Deeds Agreements

An Outlook on the Essential Sale Deed Components for Property Transfer

calendar21 Jun, 2021
timeReading Time: 4 Minutes
Essential Sale Deed Components for Property’s v Transfer

The sale deed is commonly used when the buyer intends to sell its property to the seller in a legal way. Both buyer and seller can leverage this document for legalizing the process of property transfer. Simply put, a sale deed is a legally binding document that sets out the conditions for the sale or transfer of property. The sale deed is drawn upon a non-judicial stamp paper by legal draftsmen as per the value cited by the stamp duty act of a state. The Registration Act, 1908 mandates the execution of a sale deed for selling or purchasing property in India. Since it is a legal document, the sale deed must enclose the signature of the concerned parties, i.e. Buyer and seller. Successful execution of the sale deed also seeks the presence of at least two witnesses. In this blog, you will come across fundamental  Sale deed components that are of utmost importance for the buyers and the sellers.

Essential Sale Deed Components to be included for property transaction

Following are the basic sale deed components that collectively give the legal effect to the property’s transaction.

Essential Sale Deed Components

Parties involved in the transaction

As with all legal documents, a Sale Deed also begins with the details of the parties willing to give legal effect to the transaction. It must reflect the name, age, as well as address of the parties involved in the transaction to ensure its validity. Also, the sale deed must be signed and executed with bona fide intention.

Description of the concerned Property

The sale deed must enclose an elaborate briefing of the property that you wish to buy. For example, if you are planning to buy a 2 BHK in Noida, the sale deed must reflect the parameters like

  • Total plot area
  • Detail of constructions
  • Identification Number
  • Exact location and surroundings.

There should be a Property Schedule, as an annexure to the sale deed, to reflect the exact location of the property.

Read our article:What is the Gift Deed and how it Works?

Sales Agreement

This document comes to light as soon as you pay the booking amount for your new home. This agreement reflects that both buyer and seller mutually set out the norms and conditions of the agreement so that it can maintain harmony with parties’ interests and rights. A sale agreement is typically drawn up before the sale deed. 

The clause relating to the Sale Consideration

The sale consideration clause typically entails the amount agreed between the seller and the buyer for a specific property. This is the sum that buyer promises to pay to the seller while executing the sale deed. The sale deed must reflect such an amount clearly, as it was agreed upon to avert any legal conflict.

Payment Mode and Advance Payment

If you have made any advance payment to the builder for booking the home, then the same should be cited in the Sale Deed. Apart from that, the deed should also contain the remaining amount payable for the concerned property.

The mode of payment in this regard includes- cash, cheque[1], Demand draft. Note: This must be shown on the sale deed alongside the seller’s consent to accept it in the form.

Passing of the Title

As the name suggests, Passing of title refers to a legal clause of the passing of the property title to the buyer. It is an important Sale deed components as it shows to whom the property title is being transferred. After passing of the property title, the buyer’s rights over his/her property would get dissolved.

Possession Delivery

A possession delivery is a clause in a sale deed that reflects the seller’s obligation to transfer the property’s possession to the buyer after the completion of the registration process. The sale deed must possess the exact date of delivery of possession.

Indemnity Provision

It is an important sale deed components, which is prominently used in the case of a resale property. Such a clause mandates the clearance of statutory charges such as property tax, electricity bills, maintenance charges, water bills, and society charges before the sale deed execution. Any prior dues over the property are under the seller’s obligation, i.e. he/she will be liable to clear such dues before selling the property to anyone. Thus, the buyer should examine the status of encumbrance relating to the buyer’s property from the registrar’s office before drawing up the contract.

Default Clause

Yet another imperative sale deed component that protects the parties’ interest and keeps non-bona fide intentions at the bay. The default clause specifies penal provisions for actions that are against the terms mentioned in the Sale deed. The clause mandates the defaulting party to pay the penalty to another party that is found to be in adherence with the deed’s terms.

Once the sale deed is drawn up, it seeks the ratification of two witnesses from both sides. In such an event, the witnesses are required to render their name, signatures, and full address. Needless to mention that every page of the sale deed should enclose the signature of the buyer and seller.


The sale deed is a vital document for the legally passing of the property’s title to another party. It not only embraces transparency but also protects the interest of the involved parties. With a sale deed in place, one can avert legal conflicts while transferring the ownership of the property or buying the same. One must pay attention to every sale deed component before agreeing to the terms and conditions mentioned therein. This will keep the vagueness out of the equation and make the property’s transaction legally seamless.

Stay in touch with CorpBiz’s associate just in case you wish to avail professional help regarding the sale deed. With our expertise at your disposal, you can expect error-free execution of sale deeds and avoidance of disparities that are common with such a document.

Read our article:Sale Deed Format: Know the Process of Drafting a Sale Deed in India

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