Common frauds in the transfer of properties

Common frauds

Perception is – Where there is property, there is a fraud!  Possibly because, there is a lack of transparency in the processes, and the documentation is not simple. Also, in most cases, there is a casual approach to property management issues.

Here’s a glimpse of what the transfer of property entails, the potential frauds therein, and the solutions

Transfer of Property:

  • The transfer of property is an act by which the owner of the property (transferor) transfers the ownership rights in the property to another person (transferee)
  • Property can be transferred in several ways like Gift, Will (Inheritance), Sale, Partition or Relinquishment of share in case of co-owners.  
  • Property is transferred along with the liabilities attached to it. But it should be with the consent and knowledge of the transferee. E.g. in case of Gift, the donee must accept the gifted property with the liabilities if there are any.
  • There can be some agreement or adjustment between the transferor and the transferee about liabilities. It is generally there in case of inheritance, partition or relinquishment.  

Also Read: Property rights of a son on mother’s self-earned property – Issues and the Law

Fraudulent transfer and frauds:

  • When the transferor transfers the property by concealing the facts of liabilities/defect in property from the transferee intentionally, it is called a fraudulent transfer. 

Some of the common frauds committed while transferring the property are:

Read: Property Transfer in India

  1. Fake title: The title deed is fraudulent. The person presenting himself as the owner is not the owner. Property papers are false and forged. The title deed can be any document which depicts the title of the owner in the property. 
  2. Multiple Registrations: The property transferred (sold) has got multiple registrations. The property is sold by the owner to many buyers fraudulently. The owner grabbed the money from all the different buyers and absconded. All the different buyers have to fight legal battle to establish their ownership.
  3.  Pre-mortgaged property: It happens a lot of time that the seller/transferor has already mortgaged the property sold/ transferred with a bank to avail loan against it. Thus the property is not free from encumbrances. The fact is not revealed to the buyer, and the buyer loses his hard-earned money if he purchases the property without exercising due diligence.
  4. Encroached property: The property transferred has been constructed on an encroached land. The actual land belonged to Government or another party, but the person who has sold the property to the buyer never disclosed the same. The transferee has to fight legal battles later.
  5. Permissions not obtained: Properties like those in a Registered Society or Housing Board flats require special approval from the Concerned Authorities before transfer. In some cases, the transfer is not even permissible. But the people manage to defraud the transferee and transfer such properties without obtaining the necessary permission. 
  6. Mismatch of location and area: The fraudsters transfer the property by mentioning the wrong location. The area (measurement) mentioned is also not correct. 
  7. The person not authorized to transfer: (fake GPA or misuse of GPA): A person may transfer the property which he is not authorized to transfer. The power of attorney holder misuses GPA and transfers the property in violation of the terms of the same. Hence he cheats both the actual owner and the transferee. Sometimes the GPA is a fake document.
  8. Encumbrances over the property: There are various kinds of encumbrances affecting the value of the property. These can be in the form of mortgage, lien, litigation (disputed property), unpaid charges (utility charges). The transferor of the property can cheat the transferee by not disclosing the same.

Also Read: The married daughters’ right in mother’s self-acquired property

The way out – Key to avoid the frauds:

  • Be alert
  • Take timely precautions
  • Take proper legal advice
  • Scrutinize the documents

Certain precautions will enable the transferee to avoid suspicious transactions:

  • Demand the original property papers for verification.
  • It is essential to check for the payment of dues. Verify the same from the respective Authorities, e.g. office of Municipal Corporation. It is vital to check if the transferor has paid the dues.
  • Visit the offices of local authorities to check out for the encumbrances on the property. The transferor must clear any loan availed by mortgaging the property.
  • If the Power of Attorney holder transfers the property, it is significant to verify its terms to ensure that there is a right to transfer the property.

Read: Property transfer after death

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Property rights of the second wife and her children

Property rights of second wife

Property rights of the second wife and her children can be studied and evaluated as rights of the second wife and her children born out of the second wedlock, in the property of their father.

Polygamy was recognised and acceptable among Hindus in ancient times. In modern India, we have a law in place, Hindu Marriage Act, 1955, which prohibits bigamy/polygamy. Wife is entitled to various rights if the marriage is valid under the Act.

Also Read: Legal Rights of a Wife

Valid marriage:

A marriage is valid under Hindu Marriage Act if it satisfies the conditions given under section 5 of Hindu Marriage Act, 1955.  One such condition is that at the time of marriage neither party has a spouse living or an existing valid marriage. If at the time of second marriage, any party has a spouse living or the earlier marriage has not been set aside by way of a decree of divorce/annulment, then such a second marriage is illegal.

Status of second marriage and rights of the second wife:

  • When the person governed by the provisions of Hindu Marriage Act, has married the second time and the second marriage is null and void, the second wife in such a situation has no right to inherit any property of her husband
  • If the second marriage is a valid marriage as per the provisions of the Act, then such a second wife has same rights in the property of her husband as that of the first wife.

The right of children of the second wife:

  • In case, the second marriage is a valid marriage, children born out of this wedlock share equally with the children of the first wife.
  • Even if the second marriage is void or voidable under the Hindu Marriage Act, the children of the second marriage are considered as legitimate children, and they have a right to inherit from the property of their father.
  • However, under section 16 of the Hindu Marriage Act, such children have a right to inherit the property of their parents alone.
  • They can inherit the property of their father, whether self-acquired or ancestral but not the ancestral joint family properties. It implies that they cannot inherit ancestral property other than the share of their father in the ancestral property.
  • The law says that the children of the second wife have equal rights as the children of the first wife on their father’s (self-acquired and ancestral) property. 

Read: Financial settlement during the divorce

The right of the second wife to maintenance:

If the second marriage was performed without disclosing the fact of existing first marriage, the second marriage is not valid. However, the second wife gets the status of a legally wedded wife only for claiming maintenance.  Children of such second marriage also have a right to maintenance.

This right has been recognised by courts while interpreting the law to advance the objective of the Act and to suppress the mischief of the second marriage (bigamy) as intended by the legislature.

 The right of second wife’s children from her previous marriage:

Even if the second marriage is valid under the Hindu Marriage Act, the children of the second wife from her last marriage have no right to inherit the property of deceased (their father from second marriage). The stepson is not included in the term “son” used in the class of heirs in Hindu Succession Act.  It can be a natural son or an adopted son.

Property rights of second wife are subject to the status of second marriage. If the second marriage is valid as per law, she enjoys equal rights in the property of her husband as the first wife has otherwise no right to inherit.

How does the Law define “Fraud”?

How does the Law define Fraud

Cheating and Fraud might be taken sometimes as being interchangeable in common language. Yet the Indian Law provides for these two offences in separate sections of the Constitution. To protect the interests of the people and maintain order in the society the government has lain down asset of norms that are described under IPC.

The Indian Penal Code (IPC) explains the provisions about the offences of fraud under Sections from 421 to 424.

Section 421

  • Any person who fraudulently or dishonestly conceals, removes or delivers or transfer or causes the transfer of any property to another person
  • Or anyone who has deceitfully / fraudulently, had concealed or had removed or had delivered or had transferred or had caused to be transferred any property, without appropriate consideration
  • The mentioned concealment or removal or delivery or transfer was done to prevent the distribution of that property, as per the law among the creditors of accused person or the creditors of another person.
  • The punishment for fraud is imprisonment of either description for a term which may extend to two years or fine or both.
  • The fraudster shall be punished with imprisonment of either description for a term which may extend to two years, or with fine, or with both
  • The act is non-cognizable, bailable, triable by any Magistrate, compoundable by the creditor who is affected but only with the permission of the court.

Section 422

  • Any person who fraudulently or dishonestly makes omissions or performs an act, whereby the act or omission done by him creates a situation where no amount is made available as per law for the payment of his debts or the debts of another person.
  • The punishment for cheating is imprisonment of either description for a term which may extend to two years or fine or both.

Section 423

  • Any person who has fraudulently or dishonestly executed, signed, or became a party to any instrument or deed.
  • The said instrument or deed implies to transfer or create a charge upon the concerned property or charge on interest on the involved property.
  • The concerned deed or instrument contains a false statement related to the consideration of such charge or transfer or a false statement related to the person or persons for whose benefit or use the deed is intended to operate.
  • The punishment for cheating is imprisonment of either description for a term which may extend to two years or fine or both.

Section 424

  • Any person who has fraudulently or dishonestly removed, or concealed any property of himself or another person
  • Anyone who has fraudulently or dishonestly assisted in the removal or concealment of   a property of himself or another person
  • Any individual who has dishonestly or fraudulently given up or released any claim or demand to which he is entitled
  • The punishment for cheating is imprisonment of either description for a term which may extend to two years or fine or both.

The often misinterpreted term – “Adultery”!

Adultery Laws in India

Adultery is a term associated with extramarital sex that is deemed unacceptable on social, religious, moral, or legal grounds. What sexual pursuits draft adultery varies, as well as the social, religious, and legal consequences. A single act of sexual intercourse is sufficient to constitute adultery, and a more long-term sexual relationship becomes an affair.

What is considered to be Adultery?

Intentional sexual relations between an individual who is married and someone who is not the spouse of the person. The act is seen as wrongful regardless of whether the other person was married. At Common Law, adultery was unlawful intercourse between a married woman and any man other than her husband.

What comprises Adultery Law in India?

Indian Penal Code under section 497 deals with Adultery. According to the Indian penal law, a woman cannot be convicted of infidelity. In India, Only a man who has consensual sexual intercourse with the wife of another man without his consent can be liable under this offense in India. If someone “lives in adultery,” the partner can file for separation.

Adultery Laws In India

We can sum up by saying that adultery is a consensual relationship between a married person and somebody who is not his/her legal spouse. Adultery is therefore legally wrong and is a punishable offense in India. Performing adultery is a crime which violates the marriage vows and is harmful to public morals. It is considered illegal in many countries, and certain laws have been passed to keep a check on it. Though performing adultery does not sum up to any criminal offense, it may still invite due consequences, and the person involved may be penalized and punished especially if the case is of separation.

History of Adultery

Ancient Greece and Roman world had harsh laws against adultery, but those were applicable only if the female was married. Those laws were not applicable if a man maintained a sexual relationship with a slave or an unwed woman. The Bible too prohibits adultery, and the seventh commandment clearly states this. In Judaism, both the parties were uniformly responsible for adultery. However, it applied only when the female partner was married. Lord Jesus also abhorred adultery and considered that even looking at a woman with lust is equal to adultery. As per ancient Hindu laws, only the felonious females were punished and killed whereas the men were left off with warnings only.

Adultery laws

A  legal definition of adultery would be different from one country to another. Laws related to infidelity vary from statute to statute. In some places, it is an offense, and the adulterer has to face death penalty while at some place it may not be a punishable crime. As per some statutes, if either individual is married to someone else, both parties to an adulterous liaison are culpable to the offense. As per the Indian jurisdiction, the adultery law comes under Section 497 of the Indian penal code and two rules cater to adultery, they are:-

Section 497 of IPC:

As per  IPC, section 497  it is adultery when somebody has sexual intercourse with someone whom he identifies or has reason to believe to be the wife of another man, without the permission of that man, such sexual intercourse not resulting to the offense of rape, is guilty of the crime of adultery. Such an act is liable to punishment with confinement of either for a period which may extend to five years or with fine or with both. In such case, the wife shall not be punishable as an abettor.

Section 498 of IPC:

Enticing or detaining married women with criminal intent also calls for punishment with subjecting of both order for a term which may extend to two years, or with fine, or with both.

Our society abominates marital infidelity/Adultery and these laws have been passed to maintain and preserve the sanctity of marriage.


Adoption Laws and Norms

What does Adoption mean?

  • Adoption is a legal process of establishing a parent-child relationship between two individuals who are not related by birth.
  • On the one hand enables a childless parent to have a kid of their own and on the other an orphan child or a kid whose biological parents can’t raise him/her get to have parents, a home, a good life, and a family’s name.

Acts that Governs the adoption of children in India:

  • The Hindu Adoption and Maintenance Act of 1956
  • The Guardians and Wards Act of 1890
  • The Juvenile Justice (Care and Protection) Act of 2000, amended in 2006

Who is eligible to adopt a child in India?

The Indian citizens, Non-Resident Indians, and Non-Indians residing outside India can adopt a child from India although a different set of rules are relevant for each of the category of adopting parents.

The Indian citizens residing in India are given priority during the adoption process. For the NRIs, the adoption procedure also depends on rules and regulations and immigration laws of the countries in which they reside.

What role does age play in Adoption Process?

An adoptive mother who wishes to adopt a child should be at least 21 years old. Although the maximum age limit for the single parent or the couple depends on the age of the child who is up for adoption, a single parent aged 55 years or more cannot adopt a child and couple whose cumulative age is more than 110 years.

For example, for a one-year-old child, the total age of the adoptive parent should not exceed 90 years, and neither parent should be older than 45 years.

Eligibility Norms for Parents

The eligibility norms for prospective adoptive parents are as follows –

  • The prospective adoptive parents should be mentally, physically, and emotionally stable and not have any life-threatening medical condition.
  • The potential adoptive couple should at least have two years of stable marital relationship.
  • Whether the prospective adoptive parent is married or not or they have biological son or daughter they are eligible to adopt a child.
  • A single woman is eligible to adopt any child, and there should be a minimum age difference of 21 years between the single mother, and the adoptive child if they’re of opposite sexes.
  • A single male cannot adopt a girl child i.e. he can only adopt a male kid.
  • As a couple, the adoptive parents are required to have each other’s consent to adopt a child.

Legal Aspects of Adoption

The couple or single parent looking for adopting a child should be aware of legality involved in the process. The prospective parent cannot adopt a kid directly from maternity homes, hospitals or nursing homes.

There are Specialised Adoption Agencies (SAAs) that are recognized by the government where one can register for adoption.

One of the government approved authorities is CARA, i.e., Central Adoption Resource Authority. It is a Central Designated Authority of Government responsible for facilitating adoption as per the guidelines.

The adoptive parent can register under CARA which helps in tracking the application status and searching for agencies from any state in India on the website.

Process of Adoption

  • After registering under CARA, the prospective parents have to upload some documents within 30 days of the online registration, or the registration gets cancelled.
  • The documents required to be uploaded as follows:
  • Passport/PAN Card
  • Residential Proof
  • Proof of income
  • Marriage Certificate copy
  • Birth certificates of adoptive parents
  • Medical Certificate for parent’s fitness
  • A guardian should be appointed if the prospective parent is single in the case of some mishap.
  • Once the documents are uploaded, the parents have to contact concerned SAA so that they can conduct Home Study Report (HSR) assess their capability of taking care of the adopted kid. A professional Social Worker does the process.
  • After the HSR is done, the parents are placed on agency’s wait list.
  • The waiting period depends on the agency’s existing list and the number of children cleared for the process.
  • In the end, the parents select a child and take him under foster care system i.e. till the deed is finalized.
  • The process is legally final when the court issues the adoption deed.