Property registered in wife’s name makes her its owner
When a husband purchases property using his own funds but registers it in his wife’s name, Indian law presumes it to be a gift to the wife, making her the absolute owner. This legal principle is known as the “presumption of advancement.”
The “presumption of advancement” is a law doctrine where a contribution to a property transfer by a person in a close relationship to another (like a husband to a wife, or a parent to a child) is presumed to be a gift, not a loan or a trust, unless proven otherwise. This is a rebuttable presumption, which can be disproved with evidence of the true intention.
Not a Benami Transaction
Such a transaction is explicitly exempted from being classified as an illegal benami transaction. The Prohibition of Benami Property Transactions Act, 1988, permits an individual to purchase property in the name of their spouse or child from their own known sources of income. Therefore, the transaction is legally valid.
The Presumption of a Gift
The default legal position is that the property belongs to the wife. The law presumes the husband intended to “advance” his wife’s interests by gifting her the asset.
For the wife to claim ownership, she does not need to prove she had her own income; the gift is presumed.
The Husband’s Burden of Proof to Rebut the Presumtion
The presumption of a gift is rebuttable, but the burden of proof lies heavily on the husband. To claim ownership, the husband must provide clear, strong, and convincing evidence to a court that he had no intention of gifting the property to his wife.
He must prove that the registration in her name was purely a “name-lending” arrangement for convenience and that he intended to remain the true owner. Simply proving that he paid for the property is not enough, as this fact is the very basis of the presumption of a gift.
The Role of the Wife’s Income
The wife’s income becomes relevant only in a different scenario: if the wife herself claims to have purchased the property. In that case, the burden of proof would be on her to demonstrate that she had sufficient independent income to acquire the asset.
Conclusion
A property purchased by a husband in his wife’s name is legally considered her absolute property under the presumption of a gift. It is not automatically treated as “family property.”
For the husband to claim any right over it, he must overcome the significant legal burden of proving to a court that a gift was never intended.
References
- Saurabh Gupta vs Smt. Archna Gupta And 2 Others [2024:AHC-LKO:13664]
