A very Good Morning,
Please be advised as follows:
Title in an immovable property can only be transferred by a sale deed. In the absence of a duly stamped and registered sale deed, no right, title or interest in an immoveable property, accrue to the buyer of the property.
You need to differentiate between an Sale Agreement and Sale Deed.
Sale deed can only transfer the Right and title of the property on you when its gets registered and becomes a conveyance untill then the title of the property vests with the seller only.
As per the Indian Registration Act, 1908, any agreement for transfer of any interest in an immovable property of value more than one rupee, is required to be registered. So, if you have purchased any property under any agreement for sale, without it being followed by a proper sale deed, you do not get any right or interest in the property purported to be transferred under the agreement of sale.
Immovable property can be transferred/conveyed only by a deed of conveyance (sale deed), duly stamped and registered as required by law. Therefore, the immovable property can be legally and lawfully transferred/conveyed only by a registered deed of conveyance.”
What the sales agreement creates, is a right for the purchaser to purchase the property in question on satisfaction of certain conditions. Likewise, the seller also gets the right to receive the consideration from the buyer on complying with his part of the terms and conditions.
In case of failure of the seller to sell or hand over possession of the property to the buyer, the buyer gets a right of specific performance, under the provisions of the Specific Relief Act, 1963. A similar right is available to the seller under the agreement, for seeking specific performance from the buyer.
Remedy you can Go For:
- Firstly, you should verify from the records in the website of UP Bhoomi Lekh that whether the seller who is selling you the property really owns it or not on the basis of records in order to prevent any fraud in future.
Since you have to take a loan from the bank for that you can come into an agreement on a court notarized document after paying the required stamp duty so that that is a sufficient enough proof for you to get a loan sanctioned on your name from the bank.
Try and convince the seller:
You can show the seller the sanction letter from the bank and pay your portion of the cost fully. The sale agreement is then is which acknowledges the part payment already received (1 Lakh in your case) and mentions that the balance amount will be paid to the seller within a pre-set time limit (usually 30 days) and contains a clause that the agreement would be null and void in case of a failure of payment within the stipulated time and allows the seller to retain fully/partly the amount that has already been paid as a penalty in such a case.
Based on such a registered agreement the bank will disburse the balance loan amount in the name of the seller. If this option is acceptable to the seller you should exercise some caution. Firstly you should submit photocopies of all the documents that you will be giving them after the agreement is signed and registered. Ensure you get at least an email from the bank acknowledging the documents submitted by you and providing the complete list of documents that will be needed to make the disbursement.
Go through the list and make sure that you will be in a position to provide those documents. Frequently in such cases the lender may raise last minute requests in terms of documents that it had not apprised you about earlier. Remember delays in disbursements will cost you dearly in terms of loosing the property as well as penalties.
Registered Sale Agreement may not transfer the title on to you but is always binding on the parties.
According to the Transfer of Property Act, an agreement for sale, whether with possession or without possession, is not a conveyance. Section 54 of the Transfer of Property Act enacts that the sale of an immovable property can be made, only by a registered instrument and an agreement for sale does not create any interest or charge on its subject matter.