Introduction

Many property buyers believe that once a sale deed is registered, their ownership is absolute and beyond challenge. This belief is dangerous and legally incorrect. Courts in India have repeatedly held that registration of a sale deed alone does not guarantee protection, especially when prior agreements or legal defects exist.

In several cases, buyers have lost possession or ownership due to specific performance suits, despite having a registered sale deed in their favour. This blog explains the common mistakes buyers make even after registration and how such errors can result in losing the property.

What Is a Suit for Specific Performance?

A suit for specific performance is a legal action where a person seeks enforcement of a prior agreement to sell, asking the court to compel the seller to execute the sale deed in their favour.

If the court finds that:

• A valid agreement to sell existed earlier, and

• The buyer under that agreement was ready and willing to perform,

then the court may:

• Cancel the subsequent sale deed, and

• Order transfer of property to the earlier agreement holder.

Common Mistakes That Lead to Specific Performance Despite Sale Registration

1. Ignoring a Prior Agreement to Sell

One of the biggest mistakes is purchasing property without verifying whether a previous agreement to sell exists.

Many sellers sell the same property twice—first through an agreement to sell, and later through a registered sale deed.

Legal Risk:
A prior agreement holder can file a suit for specific performance and seek cancellation of the registered sale deed.

2. Failure to Conduct Proper Title Search

Buyers often rely only on the seller’s word or recent documents and skip a full title search.

A proper title search should include:

• Past agreements

• Pending litigation

• Encumbrances

• Court orders or injunctions

Legal Risk:
If litigation or contractual obligations existed earlier, courts may hold the buyer negligent.

3. Purchasing Property During Pending Litigation (Lis Pendens)

Buying property when a dispute or suit is already pending violates the doctrine of lis pendens.

Legal Risk:
Even a registered sale deed becomes subject to the outcome of the pending case, including a decree of specific performance.

4. Notice of Agreement to Sell (Actual or Constructive Notice)

If the buyer:

• Had actual knowledge of an earlier agreement, or

• Could have known through reasonable inquiry

Courts treat this as constructive notice.

Legal Risk:
Such buyers are not treated as bona fide purchasers and may lose protection.

5. Improper or Undervalued Agreement to Sell

In Punjab and many other states, agreements to sell require proper stamp duty. Buyers who:

• Ignore stamp compliance

• Overlook deficiencies

are exposed to disputes.

Legal Risk:
Courts still enforce valid agreements even if stamp duty is later cured with penalty.

6. Buying Through GPA or POA Transactions

Purchasing property through Power of Attorney transactions instead of direct conveyance increases vulnerability.

Legal Risk:
If the principal had earlier entered into an agreement to sell, GPA transactions do not defeat specific performance claims.

7. Absence of Due Diligence on Seller’s Authority

Where property is jointly owned or inherited, buyers often fail to verify:

• Consent of all co-owners

• Authority of the seller

Legal Risk:
A prior agreement by another co-owner can override a later registered sale.

8. Ignoring Readiness and Willingness of Prior Buyer

Courts heavily consider whether the earlier agreement holder was ready and willing to perform their obligations.

If this is proved, the registered sale deed in favour of a later buyer may be set aside.

Courts’ View on Registered Sale Deeds

Indian courts have consistently held:

• Registration does not cure prior contractual breaches

• A registered sale deed is not immune from cancellation

• Bona fide purchaser protection is conditional

Merely registering a document does not override equitable rights arising from earlier agreements.

How Buyers Can Protect Themselves

Before buying property, buyers should:

• Conduct full legal due diligence

• Verify absence of prior agreements

• Check for pending litigation

• Obtain a lawyer’s title opinion

• Ensure seller’s authority is complete

• Avoid rushed or undervalued transactions

Most property litigation arises not from fraud, but from lack of legal caution.

Why Property Deals Should End at the Advocate’s Table

An advocate:

• Verifies title and prior obligations

• Identifies risks of specific performance

• Advises on stamp and registration compliance

• Protects buyers from future litigation

Skipping legal advice often results in irreversible loss.

Conclusion

A registered sale deed does not provide absolute immunity against prior legal rights. Mistakes made during property purchase—especially ignoring earlier agreements—can expose buyers to specific performance suits and result in loss of property.

Legal due diligence is not optional; it is essential.

Educational Disclaimer

This article is for general legal awareness only and does not constitute legal advice. Property disputes depend on individual facts and applicable laws.