Relinquishing property in favor of mother

Yes, you and your sister can execute a release deed without consideration in favour of your mother and your mother can sell the property. In such an event the entire sale proceeds would belong to your mother only. Depending on your mother’s income from other sources and the sale value of the house, your mother may be liable to pay capital gains tax.

In some States they charge stamp duty for the release deed based on the market value of your shares. But in Maharashtra there are a couple of Bombay High Court decisions stating that if the release deed was executed without receiving any consideration, then a nominal stamp duty of Rs.200/- only was payable. I do not know about Haryana.

Dear Krishan Attre,

Legally there is no lacuna if you all sell at once in favour of any third parties and if you jointly alienate the property, you will have the benefit of capital gains in respect of that property and burden of tax will be shared by all of them.

In case, if you wish not to sell any third parties but want to retain by only any one of you then go for a release deed.

entirely agree with mr. ksa narasimha rao

Whether there will be any savings in capital gain by distribution among the three will depend on the overall capital gain and income bracket of each person, particularly if the mother is a senior citizen