Agreement for sale vs sale deed in India: which must be registered, stamped and when

An agreement for sale is a contract to transfer property in future on agreed terms. A sale deed (also called a conveyance deed) actually transfers ownership. Under the Transfer of Property Act, 1882, a sale of immovable property worth ₹100 or more can only be made by a registered instrument. An agreement for sale by itself gives you no ownership. Agreements for sale relied on for part performance (giving possession) have had to be registered since 2001. For RERA-registered projects, the builder cannot take more than 10% of the cost before a registered agreement for sale is executed. Stamp duty on the agreement depends on the state. Some states, such as Maharashtra, charge full conveyance duty on an agreement for sale of a flat. Others charge mainly on the sale deed.

This guide is general information. State stamp laws differ, so confirm the treatment for your property with the sub-registrar or your advocate.

The two documents compared

	Agreement for sale	Sale deed / conveyance
What it does	Records the promise to sell: price, payment schedule, timeline, conditions	Transfers ownership on the date of registration
Ownership passes?	No	Yes
Registration	Compulsory for RERA projects before more than 10% is paid, and where part performance is relied on; otherwise strongly advised	Compulsory
Stamp duty	State-specific: nominal in some states, full conveyance duty in others where possession is given or agreed	Full duty on the higher of price and stamp value, less credit for duty already paid on the agreement where the state allows
Typical use	Builder flats, resale with a gap before completion	Final step of every sale

Why registration matters

Section 17 of the Registration Act, 1908 makes registration compulsory for instruments that create or transfer interests in immovable property worth ₹100 or more. Since 2001 it also covers agreements relied on for part performance under section 53A of the Transfer of Property Act.
Section 49 says an unregistered document that should have been registered does not affect the property and cannot be used as evidence of the transaction. It can still be used in a suit for specific performance and for limited collateral purposes.
Time limit: a document must be presented within four months of execution (section 23). A further four months is allowed with a fine (section 25).

In short: an unregistered agreement is weak protection, and an unregistered "sale" is not a sale.

How stamp duty works on each

Maharashtra: an agreement for sale of a flat in which possession is given or agreed is charged like a conveyance under the Maharashtra Stamp Act. The registered agreement with a builder is the main document, and full duty is paid on it at that stage. Land title passes to the society later by conveyance or deemed conveyance.
States that charge on the sale deed: a smaller duty, often nominal, applies to the agreement, and full duty is paid when the sale deed is registered.
Credit: where duty is paid on an agreement and then on the sale deed, many states give credit so you do not pay twice. Keep the receipts.

Check how your state treats your case using the state stamp duty guide.

RERA and the builder's agreement

For RERA-registered projects:

Section 13 stops the promoter taking more than 10% of the cost before a registered agreement for sale. That keeps your large payments tied to a document you can enforce.
States notify a model form of agreement under their RERA rules. Builders must not include terms inconsistent with the Act and rules.
The agreement must specify the carpet area, the payment plan linked to construction stages, the possession date, and specifications.
On completion, the promoter must execute a conveyance deed in your favour, and hand over common areas to the association, within the time the Act requires.

If a builder asks for more than 10% without registering the agreement, that is a breach you can raise with the state authority. See the RERA complaint guide.

Resale: when an agreement first makes sense

In a resale, the agreement is useful when there is a gap between signing and completing the sale, for example while the seller's loan is closed or the society NOC is obtained.

Record the price, the token and payment schedule, the date for completion, who pays what, and the consequences if either side backs out.
If a significant sum is paid, register it, or at least stamp it correctly, so that you can enforce it.
Do not take possession on an unregistered agreement.

Where everything is ready, many resale deals go straight to a registered sale deed with the full payment, which is simpler and safer. The resale documents checklist lists what to collect.

What not to rely on

Notarised agreements. Notarisation is not registration.
General power of attorney with an agreement to sell and a will. The Supreme Court held in 2011 that this does not convey title.
Allotment letters alone. An allotment letter is evidence of booking, not ownership, and is not a substitute for a registered agreement in RERA projects.
Possession letters without a conveyance. Insist on the conveyance or the state's equivalent title document.

FAQ

Is stamp duty paid on the agreement refundable if the deal fails?

State stamp acts usually allow a refund on cancelled instruments within a time limit, sometimes with a deduction. Execute and register a cancellation deed and apply promptly.

Can I register an agreement for sale without the seller present?

No. The executants, or their registered attorneys, must appear before the sub-registrar, in person or through an approved remote procedure where the state offers one.

What does "deemed conveyance" mean?

In Maharashtra, where a builder fails to convey the land and building to the society, the society can apply to the competent authority for a deemed conveyance order under state law.

Does the TDS obligation start at the agreement?

TDS applies at the time of payment or credit. If you pay instalments under the agreement, deduct TDS at each payment once the ₹50 lakh threshold applies. See the TDS guide.

Sources

India Code — Transfer of Property Act, 1882; Registration Act, 1908; RERA Act, 2016
IGR Maharashtra — stamp duty on agreements and conveyances in Maharashtra
Ministry of Housing and Urban Affairs — RERA rules and model agreements
See the mistakes guide and the title verification guide