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Dividing your property? How to do it right in a will 

Matters pertaining to succession and inheritance of an individual’s properties are classified in two categories – testamentary succession and intestate succession. An individual is said to die intestate if he has not executed any will. In testamentary succession, the distribution and inheritance of an individual’s properties is carried out as per the terms stated in his/her will. In India, testamentary succession is governed by Indian Succession Act, 1925.

A will is executed with the intention to ensure that the dispute over property of an individual are dispelled or at least mitigated. Nevertheless, certain disputes may arise amongst the future beneficiaries, especially if immoveable properties are distributed amongst more than one beneficiary. To avoid these disputes in such a situation there are certain points to be kept in mind while drafting a will.

In case an individual has an immoveable property that can be divided into clear identifiable and ascertainable portions, it is advisable to clearly describe who will get what portion of the immoveable property in the will.
For instance, A owns a freehold three-storeyed bungalow that he wants to will in favour of his daughters, D1 and D2 and son S1. If the will says that the immoveable property will be inherited equally by D1, D2 and S1 on the demise of A, then after the demise of A, dispute may arise as to who will get what portion. If there is no dispute and D1, D2 and S1 mutually divide the immoveable property, they will have to execute a partition deed which is required to be appropriately stamped and registered.

Under the Indian Stamp Act, 1899, no stamp duty is payable on a will. Thus, a will can even be executed on a plain paper, however, on a partition deed appropriate stamp duty will have to be paid.

If A’s will, clearly mentions that D1 shall get ground floor, D2 shall get first floor and S1 shall get second floor, it will serve a two-fold purpose. Firstly, it will ensure that after the demise of A, there is no dispute between the beneficiaries with respect to who shall have what portion. Secondly, the beneficiaries will not have to execute a partition deed and shall save stamp duty on the same.

It is also advisable to be very clear in the will about the usage and maintenance of common areas and utilities in the immoveable property; for instance, the terrace, parking space(s), lawn(s), sewage and water pipelines, etc. Further, the rights for further construction that may arise due to change in governmental policy should also be clearly defined. The share from any increase in the future in the floor area ratio that may enable the construction of a third floor should also be categorically devolved by A in his will between D1, D2 and S1 to avoid confusion.

Even though under Indian Registration Act, 1908, it is not mandatory to register a will as an unregistered will is considered to be a valid legal instrument, if it has been properly executed, it is preferable to register a will within one’s lifetime.

Thus, a clear devolution of interest in different portions of immoveable property amongst the beneficiaries in the will itself is advisable to avoid -disputes in the future.

(The author is a senior partner at Zeus Law, a corporate commercial law firm. One of its areas of specialisations is real estate transactional and litigation work. If you have any queries, email us at ht@zeus.firm.in and htestates@hindustantimes.com.)

  
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Realty Trends

Home prices near most-affordable levels in over 30 years: HDFC


Home prices may have been on an upward spiral for many years, but the cost of owning a house in India remains near the most affordable level in over three decades, shows data compiled by mortgage giant HDFC Ltd.

The average price of a home, purchased with a housing loan, rose to over Rs. 45 lakh in the 2012-13 fiscal year -- marking the fourth consecutive year of uptrend from about Rs. 25 lakh in the year 2008-09, HDFC has said in a presentation.

However, factors like an even greater surge in the personal income levels, tax incentives and lower interest rates, have resulted into houses becoming more affordable to purchase, it said.

 

 

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India Property Investment Gyan

Major schemes for affordable housing to be modified: Girija Vyas


NEW DELHI: Major schemes meant for providing affordable housing to urban poor will soon be modified to make them more people-friendly, the government said today and invited the private sector to contribute more actively in this area. 

Speaking to reporters here, Housing and Urban Poverty Alleviation (HUPA) ministerGirija Vyas today said her ministry is modifying all the major schemes including the Rajiv Awas Yojana (RAY), Rajiv Rinn Yojana and the, Affordable Housing in Partnership scheme and added enormous budgetary support has been earmarked during the current plan period. 

Secretary HUPA Arun Kumar Misra told reporters that a fund of Rs 35,000 crore had been allocated to the ministry for the implementation of three major schemes, including RAY, which was being run in as a pilot project earlier under 12th five- year plan. 

He said the ministry would require approval from the cabinet for the implementation of these schemes and efforts would be made that through these funds 2 million affordable houses are encouraged. 

He said that in addition to the central government funds, banks and credit institutions would be providing funds for construction of affordable houses. 

Vyas said that with urbanisation, the number of urban homeless and area under slums had grown. 

Vyas said there was a need for private developers to develop economic models to foster affordable housing for economically weaker sections and lower income group households in urban areas as government efforts in this direction needed to be supplemented. 

Vyas also said a technical group, set up by her ministry, had shown that out of 18.78 million housing shortage in the country, 96 percent shortage is in EWS and LIG category and for this huge investments and private sector participation were required. 

Misra said the group set up by the ministry has suggested incentives for the affordable housing sector included concessions to development-related charges and service taxexemptions. 

It also sought direct tax rebates for affordable housing projects and inclusion of the sector in the 'infrastructure facility' he said and added the task force had felt that governments need to still provide direct capital grant support to affordable housing projects. 

Misra said that in the symposium held today where states, experts and private sector representatives were present, there was unanimity on many of the suggestions.

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Green Property- Eco Homes

Reclaim your city space: Projects in Delhi, Mumbai and Kolkata aim to transform lives

 
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