Difference between Agreement to Sale and Sale Deed in India

Buying or selling a property in India requires following proper legal procedures. Two of the most important legal documents involved are the Agreement to Sale and the Sale Deed. Both of these documents are crucial to completing the transaction, but they have different purposes and functions. In simple terms, the Agreement to Sale is a preliminary contract that outlines the terms and conditions of the transaction, while the Sale Deed is the final legal document that transfers the ownership from the seller to the buyer. Let`s take a closer look at the differences between these two documents.

Agreement to Sale

An Agreement to Sale is a contract between the buyer and the seller that outlines the terms and conditions of the sale. It is a preliminary contract that precedes the Sale Deed. The agreement includes details like the purchase price, payment schedule, and delivery dates.

The Agreement to Sale is usually signed by both parties after they reach an agreement on the terms of the sale. This agreement is important because it is a legal document that establishes a relationship of trust and understanding between the buyer and the seller. It also prevents any misunderstandings or disputes that may arise in the future.

The Agreement to Sale does not transfer ownership of the property. It simply outlines the terms and conditions of the sale. The buyer typically pays a certain percentage of the purchase price as a token of their commitment to complete the sale. This amount is usually around 10% of the purchase price and is known as the “earnest money”.

Sale Deed

The Sale Deed, on the other hand, is the final legal document that transfers ownership of the property from the seller to the buyer. It is also known as the Conveyance Deed. The Sale Deed is a document that is registered with the local sub-registrar`s office, and it is a proof of ownership of the property.

The Sale Deed contains important information such as the name of the buyer and the seller, the purchase price, the property description, the payment schedule, and any encumbrances or liabilities on the property. The Sale Deed is signed by both parties in the presence of two witnesses, and it is attested by a notary public.

The Sale Deed is a crucial legal document, and it is important to ensure that all details mentioned in the document are accurate and complete. Once the Sale Deed is registered with the sub-registrar`s office, it becomes a public record, and any discrepancies or errors can lead to legal complications in the future.

Conclusion

In summary, the Agreement to Sale and the Sale Deed are two essential documents involved in the purchase and sale of property in India. While the Agreement to Sale establishes the terms and conditions of the transaction, the Sale Deed is the final legal document that transfers ownership of the property. It is important to ensure that both documents are legally valid and accurate to avoid any legal complications in the future. As a buyer or seller of property, it is always recommended to consult with a legal professional to ensure that all legal procedures are followed correctly.