A Conveyance Deed is a crucial legal document in property transactions, ensuring the lawful transfer of ownership from one party to another. It serves as proof of ownership and provides legal protection to the buyer.
Definition of a Conveyance Deed
A conveyance deed is a legal document that facilitates the transfer of freehold property ownership from a seller (grantor) to a buyer (grantee). It confirms that all rights, interests, and title to the property are being lawfully conveyed.
- In simple terms, it is the final proof of property ownership for the buyer.
- The term “conveyance” broadly refers to the act of transferring property.
- It can be used in different types of transactions, such as sale, lease, mortgage, or gift.
Key Features of a Conveyance Deed
Evidence of Transfer
- It legally establishes the transfer of ownership.
- Once executed, the previous owner relinquishes all rights to the property.
Irrevocable in Nature
- After execution, the seller cannot claim ownership over the property.
- The buyer gains full legal rights.
Must be in Writing
- A conveyance deed must be a written document to be legally enforceable.
- Oral agreements are not valid for transferring property.
Involves Two or More Parties
- The transfer takes place between a grantor (seller) and a grantee (buyer).
- Both parties must legally agree to the terms.
Properly Stamped and Registered
- The document must be signed by both parties.
- It requires payment of stamp duty and registration at the relevant government office.
Free from Encumbrances
- A conveyance deed should specify that the property is transferred without any legal disputes, loans, or liabilities.
- If the property is mortgaged or has dues, the seller must clear them before transfer.
Essential Clauses in a Conveyance Deed
Names of the Parties Involved
- Full legal names of the seller and buyer.
Property Description
- Clear and detailed description, including address, size, and boundaries.
Consideration Clause (Sale Price)
- The agreed-upon sale price should be mentioned.
- If the property is transferred as a gift, it should be explicitly stated.
Transfer of Ownership Clause
- Confirms that all legal rights, title, and interests are transferred.
Indemnity Clause
- Ensures the seller is responsible for any legal disputes related to the property before the transfer.
Encumbrance Clause
- Declares whether the property is free from mortgages, debts, or legal disputes.
Possession Clause
- Specifies the date when the buyer takes possession of the property.
Seller’s Legal Right to Transfer
- The seller confirms that they are the rightful owner and have the legal right to sell.
Types of Conveyance Deeds
Different types of conveyance deeds are used depending on the nature of the transfer:
(i) Sale Deed
- Used when a property is sold for consideration (money).
- The most common form of conveyance deed.
(ii) Gift Deed
- Used when property is transferred without any monetary exchange.
- Usually occurs between family members.
(iii) Lease Deed
- Transfers possession rights to a tenant for a specific period.
- The ownership remains with the landlord.
(iv) Mortgage Deed
- Used when a property is pledged as security for a loan.
- Ownership remains with the borrower, but the lender has rights in case of default.
(v) Exchange Deed
- Used when two parties swap properties instead of selling.
(vi) Relinquishment Deed
- Used when one co-owner transfers their share in the property to another co-owner.
(vii) Partition Deed
- Used to legally divide jointly owned property among multiple owners.
Legal Process for Executing a Conveyance Deed
Drafting the Conveyance Deed
- A legal expert or lawyer drafts the deed.
- It includes all necessary clauses, terms, and conditions.
Stamp Duty Payment
- The buyer pays stamp duty (varies by location).
- The amount depends on the property value.
Execution and Signing
- Both parties sign the document in the presence of two witnesses.
- The witnesses also sign as proof.
Registration at the Sub-Registrar’s Office
- The deed must be registered at the Sub-Registrar’s Office.
- Both parties must appear with original documents.
Possession Handover
- After registration, possession is legally transferred to the buyer.
Difference Between Conveyance Deed and Sale Deed
| Feature | Conveyance Deed | Sale Deed |
|---|
| Definition | Transfers ownership of property | Specifically transfers ownership in a sale |
| Consideration (Money Exchange) | May or may not involve money | Always involves money |
| Types of Transfers | Sale, gift, lease, exchange, etc. | Only for sale transactions |
| Legal Requirement | Must be stamped and registered | Must be stamped and registered |
| Ownership Rights | Grants full ownership rights | Grants full ownership rights upon sale |
Importance of a Conveyance Deed
Improper Documentation – Missing clauses can create legal risks.
Encumbrance Issues – Property may have hidden debts or legal disputes.
Forgery and Fraud – Some sellers misrepresent ownership.
Failure to Register – An unregistered conveyance deed is legally invalid.
Conclusion
A Conveyance Deed is one of the most important documents in property transactions. It ensures a smooth, legal, and binding transfer of ownership. Buyers should always verify the document, clear any encumbrances, and ensure proper registration to secure their ownership rights.