Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Money / Ask Mint Money/  Period to file a suit for an immovable property is 30 yrs
BackBack

Period to file a suit for an immovable property is 30 yrs

No claim can be raised after that period

ThinkStock (ThinkStock)Premium
ThinkStock
(ThinkStock)

My uncle died six months ago. He wanted that a flat be transferred to my father’s name, which my uncle’s widow wants to do now. But there is no Will to that effect. Can my aunt gift immovable property to my father? Can this be executed through a gift deed with stamp duty rate of 2% and registration of gift deed at 1%? My uncle had bought the property with my aunt as the first owner; it was not registered. Will I have to register the property first or can I just register the gift deed? If the property is transferred through a Will, then after the death of person making a Will, would the property be automatically transferred or re-registration of the transfer is required?

—Naresh Menghani

To respond to the query, it is assumed that the flat in question is situated in Mumbai.

We understand that the original agreement for sale/deed of conveyance through which the flat was purchased was neither stamped nor registered.

Section 54 of the Transfer of Property Act, 1882, inter alia states that the transfer of tangible immovable property of value of 100 or more must be by way of registered instrument. Section 17 of the Registration Act, 1908, lays down the documents of which registration is compulsory. Section 17(1)(b) of the Registration Act inter alia provides that any non-testamentary instrument which creates or declares whether in present or in future, any right, title or interest of the value of 100 or more to or in immovable property is a compulsorily registerable document. Therefore, the sale deed is a compulsorily registerable document. Section 49 of the Registration Act inter alia states that no document that requires compulsory registration either under section 17 of the Registration Act or under any provision of the Transfer of Property Act, shall affect any immovable property comprised therein, unless it has been registered. Thus, as the sale deed has not been registered, it does not affect any immovable property comprised therein.

However, subject to what is set out here, your aunt can gift or transfer the flat if a period of 30 years has elapsed since she and your uncle have been in possession of the flat and no claim should be able to be raised, as the maximum period of time within which a person can file a suit in a competent court with respect to an immovable property, as per the provisions of the Limitation Act, 1963, is a period of 30 years.

In case the original vendor (the person who sold the flat to your uncle/aunt) is alive, it will be advisable to execute an agreement with him stating that neither he nor anyone claiming through him has any right, title and interest in the flat.

This agreement should then be annexed to the gift/transfer deed. Note that the title of your father will always be subject to the defect in title due to non-registration of the sale deed.

While non-payment of stamp duty will not render an instrument void, one of the consequences is that the same could be impounded if produced before certain authorities. At the time of registering the gift/transfer deed that your aunt intends to now execute with your father, the sub-registrar may call for the original sale deed since the property card will not show either your uncle’s or aunt’s name as the owner of the flat since the sale deed was not registered. At that time, the sub-registrar could impound the sale deed and your aunt may be required to pay the deficient amount of stamp duty and penalty thereon. The sub-registrar may also require further deeds to be signed and other acts to be completed since the original sale deed was not registered.

We also understand that although your aunt’s name is the first name in the sale deed, it was your uncle who purchased the flat. Since he did not bequeath the flat to your aunt, there is a possibility that his other legal heirs (for example, his children) could claim a share in the flat (more so, if your uncle’s name was the second name in the sale deed).

Keeping this in mind, if all the title documents and property papers with respect to the flat (including the agreement for sale/deed of conveyance) are in the name of your aunt, then yes, your aunt can gift immovable property to your father.

The lower rate of stamp duty (i.e. 2%) on a gift deed as per article 34 of the Maharashtra Stamp Act, 1958, will not be applicable since a gift deed between a sister-in-law (your aunt) in favour of her brother-in-law (your father) is not one of the exempted categories of relatives. Therefore, the stamp duty will be as per article 25. In Maharashtra, registration charges will be 1% of the value of the property, subject to a cap of 30,000.

If immovable property situated in Mumbai is bequeathed through a Will, while no stamp duty or registration charges will be payable, the Will has to be probated and court fees will be applicable.

Queries and views at mintmoney@livemint.com

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 25 Aug 2014, 05:24 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App