At the time of divorce, couples are often confused and uncertain about
the division of property held jointly by them. The problem arises because
eventuality of separation is not contemplated while purchasing jointly and
there is no proper documentation.
Matrimonial responsibilities are no longer a domain of any single spouse. Both have to participate equally. Joint ownership of husband and wife, in property purchased after marriage, is a common feature. There are various reasons for preferring joint ownership in property.
- Rebate in stamp duty for women investors
- Tax benefits associated with joint ownership
- Loan eligibility increases and repayment process become easy
When couples decide to part away, there are many issues to be addressed
and the most important being the division of joint property.
Many times, estranged couples have approached us to find a solution to their problem of division of property. We generally advise them to decide the same with mutual consent because litigation in this regard can be quite toiling.
Division of property at the time
of divorce:
1. Division by mutual consent: Division of property held jointly, can
be smooth if there is a mutual understanding among the two for:
- Ownership
- Equity
- Contribution
The partners get their share as per the equity/contribution.
2. Proof of Contributions made for the purchase of property: The
person who holds the title is the owner even if the other partner has
contributed the purchase money in total. The other partner has to prove the
financial contributions made by him to get the due share.
3. Self-acquired property or inherited property: The self-acquired property is not part of any settlement at the time of divorce. The property to be inherited in the future does not become part of the settlement. If the ancestral property has been partitioned or has devolved as per succession law and husband or wife have got their shares, then such property becomes self-acquired property qua the spouses and is not subject to settlement at the time of divorce.
4. Joint loan: If the joint property has
been bought on loan payable by both, then the parties have to split their
liabilities accordingly, or one partner can bear the loan amount and be
compensated by other.
5. Disposal of joint property as per Section 27 of Hindu Marriage Act:
The Hindu Marriage Act, 1955 contains a provision u/s 27 of the Act, for
disposal of property presented jointly to the spouses, at or about the time of
marriage. Joint property purchased after marriage is outside the purview of
this section. However, if the parties have reached a compromise regarding such
properties, Court may record the same at the time of passing the decree.
6. Maintenance: Right to maintenance includes right to residence also
after divorce. However, the right depends upon the terms of the decree of
divorce. In Hindu law, any party can apply for the grant of permanent alimony
and maintenance pendent lite.
The amount of maintenance if not paid as directed, can be recovered from
the property of the person liable to pay the same.
Smooth Sailing:
- It is always advisable to engage a lawyer and prepare the documents relating to purchase of the property taking care of all reasonably expected eventualities. Proper documentation defining the claims based on equity makes division an easy affair later.
- Selling the property and sharing the proceeds is also an option.
- In case the joint property is a dwelling house, one can retain the house, and other can be compensated monetarily.