rashu (ca) 04 December 2012

Family settlement

Mr. X has two sons (A & B) and one daughter, after the death of their mother Elder son (A) has paid share of younger brother (b) in Year 1991 and sister relinquished her right in favour of Elder son (A), but the same was done orally and signatures were done on a piece of plain paper as family arrangement.

Now the Elder Son wants to transfer the said property in his name, my first question is what were the modes through which property can be transferred with minimum cost?

I think there wer three options either by sale - which is costly in terms of stamp duty

or by gift - again heavy duty is involved

or by family settlement deed - in which minimum stamp duty is payable (perhaps 1.5% in Haryana)

now my second question is whether the family settlement deed in which both father Mr. X, Younger Brother Mr. B and sister will be the party to the contract, is full proof mode to transfer the property to elder son?

whether in future their is any legal right with father, younger son or sister has in respect of said property or else the said property will be solely and severaaly will be held in the name of Mr. A.?

Also kindly suggest whether the property can be transferred by virtue of family settlement to the wife of elder son Mr. A to save the stamp duty costing w.r.t to female rates.

Thanks in advance

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3 Replies

Senthil Kumar L (Advocate) 05 December 2012

Sir,

You have not mentioned who is the owner of the property.

I assume that the property belongs to the Mother of the ABC and Wife of X.

If the property belongs to the mother of the ABC and Wife of X, the property devolves upon all persons.

Hence Mr. X has to get Release Deed from all the other Legal Heirs of Deceased.

In some state the Govt. charging nominal stamp duty for release deed, settlement deed between family members and registration charges as compared to Conveyance. You may go for family release deed and save stamp duty.

There will be no problem in future, if the property is self acquired by the deceased or if the property is inherited you may also get the signatures from the children of the Releasors of the property, it is safe and advisable to avoid future litigations.

For Release Deed the conveyance always be Love and Affection.

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rashu (ca) 06 December 2012

Thanks Sir

But property belongs to Mr. X, he is the original allotee of the plot from MCF( Municipal Corporation of Faridabad) , My small doubt is for release deed by Mr. X, what is this? is this the same as family settlement deed? is release deed can be made even when Mr. X is alive? Whether after that release deed Mr. X has right on the property till death or not?

Senthil Kumar L (Advocate) 06 December 2012

If the property allotted in favour of Mr. X, if the amounts due to the MCF paid out of his earnings then there is no right to any person/children other the Mr. X.

Hence Mr. X may settle the said property in favour any children as per his wish without any interruption from anybody even from his children.

If you want to avoid future litigation, you may get consent of the other children by admitting them as the Witness in the Family Settlement Deed. Hence they will not claim any right over the property from A or B in future.

The Release Deed concept is overruled in this case.

Hence you may draft a Settlement Deed executed by Mr. X in favour of Mr. A and the same document has been attested by the other children of Mr. X. The beneficiary also will claim stamp duty concession and also he gets unquestionable right over the property.