What is a Sale Deed?
A sale deed is a legal document that enables a party to transfer property from one person to another. It is defined under Section 54 of the Transfer of Property Act, 1882 as; “Sale” is a transfer of ownership in exchange for a price paid or promised or part-paid and part-promised. Thus without a sale deed, there would be no evidence to attest the transfer of a property, further there would be no evidence to facilitate subsequent transfer of the property.
Registering a Sale Deed
In order to register a sale deed the following steps have to be undertaken:
- The value of the property has to be estimated based on the circle rate (minimum value set by the state government's revenue department or the local development authorities at which the sale can occur) in that area.
- The circle rates of the area and the actual price paid for the property are compared. While calculating the stamp duty the higher of the two values, i.e., the circle rate and the actual price paid, has to be taken into consideration. Non judicial stamp paper of the value so calculated has to be purchased thereafter.
- Subsequently, the deed has to be prepared and typed in stamp papers.
- The final step involved for getting the sale deed registered is to approach the Sub-Registrar’s office in order to get the sale deed registered. The parties must be accompanied by two witnesses.
Key Components of a Sale Deed
The essentials that one must keep in mind while preparing a Sale Deed are the following:
- The Sale Deed must be classified as either a ‘Deed of Sale’ if the property is being sold, or as ‘Deed of Mortgage’, if the property is being leased or mortgaged.
- The Sale Deed must contain accurate information pertaining to the sale. A Sale Deed is said to be void if it does not contain the correct information of the buyer and the seller.
- The Sale Deed should have relevant information so as to enable a person, identify the immovable property which is the subject matter of the deed.
- A Sale Deed is incomplete if it is not accompanied by a Sale Agreement. The Sale Agreement contains all the terms and conditions that have been agreed to by the buyer and the seller.
- Finally, the Sale Deed must also contain the Proof of Registration of the property.