What is relinquishment deed?
Also called: release deed, haq tyag patra, hakka sod patra
When a co-owner, usually an heir, gives up their share in favour of the other co-owners, they sign a registered relinquishment (or release) deed. It's the usual way to put an inherited home in one sibling's name.
The situation is familiar. A mother dies without a will, leaving a house in Behala, Kolkata. Under the Hindu Succession Act her husband and children inherit equal shares. Two of the children live abroad and want the house to go to the sister who looked after their mother. Each of them executes a relinquishment deed releasing their share to her, and the property can then be mutated and, later, sold by one person.
Three rules govern it. A release can only be in favour of someone who is already a co-owner; releasing to an outsider is really a sale or a gift and is stamped and taxed as one. Because the deed extinguishes a right in immovable property, it must be registered under Section 17 of the Registration Act. And it's final: the releasing heir can't withdraw it because of second thoughts, only challenge it for fraud or coercion.
Stamp duty depends on the state and on who benefits. Several states, Maharashtra among them, charge only nominal duty when an heir releases ancestral property to close family, while a release to a more distant relative may be charged on the market value of the share. Confirm the current rate with the sub-registrar's office before booking the appointment.
Siblings abroad can sign through a POA or execute the deed at an Indian consulate; either way the document has to be stamped in India within three months of arriving here. If money changes hands for the release, it's a transfer for capital gains purposes, and the heir who received payment should report it in the return.
Three siblings inherit a ₹90 lakh house in Behala from their mother. Two of them sign a registered release deed in favour of the third, who then applies to the Kolkata Municipal Corporation to have the property recorded in her name alone.
An unregistered 'no-objection' letter or affidavit from siblings doesn't transfer their shares. A buyer's lawyer will reject it, and the siblings' own heirs can still claim later.
Questions people ask about relinquishment deed
Can a relinquishment deed be cancelled?
Once it's registered and was signed voluntarily, no. It can be set aside only by a civil court on grounds such as fraud, coercion or misrepresentation.
Is a relinquishment deed taxable?
A release without payment in favour of a relative isn't taxed in the recipient's hands. If the releasing heir is paid for the share, it's treated as a transfer and capital gains tax applies.