Documentation is one of the most important requirements in legal compliance when it comes to property transactions. These documents are obtained and maintained for record purposes and have evidentiary value. Important documents like allotment letter, agreement for sale, conveyance deed, etc. help you in establishing your title and ownership of a property in the eyes of the law. It is for this reason that these documents are carefully worded and maintained carefully with the existence of multiple copies available to the parties of a transaction.

The transaction between the builder and the buyer is recorded in several documents that are submitted for registration and stamping for legal recognition. These documents can help a buyer avail of home loans for covering the remaining amount of purchasing the property if needed. These documents will also help you when it comes to reselling your house in the future. This article seeks to explain what an allotment letter, agreement for sale and a conveyance deed is and their importance in a property transaction.

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What is an allotment letter?

One of the most important documents in a property transaction and the real estate sector is the allotment letter.

  • This letter is given by a builder to a buyer after a buyer has purchased more than 15% of the property.
  • If a person purchases property that is under construction, then this document is provided by the builder to the person (prospective buyer).
  • Here is how an allotment letter proves important to the buyer:
  1. The facts, figures and relevant information about a property are stated in the letter.
  2. The letter gives details about the construction, architectural plans and details and the amount of money to be paid to the builder or developer.
  3. The letter helps you avail of a loan from a lender for the remaining amount to be paid to the builder. This is because the letter states the amount to be paid to the builder in clear terms and figures based on which lenders sanction the money.
  4. In the case of a property under construction, an allotment letter serves as evidence of the transaction between the buyer and builder.
  5. Due to the allotment letter containing details about the property and promised amenities to be provided by the builder, on non-provision of these amenities this letter can be used as proof against the builder, holding him or her accountable for non-provision of amenities.

In a 2016 judgment given by the Maharashtra RERA Tribunal, it was held that homebuyers with allotment letters are eligible for a refund from builders for the booked flat along with interest under Section 18 of the Real Estate (Regulation & Development) Act, 2016. This was held because the promoter of the project had issued allotment letters to the buyers but had failed to transfer possession of the property to the buyers. The project got delayed. Due to this, the buyers applied to the Tribunal to seek withdrawal from the property and refund of the money paid along with interest.

So this shows the importance of an allotment letter to the buyer. The contents of the allotment letter are :

  1. Payment options
  2. Flat details
  3. Construction schedule and terms of construction
  4. The amenities provided by the builder
  5. The amount to be paid to the builder inclusive of taxes
  6. The date of completion of the project and penal provisions on builder in case of non-completion or delayed completion.

What is an agreement for sale?

The definition of the agreement for sale in the RERA is given under Section 2 (c) as “an agreement entered into between a promoter and allottee”.

  • An agreement for sale is the primary sale document between the builder and prospective buyer and is an agreement to sell the property in the future. As such, it is an executory agreement which means that it is an agreement yet to be fully executed.
  • Due to the nature of this agreement, if there is a violation of the agreement terms, the aggrieved party can only seek legal remedies in the form of a suit for damages.
  • Some important clauses of an agreement for sale are:
  1. Names of the parties, their respective ages, and their residential addresses.
  2. The date and place of execution of the agreement.
  3. The consideration amount, payment mode, and time of payment.
  4. Penalty and forfeiture clauses in case of default.
  5. The rights, obligations, and liabilities of the parties.
  6. The conditions which regulate the transfer of possession.
  7. The proportion of expenses to be met by each party in the transaction.

For an agreement of sale to be executed, it needs to be witnessed by two persons and maybe one from each party to a transaction.

What is a conveyance document?

A Conveyance Document or deed is a property document that records the transfer of ownership and title from one person to another person. It is a contract that is legally binding on the parties and has evidentiary value regarding the transaction between the parties. A sale deed is a type of conveyance deed and conveyance deed also includes deeds like gift deed, lease deed, exchange deeds, and mortgage deeds.

  • For registering property in your name, you require a conveyance deed to be shown to the authorities.
  • A conveyance deed is important if you have to prove ownership of the property and this document also protects you from fraudulent transfers.
  • There are some essential documents for a conveyance deed like:
  1. PAN cards of the parties
  2. Proof of stamp duty
  3. Registration charges
  4. Copies of electricity bill and property taxes paid
  5. Authorization and occupancy certificates
  6. Builder-buyer agreement


Documents are an important part of a property transaction which legally binds parties to a transaction to perform their respective promises in a property transaction. They also serve as legal records of the transaction and have evidentiary value to help the parties enforce their rights or get the other party to discharge their obligation in the transaction. Documents like sale agreements, conveyance deeds, allotments letters serve as proof of title of an owner to the property.

Therefore these documents need to contain all the required details and relevant terms which describe the property, set down the rights and liabilities of the parties, contain the payment details, date and place of execution of agreement, etc. Therefore if you want to ensure the smooth conduct and progress of the transaction, it is best you have the documents carefully prepared, maintained and registered with the authorities.