Selling a Jointly Owned Property in India: Consent, Shares, POA and Tax

You and your brother inherited your parents' flat years ago. Or you bought a home with your spouse, and now you are moving cities. The buyer is ready, but the sale deed needs more than one signature. One owner lives in Dubai, and another isn't sure he wants to sell at this price.

Selling a jointly owned property is not complicated in law, but it is easy to stall in practice. Here is what every co-owner should know before anyone signs an agreement.

Every owner has to agree and sign

If a property has two or more owners on the title, the whole property can be sold only when all of them sign the sale deed, either in person at the sub-registrar office or through a properly executed power of attorney. One owner cannot sell the entire flat for the others, even if they live in it, pay the maintenance or hold the original papers.

The Supreme Court said this again in 2024: a co-owner who sells the whole undivided property alone has, at best, transferred only their own share. The other owners keep their rights, and the buyer inherits a dispute. That is why careful buyers and their banks insist on every owner's signature.

The same goes for the sale agreement. Have all owners sign it, and have the token and later payments go to each owner's bank account in the agreed ratio, so the money trail matches the title.

Know who owns how much

Look at the deed through which you got the property. It may state shares clearly (50:50, 60:40) or simply list names. If it is silent:

• Bought together: shares generally follow how much each person paid, so bank statements and loan records matter. Where contributions cannot be traced, owners often treat shares as equal.
• Inherited: shares follow the will, or the succession law that applies to the family if there was no will. Get the legal heirship and khata records sorted before you list.
• Husband and wife: if one spouse paid everything and the other was added as a co-owner for convenience, income tax may treat the paying spouse as the real owner of the whole gain. Talk to a CA about this before the sale.

The cleanest fix is a short written understanding signed by all owners, stating each share and how the sale money will be split. It prevents arguments on registration day.

When an owner cannot be present: power of attorney

A co-owner who lives in another city or country can authorise someone, usually a family member, to sign on their behalf through a specific power of attorney for the sale of that property. A few practical points:

• Make it specific to the property and to the sale, not a vague general authority.
• If signed abroad, it is usually executed before an Indian consulate or a local notary with an apostille, and then stamped (adjudicated) in India within the time allowed, generally three months from receipt. In Karnataka, the stamp duty depends on who the attorney is and whether the POA is given for consideration, so confirm the amount with the sub-registrar or a lawyer.
• The attorney signs the sale deed at the sub-registrar office and the original POA is produced at registration.
• A POA is only an authority to act. The Supreme Court has held repeatedly, starting with the Suraj Lamp case, that a POA or agreement to sell is not a transfer of ownership. Only a registered sale deed is.

If a co-owner is a minor, their share generally cannot be sold by the guardian without court permission. If a co-owner has died, their legal heirs step into their place and must all join the sale.

When one owner refuses to sell

This is the hardest situation, and also a common one. Your realistic options, roughly in order:

1. Talk numbers. Most refusals are about price or timing. A fresh valuation report from a registered valuer often settles the question of what the property is worth.
2. Offer a buyout. The willing owners can sell their share to the unwilling one, or buy him out. A relinquishment or release deed between family members can transfer a share without a market sale.
3. Mediate. A neutral family elder, lawyer or formal mediator can break a deadlock far faster and cheaper than a court.
4. Sell only your share. The law allows a co-owner to sell their undivided share, but very few buyers want half a flat they cannot occupy freely. Where the property is a family dwelling house, other family co-owners may also have a right to buy out an outside purchaser.
5. File a partition suit. As a last resort, a court can divide the property or, where it cannot be split sensibly (like a flat), order a sale and divide the money. Expect this to take years, not months.

How each co-owner is taxed

Each co-owner is treated separately for capital gains. Your gain is your share of the sale price minus your share of the cost of buying and improving the property.

• Long term or short term: property held for more than 24 months gives a long-term gain. For sales after 23 July 2024 the rate is 12.5% without indexation, plus surcharge and cess where applicable. Resident individuals and HUFs who bought before that date can instead choose 20% with indexation if it works out lower.
• Exemptions are personal. Each co-owner can claim the home reinvestment exemption (the old Section 54, which continues as Section 82 of the Income Tax Act, 2025) on their own gain by buying or building a new house within the time limits, subject to the ₹10 crore cap. One owner reinvesting does not help the other.
• TDS by the buyer: for a resident seller, the buyer deducts 1% TDS when the total price is ₹50 lakh or more. Since 1 October 2024, this threshold applies to the full price, even if each owner's share is below ₹50 lakh. TDS is deducted on each seller's share against their own PAN, and each gets their own TDS certificate.
• Different residency, different rules. If one co-owner is an NRI, the buyer must deduct TDS on that owner's share at the higher non-resident rates, which needs a TAN and separate filings.

Worked example: a 50:50 sale

Anita and Vikram, siblings, jointly own a flat bought in 2016 for ₹80 lakh, shares 50:50. They sell it in November 2026 for ₹1.6 crore.

• Each one's sale share: ₹80 lakh. Each one's cost share: ₹40 lakh.
• Each one's long-term gain at the 12.5% method: ₹40 lakh, so tax of ₹5 lakh each before surcharge and the 4% cess. Each can also check whether the indexation option works out lower.
• TDS: 1% of ₹1.6 crore is ₹1.6 lakh, deducted as ₹80,000 against each sibling's PAN.
• Anita buys a new flat within the time limit and claims the reinvestment exemption on her ₹40 lakh gain. Vikram doesn't reinvest, so he pays tax on his share. Their tax bills end up completely different, and that is correct.

A checklist before you list

• Written agreement among owners on price range, shares and timeline
• PAN, Aadhaar and bank details for every owner
• Power of attorney arranged early for anyone who cannot attend
• Original deed, khata, tax receipts and encumbrance certificate in one place
• Any home loan in joint names cleared or planned for at registration
• Each owner's CA briefed on their own gain and reinvestment plans

Joint sales mix property law and tax, so have a property lawyer check the title and POA, and let each owner's CA look at their gains. If you want help coordinating several owners, buyers and paperwork on one timeline, Skyros Estates offers selling support with document checks along the way.