If two parties agree on a real estate transaction, they enter into an agreement. This agreement is called a sales contract. This agreement contains all the conditions under which the sale of the property will take place. In accordance with the Indian Registration Act of 1908, any agreement relating to the transfer of shares in immovable property with a value of more than one hundred rupees must be registered. Therefore, if you have purchased real estate as part of a purchase agreement without a correct deed of sale following, you will not get any right or interest in the property that would be transferred as part of the purchase agreement. Even if the signing of the sales contract does not mean that the sale is over, it is a decisive step in this direction. For this reason, buyers need to know precisely the conditions set out in the agreement. The agreement is valid in 100 Rs of stamp paper and even if it was not made on stamp paper, it is valid. In fact, even an oral sales agreement is legally enforceable. A contract of sale precedes the deed of sale and is a legally authorized document. This agreement is necessary if you get a home loan to finance your purchase. This agreement also reflects the money paid by the buyer as a booking amount or acomptt for the purchase of the property.
The sales contract is executed on an extrajudicial stamp document and contains the following details: In cases where you have purchased and taken possession of property under a sales contract, title to the property remains in the hands of the developer, unless a deed of sale has been executed a posteriori and registered in accordance with the Indian Registration Act. Thus, it is clear that a title to immovable property can only be transferred by a deed of sale. In the absence of a duly stamped and registered deed of sale, the buyer of the property does not have the right, title or interest in a property. Remember here that both parties must comply with the conditions set out in the sales contract. Any party that fails to comply with any of the conditions set out in the agreement may be brought before the courts if the other party so wishes. All parties concerned should also ensure that this document can be invoked as legal evidence before the courts of the law and that all those who have agreed to comply with the conditions are legally bound by it. Like contract law in most countries, the Indian Contract Act of 1872 affirms that all agreements that meet the essential requirements of free consent, legal consideration and legitimate subject matter are valid and enforceable. It is important to note that oral agreements, which constitute a wide range of contracts in India, are also contracts in force in accordance with the law, as long as they fulfill the essential elements of a contract. The Contracts Act does not make the stamp of agreements mandatory and does not consider an unstified agreement/contract to be invalid and unenforceable. Agreements therefore do not require a mandatory stamp for them to be considered legal and valid. Even if they are not stamped, they are still enforceable against the parties who signed them.
Seeing the unregistered purchase agreement can be considered as proof of the transaction and the unregistered sales agreement, since it is a legal action for a given performance and could be admissible as evidence subject to Article 49 of the Registration Act. The unreg registered sales contract may form the basis for the legal recourse of a given service and may be invoked as proof of the agreement or partial performance of a contract. The Indian Supreme Court in 2012 ruled in the case of Suraj Lamp & Industries (P) Ltd (2) v Den State of Haryana, while it deals with the validity of real estate sales made by proxy, as follows: The Indian Stamp Act, 1899 deals with the stamping of agreements/documents in India. . . .