SALE DEED REGISTRATION

A ‘SALE DEED’ is a legal document executed by the seller/ vendor and the purchaser/vendee which evidences the sale and transfer of ownership of an immovable property.The sale of an immovable property is defined under Section 54 of the Transfer of Property Act, 1882, as follows: “Sale is a transfer of ownership in exchange for a price paid or promised or part paid and part promised.”

The steps involved in the preparation and Registration of a Sale Deed are as follows:

1. The Sale Deed is drafted / prepared by a legal expert / advocate .
2. Stamp Paper is purchased as per the Circle Rates.
3. Date is fixed for the registration in the Sub Registrar office.
4. The Government registration fee is paid.
5. Both the buyer and seller and 2 witnesses visit the sub registrar office on the fixed day for the registration of Deed.
6. The Registered Sale Deed can be collected after a week.

SALE DEED : A sale deed is the most common document used for transferring the ownership of a property from one person to another. It is generally made after the execution of the agreement to sell. Sale deed is the main document which contains the details as to how the seller had got the title to the property, for what consideration the seller is selling the property to the buyer and assurance to the purchaser that the property is free from all encumbrances and liabilities, etc. A sale deed acts as an essential document for the further sale of the property by the purchaser as it establishes the proof of ownership of the property.

The registration of a sale deed is governed by ‘The Registration Act, 1908’ and is the most important document of title for both the buyer/transferee and the seller/ transferor. It is compulsory to get a sale deed registered in the sub registrar office. An unregistered sale deed has no value in the eyes of law and does not pass any title to the buyer. A registered sale deed can be used for transferring freehold flats, plots, builder floors, bunglows, apartments, DDA flats, society flats, commercial office, shops etc.

The leasehold properties can also be now sold through registration of Agreement to Sell, GPA, Builder Buyer Agreement, Apartment deed etc.

A registered sale deed can also be executed for transferring the ownership of agricultural land, Leasehold properties (Appendix 12). A tripartite sale deed having a confirming party can also be registered.

The purchaser should get a Title Search done / obtain an Encumbrance Certificate so as to check and verify the title documents of the seller before getting the sale deed executed and registered. In case, there is any charge or mortgage on the property, it should be cleared by the seller before executing the sale documents.

Important points to note in relation to registration of Sale Deed in Delhi are :

1. Stamp duty is payable @ 4% if the Buyer/Vendee is a female and @ 6% if the Buyer/Vendee is a male, firm or company etc.

2. Registration fee is payable @1% of the total Sale Consideration plus Rs.100/- for pasting charges.

3. The stamp duty is payable on the Sale deed as per the Circle rates fixed by the Revenue Department of Govt.of N.C.T.of Delhi for the locality in which property is situated . If the sale consideration is more than the minimum circle rates fixed by the Delhi Govt., then the stamp duty will be calculated on the sale consideration amount mentioned in the Sale deed.

4. Both the Vendor(s) and Vendee(s) have to be present along with their two passport size photographs and identification documents i.e. AADHAR Card and PAN Card. If a party is unable to appear in the sub registrar office, he can give a power of attorney to someone else to appear on his behalf.

5. Two witnesses along with identification documents i.e. Aadhar Card need to be present in the Sub Registrar Office for the Registration of Sale Deed.

6. If the sale consideration exceeds Rs.50 lakhs, the buyer will have to deduct TDS @ 1% of the sale consideration.

The Delhi Government had increased the circle rates in Delhi by 20% with effect from 23.09.2014. The current circle rates are as follows:

• Category A : Rs. 7,74,000/-
• Category B : Rs. 2,45,520/-
• Category C : Rs. 1,59,840/-
• Category D : Rs. 1,27,680/-
• Category E : Rs. 70,080/-
• Category F : Rs. 56,640/-
• Category G : Rs. 46,200/-
• Category H : Rs. 23,280/-

Important Clauses in a Sale Deed:

A sale deed is one of the most valuable legal documents in a transaction involving the transfer of a property. A sale deed is drafted by a legal draftsman on a non-judicial stamp paper of the requisite value as prescribed by the Stamp act of the particular state concerned. Some of the important clauses that are included while preparing a sale deed are as follows:

Description of the Parties: A sale deed must start with clear description of the parties. The sale deed must contain the Party’s names, their Father/ Husband’s Name and their complete addresses.

Date and Place: A Sale Deed must mention the Date and Place of execution of the Sale Deed by the Seller and the Buyer.

Description of the Property: A valid sale deed must contain the full description of the property which is the subject matter of sale. It must mention whether the property under transfer is a freehold or leasehold and the type i.e. Apartment, Floor, Flat, Plot, Kothi, Bungalow, Shop, office etc. It must include identification number, total plot area, construction details as well as its location with its surrounding areas. A schedule of the property must be included in the sale deed which will define the exact location where the property is actually situated.

Sale consideration : A sale deed must include the clause stating the sale consideration/amount as agreed between the seller and the buyer, and which has to be paid by the buyer to the seller on the execution of the sale deed.
Passing of the title: A sale deed should contain the clause specifying the time when the title of the property will pass to the purchaser. Once the title of the immovable property is transferred, all the rights will pass to the purchaser.

Indemnity provisions : A seller must clear all the statutory charges i.e. property tax, electricity charges, water bills, cess, society charges, maintenance charges and all other charges relating to the property upto the date of execution of the sale deed. In case there is any encumbrance on the property, the seller needs to repay the loan amount. It is the duty of the buyer to verify the encumbrance status by conducting a title search and getting an Encumbrance Certificate.

Execution: Once the Sale Deed is prepared all the parties to the deed shall execute it by affixing their signatures and thumb impressions. Each page should be signed by the seller as well as the buyer. Any alteration, addition or deletion is to be authenticated by signatures of both the parties.

Registration: According to Section 17 of ‘The Registration Act, 1908’, the registration of an immovable property is compulsory if the value of the property exceeds Rs. 100/- and it is the registration of the property which makes the sale valid. For getting the registration done, both the parties must present themselves in the sub-registrar office with the original documents within four months from the date of execution. A stamp duty and a registration fee has to be paid by the purchaser to the sub-registrar for getting the registration done.

Witnesses: The executed sale deed should be witnessed by at least two witnesses, one of whom should preferably be from the seller’s side and the other one from the buyer’s side, giving their full names, addresses and signatures.

Original documents: Once the property gets registered under the Registration Act, all the original documents of the property have to be handed over by the seller to the purchaser.

Other important Clauses:

• Responsibilities and timeline for the procedures to be completed
• All expenditures such as stamp duty, drafting and registration fee and the distribution of these expenses between the parties.
• Declaration by the seller that the property is not subject to any government acquisition
• The nature of the title detained by the seller, including any encumbrance such as lease, mortgage, or charge on the property

FAQs

Q. Is it mandatory to get a sale deed of a property registered in the sub registrar office.
A. Yes, according to the Registration Act, 1908 it is mandatory to get a sale deed registered in relation to immovable properties whose value is more than Rs.100.

Q. Can a sale deed be registered without payment of proper stamp duty?
A. No, sale deed cannot be registered without payment of proper stamp duty as per the circle rates.

Q. Can you draft / prepare the sale deed format?
A. Yes, we can prepare the sale deed and get it registered as well.

Q. Is PAN required for getting a sale deed registered?
A. Yes, a PAN card is necessary for the registration of the sale documents.