In a world full of falsity, securing one’s rights is of utmost consideration. Similarly, when it comes down to the immovable property, a deed declaring conveyance does the job. As in legal terms, a conveyance deed is nothing but a mere ‘sale deed’ in terms of property transfer. Property transfer necessitates specific procedures to be conducted. An agreement for sale is one such essential that exclusively determines the liabilities of each party involved in the transfer. On completion of such liabilities, it takes the nature of a sale deed. There are different types of deeds of conveyance, such as mortgage deed, lease deed, exchange deed, gift deed, etc. With such varying concepts, it gets difficult for common men to distinguish one from the other. And, we are here to resolve the confusion about the same. This article will serve as a guide to discuss the relevance of the Conveyance deed and its impact on property transfer and rights likewise. Without further ado, let’s get started. What is a conveyance deed? If we perceive real estate as a coin, buying and selling happen to be its two sides. The literal interpretation of conveyance deed can be better understood by analyzing the two words separately. The word deed refers to a written instrument signed, sealed, and delivered by parties who form part of an enforceable contract. A deed forms a crucial part of any transfer and can legally bind the parties involved. There is no way one can escape their liabilities. On the other hand, the term conveyance refers to transferring a legal right from one person to the other in exchange for some consideration. The right may be related to own, possess or enjoy a specific immovable piece of property. When both the concepts are synchronized together, it forms an essential part of real estate transfer. The buyer and seller are the parties entitled to the benefits of the deed. The buyer has the liability to pay the required consideration, and in turn, the seller discriminates his ownership right to the buyer. Composites of a deed of conveyance Through a Conveyance deed, the whole transfer comes to an end when both parties fulfill their respective obligations. However, certain factors make a deed of conveyance enforceable. If there is no enforceability, the sole essence of such a deed is lost. Hence, the following are the contents that ought to be present in any of such deed making it enforceable in the court of law:
- Proper demarcation of property: the piece of land that needs to be transferred needs a clear indication. It is a proven fact, any ambiguity concerning the demarcation will be accountable for making the deed unenforceable. If need be, so, one way even opt for a land survey to remove any confusion. Hence, the deed is to contain the demarcation and the right relating to the property in question.
- Terms and conditions: as we all know, are a part of life. Nevertheless, it is even more significant in the case of a real estate transfer. The deed must encompass any terms and conditions that form an inevitable part of the contract. There should be a common agreement between both parties regarding the terms and conditions (if any).
- Conveyance: it is the ultimate key to transfer. In case of a sale deed, the transferer must in clear terms express his/her willingness to give up his ownership rights to another in exchange for consideration. Also, the deed ought to contain the mode of delivery and mode of receipt by the seller and buyer, respectively.
- Ratification by both parties: ratification in this context means via the signature mode. Both the buyer and the seller essentially need to sign the deed instrument to confer their rights and obligations towards one another.
- Sealed: it is only when the deed is sealed by the notary that it acquires the nature of being enforceable. The deed needs to convey the name of the buyer (grantee) and the seller (grantor). Also, the seller’s signature must take place in the notary’s presence to enable a seal on it.
- Registration: the last phase of a sale deed is its registration with the respective local authority. Just by paying a minimal registration fee, the buyer entails himself to the property in the public domain. After completing the last stage, the document is preserved in the public records for future reference (if needed).
What are the types of conveyance deeds? Deed of Conveyance subject to mortgage: For this scenario, the purchaser can enter and enjoy the land which is in question. Deed of Conveyance of leasehold property: The owner has complete rights on anything inside the area of the property excluding the structural and external walls. The common areas, the structure, and the land on which the property is built are owned by the landlord. Deed of Conveyance of freehold property: The property can receive a freehold status only by the concerning authority for example the DDA, or any other state authority. The Deed of Conveyance is handed over as a final document to the owner. Documents required A deed of conveyance mandates producing certain documents without which you would entitle yourself to an incomplete procedure. The following are some essentially required documents:
- Registered deed of agreement to sell between the parties
- Property card /mutation entries
- Plan of the location
- Survey plan from the department of revenue
- Layout plan of the plot with approval from the local authority
- Certification under the Urban Land Ceiling Act, 1976
- Plan for the Building/ Structure with approval from the appropriate authority
- Commencement Certificate
- Occupancy Certificate (if available)
Completion Certificate
- List of owners
- Proof that Stamps Duty has been paid
- Registration proof
- Development agreement/power of attorney, if administered by the seller.
- Draft conveyance deed or Declaration to be conducted in favor of the applicant.
Two essential components of conveyance deed The stamp duty and registration fees are two essential components that you cannot do away with as a buyer. The only way to procure your deed document is by paying off the revenues for the government. The union and the state governments are entitled to get it in case of buying property within their respective jurisdiction. The chargeable amount varies from one state to the other. Home purchasers in Delhi pay about 6% stamp duty on registration while at 3% in Mumbai. In Chennai, buyers are entitled to pay 11% stamp duty and registration charges for property registration. Moving to the eastern zone of the Indian subcontinent, in Kolkata, there are different pointers for different categories of land. For example, for properties ranging Rs 25 lakhs, the stamp duty is chargeable at 6%. Coming to Ahmedabad, it is payable at 4.9%. Difference between sale deed and conveyance deed Conveyance deed is the genes, and sale deed is the species. Deed of sale is just another part of the deed of conveyance relating to the transfer of the real estate. On the other hand, deeds on mortgage, lease, exchange, or gift also form part of the conveyance deed. While the sale deed is used in a restricted perspective, the conveyance deed is used on a broader scale. Title transfer is not necessitated in case of a deed of conveyance. Whereas, in the case of a deed of sale, the seller withdraws his rights and confers them on the buyer in exchange for a consideration. Hence, there is an element of title transfer. Is conveyance deed and lease deed similar? Property and real estate deeds are of several kinds, which happens to be the major source of confusion for most. As has been already discussed, the deed of conveyance is a broader concept that holds many other concepts within it. Similarly, the concept of lease deed is within its per view. First, let’s try to understand the concept of leasehold. In the case of a leasehold, there is only possession and no transfer to title or interest in the concerned property. A lease deed is registered for a specific period as agreed upon by its undertaking parties. The deed holds within itself details such as the rented property, rent to be paid, etc. When the term of deed exceeds one year, it needs to be registered to make the parties binding. Hence, these are the key points of distinction between the two similarly related concepts. Facts on the deed of conveyance
- The Indian Registration Act 1908 entails provisions relating to the registration and documentation of real estate transfer in India.
- The deed of conveyance needs to be executed on a non-judicial stamp paper.
- The deed must mention the exact date of execution of the transfer.
- Production of sale documents for registration needs to be done within four months from the execution date.
- The deed needs to be attested by a minimum of two witnesses along with their details on the document.
- The registration fee and stamp duty associated with the execution are a means to create revenue for the Indian government.
- The grantor is liable to validate the transferable property to be free from any legal encumbrances such as property tax.
- Upon registration of the deed, it gets converted into the public domain, and such documents can be accessed from public records.
Conveyance deed Maharashtra update As we already know, without a deed of conveyance, a real estate transaction has no implication. In a practical scenario, a contrary approach was visible in the state of Maharashtra, whereby many housing societies lacked the proof deed. Owing to the situation of crisis, the state government initiated the concept of ‘deemed conveyance.’ Based on the step taken by the state government, the housing societies could directly seek such a deed from the local authority of the registrar. In January 2021, the state government initiated a movement to rescue the societies stuck with such problems. However, the movement had to witness an umpty number of criticisms at the hands of the field experts. As pointed out that the period for registration (4 months) has elapsed, and it is a major failure of the builder. Since the situation has been ignored over the years, the owners have now been held responsible. Concluding lines Imagine claiming a right title interest in a particular property, and years later, you get to know it isn’t even yours. Who would ever want to face such a scenario? none. Without legitimate proof, you would be left with nothing to stand true to your claims. That is exactly where the role of a deed comes into action. It is a legit piece of proof that can out-do all other claims. When such a document is presented, you are the ultimate owner. India does not recognize verbal execution and hence, a written instrument is a must. A conveyance deed has a significant role to play in the case of property transfers. To claim ownership, you need an executed sale deed with all the ingredients to make it enforceable in the court of law. Hence, try not to miss out on the chance of claiming your property rights when the situation demands. For any further information regarding real estate transfer and properties available, visit the Square Yards home page. All other relevant information has been provided for you to have a look at. FAQ’S We bring before you some of the most sought-after questions under this subhead. What is the purpose behind a conveyance deed? A conveyance deed entitles the buyer to claim his right title interest in the property. Since oral contracts and agreements do not have recognition, a written instrument as a deed of conveyance protects the buyer’s interest. What expenses go behind the making of a deed of conveyance? The only expense required is paying the stamp duty and the registration fee, without which your documented deed will have no recognition in the eyes of the law. What are the different types of conveyance deeds? All deeds relating to the possession, ownership, holding, etc., of immovable property require a conveyance deed as proof of transaction. Hence, in cases of a mortgaged property, leasehold property, and freehold property, a deed of conveyance can be formed. Is an agreement for sale the same as a conveyance deed? Agreement to sell is just the initial stage that leads to a conveyance deed, a final proof of execution. With an agreement to sell, both parties prepare themselves for the obligations to be fulfilled to proceed with the intended task of transfer. Is a deed of conveyance liable to cancellation? Yes, after the deed has been registered under the Registration Act, 1908, it can be canceled by mutual consent of both the parties involved in the transaction.
