Sale Deed

What is the Difference Between a Sale Deed and a Sale Agreement?

There is often much confusion regarding the difference between a sale deed and a sale agreement. This article explains the meaning of both these terms and highlights the differences between a Sale Deed and a sales agreement.

Whenever you buy any property or sell it then the sale deed is the most important document that transfers the ownership to the person buying or selling any property. You will be the complete owner once you have done the sale deed as a buyer and your ownership is considered to be legal when you get the deed registered. 

The sale deed is a final document under which your ownership rights get transferred. This ownership right is transferred to the buyer from the seller of a particular property.

The Sale deed establishes the ownership rights of a person and the following rights are transferred to the person when the Sale deed has executed these rights to lease, rights to use, rights to mortgage, or right to sell.

So the Sale deed is also a type of conveyance deed in which the person gets the ownership rights.

Features of a Sale Deed

A sale deed contains the following important information given below

  • The sale deed contains the details of both the buyer and the seller such as the name, age, and address of the buyer and seller.
  • It contains the details of the property like the total area, details about the surroundings, etc.
  • An indemnity clause is a clause, in which the seller hands over the ownership to the buyer. The seller is liable for any disputes regarding the ownership of the property for which the buyer faces monetary losses, for example, if there are previous loans, taxes, and charges on the seller regarding the property then the seller is solely liable to pay for the same.
  • The mode of payment like a cheque or a bank transfer, or cash to checking how the amount will be made for the property purchase.
  • The date of delivery of possession is also included in the sale deed.

What is an agreement to sell?

A sale agreement is an important legal document for the buyer and the seller that contains all the agreed-upon terms for the sale of the property.

A sale agreement tells us about proper terms and conditions like the rights of the buyer and the seller, the default payment, and the clauses that can occur if anyone makes any default.

Some terms and conditions are written in the agreement for sale.

Details of seller and buyer are the first thing which come under the agreement of sale like the address of the property, area, etc, second, comes the price that is agreed and then the time given by the seller for making the payment.

Features of Sale agreement

At least two individuals have to be involved in the sale agreement, for the transaction to take place. 

  • The ownership of the property needs to be transferred from the buyer to the seller to call it a sale. Just a transfer of belongings can not be termed a sale.
  • The sales agreement includes the description of the goods and services in detail. 
  • The time and method of payment have to be mentioned in the sale agreement. 
  • The method of delivery of goods and services has to be mentioned in the sale agreement.

The transfer of property act, 1882

The transfer of property act came into effect on 1st July 1882. As per the act, transfer of property implies an act by which one party passes on the ownership of a property to one or more parties, or shares the property in partnership with one or more parties. The property can be transferred at present or even in the future. The ownership can be transferred to a person, company, or group of individuals. The property to be transferred can be of any type, movable or immovable, tangible or intangible. The sale agreement is a promise of transfer of property to the buyer by the seller after the terms and conditions mentioned in the agreement are met. This agreement provides assuring to the buyer that the property would be handed over to them in the future. The seller is also promised to get his consideration after all the terms and conditions are met. 

Difference between a Sale Deed and a sale agreement

A sale deed and a sale agreement are two different legal documents. Let us dredge a little bit in detail and understand the difference between a sale deed and a sale agreement.

  1. A sale agreement anticipates the sale deed during the execution of the sale of a particular property. Whereas, an agreement of sale is a legal document that represents the terms and conditions of the transfer. It is a set of guidelines or conditions that the buyer and the seller have to follow during transaction execution.
  2. A sale deed is an important legal document that also specifies the title of the ownership to the buyer from the seller. It is also drafted legally when it is signed by both the seller and the buyer. It contains all the important information about the transactions like the name, address of the seller and the buyer, the property’s location, etc.
  3. On the other hand, an agreement of sale is the antecedent of the sale deed, it may or may not result in an actual sale of the property. Hence, when a sale deed is signed and executed by the buyer and the seller then only the sale is completed.
  4. It is necessary to register a sale deed on the date of execution of the deed so a person can receive the rights of the property.  But it is not important to register an agreement of sale.
  5. In an agreement of sale, the liabilities of the property remain with the seller until the property gets transferred in the future but in the sale deed, the risk is transferred to the buyer immediately.


From the above-discussed details about the sale deed and sale agreement, it is clear that the sale deed is an important legal document that is used as proof of sale and transfer of ownership of a property to the buyer from a seller whereas an agreement of sale is terms and conditions given to the buyer from the seller for a sale of a property. For more information about law-related topics, and to get legal advice from the best legal experts visit Vakilsearch.

Read More :

  1. Can A Sale Deed Be Executed By Power of Attorney?

  2. How to Get a Copy of the Sale Deed from the Bank

  3. Who Can Be a Witness in a Sale Deed?



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