinquishment deed and should be signed by all the parties and shall be witnessed by at least two witnesses.
- Registration of such relinquishment agreement is must condition. Pursuant to section17 of the Registration Act, 1908, any release of rights in the immovable property must be registered. The registration is required to be done in the office of the sub-registrar within whose jurisdiction the property is situated.
- The Consideration is not a must condition in a relinquishment deed, it can be done with or without any consideration.
- A relinquishment deed can be made and registered very easily and quickly and this process is not even expensive.
- A property can also be transferred to minors and such cases will be governed by the Indian Contract Act, 1872.
- It is to be printed on Stamp paper of appropriate value and, it is advisable to get is drafted by a legal expert or advocate.
- The agreement must be dated and signed.
- The property described in the relinquishment deed must be clearly defined and to whom the rights in the property has been given must be stated without any ambiguity.
Lets clear out certain common confusions or doubts about relinquishments:
Relinquishment and NOC (No Objection Certificate):
The NOC (no objection certificate) only certifies that the person who is giving and signing the NOC does not have any objection if the concerned property is being transferred to any other person. However this is not the case in the Relinquishment deed, as it is a legal document in which a person gives up or releases his legal rights of the property in favor of some other person, who should not be a third party, he/she could be co-owner.
Relinquishment and Gift:
A relinquishment deed is distinguished from a gift deed. In a gift the shares of a particular owner are gifted to another person who may or may not be a legal heir in that property i.e. can be any third party, however, this is not the case in relinquishment deed, in this it is mandatory to register the deed. The cost of such registration charges compared to a gift deed which requires high stamp duty is also less, even though there is no involvement of any kind of consideration both the deeds.