My father and elder brother holds a joint property of 3 storied house.It has been registered in both their names.There is a housing loan of 5 lakhs on the property from a PSU bank.
My father wants to gift his portion to me.what is the procedure to do so?
The two most popular options available for such transfers are – creating a power of attorney or a gift deed.
Your father can create a power of attorney for the property in your favor by which you can enjoy the use of the property. The only problem with this method is that this will be applicable during your father’s lifetime. After your father’s death, your father’s share will be subject to the succession law or will be transferred as per the directions given in his will.
The second option is that your father gifts his share in the property in your favor as given under Section 122 of the Transfer of Property Act, 1882. The gift deed allows a person to transfer his property to another person without the payment of money.
Make sure that your father is the actual owner of the said property and his ownership over the same is not contested by anyone. From the facts given by you it seems that, your father owns the property jointly with your brother. It is not possible to gift away a property which is jointly owned with someone else. Due to the joint ownership, your father does not have complete ownership over the property and therefore he cannot transfer it to you. To manage this problem your father and brother should partition the property with a partition deed by which your father will become the owner of half of your property. This partition deed will make him an undisputed owner of the property and then he can make a gift deed in your favor.
For the gift deed, you can acquire the draft of a gift deed from a lawyer, affix the stamp by paying the stamp duty. The stamp duty is different in different States but it is quite less when the beneficiary is the son or daughter. The stamp duty ranges from 1-8% of the value of the property. The deed will then have to signed by two witnesses and registered with the Sub-Registrar of the district where the property is located. The gift deed has to be registered as per Section 17 of the Registration Act, 1908 and Section 123 of the Transfer of Property Act, 1882. The registration process makes it easier for you to prove the validity of the deed if it is disputed before the Court in future. After the registration of the deed, you become the owner of the property and then you must apply for the mutation of the property. By the process of mutation, you request the government officials to accept your name as the owner of the property in the revenue records and then all the property taxes will then be levied in your name.
Therefore, for now your father can either execute a power of attorney in your favor or separate how ownership from your brother’s and gift his partitioned share to you.
firstly as it is joint property and it is difficult to decide which portion belongs to whom so it is better that your father and brother get the property partitioned and then your father can gift his share to you by way of gift deed, or a partition deed may be executed treating the property as joint family property if it is joint family property and get the property divded between you two brothers and your father can in the same deed state that he has relinquished all his rights, titlle and interest in the said property.