A V Vishal
(Expert) 17 January 2011
Relinquishment deed is a one of the modes of transfer of property. By way of relinquishment deed, one or more join owner can give up/relinquish/release his /their share in a immovable property to one or more joint owners.
The next term which is required to be understood is "transfer". This term is defined specifically under the Income-tax Act but not in any of the Acts mentioned in para 1 above. Although the term "transfer" would be understood in the general sense of conveying or passing or making over the title from one person (the Owner) to another, it is used in a much wider sense under the Income-tax Act. According to the said definition in section 2(47) of I.T.Act, "Transfer" in relation to a capital asset includes:-
sale, exchange or relinquishment of the asset; or
extinguishment of any rights therein; or
compulsory acquisition of the asset under any law; or
conversion of the capital asset into stock-in-trade of one's own business;
transaction u/s. 53 A of the Transfer of Property Act i.e. allowing possession of any immovable property to be taken or retained in part performance of the contract; or
any transaction e.g. by way of becoming a member of a society, company etc. or any agreement or arrangement which transfers or enables enjoyment of the immovable property to another person.
It will be seen that the last part is similar to the definition referred to in section 269 UA of the I.T.Act. In fact, explanation at the end of clause 2(47) clarifies that the meaning of "immovable property" for purposes of (v) & (vi) above will be the same as in section 269UA (d) of the I.T.Act.
As will be seen from the definition above that the first three meanings at (i) to (iii) above refer to the transfer as generally understood. The words Sale, Exchange, Relinquishment or extinquishment are not defined or explained in the Income-Tax Act, but are so explained in the Transfer of Property Act. We may, therefore, see how they are explained in the T.P.Act.
It means extinction of rights or interest in property. It may not amount to transfer of property if it is in favour of a person having interest in property. It amounts to transfer if it is in favour of a person who has no interest in the property.
Section 17 of the Registration Act, 1908 lays down different categories of documents for which registration is compulsory. The documents relating to the following transactions of immovable properties are required to be compulsorily registered:
Instruments of gift of immovable property. lease of immovable property from year to year or for any term exceeding one year or reserving a yearly rent. Instruments which create or extinguish any right or title to or in an immovable property of a value of more than one hundred rupees.
Under Section 2(6) of the Registration Act, 1908 the term "immovable property" includes: "land, buildings, hereditary allowances, rights to ways, lights, ferries, fisheries or any other benefit to arise out of land, and things attached to the earth, or permanently fastened to any thing which is attached to the earth, but not standing timber, growing crops nor grass."
Hence registration of relinquishment deed is mandatory.