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Legal

1Legal Issues you must Know before making Property Transaction

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Legal Contracts

1. Leave-Licence Agreement:

A leave and license agreement is one of the most popular ways adopted by parties to ensure that the letting of property does not amount to a lease under tenancy related legislation. Unlike a tenancy or lease, a leave and license agreement does not create any property rights in favour of the person who occupies the house (licensee).

In case of tenancy as well as lease, the right to use the property gets transferred from the owner to the person who is renting out the place. However, no such transfer of right to use takes place in leave and license agreements. There is only a license given to the licensee for limited use of the property in a certain way. The terms of the licenses govern what are the rights of the licensee (the person who rented the house). This is the form of agreement most preferred by landlords, and 11 month leave and license agreements for residential properties have become a norm all over India. Lease agreements are common only with respect to commercial property.

Usually Leave Licence agreements are made for Residential and Commercial Properties.

2. Sale Deed

The word “SALE DEED” otherwise called as “Conveyance Deed” is a legal written document executed by the vendor and the purchaser which evidences the sale and transfer of ownership of the tangible immovable property.

A sale deed is governed by the Transfer of Property Act and the Registration Act, 1908 and is an important document for both the buyer or the transferee and the seller or the transferor. A sale deed is executed, usually, after the execution of the agreement to sell, and after compliance of various terms and conditions between the seller and the purchaser mutually. A sale deed is the main document which gives details of how the seller got the property, at what consideration the seller is selling the property and assurance to the purchaser that the property is free from any encumbrances, liabilities or indemnity clauses. A sale deed acts as an essential document for the further sale of the property by the purchaser as it establishes the proof of ownership of property.