Sale in Transfer of Property Act

Sale, in simple terms, is selling a thing in consideration of money. In the Transfer of Property Act, a sale is made of immovable property. It is defined in section 54 of TPA. Let us look at the important headings that help you understand what is sale in the Transfer of Property Act, 1882.

Essentials of Sale

For understanding the term sale, you must know its essentials. They are:

Bare Act PDFs

1. Sale is a transfer of ownership from one person to other. One person transfers his title to another.

2. It is transferred in consideration for a price. Here, price means money and not any other valuable thing. Please note that, if in consideration, instead of money, a thing is given, then it is not sale but exchange.

3. The price may be paid or promised to be paid on a certain date or part-paid and part-promised.

4. The immovable property must be tangible in nature (which can be sensed or touched, virtually visible).

5. If the property for sale is or above the value of a hundred rupees, it can only be made through the registered instrument.

Bare Act PDFs

Important Notes:

  • If the value of a property is less than a hundred rupees, then the sale can be made either by delivery or a registered instrument.
  • A delivery of immovable property is made when the seller gives the buyer possession of the property.

What is Contract for Sale

A contract for the sale of immovable property is a contract that is made on the parties’ mutual terms and settlements. The contract does not give any interest in favour of the buyer.

The ownership remains with the seller until the seller executes the sale deed. Once the sale deed or agreement is executed, the buyer derives all the rights over the property.

What are the Duties of a Seller

If there is no contract to the contrary, a seller is bound to certain duties, which are as follows:

1. To communicate to the buyer if there is any defect or fault in the property.

2. If the buyer requests for the production of documents related to the property, then the seller must produce them.

3. To answer all the reasonable questions which the buyer raises regarding the property.

4. If the contract for sale is made, it is the seller’s duty to take due care of property and title deeds until the date of execution of the sale.

5. The seller must give the right of alienation to the buyer while transferring the ownership to the buyer.

What are the Rights of a Seller

With the duties, the seller also possesses certain rights against the buyer, which are as follows:

1. If the possession is handed over to the buyer, the seller is entitled to rents and profits till the ownership passes.

2. If the ownership of the property has been given to the buyer without the full payment, the seller has a charge upon the property until payment is made.

What are the Duties of a Buyer

The duties of the buyer are as follows:

1. If the buyer is acquainted with any fact which increases the value of the seller’s interest in the property, then he must disclose it to the seller.
For example, the buyer is well-versed with the fact that a highway tender is going to release in a month. For this, the government will give compensation money according to circle value to all householders who live nearby to it. If the property is not sold to the buyer, the seller can gain more profit than the actual price. The buyer should disclose this information to the seller.

2. To make all the payments on time and date specified in the contract.

3. On the passing of ownership to the buyer, he must bear the expenses of destruction or loss, if any, occurred to the property, provided that the loss is not caused by the seller.

4. To pay all public charges like house tax to concerned authorities.

What are the Rights of a Buyer

The duties of the seller are the rights of the buyer. Rights and duties are correlative. The rights of the buyer are:

1. Access to all the rights related to the property on the passing of ownership to him.

2. Access to the liabilities charged on the property unless declined by the buyer earlier at the time of contract of sale.

3. The right of possession and alienation to transfer the same, until payment is completely made.

Read Next: What Is Criminal Misappropriation of Property in IPC

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