Everything You Need to Know About Release Deed

A release deed is a legal document that facilitates a smooth transfer of property rights. Read more to understand its purpose, legalities, and other details.
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Everything You Need to Know About Release Deed
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2 min read
03 January 2024

A release deed is a legal document that plays an important role in property transactions and settlements. It serves as a formal agreement between two parties, releasing one party's interest or rights in a property in favour of the other. Read on to understand more about release deed.

Purpose of a release deed

The primary purpose of a release deed is to transfer, relinquish, or release one party's rights, interests, or claims in a property to another party. This can happen in various scenarios, such as when a co-owner decides to give up their share, when a borrower repays a loan secured by the property, or during family settlements where one member decides to release their stake.
A release deed is particularly crucial when it comes to joint property ownership. It ensures a smooth transfer of ownership rights from one party to another, preventing any future disputes or legal complications.

Legalities of a release deed in India

In India, a release deed is governed by the Indian Registration Act, 1908, and it must be registered with the sub-registrar of assurances in the respective jurisdiction where the property is located. The registration of a release deed ensures its legal validity and acts as evidence in case of any disputes.
The release deed should be executed on non-judicial stamp paper of the requisite value, as prescribed by the Stamp Act applicable in the concerned state. It must also be signed by the parties involved and attested by at least two witnesses.

Release deed format

A release deed includes the following details:

  1. Title: Clearly stating that the document is a release deed
  2. Parties involved: Names and details of the releasor (the party releasing the rights) and the releasee (the party receiving the rights)
  3. Property details: Description of the property being released, including its location, survey number, and any other relevant details
  4. Consideration: If any consideration is involved, it should be clearly mentioned in the deed
  5. Rights being released: Specific details about the rights, interests, or claims being released by the releasor
  6. Legal declarations: Statements asserting that the releasor is willingly and voluntarily releasing the rights without any coercion

Legal implications and significance

  1. Transfer of ownership
    A Release Deed facilitates the seamless transfer of ownership by legally releasing the relinquishing party from any claims or rights associated with the property. It is a fundamental step in ensuring a clear transition of property rights.
  2. Avoidance of future disputes
    By clearly outlining the rights being relinquished, the Release Deed helps prevent potential conflicts and disputes in the future. This legal document acts as a safeguard, providing a clear record of the transaction and the intentions of the parties involved.
  3. Inheritance and succession planning
    Release Deeds are frequently used in inheritance and succession planning, particularly in joint family properties. Individuals may choose to release their share in favour of specific family members, streamlining the transfer of property within the family.
  4. Tax implications
    It is essential to consider the tax implications associated with a Release Deed. Depending on the nature of the transfer, there may be capital gains tax or other tax liabilities that need to be addressed. Seeking professional advice is advisable to navigate the tax landscape effectively.

Disclaimer

1. Bajaj Finance Limited (“BFL”) is a Non-Banking Finance Company (NBFC) and Prepaid Payment Instrument Issuer offering financial services viz., loans, deposits, Bajaj Pay Wallet, Bajaj Pay UPI, bill payments and third-party wealth management products. The details mentioned in the respective product/ service document shall prevail in case of any inconsistency with respect to the information referring to BFL products and services on this page.

2. All other information, such as, the images, facts, statistics etc. (“information”) that are in addition to the details mentioned in the BFL’s product/ service document and which are being displayed on this page only depicts the summary of the information sourced from the public domain. The said information is neither owned by BFL nor it is to the exclusive knowledge of BFL. There may be inadvertent inaccuracies or typographical errors or delays in updating the said information. Hence, users are advised to independently exercise diligence by verifying complete information, including by consulting experts, if any. Users shall be the sole owner of the decision taken, if any, about suitability of the same.

Frequently asked questions

How can you write a release deed?

Writing a release deed involves understanding the specific details of the property transaction and adhering to the legal format. It is advisable to seek legal assistance to draft a comprehensive and legally sound document.

What are the rules for release deeds?

Release deeds must comply with the rules outlined in the Indian Registration Act, 1908, and the Stamp Act applicable in the concerned state.

Is stamp duty payable on a release deed?

Yes, stamp duty is payable on a release deed, and the amount varies based on the state where the property is located. The stamp duty should be paid on non-judicial stamp paper of the prescribed value.

What is the difference between relinquish deed and release deed?

While both deeds involve the relinquishment of rights, a relinquish deed typically involves giving up one's claim or interest in favour of another party without any consideration. In contrast, a release deed may involve consideration for the release of rights, and it is commonly used in property transactions and settlements.

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