SALE OF PROPERTY SEC 54 and 55 Transfer Property Act, 1882

Definition of sale- a complete transfer of ownership in the property for a consideration paid or to be paid or partly paid or partly to be paid. Consideration may be cash, kind or partly cash and partly kind.

Essential of valid sale Competency of the parties Subject matter existence Consideration price Mode of transfer- conveyance When the ownership is deemed to be transferred? The time of execution or registration

CONTRACTS OF SALE Right of the prospective purchaser Specific performance Right to recover price paid. Duties of the seller To disclose material defect in the property Non-disclosure of the defect in the title amounts to fraud.

To produce documents to the title to the property To answer question relevant to the property On payment execute conveyance To take care of the property till the final conveyance. To pay all the taxes and duties till the handover of the possession to the purchaser. After sale * To deliver the property without any encumbrance. * To get sale permission wherever necessary After sale To deliver possession of the property Covenant to title To deliver title documents to the property Right of the seller To receive rents and profits before final conveyance Right to charge over the property for the unpaid consideration. Rights of the purchaser Any increase in the value of the property Right to retain purchase price for the encumbrance in the property. Charge for the prepaid purchase money. Claim for compensation when the seller refuses to honour his performance.

Duties of the purchaser * Duty to enquire and satisfy about the title to the property. * To bear the loss after the final conveyance * To pay all taxes and duties after final conveyance.

In REALESTATE TRANSACTIONS TIME IS NOT THE ESSENCE OF THE CONTRACT UNLESS OTHERWISE PROVIDED IN THE CONTRACT. A contract of sale of immovable property does not confer any right, title and interest in the property to the prospective purchaser but it is subject to the terms and conditions agreed by and between the parties. Basic rights over the property Right to title Right to posses and enjoy Right to alienate

Sale of minors property Sale of minors property is subject to the permission from the court of competent jurisdiction.

consideration Consideration may be paid or promised to be paid on the sale and execution and registration of a sale deed. Insufficiency of consideration and/or non-payment of consideration does not vitiate the sale unless otherwise contract to the contrary. Case law: Vidhyadhar Vs Mankikrao and another AIR 1999 SC 1441

Writing, attestation and registration are mandatory requirements for the completion of a valid sale of property. Once sale deed is registered the ownership pass with effect from the date of execution of the sale deed.

In India there is not statutory period for which title to the land should be made out. Normally in India 30 years period for a title is considered as a reasonable one for claiming a clear, valid and marketable title to the property.

REMEDIES OF PARTIES TO A SALE

Rescission of contract a. b. c. d. e. Defect in title In capacity of the parties Inability or delay in getting required permission In ability to perform reasons beyond the control/frustration. Mis-representation by the opposite party

Specific performance When the other party refuses or partly performed the aggrieved party can file suit for specific performance of the contract. Can claim for damages

Forfeiture and recovery of deposit Vendor can forfeit the earnest money or deposit he has received from the prospective purchaser.

Suit for the damages For the breach of contract or any loss the aggrieved party can file a suit for damages as mentioned in the section 73 of the Indian Contract Act 1872. Setting aside the sale If the sale is vitiated by fraud, coercion, mis-representation and/or mutual mistake, the sale is liable to be set aside. Unpaid purchase money

If the Vendor has not received full purchase money, he can file suit for the recovery of the balance purchase money/consideration. Vendor has a statutory charge over the property for the unpaid purchase money.

Rectification When by mutual mistake or on account of fraud, the sale deed does not correctly express the intention of the parties, it may be rectified so as to bring it into conformity with the contract.