Registration of Sale Deed in India
Under Section 54 of the Transfer of Property Act, 1882, a sale is defined. A sale is defined as a transfer of ownership in exchange for a certain amount of price paid or promised, part-promised or part-paid. A Sale Deed is a document that renders the completion of the sale.
A seller transfers the rights of ownership associated with the property to the buyer through the agreement of Sale Deed. It is a very important document which proves that the purchaser has become the absolute owner of property after buying it.
A Sale Deed clearly lists the complete details related to the price and terms & conditions on which the two parties executed an agreement for the sale of a property. If the property in the agreement is meant for the future and there are terms & conditions attached to it, then it is called an agreement for sale. A Sale deed will be considered as completed when there is an immediate transfer of the property.
What is the meaning of Sale Deed in India?
In India, a Sale Deed Agreement is a legally binding document that is specifically made to transfer the title, right,and ownership of the immovable property from one person to other in exchange for a price to be paid to the seller. A sale deed is implemented by the Registration Act, 1908, of India. A Sale Deed will be considered to be valid only when it is signed by both the parties i.e., the seller and the buyer. Both the parties are required to comply with the terms and conditions mentioned in the Sale Deed.
Under the Registration Act, 1908, a Sale Deed is required to be registered within the time period of 4 months from the date of execution. The Registration of a Sale Deed will be done by the Sub Registrar of the jurisdiction, wherever the property is purchased.
What are the main components of a Sale Deed in India?
The main components of a Sale Deed in India are as follows:
- Name and details of the parties;
- Pan number details of buyer and seller;
- Representations and warranties;
- Free from the encumbrances;
- Absolute or partial right;
- Payment of the stamp duties;
- Registration fee details;
- Name of the person paying stamp duty;
- Indemnity Clause;
- Dispute resolution;
- The Governing law;
- The Consideration;
- The mode of payment;
- Description and schedule of the property;
- Details of two witnesses;
- Signature of the parties and witnesses;
- Photograph of the parties;
- Tax liability.
What is the process of Registration of Sale Deed in India?
The following steps are required to be undertaken for Registration of a Sale Deed in India:
- The value of the property based on the circle rate should be estimated. Circle rate is the minimum value set by the revenue department of the State Government or by the local development authorities at which the sale of a property can occurs in that particular area.
- After calculating the circle rate, the actual circle rates of that particular area, and the price paid for the property will be compared. While the calculation of the stamp duty is done, the higher of the two values should be considered. After that a non-judicial stamp paper of the estimated cost is required to be purchased by the parties.
- Subsequently, the Sale Deed is prepared and typed on the stamp papers.
- In the next step, the parties should approach the office of the Sub-Registrar to get the Registration of the Sale Deed.
- There is a requirement of two witnesses along with the parties.
What are the documents required for the Registration of Sale Deed in India?
The documents required for Registration of Sale Deed in India are as follows:
- A complete draft of the Sale Deed or Title deed or Conveyance Deed;
- Records of the Rights and Tenancy Corps (RTC) extracts;
- The Joint Development Agreement;
- General Power of Attorney;
- The Katha Certificate and Extracts;
- The Mutation Register Extracts;
- An allotment Letter from the Builder or Co-Operative Society or Housing Board or BDA;
- In case of any loan on the property may be Current or past, the Original document of Property with the Bank;
- The agreement of Sale with the Seller;
- All the title documents of the owner of the land;
- The plan of Building sanctioned by the Statutory Authority;
- No Objection Certificate from the Electricity Department, Pollution Control Board, Water Works and Air Port Authority;
- The Supplementary agreement or the Ratification Deed (if any);
- In case of a resale of the property a copy of all the previous registered agreements;
- In case of a resale of the property, No Objection Certificate from the Apartment Association.
What are the benefits of the Registration of Sale Deed in India?
The benefits of Registration of Sale Deed in India are as follows:
- Avoidance of Fraud
- Easier Taxation
- Establishment of Title
- Creation of Evidence
Avoidance of Fraud
The Registration of a Sale Deed allows the authorities to keep a regular check on any kind of fraudulent transaction of the properties.
The total amount of cost involved in the transfer of a property can be precisely determined which allows the process of taxation too much easier for the authorities.
Establishment of Title
The title of the property in the Sale Deed will be established properly in the name of the owner.
Creation of Evidence
A Sale Deed has a very high evidentiary value. The registered document will prove the title of the document to the owner before any court of law in India.
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Frequently Asked Questions
Yes, the registration of Sale Deed is mandatory in India to have the validity before the court of law.
According to the law, the required registration charges and the stamp duty is to be paid by the buyer. However, all other arrangements with regard to the registration charges and sharing of the stamp duty between the seller and buyer can also be incorporated in the agreement of Sale Deed.
- In case of a dispute a registered Sale Deed can be used as an evidence;
- It provides a proper legal recognition for the transaction of sale of property;
- It clearly and properly lays down the description of the parties, property, and the rights and obligations of the parties also.