Theme: Money & Property

What are inheritance rights?

When it comes to immovable property, inheritance refers to the transfer of a property’s ownership after the death of an individual. The ideal way to ensure smooth transfer of property ownership following someone’s death is through a will(( To know more about wills, read our explainer – https://nyaaya.org/topic/will/)).

However, if there is no will, i.e., an intestacy, law of inheritance applies to decide distribution of the property. In India, personal laws, customary laws and legislative laws govern the law of inheritance of property e . The broad laws are the Hindu Succession Act 1956 and Islamic personal laws.

Under the Hindu law of inheritance, a person/owner can deal with their self-acquired property as they like, but there are restrictions about transfer of ancestral property. The law gives certain family members a birthright to ancestral properties. Brothers and sisters are entitled to equal shares in the property of their mother or father under the Hindu law of inheritance. Here, the terms ‘son’ and ‘daughter’ include adopted sons and daughters, but not stepchildren.

If the survivors have a dispute over immovable property, and the owner of the property does not have a will, they can file a suit before court.

In the case of Muslim law of inheritance, the personal laws that apply depend on which sub-sect one belongs to, i.e., Sunni or Shia. The laws are not codified, which means that there is no act setting them down. For Sunnis following Hanafi Law, personal law restricts legacies to a maximum of one-third of the estate remaining after taking care of funeral expenses, outstanding wages of domestic servants and debts.

What are the different types of immovable property?

Under Indian laws, immovable property includes land, buildings, hereditary allowances, rights to ways, lights, ferries, fisheries or any other benefit to arise out of land, and things attached to the earth, or permanently fastened to anything which is attached to the earth, but not standing timber, growing crops nor grass.(( Section 2 (6) of the Registration Act, 1908)) Due to the fact that land is a state subject under Schedule VII of the Indian constitution, the laws governing immovable property vary from state to state.

Land and Property belonging to SC/ST

It is illegal to take over any land that is owned or controlled by, or allotted to any SC/ST member as well as forcing an SC/ST member to leave her home unless it is done legally. 

The takeover of the property is considered illegal if it is done

  • without the agreement of the victim, or
  • by threatening her or someone connected to her, or
  • by making false records.

It is also a crime to similarly illegally deprive an SC/ST member of his property or to prevent him from exercising his rights over any land. This includes:

  • Blocking an SC/ST member from accessing any forest rights under the Forest Rights Act.
  • Blocking rights to any water source or irrigation source.
  • Destroying or taking away crops.

You can face imprisonment of a term of 6 months to 7 years for using fire or bombs to damage homes, religious places and/or property belonging to SC/ST members. You can report such crimes.

Calculating Taxable Income

The Income Tax Department taxes you based on your income from the categories given below(( Section 14, Income Tax Act, 1961)). Gross total income is the total income calculated based on these categories. It is from this amount that deductions are made.

Income from Salary 

Income from salary is taxable in India. Salaried income which is taxable consists of:

  • Salary due from the employer (including a former employer) to the taxpayer during the previous year. The salary will be taxed even if it has not yet been paid.
  • Salary paid by the employer (including the former employer) to the taxpayer during the previous year, before it became due. For example, if the employer pays the salary for a project in advance.
  • Any arrears or pending salary paid by the employer (including the former employer) to the taxpayer during the previous year. This happens only if tax was not charged to this amount in an earlier year.

The following break-ups within your salary are fully taxable:

Basic Salary Fully Taxable
Dearness Allowance Fully Taxable
Bonus, Fee or Commission Fully Taxable

Income from Capital Gains

Income from capital gains(( Capital Gains, Income Tax Department, available at https://www.incometaxindia.gov.in/Tutorials/15-%20LTCG.pdf. is charged only in the following conditions: There should be a capital asset((Section 2(14),Income Tax Act, 1961)). In other words, this refers to any property held by a taxpayer.

  • During the previous year, the capital asset is transferred by the taxpayer.
  • There should be profits or gains as a result of transfer. Read more here to understand which transactions are not considered to be “transferred” by the taxpayer.

Some transactions not taxed are:

  • Distribution of assets(( Section 46(1), Income Tax Act, 1961)) in a company to the shareholders at the time of liquidation
  • Distribution of capital assets (( Section 47(1), Income Tax Act, 1961))on a partition of a Hindu Undivided Family

Income from House Property 

A house property could be your home, an office, a shop, a building or some land attached to the building like a parking lot. The Income Tax Act does not differentiate between a commercial and residential property. All types of properties are taxed under the head ‘income from house property’ in the income tax return. This includes property you own. Income from house property is taxable if:(( Section 22, Income Tax Act, 1961))

  • The house property should consist of any building or land attached with it
  • The taxpayer should be the owner of the property
  • Business or profession is not carried on by the taxpayer in the house property

Income from Business and Profession 

Remuneration, bonus or commission received by a partner from the firm or anyone working independently in a business or profession, is not taxable as ‘Income from Salaries’. Rather, it would be taxable as ‘Income from a Business or Profession’ (( Section 17, Income Tax Act, 1961)). Tax is charged  on the following from a business or profession(( Section 28, Income Tax Act, 1961;Section 41, Income Tax Act, 1961; Section 43 , Income Tax Act, 1961)):

  • Any compensation or other payment owed to or received by any specified person.
  • Income derived from a trade, profession or any specific services performed for its members, like an income made by a contractor.
  • Cash assistance (by whatever name it is called) received or receivable by any person against exports under any scheme of Government of India.
  • Value of any benefits arising from a business or a profession.
  • Interest, salary, bonus, commission or remuneration owed to or received by a partner from partnership firm.

Read more examples on which income is charged here.

Income from Other Sources 

Any income which is not chargeable to tax under any other heads of income, but which is not to be excluded from the total income, is chargeable to tax under the head “Income from Other Sources”.(( Section 56, Income Tax Act, 1961)) Some examples of these are:

  • Dividends
  • Income from winning lotteries, crossword puzzles, races including horse races, card games, gambling or betting of any form or nature.

The following amounts fall under the head “income from other sources”. Amounts not taxed under the head of ‘Profits and Gains from Business or Profession’, fall under this category. This is applicable only if

  • Any money received by an employer from his employees as a contribution towards PF (Provident Fund), ESI (Employee State Insurance), Superannuation Fund, etc.
  • Interest on securities
  • Income from machinery, plant or furniture belonging to taxpayer and let on hire
  • Composite rental income from letting of plant, machinery or furniture with buildings
  • Any sum received under Keyman Insurance Policy (including bonus)

Steps for Negotiation with Landlord

Steps to Take for Negotiation with Landlord

Ask for Identity Proof

You can ask the landlord/licensor for identity proof so that you can confirm that the landlord is the owner of the house or has the permission of the owner to rent the property. The purpose of asking for identity proof is to check whether the person is who they claim to be. Some of the most common identity cards used are Aadhaar card, Driving License etc. The ID card must have the picture as well as the permanent address.

Negotiate Rent and Security Deposit

Negotiate the rent and security amount with him and try to ask for the receipts for both. In some cases, the brokers can be very helpful while trying to negotiate the rent, so you can also request him to accompany you during the rent negotiations.

Negotiate Requirements in the House

While inspecting the house if you have come across any changes or additions to be made, you should tell your landlord before signing the contract. It is helpful to do it before as you will know whether the landlord is open to negotiations for the requirements you want and to assess whether you are getting your house for the best price. Make a list of repairs and installations so that your landlord can look into them.

Valid Will

For a will to be valid:

  • It must have your signature (or your thumb impression).
  • The signing/fingerprinting should be done in the presence of two other people who will act as witnesses.
  • Both witnesses will sign the will or put their thumb-impression in your presence.

You can also direct someone else to sign your will in your presence. There is no prescribed format or prescribed place for this signing. Anyone can be a witness to your will – including the executor.

What are consumer rights?

Consumers who are unaware of their rights are vulnerable to the marketplace. It is vital for consumers to be aware of their rights so that they can make choices confidently, and with due regard to their interests. Consumer Rights include, but are not limited to, the following ((Consumer Rights, Department of Consumer Affairs, accessed at https://consumeraffairs.nic.in/organisation-and-units/division/consumer-protection-unit/consumer-rights:

Right to protection against goods and services which are hazardous to life and property

Goods should not only meet the consumers’ immediate needs, but also fulfill long-term interests, and the use of goods and services  should not result in any harm to consumers. For instance, if a person uses a medicine that cures an immediate ailment such as the flu, but the medicine causes worse side-effects, then they can file a consumer complaint.

Right to be informed

Consumers have the right to be informed about the quality, quantity, potency, purity, standard and price of goods. This right ensures that sellers put out authentic information on the product labels and do not make claims which are not true.

The government also publishes a price monitoring list for essential commodities along with Mandi prices, daily price reports, educational material on consumers’ digital safety etc. Some state Governments, such as Tamil Nadu, have also published advisories to educate consumers.

Right to choose a variety of items at competitive prices, wherever possible

Consumers have the right to get basic goods and services at fair prices. For example, you have the right to buy medicines either from the hospital medical store or from general stores at fair prices.

Right to file a complaint at Consumer Redressal Forums

Consumers have the legal right to use Redressal Forums to file their complaints. Every consumer has a right to file a complaint and be heard so that the grievance can be resolved.

Right to seek redressal against unfair trade practices

Unfair trade practices usually relate to cheating, deceiving, or defrauding the consumer through schemes, advertisements etc. The law protects consumers from being exploited and creates a system for the consumer to claim a fair settlement through the redressal forums.

Lodging a complaint with the Bank

Most banks have staff dedicated to matters like this. The relevant contact details are found on the backside of your card as well as the website of the bank. Telephone numbers of help desks are also displayed at every ATM machine.

If you have suffered a loss you must immediately contact the banks via phone (preferably) or email. Do not forget to note the complaint number and follow up your complaint using the same number. The bank should acknowledge your email.

The Code of Bank’s Commitment to Customers (CBCC) enacted by the Banking Codes and Standards Board of India (BCSBI) mandates each bank branch to display the name of the official at the bank branch responsible for addressing customer grievances.

If your complaint is unresolved at the branch level, you may approach the Regional or Zonal Manager or the Principal Nodal Officer (PNO) at the address displayed at the branch.

Typically, within 30 days of receiving the complaint, the bank will send you a final response or explain why more time is needed to investigate. The Bank will also tell you the process to take the complaint forward in the event you are still unsatisfied after the final response from the bank.