Agreement to sale and sale deed. both required?

Mr.Victor,

Your doubt is a very common doubt as usually people think that an "Agreement for Sale"/"Agreement to Sell" and a "Sale Deed" are same! But this is not true as both of these documents are extremely different in nature and both are very important in completing the Property Transfer Process.

An "Agreement for Sale" /"Sale Agreement"/"Agreement to Sell" , is a document whereby both the parties enter into an agreement about how the future Sale proceeds will happen. This document contains the future terms and conditions under which the whole transfer will take place. So ideally this document is an agreement which is in interest of a purchaser also to ensure the future sale proceeds are as per his satisfaction and agreed terms. Even this shall be registered or atleast be Notarised.(Without Registration or Notary it is of no value) The Transfer of Property Act, 1882, which regulates the matters dealing with the sale and transfer of house property, defines the contract for sale or an agreement for sale as under:

“A contract for the sale of immovable property, is a contract that a sale of such property shall take place on the terms settled between the parties” – Section 54. 

Whereas a "Sale Deed" is the main documents through which the transfer of the property gets executed on the basis of the terms which have been finalized in the "Agreement for Sale" /"Sale Agreement"/"Agreement to Sell. A "Sale Deed" is that document which will transfer the rights and interests of the property from the Seller to the Buyer and while executing this document and while its registration in the sub-registrar office, the buyer has to pay the Stamp Duty and Registration charges.

Hence, "Agreement for Sale" /"Sale Agreement"/"Agreement to Sell" and the "Sale Deed" both are important document as "Agreement for Sale" /"Sale Agreement"/"Agreement to Sell" doesn't practically executes the transfer of the rights and interest of the property but contains the terms and conditions under which the future transfer will take place. Whereas, the "Sale Deed" is the document to execute the transfer of rights & interests and is the main document for property transfer.

Hope this suffices your query!

Thanks & Regards

Advocate Abhishek Sinha

+91-70459 49997