Deed Of Sale: What Is Sale Deed In India?

Published on 31 Mar 2020 by Shivi

Buying or selling a house or property has become a reason for concern for many in India due to the increasing number of frauds and property scams. When it comes to buying or selling a house, it has become important to lay down a written document that defines the transaction between the seller and buyer. Though there are numerous kinds of property documents, once of the most important property documents between a seller and buyer is the sale deed. This guide lays down the meaning, requirement, parties, documents, and registration of a sale deed in India.

What Is a Sale Deed?

A sale deed is a legal document that proves that the seller has transferred the absolute ownership of a property to the purchaser. The deed of sale in India defines the rights and interests in the property and mentions that these rights and interest are now transferred to the new owner.

A sale deed in India is considered to be valid only when it is signed by both the seller and buyer and both the parties have agreed to comply with the terms and conditions mentioned in the sale deed. A sale deed must be registered under the Registration Act, 1908 within 4 months from the date of execution. The registration of sale deed in India is done by the Sub-Registrar of Assurances of the jurisdiction where the property is purchased.

Components of a Sale Deed

A deed of sale in India must be drafted by the best property contract drafting and vetting lawyers in India and must include the key components that protect the rights and interest of both the seller and buyer. The key contents of a sale deed are as follows:

  1. Name and details of parties

  2. PAN number of buyer and seller

  3. Photograph of parties

  4. Tax liability

  5. Consideration

  6. Representations and warranties

  7. Free from encumbrances

  8. Absolute/partial right

  9. Payment of stamp duties and registration fee details

  10. Name of person paying stamp duty

  11. Indemnity

  12. Dispute resolution

  13. Governing law

  14. Description and schedule of property

  15. Two witnesses details

  16. Signature of parties and witnesses

Parties of the Sale Deed

The first provision of any sale deed must mention the details of the seller and buyer involved in the property transaction. The provision must mention the name, age, address, etc. of the buyer and seller in order to validate the rights of each party. The sale deed is also signed, executed and registered by the seller and buyer mentioned in the document.

Description of the Property

The property sale deed must clearly describe the property being sold and purchased. The sale deed must mention the total plot area, ID number, details of construction, location, surroundings, amenities, etc. of the property. 

Sale Agreement

Usually, the sale agreement is drawn up before the sale deed.  This agreement states that both seller, as well as the buyer, would mutually settle the terms of the agreement so that it won't affect the rights of either party. The sale deed must mention that the sale agreement has been executed between the parties involved.

Price of Property

This clause mentions the agreed amount to be paid by the buyer to the seller for the property. This also includes the details of any advance paid, the manner in which the payment- cheque, cash or DD would be made along with any instalment or payment cycle details along with the consent of the seller to accept it in the form.

Passing Of The Title

The sale deed should mention when the property title shall be passed to the buyer. The seller must be given a time limit for the title transfer. Once the title has been transferred, all related rights shall pass onto the buyer.

Possession Delivery

A clause in the sale deed must bear the information that the possession of the property shall be transferred to the buyer by the seller after completion of the registration process. The sale deed should state the actual date of delivery of possession.

Indemnity Provision

The indemnity means protection against damage or loss, especially in the form of a promise to pay for any damage or loss that happens. In a property transaction, the term assumes the exact meaning. As plot purchases involve higher risk, getting this clause inserted in the sale deed is particularly important if you are buying a plot.

The deed of sale has to be drafted with the help of legal professionals who knows to incorporate every valid detail. Legistify can connect you with top documentation lawyers in India for your deed of sale drafting, vetting and registration. Call us at 8468833013 or send us an email at [email protected]


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