Sale Deed
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Introduction
Under Indian law, a sale agreement is a legal document that defines the terms and conditions of a sale transaction between a buyer and a seller. It is also known as a purchase agreement or a sales contract.
A sale agreement typically contains details about the goods or property being sold, the price, the payment terms, and the delivery and possession details. The agreement also outlines the warranties, representations, and indemnities provided by the seller.
In India, sale agreements are governed by the Indian Contract Act, of 1872, which defines the legal requirements for the formation of a contract and sets out the rights and obligations of the parties to a contract. The Sale of Goods Act, of 1930 also applies to sale agreements and provides additional provisions relating to the sale of goods and the Transfer of Property Act, of 1882.
Sale of Goods Act, 1930
Under the Sale of Goods Act, of 1930, a sale agreement is a legal document that defines the terms and conditions of a sale transaction between a buyer and a seller. The Sale of Goods Act applies to the sale of movable goods, such as machinery, vehicles, and consumer goods. It is important to note that a sale agreement under the Sale of Goods Act is different from a contract for work and labor or a contract for services.
A sale agreement under the Sale of Goods Act only applies to the sale of movable goods.
Transfer of Property Act, 1882
Under the Transfer of Property Act, of 1882, a sale agreement is a legal document that defines the terms and conditions of a sale transaction between a buyer and a seller. The Transfer of Property Act governs the transfer of ownership rights from the seller to the buyer and applies to immovable property such as land, buildings, and apartments. It is important to note that a sale agreement is different from a sale deed. A sale agreement is a preliminary document that outlines the terms and conditions of the sale, while a sale deed is a final document that transfers the ownership rights from the seller to the buyer.
A sale agreement typically contains details about the goods or property being sold, the price, the payment terms, and the delivery and possession details. The agreement also outlines the warranties, representations, and indemnities provided by the seller.
A sale deed is a legal document that records the transfer of ownership of a property from the seller to the buyer. The sale deed is an important document that provides evidence of ownership of the property and is legally binding on both parties.
Key aspects of a sale deed under Indian law:
- Property Details: The sale deed must contain a detailed description of the property being sold, including the location, dimensions, boundaries, and any other relevant details.
- Price and Payment: The sale deed must mention the agreed price for the property and the payment terms, such as the amount of the initial payment, mode of payment, and payment schedule.
- Transfer of ownership: The sale deed should mention that the property is being sold to the buyer and the ownership of the property is being transferred from the seller to the buyer.
- Representations and Warranties: The sale deed may include representations and warranties by the seller regarding the title and ownership of the property, and any other relevant details.
- Stamp Duty and Registration: The sale deed must be executed on a non-judicial stamp paper of the appropriate value and must be registered with the local sub-registrar of assurances. The stamp duty and registration charges must be paid by the buyer or seller, as per local laws.
- Legal Compliance: The sale deed must comply with all applicable laws, regulations, and policies of the government and local authorities.
Stamping and registration of a sale agreement
- A crucial requirement for a sale agreement format to be valid, enforcing, and binding, the properly formatted copy with all the necessary clauses should be signed by both the parties –seller and buyer.
- This sale agreement copy should be appropriately stamped as per the requirement under the Indian Stamp Act, 1899, or the legislation of the respective states. The sale agreement is registered at the jurisdictional Sub-Registrar of Assurances office upon the payment of requisite registration charges as mandated under the Registration Act of 1908.
- A document that is not properly stamped or is unregistered will not be permitted as evidence, and this transaction is deemed to be incomplete until all the statutory requirements are completely fulfilled. When a party to the sale agreement is unable to be present for the execution and registration and is represented by a holder of power of attorney, this is necessary to examine this document thoroughly and is also duly stamped as well as registered.
- Specifically, where the seller of the property is authorized by an attorney, then the document’s terms may be suitably scrutinized. This is to ascertain that the attorney is authorized for executing and registering the sale agreement, to receive the right consideration, and to complete all the necessary formalities to convey the suitable title to the buyer. The buyer is entitled to retain the original sale agreement as evidence of this property owner.
Agreement for sale versus sale deed
Sale deed | Agreement for sale
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A sale deed is an actual transfer of property ownership. | An agreement to sell is a promise of a future transfer of property ownership.
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The sale deed includes information about both the parties (buyer & seller), their ages, addresses, and other details | The agreement to sell specifies the terms and conditions under which the property will be transferred
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The sale deed gives the rights and interests in the property to the new owner. | Agreement to sell gives a right the purchaser to purchase the property in question to the satisfaction of certain conditions.
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Buyer has to pay stamp duty and registration fee to execute a sale deed | The agreement to sell precedes the sale deed signed and executed by the seller and buyer on non-judicial stamp paper.
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How can we help?
We can provide legal assistance in drafting and executing a sale deed, which is a legal document that transfers the ownership of a property from the seller to the buyer. A sale deed is an important legal document, and it is important to ensure that it is drafted correctly and by the applicable laws to avoid any legal issues or disputes in the future.
- Review and verify property documents: We can review and verify the title documents and other property-related documents to ensure that the seller has the legal right to sell the property.
- Draft the sale deed: We can draft the sale deed by the applicable laws and regulations. The sale deed must contain certain essential elements such as the details of the property, the purchase price, payment terms, warranties, and representations.
- Registration of the sale deed: We can assist in getting the sale deed registered with the local sub-registrar of assurances. The registration process involves payment of stamp duty and registration fees, and a lawyer can help ensure that these are paid correctly.
- Verification of payment: We verify that the payment terms have been adhered to by the buyer and ensure that the payment has been made in full.
- Resolving legal disputes: In case of any legal disputes related to the sale deed, we can provide legal representation and help resolve the dispute through legal means.
Our Legal experts can play a critical role in ensuring that the sale deed is executed correctly and by the applicable laws and regulations, providing legal protection to both the buyer and the seller.
