The Indian courts have for a long time faced the question of identification of deeds as a relinquishment deed and gift deed. The high court from different states, not once, but on various occasions have tried to lay down criterias based on which the line of distinction can be drawn to differentiate between conveyance and a relinquishment deed. Recent decision in the case of Tripta Kaushik v. Sub Registrar VI-A and Ramesh Sharma v. State govt. of N.C.T. of Delhi. in which the Delhi High Court has come to decide that a relinquishment deed shall lead to an increase in the share of the co-owner receiving the property in the deed and also the co-owner relinquishing such property must share the property to all the remaining co-owner and not just one co-owner.
W.P. (C) 9193/2019
This petition is filled against the order dated 05.03.2019, wherein the relinquishment deed by Mr. Kapil Kaushik (son of the petitioner) in favour of the petitioner Shmt. Tripta Kaushik dated 01.03.2019, was read as a gift deed under Section 33 of the Indian Stamp Act, 1899 and also the stamp cost against the same have also been challenged to be inadequate.
W.P. (C) 3560/2018
This case is a petition against the order dated 1.03.2013, wherein the impounded relinquishment deeds of five sisters of the petitioner were decided to be conveyance deeds. The petitioner had received half share of the total property no. E-67, Greater Kailash, Part-II, New Delhi, through a will on the death of his father while the remaining half of the property was left to all the heirs of his father (five sisters, petitioner and the mother) in equal share. The sisters had relinquished their shares in the property to the petitioner through five relinquishment deed, three of them dated 03.07.2012 and two dated 17.07.2012.
Another order disputed under this petition was with respect to stamp costs at which the deeds were marked. It was said that the penalty be attached to Rs. 100,000/-. Since both the petitions have common issues the court order to hear both the petitions together.
The statutory provisions dealing with the instruments of gift and release are produced hereinunder:-
|Description of instrument||Stamp duty attached|
|“33. GIFT, Instrument of, not being a Settlement (No.58), or Will or Transfer (No. 62).” HIRING AGREEMENT or agreement for service- See Agreement (No.5)”||“The same duty as Conveyance (No.23) on the value of the property.”|
|“55. RELEASE, that is to say, any instruments 2[(not being such a release as is provided for by section 23A)] whereby a person renounces a claim upon another person or against any specified property— (a) if the amount or value of the claim does not exceed Rs. 1,000;(b) in any other case.”||“same duty as Bond (No.15) for such amount or value as set forth in the Release. One hundred rupees.”|
View of the Court
The High Court at Delhi had examined the different cases where the courts were faced with the same issue as to deciding the conditions that enables a deed to be qualified as a relinquishment deed and not a conveyance or a sale deed. The court relied on the Judgement of the Apex court in Ranganayakamma and Anr. v. K.S. Prakash (Dead) by Lrs. And Ors., where it observed that the existence of consideration against the release of share of property is not a question of law when it comes to deciding if the deed is a relinquishment deed or not.
The court further went on to answer the question, between who can a relinquishment deed be executed. With reference to the judgement of the Allahabad High Court in Raghvendra Jeet Singh v. Board of Revenue And Ors., the court held that another ground for distinction between a relinquishment deed and a gift/conveyance deed is that a relinquishment deed cannot be executed in favour of a person who has no share/ right of enjoyment of the property mentioned in the deed.
The court also placed reliance on a no. of cases including Kothuri Venkata Subba Rao and Ors. v. District Registrar of Assurances, Guntur, Balwant Kaur and Ors. v. State of U.P., The Board of Revenue, the Chief Controlling Revenue Authority v. V.M.Murugesa Mudaliar of Gudiyatham and other cases, where in the high courts of different states have agreed that the executant of the instrument must be a co-owner i=of the property referred in the instrument and also that such share must lead to an increase in the share of the remaining co-owner(s). it has also been discussed that if the executant, in such instrument specifies the co-owner to who the rights are being released, then it shall consider to be a conveyance deed. It is because the relinquishing of rights to a specified co-owner will lead to a transfer to title, that such transfer shall be read as a conveyance or gift deed, while the relinquishment deed only feeds title to the co-owners.
After giving due consideration to the above mentioned judgements and understanding the application of relinquishment deed, the High Court of Delhi in the Present petitions decided that, in the petition of Tripta Kaushik, there were only two co-owner, among which the relinquishment deed was executed and thus the instrument must be read as a relinquishment deed and not a gift deed. And thus, the petition (W.P.(c) 9193/2019) succeeded. As for the matter in petition of Mr. Ramesh Kumar (W.P.(C) 3560/2018), the court held that the property in question was to divided as such:
- half of the property to be given to the son i.e. petitioner by way of will of his father;
- other half of the property to be divide equally among the legal heirs i.e. the mother of the petitioner, five sisters and the petitioner.
The court addressed the fact the sisters relinquished their share of the property in only the name of the petitioner; however, the mother was also a co-owner in the said property. Since the deeds signed by the sisters were in favour of a specified co-owner, the deeds could not be considered as relinquishment deeds but as gift/conveyance deeds as per the Indian stamp act and the cost to the deeds need to be revised. Keeping in mind the bonafide intention of the petitioner the penalty was removed.
The understanding of the instruments of relinquishment deed, sale deed and the gift/conveyance deed has been thoroughly revised while deciding the mater in Tripta Kaushik v. Sub Registrar VI-A and Ramesh Sharma v. State govt. of N.C.T. of Delhi. the take away points for easily understanding the distinction between the relinquishment deed and gift deed are as follows:
- The actual character of the transaction by the executant.
- The intention behind signing of a relinquishment deed is to relinquish the right of the executant.
- There has to be co-ownership to successfully execute a relinquishment deed; co-ownership may be by inheritance of purchase.
- The relinquishing of the right must lead to an increase in the share of the remaining co-owners; where the relinquishment of the right by the co-owner is only in favour of one of the co-owner and not against all, the document would be one of Gift/Conveyance and not of “release”.
This article is authored Samiksha Goel.
 W.P. (C) 9193/2019 and W.P. (C) 3560/2018.
 The Indian Stamp Act,1899.
 (2008) 15 SCC 673.
 2015 SCC OnLine All 5678.
 AIR 1986 Andhra Pradesh 42.
 1955 SCC OnLine Mad 83.