The Vehicle Sale Agreement is a document used to specify the terms and conditions entered into between the seller and the buyer of the vehicle. This agreement can be used by either the seller or buyer to buy or sell any type of vehicle, including a car, bike, bus, or truck. Individuals or businesses, including vehicle dealers, can use it. The Vehicle Sale Agreement helps to avoid any disputes over the sale of the vehicle in the future and can include important details about the vehicle.
The Vehicle Sale Agreement is different from the Bill of Sale. A bill of Sale is a document executed at the time of actual delivery of the Vehicle. On the other hand, a Vehicle Sale Agreement is an Agreement entered into between the parties prior to the actual delivery of the Vehicle.
No, having a written Vehicle Sale Agreement is not mandatory. However, it will protect both the buyer and seller from future disputes and ensure that both parties are on the same page.
This Agreement includes the following clauses:
Any individual (18 years or older) or legal entity in India not prohibited by law can enter a Vehicle Sale Agreement.
The duration of the Vehicle Sale Agreement varies from one transaction to another. It may be for a few days before the actual transfer, or it could be for a year before the actual transfer of the vehicle. The parties can specify the period within which the vehicle should be delivered.
The Vehicle Sale Agreement will be legally binding when it has been printed on non-judicial stamp paper or e-stamp paper, and signed by each party. The value of the stamp paper would depend on the state in which it is executed. Each state in India has provisions in respect of the amount of stamp duty payable on such agreements. Information regarding the stamp duty payable can be found on the State government websites.
Each Party should sign and return a copy of the Vehicle Sale Agreement. Where a company is a party to this agreement, they should ensure that the Vehicle Sale Agreement is signed by an authorized signatory, which is usually a director as authorized by a board resolution of the company.
Each Party should keep a signed copy of the Vehicle Sale Agreement. To do this, two different copies can be signed, or if only one copy is signed, it can be photocopied and then distributed between the parties.
This Vehicle Sale Agreement does not legally transfer ownership of the vehicle. After the sale, the necessary forms must be submitted to the relevant Regional Transport Office (RTO).
The following are the mandatory documents for transferring the vehicle:
The following documents may be required as per the state rules:
Where the ownership of the vehicle is transferred, the transferor shall report the fact of transfer in Form 29 to the concerned RTO online or offline where the Vehicle is originally registered.
In case of a Vehicle transferred within the same state, within fourteen days of the transfer, an application for transfer of ownership of the Vehicle shall be made by the transferee in Form 30 to the concerned RTO where the vehicle is registered.
In case of a Vehicle transferred to another state, within forty-five days of the transfer, an application for transfer of ownership of the Vehicle shall be made by the transferee in Form 30 to the concerned RTO where the vehicle is registered.
The Vehicle Sale Agreements in India are enforceable under The Indian Contract Act, 1872.
If the vehicle is sold to an individual person for a non-commercial purpose (other than for self-employment) the Consumer Protection Act, 2019 will also be applicable.
The details of the Vehicle and other services can be found at Vahan Portal.
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Vehicle Sale Agreement - Template - Word & PDF