Sale Deed is a document by which the property is transferred from one person to another by way of sale. Section 54 of The Transfer of Property Act, 1882 provides that in case of immovable property like land, house of more than Rs.100, the sale can be made only by a registered document.
Section 17 of the Registration Act, 1908 also provides that non-testamentary instruments which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property need to be compulsorily registered.
Therefore, the registration of sale deed is compulsory as per Section 54 of the Transfer of Property Act and Section 17 of the Registration Act, 1908.
Process of Registration:
For registration of Sale Deed, the following steps have to be undertaken:
- The value of the property has to be estimated based on the circle rate (minimum value of property set by the state government’s revenue department or the local development authorities) in that area.
- The circle rates of the area and the actual price paid for the property has to be compared. While calculating the stamp duty the higher of the two values, i.e., the circle rate or the actual price paid, has to be taken into consideration. Non judicial stamp paper of the stamp duty value so calculated has to be purchased.
- Preparation and typing of the deed in stamp papers.
- The final step involved is Registration of sale deed by approaching the Sub-Registrar’s office in order to get the sale deed registered. The parties must be accompanied by two witnesses.
Consequences of Non-Registration of Sale Deed:
Sale is invalid if the Sale deed is not registered. As per Section 49 of the Registration Act, an unregistered sale deed is not the evidence of sale. An unregistered sale deed neither affects the immovable property nor confers any title or power.