Section 54 of the Transfer of Property Act, 1882 governs the sale of immovable property, such as buildings, which involves a contract between parties for the transfer of ownership in exchange for a cash price. The contract outlines terms like the timing of ownership transfer, property delivery, and buyer payment. Upon the seller transferring ownership, the sale is completed, often accompanied by the delivery of possession to the buyer. Registration of the sale through a formal instrument is required for tangible immovable property valued at one hundred rupees or more.
The definition of “sale” under Section 54 entails a transfer of ownership in return for payment or a promise thereof. Such transfer, for tangible immovable property of a certain value or intangible items, must be effected via a registered instrument. Delivery of tangible immovable property occurs when the seller places the buyer or a designated person in possession.
Rights and duties of both the buyer and seller include:
- The seller must disclose any material defects in the property or title, such as flooding or encumbrances, known to them.
- The seller must provide all relevant land documents for the buyer’s inspection.
- The seller is obligated to answer the buyer’s inquiries regarding the property’s title.
- Once the buyer has paid the purchase amount, the seller must take necessary steps to transfer ownership.
- After ownership transfer, the seller must provide possession of the property upon the buyer’s request.
- It is implied that the seller has the legal right to sell the property.
- Upon full payment, the seller must deliver all title documents related to the property to the buyer.
