If you are dealing with agreement to sell review for a residential property, this guide sets out the legal position, the documents you will need, the usual steps and the mistakes that cost people time. The firm of Advocate B.K. Singh handles this work from offices in Dwarka, New Delhi and Vaishali, Ghaziabad.
In short. An agreement to sell review is a lawyer's check of a draft or signed property agreement against the seller's title papers and the current law. It looks at who is selling, what exactly is sold, how and when money is paid, stamp duty, approvals, deadlines and default clauses, and points out terms that are one-sided, unenforceable or missing before you sign or pay.
An agreement to sell review is what you need when the other side, a broker or a builder hands you a draft and asks you to sign it, or when you have already signed and something now looks wrong. The review reads the agreement against the seller's title documents, the property's approvals and the law that applies, and tells you in plain terms what protects you, what exposes you, and what to change.
The stakes are higher than most people think. Once an agreement to sell is signed and earnest money is paid, a buyer who backs out can lose that money, and a seller who backs out can face a suit for specific performance. A clause that seems harmless, such as a missing final date or a vague description of the property, can decide years of litigation. This page explains what a careful review covers, the red flags we see most often, how the review changes for buyers and sellers, different properties and different parties, and what to do if the agreement is already signed.
- What is reviewed
- The draft or signed agreement, the seller's title deed and chain, approvals and NOCs, loan papers, stamp and registration position
- Law
- Transfer of Property Act 1882 (sections 53A and 54); Indian Contract Act 1872 (sections 55, 73 and 74); Specific Relief Act 1963; Registration Act 1908; Indian Stamp Act 1899 and state laws; RERA 2016 for promoter sales
- Best time
- Before signing and before paying any earnest money; a review after signing still helps fix gaps through an addendum or a timely notice
- Who needs it
- Buyers, sellers, NRIs, companies, LLPs, societies, investors and anyone buying from a builder, or selling an inherited, leasehold or mortgaged property
- Output
- A list of issues with suggested wording, documents to call for, and advice on whether to sign, renegotiate or walk away
- Time limit to note
- A suit for specific performance must be filed within 3 years from the date fixed for performance or from notice of refusal (Article 54, Limitation Act)
What an agreement to sell review covers
A review answers three questions. Can this seller actually sell this property? Does the agreement say clearly what each side must do, by when, and with what money? And if something goes wrong, does the agreement leave you with a fair and enforceable remedy? Everything in the review serves one of those three questions.
The first question needs the seller's documents, not just the agreement. A perfectly drafted agreement for a property the seller does not fully own is worthless. The second question is about the drafting itself: the description of the property, the price, the payment schedule, the conditions, the dates. The third is about the default, cancellation, forfeiture, indemnity and dispute clauses, which most people skim and later regret.
An agreement to sell does not transfer ownership. Under section 54 of the Transfer of Property Act 1882, it creates no interest in the property and only binds the parties to a future sale. A review therefore also looks ahead to the sale deed: are the conditions for registration clear, will the stamp duty already paid be adjusted, and will the buyer be able to get mutation afterwards?
The review starts with the property, not the document
Before reading a single clause, compare the property description in the agreement with the seller's registered title deed. The plot or flat number, block, sector or colony, khasra numbers for land, area, floor and boundaries must match. A mismatch is the first sign of trouble: the seller may be selling something slightly different from what he owns, or a part of the property may belong to someone else.
Next, check that every person shown as an owner in the title deed or in the mutation records is a party to the agreement. Inherited property often has several co-owners, and an agreement signed by one brother binds only his share. If one person signs for others, the agreement should refer to a valid power of attorney or written authority, and a copy should be annexed. Where a minor has a share, court permission under section 8 of the Hindu Minority and Guardianship Act 1956 will be needed before sale.
Then look at what the agreement says about title and encumbrances, and compare it with reality. If the property is mortgaged, the agreement should say so and explain how the loan will be closed. If it is leasehold, the authority's permission should be a condition. If the seller says there is no litigation, a quick search of court records and an encumbrance check at the Sub-Registrar should confirm it. A full title search is the safest course before any large payment.
Red flags in an agreement to sell and what to ask for
| Clause or issue | Red flag | What to ask for |
|---|---|---|
| Parties | Not all owners sign; signatory for a company has no resolution annexed | All co-owners as parties, or valid authority annexed; certified board or partner resolution |
| Property description | Different from the title deed; no area, boundaries or khasra numbers | Description copied from the registered deed, with a site plan if needed |
| Price and payment | Large payment upfront, payments in cash, no link to documents | Reasonable earnest, bank payments, each instalment tied to a document or event |
| Earnest money | Seller can forfeit everything paid if buyer is a day late | Forfeiture limited to a reasonable earnest, after notice and a cure period |
| Final date | No date, or seller can extend it at will | A fixed final date with a clear and mutual mechanism to extend |
| Title warranty | Seller gives no warranty or excludes liability for defects | Warranty of clear and marketable title backed by an indemnity |
| Loan on property | Mortgage not mentioned, or buyer pays seller before bank releases deeds | Payment to the bank against a foreclosure letter, original deeds returned before registration |
| Approvals | Silent on authority permission, society NOC or conversion | Seller to obtain them by a date, with costs stated; sale conditional on them |
| Possession | Possession before sale deed with no reference to stamp duty | Correct stamp duty on the agreement, or possession only at registration |
| Default remedies | Only the buyer can be penalised; seller's default leads only to refund without interest | Mutual remedies: refund with interest or compensation, and the right to sue for specific performance |
| Dispute clause | Arbitration and exclusive court clause both present, or courts of a distant city named | One clear route, with courts where the property is located |
The law a reviewer checks the agreement against
Sections 53A and 54, Transfer of Property Act 1882
An agreement to sell creates no interest in the property. A buyer in possession under a written agreement is protected under section 53A only if the agreement is registered, after the 2001 amendments.
Sections 33 and 35, Indian Stamp Act 1899
An instrument that is not duly stamped can be impounded and is not admissible in evidence until the deficient duty and penalty are paid. Under the Indian Stamp Act the penalty can go up to ten times the deficiency, and some states, including UP, have their own penalty rules.
Specific Relief Act 1963, as amended in 2018
Specific performance is the normal remedy for breach of a contract to sell, subject to sections 11(2), 14 and 16. A party seeking it must prove that he performed or was always ready and willing to perform his essential obligations.
Sections 55, 73 and 74, Indian Contract Act 1872
Whether time is of the essence and what compensation follows a breach. A stated amount for breach is allowed only up to a reasonable figure, which is why one-sided forfeiture clauses are often cut down by courts.
Section 13, RERA Act 2016
A promoter cannot accept more than 10 per cent of the cost as an advance or application fee without first executing and registering an agreement for sale in the form prescribed by the state rules.
Reviewing the agreement for a buyer
For a buyer, the review is about not paying for something you may not get. The key questions are whether the seller's title is clear, whether your money is protected until the title documents and approvals are in hand, and whether you can get your money back with interest, or the property itself, if the seller backs out. The agreement should give you a period to verify title, and the right to withdraw with a full refund if the title is defective.
Watch for clauses that make the buyer pay most of the price early, accept the property 'as is' without any warranty, waive the right to specific performance, or agree that the seller's only liability is to return the money without interest. Each of these shifts risk to the buyer. Some are acceptable in a fast, cheap deal with a well-known seller; most are not acceptable where the title is complex or the seller is a stranger.
A buyer taking a home loan needs an agreement that gives enough time for sanction and disbursement and allows the bank to pay the seller or the seller's bank directly. The bank's legal team will also review the title, and its objections should be dealt with before the final date, not after. When Advocate B.K. Singh reviews an agreement for a buyer, the first thing he checks is whether any payment beyond the earnest is due before the seller has handed over something concrete, such as a bank's no dues letter, an authority's permission or the original title deed. If the answer is yes, that clause is rewritten before anything else.
Reviewing the agreement for a seller
For a seller, the review is about not getting stuck. Sellers often sign agreements prepared by the buyer or a broker that leave the property tied up for months with no assurance of payment. The seller needs a fixed final date, a clear right to cancel and forfeit a reasonable earnest if the buyer does not pay on time, and freedom from open-ended obligations such as getting approvals that depend on the buyer's own conduct.
Sellers should also check the warranties they are being asked to give. A warranty that the property is free from all defects of any kind, or an indemnity without any limit of time or amount, can come back years later. Warranties should be accurate and limited to what the seller actually knows and controls. If there is a known issue, such as an old tenant, a pending mutation or a small deviation from the sanctioned plan, disclose it in the agreement so that the buyer cannot later claim fraud.
Tax terms matter for sellers too. The agreement should state that the buyer will deduct TDS where required and give the certificate on time, and the price should not be below the circle rate without understanding the tax effect. Payments should come by bank transfer to the seller's own account, not to a broker or third party.
Stamp duty and registration: the check most people skip
The review must check whether the agreement carries the right stamp duty. In Delhi, UP and Haryana, an agreement to sell under which possession is given, or agreed to be given without a conveyance, is generally charged with duty as a conveyance on market value. Without possession, a lower duty applies under the state's agreement article. An agreement printed on low-value stamp paper that hands over possession is understamped, and that matters if there is ever a dispute.
An understamped agreement is not void, but it cannot be used in evidence until the deficiency and penalty are paid. A seven-judge bench of the Supreme Court confirmed in December 2023 that an unstamped or understamped agreement is inadmissible rather than void, and the defect can be cured by paying the duty. In practice, a buyer who later wants to sue for specific performance on an understamped agreement will first have to pay the deficient duty and penalty, which can be expensive. Our stamp duty advisory page explains how the duty is worked out.
On registration, the question is whether the buyer needs it. A buyer taking possession who wants protection under section 53A, a buyer from a promoter under RERA, and a buyer who wants a public record to deter a second sale should register the agreement. An unregistered agreement can still be used as evidence of the contract in a suit for specific performance under the proviso to section 49 of the Registration Act, but it gives no section 53A protection.
Checking the money clauses
The price clause should match what was actually agreed, including whether parking, fittings, furniture and transfer charges are included. Every payment already made should be acknowledged with its date, mode and amount. Cash payments should be avoided; they are hard to prove, create tax exposure for both sides and, above certain limits, breach income-tax rules on cash receipts.
Earnest money clauses deserve close reading. Courts allow forfeiture of a reasonable earnest amount where the contract provides for it, but they do not allow a seller to keep large part payments just because the agreement calls them earnest. If the draft says that everything paid will be forfeited on any delay, ask for the forfeitable amount to be limited to a defined earnest figure and for the rest to be refunded, after a notice and a cure period.
The review should also check the TDS clause where the price crosses the threshold in income-tax law, the treatment of TDS as part of the price, and the seller's PAN. For an NRI seller, the TDS calculation is different and the buyer needs a TAN. Since the Income-tax Act 2025 replaced the 1961 Act from April 2026, older formats that cite section 194-IA should be updated to refer to the current provision.
Checking default, cancellation and remedy clauses
Default clauses should be mutual and proportionate. If the buyer's delay leads to forfeiture, the seller's delay should lead to refund with interest or a stated compensation, and the buyer's right to sue for specific performance should not be excluded. A clause that lets the seller cancel by a simple letter and refund money without interest, while the buyer loses everything for a short delay, is a red flag in a review.
Check how notices must be given and to which address, because a cancellation that was not properly notified is often challenged. Check whether time is stated to be of the essence; courts generally presume that time is not of the essence in contracts for immovable property unless the agreement and conduct clearly show otherwise. If the deadline matters, the agreement must say so plainly, with a grace period and notice.
Finally, look at the dispute clause. Suits about the property itself must generally be filed where the property is located, so naming the courts of another city usually causes delay rather than helping. An arbitration clause is valid for disputes under an agreement to sell, but it adds cost. Choose one route and make sure the clause does not conflict with any other clause.
How we review an agreement to sell
A review is quick if the documents are ready. This is the order we follow.
Collect the draft and the documents
Get the draft or signed agreement, the seller's title deed and chain, mutation and tax records, loan papers, approvals and any receipts already issued. A review on the agreement alone misses half the risks.
Match the agreement to the title
Compare parties and property description with the registered deed and revenue or authority records. Note every mismatch and every missing owner.
Read the money and time clauses
Check price, earnest, instalments, TDS, payment routes, final date and conditions. Ask whether any payment is due before the seller delivers something concrete.
Test the default and remedy clauses
Look at what happens if each side defaults. Mark clauses that are one-sided, unenforceable or inconsistent with the Specific Relief Act or the Contract Act.
Check stamp, registration and approvals
Confirm the stamp duty, whether registration is needed, and which authority or society permissions must be obtained before the sale deed.
Give a written list of changes
Provide suggested wording for each change, the documents to call for, and a clear view on whether to sign as is, sign after changes, or walk away.
If the other side refuses reasonable changes, that refusal itself tells you something about the deal.
Agreement to sell review checklist
- All owners and co-owners are parties or are validly represented
- Property description matches the registered title deed and records
- Seller gives a warranty of clear title with an indemnity
- Mortgage, if any, is disclosed with a clear method of closure
- Authority permission, society NOC or conversion is a stated condition
- Earnest money is reasonable and other payments are refundable on seller default
- Every payment is by bank and linked to a document or event
- A final date is fixed and the extension mechanism is mutual
- Stamp duty matches whether possession is being given
- Default remedies are mutual and specific performance is not excluded
- Dispute clause names one route and the courts where the property lies
Reviewing a builder agreement for sale
Where the seller is a promoter selling an apartment, plot or building in a project registered under RERA, the agreement for sale must follow the form prescribed by the state RERA rules, such as the forms under the UP, Haryana or Delhi rules. Clauses that contradict the Act or the rules are generally not enforceable against the buyer. A review compares the builder's draft with the prescribed form and points out added clauses that shift risk to the buyer.
The points to check closely are the carpet area and how any change in it affects the price, the possession date and the grace period, the interest payable by the builder for delay compared with the interest charged to the buyer for late payment, the force majeure clause, the specifications, the parking and common areas, and the cancellation and refund clause. The agreement must be registered before the promoter takes more than 10 per cent of the cost. Our buyer agreement review page deals with builder documents in more detail.
Where a builder or developer sells commercial or industrial space outside a registered project, or sells land rather than units, RERA may not apply, and the agreement is reviewed as an ordinary contract. If a dispute arises later under a RERA agreement, the buyer can file a RERA complaint or approach the consumer commission, as the Supreme Court allowed in Newtech Promoters v State of UP (2021).
How the review changes by property type
For a flat in a group housing or cooperative society, the review checks the society's NOC, share certificate, maintenance dues, parking allotment and whether the flat is leasehold or freehold. For a builder floor or independent house, it checks the sanctioned plan, completion or occupancy certificate where applicable, and whether the floor being sold matches the approvals and the property tax records.
For a leasehold plot from DDA, Noida, Greater Noida or GDA, the review confirms that the agreement makes the authority's transfer permission a condition and states who pays transfer charges. For an industrial plot or factory, it checks the lease conditions on transfer, change of activity, pending dues to the authority, and the treatment of machinery, consents and power load. For commercial and retail space, it checks existing tenancies, security deposits, maintenance agreements and signage or usage rights.
For agricultural land, the review checks revenue records, restrictions on transfer under the Delhi Land Reforms Act 1954 or the UP Revenue Code 2006, land use, and whether the buyer is eligible to buy agricultural land in that state. For a villa, farmhouse or resort property, it checks land use, the area covered by the title compared with the area being sold, and approvals for the built structures.
How the review changes by the parties involved
NRI and OCI buyers can buy residential and commercial property but not agricultural land, plantation property or farmhouses, and payment must come through banking channels. The review checks the payment route, TDS obligations if the seller is also an NRI, and the power of attorney if someone in India signs on their behalf. A power of attorney executed abroad must be properly attested and stamped in India within the time the law allows; our power of attorney drafting page covers that.
Companies, LLPs and startups need the signatory's authority checked against a board or partner resolution, and the company's own constitution should permit the purchase or sale. Cooperative societies selling property need the resolution their bye-laws require. Banks usually appear as lenders to the buyer or as mortgagees of the seller; their consent and the release of the charge must be built into the agreement. A buyer at a bank auction under the SARFAESI Act signs a different set of documents, and the review focuses on the sale certificate, encumbrances disclosed and pending litigation in the DRT.
Heirs selling inherited property should be checked for a complete list of legal heirs, any will, and mutation in their names. In agreements that reach Advocate B.K. Singh's office after a dispute has started, the weak point is very often an inherited property sold by some heirs without the others, which leaves the buyer with only part of what he paid for.
If you have already signed the agreement
A review after signing is still useful. If both sides agree, gaps can be fixed through a supplementary agreement or addendum, signed and stamped in the same way as the original. This is common when a date needs to be extended, a payment needs to be linked to a bank's release of documents, or an approval that was overlooked needs to be made a condition.
If the other side will not agree and is not performing, the next step is usually a written notice calling on them to perform within a reasonable time. A notice for breach of agreement also creates a record of your own readiness and willingness, which matters if you later sue. The buyer's main remedies are a specific performance suit within 3 years, or a claim for refund with interest. The seller's main remedy is cancellation and forfeiture of a reasonable earnest, which should be done carefully and, where the agreement is registered, may need a formal cancellation of the agreement to sell.
If the agreement turns out to be understamped, consider paying the deficient duty before any dispute arises. Doing so voluntarily is usually cheaper and quicker than paying duty and penalty under a court's impounding order.
What reviews most often find
- Formats copied from the internet. Many drafts still say that specific performance is discretionary, refer to the old Income-tax Act, or ignore RERA.
- The broker's interests built in. Clauses fixing the broker's commission or routing payments through him have no place in the parties' agreement.
- No title verification period. The buyer pays and then finds a defect, with no clear right to withdraw.
- Silence on existing occupants. Tenants, relatives or caretakers in the property are not mentioned, and vacant possession is not promised.
- One-sided forfeiture. The buyer loses everything for a short delay while the seller's default costs him nothing.
- Wrong stamp for the possession clause. Possession is handed over on low-value stamp paper, leaving the agreement inadmissible until duty and penalty are paid.
A made-up example: the draft that hid a second owner
Here's a made-up example. A buyer was given a broker's draft agreement to sell for a builder floor in West Delhi. The draft named only the seller, required 40 per cent of the price within a week, allowed the seller to forfeit all payments on any delay, and gave the buyer only a refund without interest if the seller defaulted. Possession was to be handed over on signing, on stamp paper of a small value.
The review found that the sale deed in the seller's favour was in the joint names of the seller and his mother, so she had to be a party. The 40 per cent payment was reduced to a reasonable earnest, with the next payment due only after a title search and the mother's signature. The forfeiture clause was limited to the earnest after a 15-day notice, and seller default was made to carry refund with interest and the right to specific performance. Possession was moved to the date of the sale deed, so that the agreement did not attract conveyance duty. The seller accepted most changes. The ones he refused told the buyer where to be careful.
Related services and the next step
A review fits between the first draft and the sale deed. If you would rather have a fresh draft prepared on your instructions, see our page on agreement to sell drafting. For a complete check of the property before you pay, our property due diligence page explains what is examined, and when the deal moves to completion, our sale deed review page covers the last document you will sign.
If you want the papers checked before you sign or pay, the team of Advocate B.K. Singh at Legals365 can review them and tell you the next step through our talk to a lawyer page.
Residential property: what changes
Residential property covers houses, builder floors, flats in group housing societies and apartments in developer projects. It is the property people care about most, and the law gives it more protection than commercial premises: consumer remedies against builders, rent control for old tenancies, special rules for senior citizens and family members. It also carries more family disputes than any other kind of asset.
The documents depend on the type. For an independent house or builder floor in Delhi, ask for the chain of sale deeds or the conveyance deed from DDA, the sanctioned building plan, the completion certificate, mutation in MCD records, the latest property tax receipt and electricity and water bills. For a flat in a cooperative group housing society, ownership runs through membership: the share certificate, the society's NOC and the Registrar of Cooperative Societies' approval of the transfer matter as much as the deed. For a flat in a developer project in Noida, Greater Noida or Gurugram, check the RERA registration, the builder-buyer agreement, the occupancy certificate, the tripartite sub-lease or conveyance deed, and whether the builder has paid the land dues to the authority, since unpaid dues have held up registration for thousands of buyers.
Stamp duty is charged on the higher of the price and the circle rate. Delhi charges women buyers a lower rate, and joint purchases fall in between; Uttar Pradesh and Haryana have their own concessions. Registration is at the sub-registrar office for the area, with both parties and two witnesses present. After registration, mutation in the municipal or authority record should be applied for, since it governs property tax and later dealings, even though mutation is not proof of title.
Disputes tend to fall into a few groups. Against builders: delayed possession, reduced area, poor construction and missing amenities, which go to the RERA authority or the consumer commission at the buyer's choice. Between landlord and tenant: old tenancies with rent up to ₹3,500 a month in Delhi are governed by the Delhi Rent Control Act 1958, where eviction for the landlord's bona fide need under section 14(1)(e) is the usual route; newer tenancies are contractual and go to the civil court or the rent authority under any new tenancy law the state has adopted. Within families: partition, wills and succession, and disputes over who may live in the house. Senior citizens can approach the Maintenance Tribunal under the Maintenance and Welfare of Parents and Senior Citizens Act 2007, which in appropriate cases has ordered children to vacate a parent's house. A wife's right to reside in the shared household under the Domestic Violence Act 2005 can also affect who stays in a property.
A few habits prevent most problems. Never buy on a GPA and agreement to sell alone. Insist on the occupancy or completion certificate. Keep original documents safe and certified copies handy. And put family arrangements about a house in writing, ideally a registered partition or family settlement, before a death or a marriage breakdown turns them into litigation.
Frequently asked questions
Why should I get an agreement to sell reviewed before signing?
Because once you sign and pay earnest money, the terms bind you. A review checks the seller's title, the payment terms, stamp duty and default clauses, and lets you fix problems before they cost money. It is far cheaper than a dispute later.
What documents does a lawyer need to review an agreement to sell?
The draft agreement, the seller's registered title deed and previous chain, mutation and tax records, loan papers if the property is mortgaged, and any approvals or society NOC. Receipts for payments already made are also useful.
What are the main red flags in an agreement to sell?
Missing co-owners, a property description that differs from the title deed, large payments before documents are delivered, no final date, one-sided forfeiture, and no warranty of title. Possession given on low-value stamp paper is another common problem.
Can the seller forfeit all the money I paid?
Only a reasonable earnest amount can usually be forfeited, and only if the agreement provides for it and you are actually in default. Courts do not allow forfeiture of large payments towards price without proof of loss.
Is an unstamped agreement to sell valid?
It is not void, but it cannot be used in evidence until the deficient stamp duty and penalty are paid. The Supreme Court confirmed this in 2023. Paying the duty early is usually cheaper than paying it with a penalty later.
Should I register the agreement to sell?
Register it if you are taking possession and want section 53A protection, if you are buying from a promoter under RERA, or if you want a public record against a second sale. Simple agreements without possession are often left unregistered.
What if one co-owner refuses to sign?
The agreement binds only those who sign, and the buyer cannot get full title. Do not pay beyond a small earnest until all co-owners have signed or a valid authority is produced.
How is a builder agreement for sale reviewed?
It is compared with the form prescribed by the state RERA rules, and added clauses that shift risk to the buyer are flagged. Key points are carpet area, possession date, delay interest, force majeure and cancellation terms.
Can I change an agreement to sell after signing it?
Yes, if both sides agree, through a supplementary agreement or addendum signed and stamped like the original. If the other side refuses, a notice and, where needed, a suit are the remaining options.
What happens if the seller backs out after signing?
The buyer can sue for specific performance within 3 years from the date fixed for performance, or claim refund with interest and compensation. The buyer must show that he was ready and willing to pay the balance throughout.
Does a review cover tax issues like TDS?
It checks that the TDS clause is correct, that the price is compared with the circle rate, and that payments are by bank. Detailed tax planning on capital gains is a separate question for a tax adviser.
How long does an agreement to sell review take?
A review of a straightforward draft with complete documents can usually be done within a few working days. Complex titles, leasehold properties and builder agreements may take longer.
Should I go to RERA or the consumer commission against my builder?
You can choose either, as the Supreme Court held in Newtech Promoters v State of UP (2021), but not both for the same relief. RERA is often quicker for refund or delay interest under section 18; the consumer commission can also award compensation for deficiency in service. The choice depends on the amount, the relief you want and how far the project has progressed.
Can my son be evicted from my house if he harasses me?
In many cases, yes. The Maintenance Tribunal under the Senior Citizens Act 2007 has power to protect a parent's property and life, and courts have upheld eviction orders against children in suitable cases. The parent's ownership of the house and evidence of ill-treatment are the key facts.
Need help with Agreement To Sell Review For Residential Property? Send your papers or a short note of what has happened. An advocate from the team of Advocate B.K. Singh will read it and tell you the next step.
