Tuesday, 21 April 2015

ABOUT A SALE DEED

ABOUT A SALE DEED

Sale Deed is also known as conveyance deed. This is the document by which the seller transfers his right to the purchaser, who, in turn, acquires an absolute ownership of the property. This document is executed subsequent to the execution of the sale agreement and after compliance of various terms and conditions detailed in the sale agreement.
Before the execution of the sale deed the title of the seller is to be established beyond doubt. Copies of the documents of title must be scrutinized by an advocate, well versed and experienced in property dealings.
If there is any encumbrance on the property, such encumbrance is to be cleared by the seller at his cost.
All statutory payments like property tax, water and power charges and any other payments due on the property should be cleared before the execution of the Sale Deed. Any previous charges or mortgage should be clear before execution of the Sale Deed.
Clearances, and permissions required to be obtained by the seller should be obtained prior to execution of the sale deed.
Latest encumbrance certificate of the property, subsequent to the date of the sale agreement up to the proximate date of sale deed should be obtained, and such certificate should be of nil encumbrance.
All the persons having interest in the property should be made parties to the deed. Particular attention needs to be paid in case of purchase of properties from a Limited Company, Partnership Firm, Hindu Undivided Family, Trust, Power of Attorney Holder and Minor.
Draft Sale Deed
A draft Sale Deed, containing full details of the parties, advance amount paid, mode of balance amount payable, receipt of the balance amount by the seller, handing over the original documents of the property, handing over the possession of the property, handing over the authorization letter to transfer power and water meters, signing of the application for transfer of khatha, title of the seller of the property, indemnifying the purchaser in case of defect in the title, easement rights, will be prepared by the purchaser’s advocate. Such draft Sale Deed should be captioned as draft Sale Deed and shall be signed by the purchaser’s advocate.
A copy of the draft Sale Deed will be given to the seller for his approval. The seller and his advocate will verify the draft sale deed and approve it, or may suggest suitable deletions, additions or amendments. The purpose is to bring forth the correct intention of the parties to the Sale Deed.
On approval of the draft Sale Deed, the same has to be prepared on a quality or a document paper. In Karnataka it may be prepared on good quality paper like bond paper or green paper and the stamp duty may be paid by way of demand draft or pay order or cash. The exact amount of stamp duty should be ascertained from the Sub Registrar office. Purchaser is liable to pay the Stamp duty as per value stated in the documents or as per the Sub- Registrar office value whichever is higher.
Execution
After the Sale Deed is prepared all the parties to the deed shall execute it by affixing full signatures. Each page should be signed by all the sellers. Any overwriting, cancellations, erasures and additions have to be authenticated by full signatures of the parties.
The execution of the Sale Deed requires to be witnessed by two witnesses. The witnesses shall give their full particulars and addresses.
Sale Deed of immovable property of value more than Rupees one hundred needs compulsory registration. The duly executed sale deed should be presented at the jurisdictional sub-registrar office. All the parties, including the confirmation witnesses shall be present at the time of registration and admit the execution. Purchaser also has to be presented for the execution of the documents at the Sub Registrars office. In case the purchaser is not in position to be present before Sub Registrar, he can give Power of Attorney to any of his persons to sign and present the documents on his behalf. In case seller signs the Sale Deed, it is compulsory that through the registered Power of Attorney holder only can represent for him to present the documents before the Sub-Registrar.
Registration
In Karnataka, the Sub-Registrars office, take the photos of purchaser, vendors, witness and also their thumb impressions and print the same on the Sale Deed.
The vendors has to produce all the original documents pertaining to the property to the purchaser. If the property is divided into one or more portions, the seller has to give certified copy or Xerox copy of the documents to the purchaser and has to give declaration to that effect. Generally, the larger portion holder should get the original documents.
There is a time limit for presenting the documents for registration. The time limit is four months from the date of execution.  Thereafter a grace period of another four months is allowed on payment of penalty. The maximum penalty is ten times of registration charges.
At times, the registering authorities may dispute the stamp duty paid. In such cases, the purchaser has an option of paying the additional stamp duty by way of cash or payorder. The purchaser may contest it in which case the Sub Registrar will do the pending registrations and send it to the Registrar of Under Valuation to arrive at proper Stamp Duty.
Parties have to quote their Income Tax Permanent Account Number in case the transactions are done in cash for the property which values more than Rs 5,00,000. Parties, who have not yet been allotted Permanent Account Number, will have to file Form No.60 or Form No. 61 in case of Agriculturists.

The purchaser’s advocate has to take all precautions while preparing Sale Deed. It is a most important document and decides the fate of the purchaser. The purchaser has to preserve the Sale Deed very safely.


For more : 


Posted by at

2 comments:

Subscribe to: Post Comments (Atom)