Co-own­ers’ share in joint prop­erty

Un­der the Trans­fer of Prop­erty Act (TPA), the in­ter­est of each co-owner is pro­por­tion­ate to his/her fi­nan­cial con­tri­bu­tion made at the time of pur­chase

HT Estates - - Front Page - Su­nil Tyagi

When a cer­tain im­mov­able prop­erty is pur­chased by two or more in­di­vid­u­als, it is called a jointly owned prop­erty and the in­di­vid­u­als are re­ferred to as co-own­ers. Each owner’s in­di­vid­ual share can be clearly spec­i­fied only if the sale deed states the per­cent­age/pro­por­tion that each in­di­vid­ual owns in re­la­tion to the en­tire prop­erty. One may even iden­tify the un­di­vided share of each in­di­vid­ual co-owner by giv­ing a phys­i­cal de­scrip­tion of the spe­cific por­tions of the prop­erty owned by such in­di­vid­u­als. On the other hand, there are nu­mer­ous in­stances where the de­scrip­tion or quan­tum of each co-owner’s share in a jointly owned prop­erty was ei­ther not clearly spec­i­fied or com­pletely omit­ted in the sale deed. In such a case a chal­lenge arises from the per­spec­tive of the co-own­ers and prospec­tive buy­ers who wish to pur­chase ei­ther the whole or a por­tion of the jointly owned prop­erty - how can each owner’s share be de­ter­mined?

In such cases where there are sev­eral joint own­ers of an im­mov­able prop­erty, the pro­vi­sions of Trans­fer of Prop­erty Act (TPA) can help as­cer­tain the quan­tum of own­er­ship, rights and in­ter­est of each co-owner. How­ever, it is im­por­tant to un­der­stand that the de­ter­mi­na­tion of each co-owner’s share, rights and in­ter­est in a par­tic­u­lar joint prop­erty may also be af­fected by the unique facts and cir­cum­stances of each in­di­vid­ual case.

Un­der the TPA, the in­ter­est of each co-owner shall be in pro­por­tion to their share of pur­chase money which was con­trib­uted (by each such coowner) at the time of buy­ing the prop­erty. Of­ten, two or more in­di­vid­u­als jointly buy a prop­erty by mak­ing a pay­ment of sale con­sid­er­a­tion from a com­mon fund. In this case too, the share of each coowner in the joint prop­erty shall be equiv­a­lent to his/her in­di­vid­ual in­ter­est/con­tri­bu­tion in the com­mon fund. There are also in­stances where it may not be pos­si­ble to de­ter­mine the pre­cise amount which was paid or con­trib­uted by each in­di­vid­ual co-owner to­wards the to­tal sale con­sid­er­a­tion amount. In the ab­sence of any valid proof (eg cheque de­tails, RTGS de­tails), the law shall pre­sume that each co-owner has equal in­ter­est and equal share in the joint prop­erty.

One must bear in mind that th­ese TPA pro­vi­sions are ap­pli­ca­ble in the ab­sence of a con­tract to the con­trary be­tween the par­ties (that is, if the par­ties have not ex­e­cuted any doc­u­ment which clearly sets out the share of each co-owner in the joint prop­erty). To se­cure one’s rights, ti­tle and in­ter­est in a joint prop­erty, it is ad­vis­able for co-pur­chasers to dis­cuss the na­ture and ex­tent of each pro­posed co-pur­chaser’s share prior to fi­nal­is­ing the ac­tual sale-pur­chase trans­ac­tion. It is best to set out the own­er­ship share of each co-owner at the time of pur­chas­ing the prop­erty in the sale deed so there is lit­tle room for dis­pute later.

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