Things You Should Know About Sales Deed In Property.
The real estate industry is currently seeing an immense growth and one should know the sales deed in property purchase. Not only has property become a valued possession but it has also turned into a financial asset which is worthy of long-term investment. It gives you valuable returns of your investment.
However, purchasing a property requires you to undertake detailed paperwork. It includes the most valuable legal document called ‘Sale Deed’ in property purchase. Based on the purchase deed, you shall be allowed to proceed with registration and mutation of the property. The sale deed or purchase deed is drawn upon a non-judicial stamp paper by legal drafts-men according to the value prescribed by the stamp duty act of a state.
When you buy or sell property, the transaction is not legally valid without the buyer and seller signing the sale deed. It is done in the presence of at least two witnesses. Governed by the Registration Act, 1908, sale deed is the most important document while selling or purchasing property in India.
Also Read: List of Documents Required for Buying Property
Parties of the Sale Deed
Needless to say, a sales deed in property must begin with the details of the parties involved with the transaction. It should bear the name, age and addresses of the parties (buyer and seller) involved in the transaction, in order to make it valid. Both parties must sign and execute the deed with bona fide intention.
Description of the Sales Property
The sales deed must have a proper description of the property you intend to buy. The sales deed should include the total plot area, identification number, details of construction, the exact location and surroundings of the property. The property schedule must be incorporated in the sale deed to define the accurate location of the property.
Sales Agreement
This document is drawn up when you pay a booking amount for your new apartment. This agreement states that both seller as well as the buyer shall mutually settle the conditions and terms of the agreement so that it won’t affect the rights of either party. Usually, the sales agreement is drawn up before the sale deed.
Clause of Sale Consideration
The amount agreed between the buyer and seller must be included in the sale consideration clause. This is the amount that the buyer agrees to pay to the seller during the sale deed execution. The sale amount should be stated clearly on the deed, as it was agreed upon.
Advance Payment and Payment Mode
If you have paid anything in advance to the builder or seller for booking the flat, then this should be mentioned in the sale deed clearly. The remaining amount payable must also be written in the document.
The mode of the payment whether it is cheque, cash or DD must be mentioned 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
This is mostly applicable in case of a resale property. The clause states that the seller should clear all statutory charges such as electricity bill, property tax, water bills, maintenance charges and society charges and all other dues prior to the sales deed execution. In case a home loan was taken to purchase the property by the original buyer, then the seller must repay the loan and get the papers back from the bank. As a conscious buyer, you should scrutinise the status of encumbrance from the sub registrar or registrar’s office.
Default Clause
Sales agreements should ideally bear a clause that if there is any default on the part of the buyer or seller then the party defaulting shall have to pay a penalty to the non-offending party so that the execution of the sale deed is not affected.
Once the sale deed has been prepared, it must be ratified by two witnesses from both sides. The witnesses shall have to provide their full addresses, signatures and names. The signatures of the buyer and seller must be present in every page.
Source: The Hindu
