No need to sign an indemnity bond
once relinquishment deed is executed sibling would be absolute owner of property
he should only give bond
Indemnity bond
Hi Including my mother there are 4 siblings. The siblings parents have a flat in Mumbai. The parents passed away and as per the hindu succession act all 4 siblings have inherited 25% share on the property. Off the 4 siblings, one of the siblings has been staying this property and paying all the taxes and maintenance. Now this care taker sibling wants to sell the property and requested the other 3 siblings to sign on a transfer deed and indemnity bond. After signing the transfer deed the property will be in the sole name of the sibling living in that property. But he also wants all the other siblings to sign on an indemnity bond/affadavit which has a clause that all costs related to claims arising in the future will be borne by all the siblings. is this correct? Why should all siblings sign on indemnity bond when they are signing on a release deed and willingly releasing their share of property?
Asked 3 years ago in Property Law
Religion: Hindu
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9 Answers
I was of the same opinion, however that sibling is suggesting that the society members (where the flat is located) & the purchaser are insisting that all brothers and sisters must sign indemnity bond to protect them against the 3rd part claims. Is this correct?
Asked 3 years ago
As all the 4 siblings have 25% undivided share each, any sale deed has to be executed by all the four jointly, to be legally valid. Alternatively, the other three may either jointly or severally execute and register a specific PoA in favour of the caretaker sibling. However, the sale proceeds have to be shared equally among all the 4 siblings after defraying the incidental expenses. Again, alternatively, the other siblings may relinquish their respective undivided shares in favour of that sibling for monetary consideration. This relinquishment deed has to be registered before the sale takes place. There is no need to sign any indemnity bond separately, as such an indemnity by the vendor is usually built in, in any sale deed.
Refuse to do so
once relinquishment deed is executed duly stamped and registered you have no right , title , interest in the flat
- Since the all the siblings are leaving their share in his name by way of registered release/relinquishment deed , then the question to sign on the indemnity bound should not arise .
- However, the purchaser of that property may ask for indemnity bond for his safety , so that no legal heirs of the releaser even claim any right over the property in future.
Dear Client,
Please note that once the relinquishment deed has been registered and executed, it is not necessary to sign an indemnity bond. The relinquishment deed renders the siblings as the absolute owner of the property, and hence, such a clause shall not be legally valid.
It is advisable not to sign such an indemnity bond. It shall be deemed completely baseless.
Thank you.
If there are legal heirs it's advisable to sign for indemnity bond to secure the interest of buyer. But it's not a mandatory law
The registered release deed executed by the siblings relinquishing their rights i the property is more than enough and once they have relinquished their rights in the property they are not liable for any issue that may arise in the future.
Hence the proposed indemnity bond is not necessary, you people can refuse to execute any such bond or else you can state that you are all not willing to relinquish your rights in the property.
This is incorrect.
The buyer cannot demand any such indemnity bond.
The sale deed itself would contain the clause stating that the seller would be responsibly for any litigation that may arise at a later stage in respect of the property that is being sold now.
You all can refuse to do so, the society also do not have any rights to demand such a bond from the shareholders of the property who have relinquished their rights in the property by executing a registered release deed.
Dear Sir,
You should not agree to sign indemnity bond but jointly sell the property and get your respective shares in your respective accounts by way of transfer.
