This article has been written by Manya Manjari. This article briefly discusses conveyance deeds and sale deeds. It also discusses in detail the difference in the laws they are governed by, landmark cases, the procedure to draft these deeds, and their key focus in India.
Table of Contents
Introduction
Imagine a situation where ownership of a property is transferred; it may be a city apartment or a nice cottage in the countryside. This procedure calls for formal papers or ‘deeds’. Black’s Law Dictionary defines it as “a sealed instrument, containing a contract or covenant, delivered by the party to be bound thereby, and accepted by the party to whom the contract or covenant runs.”These documents are more than simple paperwork; they have the legal authority to ensure that the transfer of property ownership is done lawfully.
Deeds are essential in determining who legally owns any significant item, including real estate, buildings, and other types of property.
However, if they are not completed properly—for example, if necessary paperwork, registration, or notarization are not included—they will lack enforceability in the eyes of law.
One may be familiar with terminology like ‘sale deed’ and ‘conveyance deed’ when it comes to real estate transactions. Despite the fact that they appear to be the same, they stand for various aspects of property transfers.
The scope of this article is restricted to conveyance deeds, sales deeds, and the difference between the two. In order to understand how these legal papers affect the process of transferring of property ownership, let’s understand the difference between the two terms.
Key differences between conveyance deed and sale deed
Meaning and Definition
Conveyance Deed
Black’s Law Dictionary defines conveyance as “Conveyance includes every instrument in writing by which any estate or interest in real estate is created, aliened, mortgaged, or assigned, or by which the title to any real estate may be affected in law or equity, except last wills and testaments, leases for a term not exceeding three years, and executory contracts for the sale or purchase of lands.” This definition was also relied on by the Supreme Court of Minnesota in the case of Shraiberg v. Hanson (1917). A conveyance deed is a document which essentially transfers the ownership of movable or immovable property. It is a broader term that includes the ownership transfer of any gift, mortgage, lease, or exchange. It does not always require consideration. It is not limited to just sale transactions as it also includes transferring property in several other manners as well.
Sale deed
“The transfer of ownership of real estate for money is referred to as sale” under Section 54 of the Transfer of Property Act 1882. A sale deed is a legal document used to transfer a real estate property’s rights, title and ownership from one party to another. A sale deed is generally executed in cases of immovable property. A sale deed always requires consideration. It is only made in case of sale transactions. It is a document showing that the sale is successful and that the property belongs to the buyer.
Origin
Conveyance deed
The origin of the conveyance deed can be traced back to Anglo-Saxon England. Between the 8th to 11th centuries, people began documenting the information relating to the ownership of land. In this period, ownership documents were executed on vellum or parchment to record land transactions. Eventually, people started relying more on this method of transfer of land ownership. Around the 16th century, due to the legal safeguards offered to the parties, the conveyance deed became a more reliable option for the execution of contracts. With the passing of time, it became a widely accepted mode and gained official recognition from the government, thereby ensuring transfers’ security and establishing clear ownership of property.
Sale deed
The sale deed has its origin from the deed of conveyance itself. However, in India, the concept was officially recognised after the commencement of the Transfer of Property Act, 1882. The sale deed is new, as it only covers a few topics that are dealt with exclusively in sale transactions.
Governing laws
Conveyance Deed
A conveyance deed is governed by two major laws, namely, the Indian Registration Act, 1908 and the Indian Stamp Act, 1899. Registration of a conveyance deed is mandatory. When the transfer is made permanent in the public records and it is signed by two witnesses, the process of the conveyance deed is completed. It can also be notarised.
Sale deed
A sale deed, on the other hand, is governed by the Sale of Goods Act 1930, the Transfer of Property Act 1882 and the Indian Registration Act for registration purposes. It is absolutely necessary to have a sale deed registered, and anything that costs more than 100 rupees must be registered for its execution as per Section 17 of the Indian Registration Act, 1908.
Features
Conveyance deed
A conveyance deed is an important document. Its main characteristics are that it serves as evidence to show that an individual owns the property. It is proof of ownership of the concerned property. It helps transfer property rights and claims arising from said property.
Sale deed
Similar to a conveyance document, a sale deed’s key features include establishing the buyer’s ownership right. It transfers ownership from the seller to the buyer in return for some for consideration. One distinct feature is that it clearly lays down the monetary transactions and schedules of the consideration. It is a document enforceable in the eyes of the law. Once the sale deed is registered, the buyer reserves all the rights of the concerned property.
Applicability
Conveyance deed
A conveyance deed is applicable not just to sale transactions but also to gifts, leases, mortgages, wills and any other kinds of property transfer.For instance, A might draft a gift deed to formally transfer ownership of his property to his son B as an act of goodwill. This legal document attests to the transfer of the property without consideration for money, hence serving as a good example for conveyance deeds.
Sale deed
A sale deed becomes applicable only to those transactions where there is a sale particularly. Sale, which is the transfer of ownership of a property from one person to another in return for a consideration, is governed by the provisions of Section 54 of the Transfer of Property Act 1884. For instance, A sale deed would be used if A decided to sell his property to someone else, let’s say C, for a specific amount of money in order to verify the ownership was transferred legally.
Contents
Conveyance deed
The contents of a conveyance deed are as follows-
- Definite demarcation of property boundaries
- Information on power of attorney (if any)
- Details of property handover
- Titles of both parties
- Signatures of buyer and seller
- Clearly stated terms and conditions
- Details of encumbrances (if any)
- Details and signatures of witnesses
- Method of property delivery
- Specific dates of transfer
The date and time of conveyance have to be followed with utmost care.
In the case of Smt. Jaswant Kaur v. Harpal Singh (1977), issue was raised concerning inheritance and gift deeds. A man had executed a will transferring his property to his wife, which would pass on to Major Harpal Singh after her death. The wife, after receiving the property, further started dividing it by making gift deeds. This was contested by the appellant, Major Harpal Singh. It was decided by the Punjab and Haryana High Court that even if the deed were executed after the death of the husband several years later if the deed clearly mentions that the property will be transferred on a specific date, it would be considered as if the transfer happened on that date and in the way which is mentioned in it.
Sale deed
A sale deed generally contains the following information-.
- A sale deed contains the property’s location, address, and description.
- It includes crucial information about stamp duty and its payment details.
- The sale deed also outlines the terms and conditions agreed upon by the parties involved.
- The sale deed is considered legally binding with the acceptance through signatures from both parties.
Essential elements
Conveyance deed
The below-mentioned points are the essential elements; in the absence of these, a conveyance deed will not be treated as complete.
Details of parties
Like any other agreement, a conveyance deed requires the details of the parties involved in the execution of the deed. These details contain the name, address, and information regarding the execution, as mutually decided by the parties. Since a conveyance deed also includes gift deeds, wills, mortgage deeds and many others, the details vary from case to case basis.
Recitals
Recitals contain the reason behind the contract that is being entered into by the parties. It is the preamble clause, or generally, it begins with ‘Whereas’. These clauses must be clearly laid down so that the objective behind the agreement is clear.
Transfer details.
This clause contains all the details of the purchase mandatorily, along with the kind of transfer that is being made through the conveyance deed. If it is a gift deed, then there will be no consideration, and if it is a mortgage deed, it will contain all details of the property being mortgaged and the other necessary details. In the mortgage deeds, the mortgagee holds a right if the mortgagee has not repaid the loan. Also, as per the terms mentioned in the mortgage deed, the property mortgaged is used as a security for the repayment of the loan.
Clauses
A conveyance deed has several clauses depending on the type of transfer. Clauses are drafted depending on the facts and circumstances of each case. Other essential clauses like the dispute resolution clause, jurisdiction and warranty clause are also present in every kind of conveyance deed.
Notary or registry details
A conveyance deed should be registered or notarised. It can be notarized by the notary office at the place where the contract is being formulated or at the office of the sub-registrar.
Attestations
Conveyance deeds have to be signed by the people who are parties to the contract. Along with that, the signatures of the witnesses are also very important to ensure that the transaction was initiated with the parties’ free will.
Sale deed
A sale deed generally begins with the details regarding the date and time of execution, along with the names of the parties, details of any representations that are to be made and thereafter, the necessary clauses are mentioned in accordance with the concerned law. The necessary clauses are mentioned under:-
Stamp details
The top part of a sale deed format has a stamp and seal of the registrar and sub-registrar. The stamp fees and seal will depend upon the value of the property being sold and also the local laws of each state.The amount and the party making the payment on the stamp paper for the deeds are determined by Sections 28 and 29 of The Indian Stamp Act of 1899. Stamp duty is imposed based on whichever is greater than the circular rate (stamp duty rate )or the actual value of the property. Stamp duty may range from 3 to 10%, depending on the state. In Delhi, for instance, the rate of stamp duty is 6% for men, 4% for women, and 5% for joint ownership.
Parties in a sale deed
The details of both the buyer and seller are significant in a sale deed. This consists of name, age, father’s name, address and so on. Any information about the power of attorney, or legal representation or any other information by which they are expressing their willingness to enter into a contract for sale. The person should be a juristic person; it cannot be any unregistered firm or a fictitious person.
Description of the property
The details regarding the property boundaries on all sides, along with details as to any encumbrances or any mortgage, are mentioned. The nature of the property, i.e., whether the property is a plot, or a house, a building or a commercial property, should be clearly laid down. The exact location, address and house number, along with carpet area and rooms, should preferably be mentioned. The approved map and photos are also attached for the convenience of the parties.
Consideration and payment details
Clauses containing the details of consideration and payment schedule are mentioned. Consideration is the price that is paid in return for the property. The method of payment, be it check, cash, demand draft, instalments, online mode of payment or through a loan, is mentioned in that clause. The date of handing over of original property documents are also mentioned. If there is to be any advance payment, there should be an acknowledgement slip attached to it. Any faults or defects in the property should also be reported in this clause.
Transfer title
The transfer of title clause contains the relinquishment of the title of the previous owner and gives the new owner all the right to enjoy the property.
Other clauses
A few important clauses like the indemnity clause in case of a defect by a party, the witness of the sale, the clause containing the rights of the parties, the warranty clause of the property, and dispute resolution clause containing the method by which disputes would be resolved are also present in the sale deed.
Annexures
The last part of the deed is that it should have the details of identification, photos, payment slips, maps, etc. The annexures can be presented as evidence of the details and facts mentioned in the clause.
Registration
A deed can be executed only after it has been registered. So it becomes necessary to register a deed. Registration is done by the provisions provided under Section 17 of the Indian Registration Act 1899.
Conveyance deed
The rules and regulations of the state in which a conveyance deed is executed will govern its registration.
- Declaration and Signatures: In some states, a certified advocate and the person who wrote the conveyance deed must sign a declaration attesting to the accuracy and authenticity of the deed before it is finally executed. Furthermore, the unregistered document needs to have the token number that the relevant body granted to the deed attached to it.
- Proof of Payment: Unless the conveyance deed is a gift deed, the conveyance deed must be accompanied by valid consideration for the registration fees and any relevant taxes.
- Identity Proof: All participants in the transaction, including the witnesses and the transferor and transferee, must provide valid and verifiable identity proofs.
- Draft of the Deed: The conveyance deed must include all pertinent information about the transfer of property, including-
a) The method of property transfer must be clearly stated.
b) The agreed-upon specific transfer dates by the parties.
c) Any other necessary formalities that need to be completed in the allotted time limit.
- Original Documents: the original documents for the property being transferred must be presented. This contains all previous certifications and records pertaining to the asset. Furthermore, legitimate documentation must be shown to demonstrate that the property is free of liens and disagreements.
- Witnesses: In order to verify that the deed was executed correctly, witnesses from both parties involved should ideally be present.
Sale deed
- Document Preparation: A sale deed must be correctly written and printed in order to be registered.
- Original Documents: The sub-registrar’s office must receive the following information:
- Agreement to sell: Legal agreement to sell the property is called an agreement to sell, which was offered initially by the seller.
- Allotment Letter: The property’s initial allocation letter.
- Title Documents: The property owners’ duly executed and legal title documents are required to register a deed.
- Registered Agreements: Copies of all earlier registrations that the seller made in relation to the property must be presented at the time of registration.
- Tax Receipts: Tax receipts of the original tax for the property must be presented at the time of registration.
- Most Recent Amenities Bills: Copies of the most recent bills for the property’s amenities must be attached along with the other documents for registration.
- Association Certificate: It is required for selling or reselling an apartment or flat. It is given by the apartment association. Association certificates must be obtained beforehand and presented for registration.
- Identity Proof: Appropriate identity proof must be provided by the witnesses and the people engaged in the deed.
- A Non-Objection Certificate (NOC): NOC is a document issued by the municipality, society (in case of the sale of flats) or any other relevant authority, as the case may be. It must be presented at the time of registration for clearance of the deed.
- Any other Relevant Documents: Any further documents that the state’s local regulations in the area where the sale is occurring mandates must be presented to the registrar.
- Verification and Registration: The verification and registration process of the sale deed requires the completion of all required procedures and the approval of the attached documentation mentioned above.
- Expenses of Registration: The charges can be borne by either of the parties. They have to pay the following:
- Stamp duty
- Registration costs at the registrar’s office.
Overlapping aspect
There exists a few differences between a sale deed and a conveyance deed. However, there are some overlapping aspects too. Conveyance deed is a wider term, and it includes all types of deeds for transfer transactions. A sale deed is also a type of conveyance deed, which means that every sale deed is a conveyance deed, but not every conveyance deed is a sale deed.
Difference between a conveyance deed and a sale deed
Sale deeds and conveyance deeds are interchangeably used in any kind of real estate transaction. However, there are distinct differences between these.
| Serial no. | Basis | Sale deed | Conveyance Deed |
| Nature | Transfer of property ownership from one person to another in exchange for monetary consideration. | Property ownership is transferred from one party to another, which may not necessarily involve monetary consideration. It can also be through gifts or exchanges. | |
| Consideration | involves selling through money or exchange for a sale price, which the buyer pays the seller. | Does not necessarily involve monetary consideration. It depends upon the type of conveyance. | |
| Governing laws | It is governed by the Sale of Goods Act 1930, the Transfer of Property Act 1882, the Indian Stamp Act 1899 and the Indian Registration Act 1908. | It is governed by the Indian Registration Act 1908, The Transfer of Property Act 1882 and the Indian Stamp Act 1899. | |
| Registration | Must be mandatorily registered as per the Indian Registration Act, 1908. | Generally requires registration, or it becomes an imperfect deed. Wills may or may not be registered. | |
| Types | It is specifically used for immovable property. | It has a wider category of transfers, including sales, gifts, exchanges, leases, warranties and so on. | |
| Purpose: | It is made for sale transactions specifically. | It is made for transfer purposes. |
Landmark cases
Narinder Singh Rao v. Avm Mahinder Singh Rao (2013)
Facts
In this case, a property belonging to Narinder Singh Rao was in dispute. The property in question belonged to Rao Gajraj Singh, and he executed a document that stated whosoever among his wife and him would survive shall inherit the property. This was attested by only his sister and one witness.
After the demise of Rao Gajraj Singh, his wife, Sumitra Devi, became the owner of the property. She went on to construct several shops on it and gave it on rent. Before her demise, she executed a will and bequeathed all the property to one of her eight children, Narinder. The other four surviving siblings challenged this in court. The lower and high courts held that the will was valid, so the matter went before the Apex court.
Issues
The issue, in this case, was whether the will executed by Sumitra Devi and Rao Gajraj Singh was valid.
Judgment
It was held by the Supreme Court that the will executed by Sumitra Devi was valid. However, the will executed by her husband, Rao Gajraj Singh, was not as it did not have proper attestation and had only one witness’ signature. So the property share of each person was determined as 1/9th, and the 1/9th share of Sumitra Devi was given to Narinder Singh additionally. This case highlighted the importance of attestation in conveyance deeds and laid down that any deed is incomplete without two signatures.
Kewal Krishnan v. Rajesh Kumar and Others (2021)
Facts
In this case, certain property was owned jointly by Kewal Krishnan (Appellant) and Sudarshan Kumar (Respondents). A Power of Attorney was executed by the appellant in favour of the respondent so that all the transactions could be dealt with by him on his behalf. The respondents fraudulently executed two sale deeds in favour of his son and his wife for the jointly owned property, which also equally belonged to the appellant. This matter was first taken up before the Trial Court, but the appellants did not get any relief. The matter was again taken up before the District Court, wherein the sale deeds were set aside, and so the respondents went to the Punjab and Haryana High Court, where this decision was reiterated. So a final appeal was filed before the Supreme Court.
Issue
The issue raised in this case was whether the sale deeds were executed without any consideration, and if yes, will it be void?
Judgment
It was held by the Supreme Court that Sudarshan Kumar had failed to present any proof showing that the sale deeds were executed in exchange for any consideration, as neither his wife nor his children were working, and there can be no sale without any consideration. They also failed to show that there was any intention to pay the consideration as it was not even due to be paid at later dates. In addition to that, it was also held that the sale deeds be ignored as they are void, and the appellant would still have his undivided share over half of the property. This is one of the landmark cases regarding the sale deed, which highlights that there can be no sale without any consideration, and if any sale deed is made as a result of a sale like that, it will have no effect.
Syed Afsar Pasha Quadri v. The State Of Telangana (2021)
Facts
In this case, anticipatory bail was sought by the petitioner, and one of the conditions was to cancel the registration of the sale deed and return the consideration amount to the respondents. This bail petition was in front of the Telangana High Court, which ordered him to cancel his sale deed. So, the petitioners went before the Apex Court, challenging this condition of the bail.
Issues
The issue was whether the condition of cancelling the sale deed was valid or not.
Judgment
Bail was granted to the petitioner on the promise of cooperating with the police, and it was held that the condition was not valid as “a registered sale deed cannot be cancelled unilaterally by one party to the said document in purported compliance of the direction given by the Andhra Pradesh High Court and thereby adversely affecting the rights of the purchasers, who are not a party before the High Court.”
Damodhar Narayan Sawale (D) through LRs v. Shri Tejrao Bajirao Mhaske & Ors (2023)
Facts
In this case, two defendants sold a piece of land to the plaintiff. After the plaintiff had taken possession of the land, the second defendant started disturbing the plaintiff’s possession, which led to a legal dispute. The lower court initially dismissed the case, which stated that the sale deed was void. The dispute revolved around the transfer of 2 acres and 20 guntas of a property. An acre of land was divided without the District Court’s necessary permission, according to the sale deed. According to Section 8 of the Maharashtra Prevention of Fragmentation and Consolidation of Holdings Act, 1947, this division is deemed to be unlawful fragmentation. According to this, the sale deed was rendered void under Section 9 of the aforementioned Act and declared as a sham document. This decision was reversed by the first appellate court, which favoured the plaintiff. The case further went to the Bombay High Court, which ruled in favour of the defendants, as the defendants claimed that the sale deed was given to the plaintiff only as a security for mortgage purposes. Finally, the matter came before the Supreme Court.
Issue
The issue was whether the sale deed was valid and if it is, what is the significance of a sale deed in the sale transactions.
Judgment
The Supreme Court allowed the Plaintiff’s appeal, upholding the First Appellate Court’s decision and setting aside the Trial Court and Bombay High Court’s orders. It was held by the Apex court that the primary goal of Section 54 of the Transfer of Property Act, 1882, along with Section 17 of the Indian Registration Act, is to register the sale of an immovable property valued at over Rs. 100/- to clarify ownership rights. The parties’ desire to complete a sale is apparent, given that the sale of the property in question was accomplished through a properly prepared and recorded sale document, making the deal legitimate. A selling deed automatically implies legitimacy and implies a genuine and bona fide transaction.
Conclusion
Sale and conveyance deeds are both essential documents in property transactions. A conveyance deed makes it easier for parties to transfer ownership of property to one another, whereas sale deeds are typically used in sales transactions. For both deeds, careful preparation and proper registration are necessary to prevent future issues. In conclusion, the careful implementation of these documents is critical to safeguard the rights of all stakeholders in the property transfer procedure.
Frequently asked questions
Who prepares the conveyance and sale deeds?
The preparation of a conveyance deed and a sale deed is usually done by an experienced lawyer or advocate or a deed writer. They have expertise and experience in drafting these deeds.
Can a sale deed be executed online?
No, a sale deed is not executed online. It is mandatory to visit the sub-registrar office for registration of the deed. One can get e-Registration done and make an appointment ahead of time to avoid any problems and ensure hassle-free registration. It also depends on the rules of the states. Some states, like Maharashtra, have allowed online registration.
What to do if a conveyance or sale deed is lost or stolen?
If a conveyance deed or a sale deed is lost or stolen, one must lodge a First Information Report (FIR) at the nearest police station. After this, a notice must be given in the newspaper, one of which must be in vernacular language. The next step is to prepare an affidavit on stamp paper and attach it with a copy of the FIR and advertisement. The last step is to visit the sub registrar’s office and submit the documents and pay the fees for obtaining a duplicate sale deed, and after verification, a new deed would be issued.
Can a deed be challenged in court?
A deed can be challenged in court if its validity or legality is questioned. A deed can be challenged if it is entered or executed under fraud, undue influence, mistake, non-compliance with legal requirements, ownership disputes, or in contravention of law. The deed can only be challenged by the parties involved in the transaction of the deed. So, it includes the seller and the buyer. The rule of locus standi “a person who is stranger to a disputed matter cannot be allowed to interfere in the judicial proceedings” appears here as well, and only the parties that are affected by the deed can challenge the deed. No one else has the power, not even the registrar, but a registrar can lodge a complaint against the persons and institute a criminal case if the parties have registered the deed based on false information to challenge or cancel any deed under Section 68 of the Indian Registration Act 1908.
Can a conveyance deed and a sale deed be cancelled?
A registered deed cannot be cancelled. It can only be cancelled by order of the court. Section 31 of the Specific Relief Act, 1963 states that a deed can be cancelled if there is an apprehension that the deed will inflict injury on one of the parties. Section 32 states that a court can allow the cancellation of a deed in part or whole if the deed has been registered under the provisions of the Indian Registration Act, 1908, and then a notice is also sent to the sub-registrar’s office to cancel the deed. Section 33 lays down the compensation to be provided for the cancellation of the deed.
References
- https://www.magicbricks.com/blog/what-is-a-conveyance-deed–why-is-it-important/115034.html#:~:text=Conveyance%20deed%20is%20a%20broader,not%20all%20are%20sale%20deeds.
- https://www.kotak.com/en/stories-in-focus/loans/home-loan/what-is-a-conveyance-deed-ttypes-purpose.html
- https://www.legalkart.com/legal-blog/conveyance-deed-and-sale-deed-two-sides-of-the-same-coin-
- https://www.bajajfinservmarkets.in/loans/home-loan/conveyance-deed.html
- https://www.kaanoon.com/256597/what-is-the-difference-between-sale-deed-conveyance-deed
- https://www.legalbites.in/registration-of-sale-deed/
- https://www.lawyersclubindia.com/articles/sale-deed-and-conveyance-deed-analysis-and-comparison-14320.asp
- https://www.vedlegal.com/difference-conveyance-deed-sale-deed/
