DR.

RAM MANOHAR LOHIA NATIONAL LAW

UNIVERSITY

2017-2018

DRAFTING OF PLEADING AND CONVEYANCING

FINAL DRAFT

SALE DEED-MEANING OF SALE DEED AND ITS

ESSENTIAL

Submitted to: Submitted by:

Dr. Shakuntala Sangam Vaibhav Verma

Asssistant Professor(Law) Enroll No. 140101157

Sec-B, Sem-VI

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 ACKNOWLEDGEMENT

I would take great pleasure in thanking my DRAFTING OF PLEADING AND

CONVEYANCING teacher, DR. SHAKUNTALA SANGAM for her infallible support all
through the course of this project. This endeavor would not have been in its present shape had
she not been there whenever I needed her. She has been a constant source of support all the
while.

Also I would like to extend my sincere thanks to the library staff for always helping me out with
finding excellent books and material almost every time I needed. They too have been a constant
support system in the completion of this project.

Last but surely not the least- I would like to thank my friends for their timely critical analysis of
my work and special feedback that worked towards the betterment of this work.

-VAIBHAV VERMA

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 TABLE OF CONTENT

1) INTRODUCTION
2) EXECUTION OF SALE DEED
3) ELEMENTS OF SALE DEED
4) PREPARATION OF SALE DEED
5) WORKING OF SALE DEED
6) DIFFERENCE BETWEEN SALE DEED AND AGREEMENT
OF SALE
7) CONCLUSION
8) BIBLIOGRAPHY

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 INTRODUCTION

A sale deed, also known as conveyance deed, is a critical document in property transactions. It is
a legal document and an evidence that the sale of a property has been made in favour of the
buyer from the seller. It is also a proof that the buyer is the absolute owner of the said property. 

Here is how a sale deed is executed:

  The deed is executed after the execution of the agreement to sell, and after complying
with various terms and conditions outlined in the agreement.
 The draft sale deed is made on a non-judicial stamp paper as prescribed by the Stamp Act
of the state concerned. The document lays down the terms and conditions of the sale and
contains the details of the parties, the property, the sale amount, the advance payment, the dates,
the mode of payment, the time for handing over the original documents and the possession of the
property, etc.
 Apart from giving the complete details of both the seller and the purchaser, the contract is
signed and executed by both the parties. Details outlining the specifications of the property —
identification number, total area of the plot, details of construction, the total amount to be paid,
the instruments through which such transactions will be made — are also stated.1
 The earnest money paid by the buyer also finds a mention in the agreement.
 Besides giving a detailed list of documents executed by him in favour of the buyer, the
seller also certifies that the property under sale is free from any encumbrance.
 Subject to an agreement between the parties, payments such as property tax, water
charges, electricity charges, society maintenance charges, etc, should be paid by the seller before
the execution of the sale deed.

1
https://www.makaan.com/iq/legal-taxes-laws/how-sale-deed-is-executed

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 Once all the terms and conditions have been agreed upon, the sale deed is made. The
main document for the transfer of ownership of property, it is executed by all the parties and all
pages of the document are signed. It is mandated that the deed should be signed by at least two
witnesses, giving their full names and addresses.
 Under the Registration Act, the sale deed is registered at the sub-registrar's office, where
it is compulsory for both parties to be in attendance, along with original documents. For any
reason, if the buyer can't be present at the sub-registrar's office on the given day, he can give a
power of attorney to his agent to act on his behalf.
 After the sale deed has been signed by both the parties, the documents should be
presented for registration within four months from the date of execution. If it is not done, a grace
period of another four months is given on payment of some fine.
 Generally, the buyer is responsible for the stamp duty as well as registration charges.2

2
http://www.lawyersclubindia.com/forum/Difference-between-Agreement-of-Sale-Sale-Deed-and-Deed-of-
32970.asp

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 WHAT DOES A SALE DEED CONTAIN?

This deed consists of almost all the details which are required in order to carry out the purchase
or sale of a property. Details like complete name of the buyer and the seller along with their
addresses are included. Other details like the details of the property under sale, the identification
number, the property location, the property address, the total area of the property and others will
be included.

 One of the most important statements a sale deed has is that, the deed will require the
seller to certify that the property under sale is free from all the encumbrances and is without any
lien.
 The sale deed can be executed by the property seller only after he settles the loan which
he has taken for the property.
 The draft sale deed will include the total amount which is to be paid for the purchase/sale
of the property, the advance amount, the date of payment, the mode of payment, the deadline to
make the payment and the details and the transactions of the payment. This deed will also have
the protection provisions for the buyer and the seller.
 It contains the details about the receipt which is issued by the seller to the buyer for the
money received towards the sale transaction.
 The deed contains the precise date of transferring the property related documents to the
buyer along with the possession of the property under sale.3

3
https://economictimes.indiatimes.com/sale-deed-confers-title-to-property/articleshow/2695953.cms

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 How is a sale deed prepared?

As mentioned earlier, a sale deed is prepared with the mutual consent of both the parties on a
non-judicial paper. The value of the deed differs from state to state based on the prescribed
Stamp Act of the State. Also the sale deed will be signed by witnesses apart from just the buyer
and the seller.

How does a sale deed work?

 The jurisdictional Sub-Registrar’s office registers the sale deed and at the time of
registration there should also be witnesses present apart from the buyer and the seller. In case the
buyer or the seller is not in a position to present them physically, they can represent their
nominated agent who will be empowered with a legal power of attorney in order to execute the
sale deed.
 The deadline to produce the original documents will be four months from its execution.
In case the documents are not produced within the given period, the Registrar will allow a grace
period of another four months for the documents to be produced. Further, this will also levy a
maximum penalty of 10 times the registration charges related to the property.
 At the time of property selling, the buyer pays charges like the stamp duty and the
registration charges, whereas the seller pays for the property tax, the cess, water and electricity
charges.
Henceforth, both the buyer and the seller should make a thorough check before signing the sale
deed.4

4
https://www.google.co.in/url?url=https://www.legalbites.in/sale-immovable-property/&rct=j&frm

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 Difference Between Sale Deed And Agreement To
Sell

Selling and buying are two activities that keep fuelling the economy by ensuring the flow of
money. It brings about development and growth by giving direct and indirect employment
opportunities of multifarious nature. Since selling or buying involves transfer of titles of movable
and immovable property, such activities are well regulated by the government agencies who
enact, implement and safeguard various laws for the safety of the resources involved in
economic activities. Properties of all forms may be purchased/sold – whether movable or
immovable. The protection granted to such sales also depends upon their category, inasmuch as
immovable properties, for instance, are of higher value and requires stricter measures for
protection. Let us observe some legal terminology related to sale agreements as applicable to
movable and immovable properties.

What Is An Agreement To Sell?

An Agreement to sell is by nature a memorandum of agreement wherein the terms and condition
of a prospective contract of sale is enumerated along with the proposed consideration and details
of payment. It is a document of major importance in a sale of immovable property.  It is the
document on which the Deed of Sale is based on. It enables the process of sale to happen
smoothly by describing the steps in detail. This helps in creating a better understanding between
the parties and their individual roles in the sale.

An Agreement to Sell includes matters like:

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 1. Proposal to purchase and agreement to sell
2. Detailed description of the property
3. Proviso requirement of good marketable titles and no encumbrances
4. Payment details including earnest money
5. Delivery of original documents on payment
6. Drafting of sale deed and registration of the same  if titles found good
7. Method of delivery of property
8. Refund of earnest money in case of improper titles
9. Remedies for non-completion of sale on part of vendor including specific performance
and bearing of expense of proceedings
10. Forfeiture of earnest money, if purchaser fails to complete the sale
11. Action if the property is affected by notice from government authorities.
12. Production of tax related certificates
13. Schedule description of the property
14. Memo of consideration for earnest money received
15. All other matters incidental to the proposed Sale

An Agreement to Sell thus shows the willingness of the parties to sell/buy a property in question
and culminates in creation of the actual sale deed. It cannot be called a Sale Deed because it does
not create any rights on the property for the buyer.5

What Is A Sale Deed?

A deed of sale is a document that actually transfers the rights associated with a property from
one party to another. It is usually drafted as a continuation of the agreement to sell. All the terms
and conditions mentioned in the former would be fulfilled and observed in a deed of sale.
Following are some of the points that are mentioned in a Sale Deed.

1. Description of the ownership and property

5
http://www.google.co.in/url?url=http://theindianlawyer.in/content/sale-of-immovable-
property&rct=j&frm=1&q=&esrc=s&sa=U&ved

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 2. Clear titles verified by the purchaser
3. Reference to the Agreement to Sell and the price details
4. Release/discharge of the property with description of facilities measurements, privileges,
easements and other rights
5. Transfer of all rights, interests, claim, demand whatsoever of the property
6. Facilitating peaceful enjoyment of the property without hindrance
7. Indemnifying the purchaser against losses arising out of negligence/actions of seller or
heirs
8. Full authority of vendor to sell.

In short, a Sale deed mentions more of the transfer of property and rights which forms the crux
of it. All other terms and conditions are mentioned in the agreement to sell. Therefore, the Sale
Deed can be drafted briefly.

Key Differences Between Sale And Agreement To

Sell
1. A sale implies immediate transfer of property. It is accomplished through a Sale Deed,
while an agreement to sell implies future transfer.
2. Risks are transferred immediately in Sale, whereas they remain with the seller in case of
Agreement to Sell.
3. A Sale is an executed contract, while an Agreement to Sell is an executory contract.
4. Breach of Sale can result in a suit for price as well as damages, while any breach of terms
of an Agreement to Sell can result only in suit for damages.
5. A Sale Deed is a compulsorily registrable instrument whereas an Agreement to Sell is
subject to laws of the particular state.6

6
https://www.google.co.in/url?url=https://legaldesk.com/general/difference-between-sale-deed-and-agreement-
to-sell&rct=j&frm=1&q=&esrc=s&sa=U&ved=0ahUKEwjdoeLK7

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 CONCLUSION
 Once the registration of sale deed gets done then all the original documents pertaining to the
property are handed over to the purchaser by the sub registrar. The registration entitles the
passing of right title, ownership, interest, possession and privileges associated with the property.
Drafting a Sale Deed requires a sound knowledge of all the legal contents which can be
incorporated in the Agreement to Sale so that no discrepancies arise at the time of registration
under the Registration of Property Act,1908.

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 BIBLIOGRAPHY

1) http://www.google.co.in/url?
url=http://www.lawyersclubindia.com/experts/Essential-
documents-for-sale-deed

2) https://www.google.co.in/url?
url=https://www.legalbites.in/sale-immovable

3) https://legaldesk.com/general/difference-between-sale-deed-
and-agreement-to-sell

4) https://www.google.co.in/url?
url=https://economictimes.indiatimes.com/agreement-to-sell-
precedes-sale-deed/articleshow/6798488

5) https://www.google.co.in/url?
url=https://indiancaselaws.wordpress.com/2014/12/15/differe
nce-between-agreement-of-sale-and-sale-
deed/&rct=j&frm=1&q=&esrc=s&sa=U&ved

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