6. Various Types of Instruments/ Agreements

 6. Various Types of Instruments/ Agreements

The below mentioned Agreements are mostly governed under The Indian Contract Act 1872, and other general Statutes as per concern terms.

01. MEMORANDUM OF UNDERSTANDING (M.O.U) :

This is the Primary Document between two or more persons.

It is the starting point of negotiation of any transaction.

It describes broad outline of an agreement and deal that parties have Decided after execution it becomes a contract.

02. DEVELOPMENT AGREEMENT :

This Agreement is executed between the Land Owner & Promoter / Developer/ Builder.

This Agreement is executed for development or Re - development of Land.

In this Generally after the negotiation between both the parties the Land Owners gets:

1. Certain Area of construction in Unit(s) (e.g. Flats, Shops Showrooms), Parking area.

2. Deposit Amount - which may be Refundable & or Non Refundable.

3. Rent till the land owners get possession of their unit(s)

[may provide after execution of development agreement till possession of units or From the expiry of possession date of units to handover.]

The Ownership of land is still with the land owner until Builder don’t execute conveyance deed in favour of Society after forming the Society Or Apartment Deed of that Project. Hence after conveyance deed the land ownership get transferred directly to society in common or Apartment Owners as per their unit’s area, share is calculated individual level.

03. JOINT VENTURE AGREEMENT :

This Agreement is executed between the Land Owner & Promoter / Developer/ Builder (Primary Builder). And Or

This Agreement is executed between the Land Owner & Promoter / Developer/ Builder (Primary Builder) with another Promoter / Developer/ Builder (Secondary Builder).

This Agreement is executed for development or Re - development of Land.

In this generally after the negotiation between both the parties the Primary Builder committed to give the Land Owners Area + Deposit + Rent as above mentioned.

And the Secondary Builders after pursuing the development rights from Primary Builder and through Land Owner Directly or Indirectly through Power of Attorney gives their consideration Area or Deposit as their benefits.

The Ownership of land is still with the land owner until Builder don’t execute conveyance deed in favour of Society after forming the Society Or individual units holder as per their unit area share under Apartment Deed of that Project.

04. SALE DEED :

This agreement is executed between the Parties i.e. Buyer & Seller. Generally the term Assignee (s) and Assignor(s) is used instead of Buyer and Seller. As one Person is assigning his rights in favour of another.

The Right Title and Interest of Property ownership is immediately get transfer after the execution of Sale Deed.

The Term Sale Deed is usually used for Land Transactions but as concern to Unit(s) selling the term Deed of Assignment (D.O.A.) is used.

05. AGREEMENT TO SELL :

This Agreement is a contract between both the parties i.e. Seller and Purchaser(s) of Property. Generally executed between Flat Purchaser(s) & Builder(s)

In this generally Consideration amount is mentioned and how the Flat Purchaser(s) has to pay the builder in percentage as per work stages gets started / completed.

06. POWER OF ATTORNEY :

The Power of Attorney is such an instrument / document empowering a specific person to act on his / her behalf where he unavailable to perform those activities due to his Physical health or he is far away from that Property or due to busy in other work activities.

The Person who is executing power to other is known as the Executants and The Power executed in whose favour is known as the Constituted Attorney.

The Power of Attorney can be Revocable (can be cancelled) and Irrevocable (cannot be cancelled). It depends on the Title Heading on Deeds and as per internal clauses mentioned.

The Power of Attorney is governed under Power of Attorney Act, 1882.

TYPES OF POWER OF ATTORNEY :

i. ADMISSION :

In this the Executants already had signed and impression of his left thumb stamped on concern main document which has to be registered, but as he is unable to manage his time to perform his activity and or not physically capable or available to present at Registration office to execute that concern document, hence he appoints the constituted Attorney on his behalf to execute that document, and for that purpose this Admission Power of Attorney is drafted and registered but in that the main document which is signed by the executant are considered for registration through Power of Attorney.

In this Stamp duty is paid nominal amount.

ii. TOTAL AUTHORITY POWER :

In this Power of Attorney the Executants signs and provides impression of his left thumb stamped on concern Power of Attorney document which both parties register at sub registrar office, in this Power of Attorney full authority is provided by the executant to the Constituted Attorney till sell of property by the signature of the constituted Attorney himself but in this full stamp duty of the concern property has to be paid as like sale deed or Deed of Assignment.

iii. SPECIAL / SPECIFIC :

In this the Executants gives Special / Specific power concern to do that specific act only to the constituted Attorney.

In this Stamp duty is paid nominal amount or full Stamp duty per valuation of Property depends upon the clauses what are mention, Sub Registrar instruct to pay stamp duty as per rules & regulations.

TERMINATION / CANCELLATION OF POWER OF ATTRONEY :

1. After Completion of Specific work allotted under it.

2. Date of termination is mentioned in Attorney

3. After the Death or Bankrupt

4. If Husband & wife both get separated

5. When Executants declares cancellation of Attorney in Power of Attorney.

07. SUPPLEMENTARY AGREEMENT :

The name itself denotes that it is the “Supplement” of main Agreement which had been executed & registered earlier.

Any additional clauses such as additional area, additional consideration, additional terms & conditions to be inserted.

And even under this Title Deed Units (Flats / Shop/etc.) is allotted. Most of the time for Additional Area or Additional Consideration – Additional Stamp duty & Registration has to be paid. Now this document has to be adjudicated, then only document gets registered.

08. AGREEMENT TO ASSIGN AND TRANSFER (A.T.A.T.) :

This Agreement is executed when both the parties (i.e. Seller & Purchaser) has come to the conclusion about selling / purchasing of unit.

In this Agreement vital part is “consideration” payment, How much Purchaser has self - contributed and how much balance to be paid in how many days he is going to pay and their other negotiated finalized further terms .

In this mostly possession of the unit is not handover to the Purchaser Party unless and until full payment is not received by the Seller Party. After receiving final payment details then the Deed of Assignment (D.O.A.) is executed, after this D.O.A. agreement gets registered and handover to the Banker original copy, the Banker handover the Cheque or account transfer it if that balance amount is raised through loan.

Mostly this A.T.A.T. document is executed due to following reasons -

FROM SELLER SIDE :

He has already raised a loan from his bank and for authenticity of this selling transaction this document has to be executed in which payment of self-contribution amount with full Stamp Duty & Registration fees has been paid and intimate the bank from whom he has raised the loan.

FROM PURCHASER SIDE :

Mostly Purchaser also raise loan to purchase unit and after doing all procedural part of banking section as well as confirming how much the loan will be provided to Purchaser then the difference remaining amount out of total consideration has to be paid by the Purchaser as a self-contribution and registered the document with payment of full Stamp Duty & Registration and handover this document to the bank from whom he has to raise the loan.

This Agreement is one type of Agreement to Sell, but is said as Agreement to Assign & Transfer, because we assign the rights of unit.

* Note – Some time Purchaser Bank direct the Purchaser to execute the Deed of Assignment directly (after approval of draft from the bank ) by skipping this Agreement to Assign and Transfer.

09. DEED OF ASSIGNMENT (D.O.A.) :

Deed of Assignment is the Agreement where both the parties (i.e. Seller & Purchaser) have come to the conclusion about selling / purchasing of unit.

In this Agreement total consideration amount is mentioned (full payment by purchaser or Self Contribution and Bank loan amount). From this Document Right, Title, Interest and Ownership directly vest with the Purchaser after getting registered this document. But encumbrance of Bank is still there until the bank loan is not paid.

Possession of units gets immediately after getting full payment to the seller.

This Agreement is one type of Sale Deed, but is said as assignment deed because we do not sell rights we assign the rights of unit.

10. APARTMENT DEED :

Apartment Deed is the document where Builder/ Developer assign all their right, title, interest and benefit in the said flat and percentage of undivided share in the said Land and all the common areas and facilities in favour of the unit(s) purchaser.

This Apartment Deed is governed under Maharashtra Apartments Ownership Act, 1970.

11. DEED OF DECLARATION :

The Deed of Declaration is such a document where Builder execute himself & declare each & every details of Land and Project which he has developed specifying total number of units with their areas, amities provided and common passage area as well as percentage of share of each unit owners will share how much as per their ownership in it.

This Deed of Declaration is governed under Maharashtra Apartments Ownership Act, 1970.

12. POSSESSION RECEIPT :

Possession Receipt is the document where builder execute & register document in favour of unit purchaser for confirmation of his legal possession of the unit and builder has handover it to the Purchaser after full payment settlement.

Sometime builder may give possession receipt on his letter head also.

13. CORRECTION DEED :

Correction Deed is the agreement where earlier main document which has been executed & registered after a certain time period parties get realized that there is any typographical mistake in the said document which can be corrected by this deed hence this deed is executed.

14. PARTITION DEED :

Partition is a process whereby the life of coparcenary comes to an end. On Partition every coparcenary gets undivided share divided by metes & bounds. Partition is of two kinds – Total & Partial Partition. Joint family property or Coparcenary property only can be partitioned. Water Reservoir’s, well, common way, road, entrance, garden, dwelling house, and temple idols cannot be partitioned. Partition can be executed by Partition Deed, by Arbitration, by Apostasy, by conduct, by will, by notice, by renunciation of shares, by institution of suit, by marriage of a coparcener under the Special Marriage Act, by sale one coparcener to another.

15. EASEMENT AGREEMENT :

An easement is a right which the owner or occupier of certain land possesses, as such, for the beneficial enjoyment of that land, to do and continue to do something, or to prevent and continue to prevent something being done, in or upon, or in respect of, certain other land not his own.

Dominant and servient heritages and owners. -The land for the beneficial enjoyment of which the right exists is called the dominant heritage, and the owner or occupier thereof the dominant owner; the land on which the liability is imposed is called the servient heritage, and the owner or occupier thereof the servient owner.

16. CANCELLATION DEED :

This deed is executed when the earlier agreement whatever name has been executed and registered, but from both side parties one or the another party is unable to perform their committed activity as per earlier contract, hence after all negotiations and settlements this document is executed.

17. RELEASE DEED :

In this Deed one person releases his right, title & interest as well as ownership from specific property e.g. Land, any type of Unit(s) shop/flat/showroom etc. in favour of another person. Generally Release Deed is executed in joint ownership.

18. MORTGAGE DEED :

A mortgage is the transfer of an interest in specific immoveable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability.

The Transferor is called a Mortgagor and the Transferee is called a Mortgagee; the principal money and interest of which payment is secured for the time being are called the mortgage-money, and the instrument (if any) by which the transfer is effected is called a Mortgage Deed.

Mortgage is governed under Transfer of Property Act ,1882.

TYPES OF MORTGAGE DEED :

1. SIMPLE MORTGAGE :

Where, without delivering possession of the mortgaged property, the mortgagor binds himself personally to pay the mortgage-money, and agrees, expressly or impliedly, that, in the event of his failing to pay according to his contract, the mortgagee shall have a right to cause the mortgaged property to be sold and the proceeds of sale to be applied, so far as may be necessary, in payment of the mortgage-money, the transaction is called a simple mortgage.

2. CONDITIONAL SALE MORTGAGE :

Where, the mortgagor clearly sells the mortgaged property on condition that on default of payment of the mortgage-money on a certain date the sale shall become absolute, or on condition that on such payment being made the sale shall become void, or on condition that on such payment being made the buyer shall transfer the property to the seller, the transaction is called mortgage by conditional sale and the mortgagee a mortgagee by conditional sale. Provided that no such transaction shall be deemed to be a mortgage, unless the condition is embodied in the document which effects or purports to effect the sale.

3. USUFRUCTUARY MORTGAGE :

Where the mortgagor delivers possession (expressly or by implication binds himself to deliver possession) of the mortgaged property to the mortgagee, and authorises him to retain such possession until payment of the mortgage money, and to receive the rents and profits accruing from the property (or any part of such rents and profits and to appropriate the same) in lieu of interest, or in payment of the mortgage money, or partly in lieu of interest (or) partly in payment of the mortgage money, the transaction is called an usufructuary mortgage and the mortgagee an usufructuary mortgagee.

4. ENGLISH MORTGAGE :

Where the mortgagor binds himself to repay the mortgage money on a certain date, and transfers the mortgaged property absolutely to the mortgagee, but subject to a proviso that he will re-transfer it to the mortgagor upon payment of the mortgage money as agreed, the transaction is called an English mortgage.

5. EQUITABLE / MORTGAGE BY DEPOSIT OF TITLE-DEEDS :

Where the State Government concerned may, by notification in the Official Gazette, specify in this behalf, delivers to a creditor or his agent documents of title to immoveable property, with intent to create a security thereon, the transaction is called a mortgage by deposit of title-deeds / Equitable Mortgage.

6. ANOMALOUS MORTGAGE :

A mortgage which is not a simple mortgage, a mortgage by conditional sale, an usufructuary mortgage, an English mortgage or a mortgage by deposit of title-deeds within the meaning of this section is called an anomalous mortgage.

7. REGISTERED MORTGAGE :

This Mortgage deed gets registered as like sale or any other title deed on which the mortgagor has to pay applicable stamp duty & registration charges.

Registered mortgage is also known as 'Deed of Trust'. A registered mortgage meets all the necessary legal requirements to create a mortgage or a charge. If the borrower repays the loan according to the terms and conditions of the home loan agreement, the title of the property is given back to the borrower.

In India Two Types of Mortgage is majorly practiced

I) EQUITABLE MORTGAGE

II) REGISTERED MORTGAGE

19. RE - CONVEYANCE OF MORTGAGE DEED :

A deed of re-conveyance is a legal document that indicates the transfer of a property's title from lender to borrower(s). The deed of re - conveyance is executed & registered after the borrower(s) has paid off their full loan amount.

20. EXCHANGE DEED :

When one property owner(s) desire to transfer ownership of their property with another party and another party is also willing the same to transfer ownership of their property, they establish, execute & get registered a deed of exchange. A deed of exchange will be used to carry out such a transfer. By executing a deed of exchange, parties can adjust consideration amount in that too as other assets in addition to immovable property.

21. SERVICE CONTRACT :

In this Agreement the one party gives the task to another party for a decided consideration amount, on that basis Service contract is executed between both parties. This agreement is done to perform special task.

22. CONVEYANCE DEED :

Conveyance Deed is the Agreement where the Builder/ Developer and Land owner Handover the ownership of their land in favour of the Society which is formed by the Developer where the project has been developed and units has been sold. The Ownership – Right Title & Interest of the land vest with the Society only and not with individual unit purchaser.

23. GIFT DEED :

Gif Deed is a document in which one person out of affection & love gifts his own property to that loved person without any consideration.

24. WILL , CODICIL & PROBATE :

Will is a legal document conferring ownership of personal property and assets by the testator (the one who makes the will). This document is executed before his or her demise as there is no guarantee to life span. It comes with guidelines on the distribution and disposal of property and assets, ensuring that there are no future legal disputes amongst the beneficiary after the demi of testator.

Codicil as an instrument made with reference to the will executed earlier and explaining, altering or adding to its dispositions, and shall be deemed to form part of the will.

Probate is a copy of will certified under the seal of competent court with a grant of administration to the estate of Testator. The Probate may be granted only to such a person or persons who are appointed as executors by the testator in his will.

Will Codicil, Probate is govern under The Indian Succession Act 1925.

25. CONSENT / CONFIRMATION DEED :

In this Agreement, one of the parties has been left or unable to avail at the time of executing any document which has been executed & registered earlier and or any terms conditions has been skipped in writing in earlier executed & registered document which is now mention in this consent or confirmation deed agreement, hence to get his / her / their consent of that earlier document and or any additional clause term conditions for that this Deed is executed.

26. LEAVE & LICENCE AGREEMENT :

The leave and license agreement is a contract executed between the Property Owner who is licensor and the person who wants to use the owners property on rental basis who is said as licensee. This agreement is usually for short period and can be renewed.

27.      LEASE DEED :

 

Lease Deed is a contract executed between the Property Owner who is lessor and the person who wants to use the owner’s property on rental basis who is said as lessee. This agreement is usually for short period and can be renewed to use the asset in return for regular rental payments basis may be for long term tenure also.

 

 

Particulars	LEASE	LEAVE & LICENCE
ACT	TRANSFER OF  PROPERTY ACT, 1882.	INDIAN EASEMENT ACT1882
SECTION	Sec. 105	Sec. 52
Definition	A lease of immoveable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms.	Where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the absence of such right, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a license.
Salutations	LESSOR (Owner) & LESSEE (Tenant)	LICENSOR (Owner) & LICENSEE (Tenant)
Duration	LONG TERM (33/99Yrs, Perpetual)	SHORT TERM 11 months to max 60 months.
Rights	Transfer of Interest	Mere Permission to do something without any transfer of Right.
Possession	Lessee has the right to protect the possession in his own right.	Licensee cannot defined his possession in his own name as he does not have any property right in the Property.
Property Repairs & Maintenance	Entitled to any improvement or accession made to the Property.	Not entitled to any improvement or accession made to the Property.
Transfer	Both Transferable & Heritable	Neither Transferable & Heritable
Termination of contract	Comes to an End only accordance with the terms and conditions stipulated in the Contract	Can be withdrawn at any time at the pleasure of the granter.
After sell of property	Unaffected by the transfer of Property by sale in favour of third Party	Comes to an end immediately if the property is sold to a third party.
Death of parties	Does not comes to an end either by death of the grantor or grantee	Comes to an end with the date of either granter or grantee