The article talks about the relinquishment of a title and interest in the joint property which sometimes creates confusion between a deed of conveyance and a release deed. A relinquishment deed is a legal document/instrument in which a person legally or formally relinquishes or releases his legal rights to the property being surrendered in the name of another person. This is one method of transferring immovable property rights.
Because a relinquishment deed is a legal instrument in which a person legally gives up his claim to another person, it must be systematically completed and registered in accordance with the statutory governance. Please keep in mind that a professional property lawyer is required for systematic legal compliances and the necessary papers for drafting/making relinquishment. The concerned article explains the very concept with reference to case law Gyan Chand vs. State and Ors. (AIR 1998 RAJ 223: 1998 (2) Raj LW 1101: 1998(3) WLC 181). The very facts of the case are explained discussing the dispute along with the key issue of the problem. The author has also explained the laws applicable with various case laws referred to in the judgment. The jointly purchased property can be said to create an interest of the joint owners in each other’s share is also looked at and discussed in the following article.
Table of Contents
Facts
Gyan Chand the petitioner and one Laxman Singh jointly purchased plots situated at Bhilwara by sale deeds dated 12-3-1984 and 14-3-1984. Laxman Singh who was the joint owner of the said two plots released his shares in respect of both the plots by a deed dated 17-7-1985 tied as ‘Release Deed’. The documents were presented for registration before the Sub-Registrar, Bhilwara.
The matter was taken up under Section 47C(3) of the Rajasthan Stamps Law (Adaptation) Act, 1952 by the Deputy Inspector General of Stamps Ext Officio, Collector Stamps, Ajmer and the document was held to be a deed of conveyance and not ‘Release Deed’. The petitioner was directed to pay the additional stamp duty of Rs. 39022.75 including penalty etc.
Aggrieved by the said order, the petitioner preferred a revision petition under Section 56 of the Indian Stamp Act before the Board of Revenue. The revision petition and, thereafter, review application, filed by the petitioner were dismissed. Submission of the learned counsel for the petitioner is that the property having been purchased by the petitioner and Laxman Singh, jointly both had a joint interest in the entire property and, therefore, Laxman Singh could have released his share in the property and, the documents should not have been treated to be a deed of conveyance.
Issue
The main question that requires determination, in this case, is whether the jointly purchased property can be said to create an interest of the joint owners in each other’s share.
Related Case Laws
In Hutchi Gowder v. Bheema Gowder[1], it has been held that the release deed can only feed title but cannot transfer title. In S. P. Chinnathambiar v. Varanguna Rama Pandia Chinnathambiar[2], it is held that the renunciation must be in favour of the person who has title to the estate, the effect of which is only to enlarge right. Renunciation does not vest in a person a title where it did not exist.
In the Board of Revenue, Hyderabad v. Valivety Rama Krishnaiah[3], it has been held that the release deed can only feed title but cannot transfer title and the renouncement must be in favour of a person who already has title to an estate.
In Kuppuswami Chettiar v. A. S. P. A. Arumungam Chettiar[4], while considering the nature of deed styled as release, it is said by the Supreme Court that: “here the deed was in favour of a person having no interest in the property, and it could not take effect as aft enlargement of an existing estate. It was intended to be and was a transfer of ownership. A deed called a deed of release can, by using words of sufficient amplitude, transfer title to one having no title before the transfer.
It is said that the S. P. Chinnathambiar’s and Hutchi Gowder’s case does not lay down that a deed styled a deed of release cannot, in law, transfer title to one who before the transfer had no interest in the property.
It has been held by the Supreme Court in Kuppuswami Chettiar’s case that a registered instrument styled as release deed releasing right, title and interest of releaser without consideration may operate as transfer by way of gift when document clearly shows the intention to effect the transfer and is signed by or on behalf of releaser and attested by at least two witnesses. This case is on a point that although the document is styled as a release deed, it can be treated in given facts and circumstances to be a transfer deed conveying title.
The aforementioned decision lays down that the deed of release can enlarge titles where there is one but cannot create a title where there is none. The release deed can be construed to be a deed of transfer conveying an interest in the property.
Under Section 45 of the Transfer of Property Act, 1882 where the immovable property is transferred for consideration to two or more persons jointly makes them co-owners of the property transferred, their interest is in proportion to the share of the consideration they have advanced. In the absence of evidence of share of the consideration, the co-owners shall be presumed to have an equal interest in the property.
Co-owners have unity of possession and commencement of title in the property but do not have unity of title or unity of interest in the property. The joint owner of the property cannot be said to have title and interest in the property of another co-owner. Every joint owner has his title and interest in the property purchased jointly by them.
Law Applied- Section 45 of the Transfer of Property Acr, 1882
As per Section 45 of the Transfer of Property Act, 1882, where immovable property is transferred for consideration to two or more persons and such consideration is paid out of a fund belonging to them in common, they are, in the absence of a contract to the contrary, respectively entitled to interests in such property identical, as nearly as may be, with the interests to which they were respectively entitled in the fund; and, where such consideration is paid out of separate funds belonging to them respectively, they are, in the absence of a contract to the contrary, respectively entitled to interests in such property in proportion to the shares of the consideration which they respectively advanced. In the absence of evidence as to the interests in the fund to which they were respectively entitled, or as to the shares which they respectively advanced, such persons, shall be presumed to be equally interested in the property.
The main question raised herein was whether jointly purchased property can be said to create an interest of the Joint Owners in each others’ share. Under Section 45 of the Transfer of Property Act, where the immovable property is transferred for consideration to two or more persons jointly makes them co-owners of the property transferred, their interest is in proportion to the share of the consideration they have advanced.
As mentioned in the case in hand, in the absence of evidence of the consideration the co-owners shall be presumed to have an equal interest in the property. Co-owners have unity of possession and commencement of title in the property but do not have unity of title or unity of interest in the property. The joint owner of the property cannot be said to have title and interest in the property of another co-owner.
Every joint owner has his title and interest in the property purchased jointly by them. Thus relinquishment of title and interest in the joint property by one joint owner in favour of another joint owner would only be a transfer of an interest of one joint owner in favour of another joint owner, each joint owner having the distinguishable, independent, individual title in the jointly purchased property.
Where land is purchased jointly by several persons in the absence of a contract for their respective shares, they being joint owners as per the provisions of Section 45 are presumed to be equally interested in the land purchased, each one being separately entitled to one unit.[5]
Where the deed of the agreement clearly stated that the defendant was to have two-third and the plaintiff along with a third person to have only one third in the suit property according to their share of sale consideration, the presumption could not be raised that the parties have an equal share in the property.[6]
Transfer of Property Act is a general law, which deals with the rights concerning the transfer of the property in general. Where there was the joint purchase of land, the share of each purchaser was not specified, the specific shares were not specified in the revenue records when the Urban Land (Ceiling and Regulation) Act, 1976 came into force, joint form under section 6 of the Act was submitted in the name of all, it was held that the purchasers were not entitled to one unit for each of them, Section 45 of the Transfer of Property Act could not be invoked for the purpose. It cannot be said that Section 45 of the Transfer of Property Act raises a presumption of equal interest/share in the immovable property transferred to two or more persons, in the absence of evidence as to the interest in the fund, out of which the property was purchased.[7]
Judgment
Relinquishment of title and interest in the joint property by one joint owner in favour of another joint owner would only be the transfer of an interest of one joint owner in favour of another joint owner, each joint owner having the distinguishable, independent, individual title in the jointly purchased property.
Thus it was held that the right, title and interest of Laxman Singh in the property jointly purchased cannot be said to have co-existence with the right title and interest of the petitioner in the property. The deed, although styled as a release deed, in effect, had conveyed the title and interest of Laxman Singh in the property in favour of Gyan Chand the petitioner and, thus, the release deed having been deed of conveyance was rightly charged with the stamp-duty as a deed of conveyance.
For the aforesaid reasons, the writ petition fails and is hereby dismissed. There shall, however, be no orders as to cost.
Conclusion
As mentioned in the case that where the property has been jointly purchased and one of the joint owners transfers his share in the property to another joint owner through a conveyance deed, such a deed even though styled as a release deed, is a conveyance-deed chargeable with stamp duty as a deed of conveyance.
Where some persons by registered sale deed purchase land jointly, each purchaser should be treated as a co-owner, the share of each co-owner would be equal.[8] In the absence of specific mention about the shares of co-owners in any sale deed, all co-owners will have their equal share in the properties thereunder. There is nothing to suggest in Section 45 that the section is inapplicable to an involuntary transfer[9].
REFERENCES
[1] AIR 1960 Mad 33.
[2] AIR 1954 Mad 5.
[3] AIR 1973 Andh Pra 275.
[4] AIR 1967 SC 1395.
[5] Ranchhod Lala v. Union Territor, Dadra & Nagar Havelli, AIR 1996 HP 65 (68) (DB); Nalamuru Nadipi Subbanna v. Katru Chenamma, 2002 AIHC 4201 (AP); Atindra N Chakrabarty v. Anil K Chakravarty, 2006 (1) Cal HN 521 (524) (Cal-DB).
[6] Nalamuru Nadipi Subbanna v. Katru Chenamma, 2002 AIHC 4201 (AP).
[7] Mohansingh Gurucharansingh v. State, AIR 1996 Guj 80 (84).
[8] Durlabhhji D Patel v. Competent Authority & Dy Collector, Surat, AIR 1996 Guj 197.
[9] Reazaddi Behari v. Yakub Bepari, AIR 1941 Cal 416 (417): 200 IC 37; Balai Chandra v. Raisuddin Naskar, AIR 1956 Cal 58 [LNIND 1955 CAL 162]: 60 Cal WN 270 (AIR 1940 Cal 145 distinguished).
BY RICHA VYAS | VIT SCHOOL OF LAW, CHENNAI