What if the sale deed cheque got rejected.

Nothing to do just take acknowledgement from the seller.

First of all take the instruemt /checque back- and  make a receipt and affix a  revenue stamp on it ; mention details there in and let the seller sign it in presence of witnesse .

He must sign on revenue stamp too in a way that half of signature in on stamp and half on receipt.

Once payment is received by the seller in full, no action can be taken against you. But in order to protect yourself, take back the rejected cheque and cancel or destroy it.