{"id":32098,"date":"2021-06-22T12:06:20","date_gmt":"2021-06-22T06:36:20","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=32098"},"modified":"2021-06-22T12:06:22","modified_gmt":"2021-06-22T06:36:22","slug":"agreement-of-sale-and-sale-deed","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/agreement-of-sale-and-sale-deed\/","title":{"rendered":"Agreement of Sale and Sale Deed: Know the Key Differences"},"content":{"rendered":"\n<p class=\"has-drop-cap\">Though\nagreement of sale and sale deed sounds similar, they have some key differences.\nBoth these documents refer to a legally binding agreement that encloses a long\nlist of clauses for a property\u2019s transfer. After reading this write-up, you\nwill be able to pinpoint the key differences between these two agreements.<\/p>\n\n\n\n<p>The formalization of property sales is done in a stage-wise manner. One of the initial paperwork that is executed, to render a legal status to an understanding between a seller and buyer, refers to an agreement of sale. This vital document is widely known as a sale agreement. But, such an agreement should not be confused with a <a href=\"https:\/\/corpbiz.io\/sale-deed-registration\"><strong>sale deed<\/strong><\/a>.\u00a0\u00a0<\/p>\n\n\n\n<p>There is a common misconception that these similar-sounding agreements serve an identical purpose. However, the reality is otherwise. Have a glance over the following table that pinpoint the main difference between the agreement of sale and sale deed.<\/p>\n\n\n\n<table class=\"table table-bordered\"><tbody><tr><td>\n  <strong><em>Sale Deed<\/em><\/strong>\n  <\/td><td>\n  <strong><em>Agreement for sale<\/em><\/strong>\n  <\/td><\/tr><tr><td>\n  <strong><em>Sale\n  deed refers to an actual transfer of property ownership<\/em><\/strong>\n  <\/td><td>\n  <strong><em>Sale\n  agreement is an assurance for the future transfer of property ownership<\/em><\/strong>\n  <\/td><\/tr><tr><td>\n  <strong><em>Sale\n  deed entails detail about the buyer and seller, such as age, addresses and\n  other details.<\/em><\/strong>\n  <\/td><td>\n  <strong><em>Sale\n  Agreement sets out conditions and norms under the property will be\n  transferred.<\/em><\/strong>\n  <strong><em>&nbsp;<\/em><\/strong>\n  <\/td><\/tr><tr><td>\n  <strong><em>Sale\n  deed transfer the seller\u2019s right over the property to the new owner. <\/em><\/strong>\n  <\/td><td>\n  <strong><em>Sale agreement\n  set out rights that enable the purchaser to legally purchase the property in\n  question upon meeting certain conditions. <\/em><\/strong>\n  <\/td><\/tr><tr><td>\n  <strong><em>Buyer\n  has to pay the registration fee as well as stamp duty for the execution of a\n  sale deed. <\/em><\/strong>\n  <\/td><td>\n  <strong><em><br>\n  Sale agreement precedes sale deed, attest &amp; executed by the seller as\n  well as the buyer on a non-judicial stamp paper.<\/em><\/strong>\n  <strong><em>&nbsp;<\/em><\/strong>\n  <\/td><\/tr><\/tbody><\/table>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/agreement-of-sale-and-sale-deed\/#What_Do_You_Mean_by_Agreement_for_Sale\" >What Do You Mean by Agreement for Sale?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/agreement-of-sale-and-sale-deed\/#Significance_of_Agreement_for_Sale_in_Legal_Parlance\" >Significance of Agreement for Sale in Legal Parlance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/agreement-of-sale-and-sale-deed\/#What_is_a_Sale_Deed\" >What is a Sale Deed?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/agreement-of-sale-and-sale-deed\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_Do_You_Mean_by_Agreement_for_Sale\"><\/span>What Do You Mean by Agreement for Sale?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>An\nagreement of sale refers to an agreement to sell out a property in the future.\nSuch an agreement entails terms and conditions for the proposed transaction of\nthe property in question. Section 54 of the Transfer of Property Act, 1882\ndefines the contract sale as a contract to sell the immovable property as per\nthe conditions agreed by the involved parties.<\/p>\n\n\n\n<p>Section\n54 further states that such a property should be free of any charge or interest\nthat hinders the parties\u2019 interest.<\/p>\n\n\n\n<p>It\nis evident from the above that an&nbsp;<em>agreement of sale<\/em>&nbsp;is nothing but an assurance to\ntransfer a property in question in the future, on fulfillment of certain\nconditions set out by the parties. Therefore, this agreement defies the\nself-creation of any rights or interest over the property in question, for the\nproposed buyer.<\/p>\n\n\n\n<p>The\nsale agreement specifically revolves around the purchaser\u2019s rights to buy the\nproperty in question on the meeting of certain conditions. Similarly, the\nseller also has access to rights to receive the consideration from the buyer on\nmeeting conditions meant for him\/her.<\/p>\n\n\n\n<p>In case of default of the seller to pass the property\u2019s title to the buyer, the buyer will have access to the right of specific performance as per the <strong><em>Specific Relief Act, 1963<\/em><\/strong><sup><a href=\"https:\/\/en.wikipedia.org\/wiki\/Specific_Relief_Act_1963\"><strong><em>[1]<\/em><\/strong><\/a><\/sup>. The same goes with the seller as well, in case the buyer commits some statutory mistake in this context.<\/p>\n\n\n\n<p><em><strong>Agreement of sale doesn\u2019t ensure instant transfer of property; instead, its talks about the fulfillment of certain conditions set out by the parties for the future transaction of property. It is advisable to proceed cautiously while setting out the conditions for the same.\u00a0\u00a0<\/strong><\/em><\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/essential-sale-deed-components-for-property-transfer\/\">An Outlook on the Essential Sale Deed Components for Property Transfer <\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Significance_of_Agreement_for_Sale_in_Legal_Parlance\"><\/span>Significance of Agreement for Sale in Legal Parlance <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>Signing\na sale agreement is important in light of given factors:&nbsp;<\/em><\/strong><\/p>\n\n\n\n<ul><li>A Sale agreement serves as legal proof in a court\nproceeding, helping the non-offending party to demand compensation for losses\ntriggered by the defaulter.&nbsp;<\/li><li>If you are seeking a home loan, the bank would\nreject the application for the same if you refuse to sign an agreement of sale.<\/li><li>Adherence to the conditions mentioned in the\nagreement of sale is of utmost importance. Hence, any non-conformity in this\ncontext would trigger the chance of penalties and even compel the offending\nparty to face the legal proceeding.&nbsp;<\/li><li>Agreement of Sale is admissible in the court as it\nacts as prima-facie evidence.&nbsp;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_a_Sale_Deed\"><\/span>What is a Sale Deed?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>A\nSale deed is nothing but a statutory document for legalizing the transaction of\nproperty between the seller and the buyer. The passing of the property\u2019s title\nto the new owner is only possible through this document. After being executed,\nthe sale deed dissolves all the rights of the previous owner over the property.\nTherefore, the sale deed ensures the complete transfer of ownership\u2019s right\nfrom the seller to the buyer mentioned therein. Such a document comes in handy\nin a legal dispute as it acts as prima-facie evidence in the legal proceeding.<\/p>\n\n\n\n<p><em><strong>The sale deed usually encloses information, such as;<\/strong><\/em><\/p>\n\n\n\n<ul><li>Detail of the sellers as well as buyers, such as name, age, and addresses.<\/li><li>Property details, such as total area, exact address, and details of constructions.<\/li><li>Sale amount + advance payment paid<\/li><li>Mode of payment<\/li><li>The time frame when the property in question shall be actually passed to the buyer.<\/li><li>The exact date for the delivery of possession.<\/li><li>Indemnity clause for ensuring reimbursement of losses incurred by the buyer with regards to the property in question. It is a kind of assurance for the buyer to negate any mishaps from the seller\u2019s end.<\/li><\/ul>\n\n\n\n<div class=\"shadow1\"><strong>Key takeaway:<\/strong> One of the key differences between an agreement of sale and a sale deed lies in their way of execution. While the sale deed ensures instant transfer of property\u2019s rights after being signed by either of the parties; the sale agreement waits for the predetermined time line in which it is proposed to be executed against the conditions mentioned therein. Knowing this difference will be enough for you to overcome skepticism around these documents. <\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The line that differs between that agreement of sale and sale deed is quite thin. This is the reason why most people get confused between the two. Hopefully, the information above will boost your understanding of this topic. In case of doubt, share your concern by dropping the comment in the comment section.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/sale-deed-format-know-the-process-of-drafting-a-sale-deed-in-india\/\">Sale Deed Format: Know the Process of Drafting a Sale Deed in India <\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Though agreement of sale and sale deed sounds similar, they have some key differences. Both these documents refer to a legally binding agreement that encloses a long list of clauses for a property\u2019s transfer. After reading this write-up, you will be able to pinpoint the key differences between these two agreements. The formalization of property [&hellip;]<\/p>\n","protected":false},"author":22,"featured_media":32110,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[1011],"tags":[1826],"acf":{"service_id":"286"},"authorName":"Pankaj Tyagi","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/01\/MicrosoftTeams-image-42.jpg","authorDescription":"Pankaj has a diverse experience of writing research papers, blog, and articles during his college time. Earlier, he was working as a tax consultant in a financial firm, but his interest in writing drives him to pursue a career in the writing field.","postViews":5873,"readingTime":4,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/32098"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=32098"}],"version-history":[{"count":13,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/32098\/revisions"}],"predecessor-version":[{"id":32113,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/32098\/revisions\/32113"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/32110"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=32098"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=32098"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=32098"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}