The Private Client team at Cyril Amarchand Mangaldas shares their comments and opinions shared in an article in the following Q&A which was published by the Mint Newspaper on 14th April, 2021 and the online edition of the same can be found here.
I am 76 and in the process of writing my will. At present, I have a residential apartment in my name, along with my wife and elder daughter. As per my will, can I assign this property to my wife and younger daughter (and not my elder daughter)?
—Name withheld on request
We have assumed that you are Hindu by faith and the residential property is “self-acquired” (i.e. not Hindu Undivided Family/ancestral property). On the basis of these facts, we note that the property is jointly owned by you, your wife and your eldest daughter. Accordingly, your ownership interest in the property is limited to one-third of the total interest.
Accordingly, your right to bequeath an interest in the property is limited to only your limited share. Under your will, you can bequeath your share to a legatee of your choosing, to the exclusion of others. However, please note that your wife and your eldest daughter will continue to own their respective shares, irrespective of how you choose to bequeath your interest.
Should you bequeath your one-third interest in the property under your will to your wife and youngest daughter (to the exclusion of your eldest daughter), the ownership will ultimately reflect as your wife owning one half of the property; your eldest daughter continuing to own one-third; and your youngest daughter owning one-sixth of the property.
We are four brothers and two sisters. Our father passed away four years ago and mother died six years ago. Now, all of us have decided to partition the property that our father had created. It includes a plot of land, which also had a shop. One of my brothers stayed with our parents. All other siblings are in different cities or countries. When we discussed the division, my brother who stayed with our parents revealed that father had given him the shop via gift deed. We were all surprised by this. All of us want an equitable distribution. Can we challenge the gift deed and ask the court to revoke it, as this was made when father was 90 and bedridden. What are the other options that we have?
—Name withheld on request
The solution would lie in the identity of the property in the hands of your father at the time of his death. Based on the facts provided, it appears that as your father had “created” a property on the land, the shop was therefore “self-acquired”.
For the purpose of our response, we have assumed that you and your family are Hindu by faith. Under Hindu law, a person has the absolute right to gift any part of their self-acquired property. Any challenge to such a gift will have to be done on the merits of the matter itself, including factual arguments on the capacity of your father to enter into the gift deed, considering his health at the time. A further challenge may lay on the merits of the gift deed, i.e., if it was entered into by your father under duress, or by exercise of fraud, misrepresentation, etc., or if the gift deed was insufficiently stamped. That said, this would require consultation with a counsel, since an examination into the particulars of the deed are crucial prior to maintaining such a challenge.
In the event that the gift is held to be valid, the balance property would devolve on your siblings and yourself, with each acquiring one-sixth share (minus the shop).
However, if the property was acquired by your father, but thereafter added to any HUF, then a gift in favour of your brother would be void. The assessment of the identity of the property and the gift deed would be imperative.