How to draft a cancellation deed using AI

In this article, we will master the use of AI in drafting a cancellation agreement and understand its key components. So, whether you are a law student or a lawyer who wants to learn a new skill, this article will significantly enhance your working style, making it faster and more effective.

Introduction

One of my colleagues called me from the district court with an urgent situation that had been on her mind for weeks.

“You know that property case I have been handling for Rekha Patel?” she began, her voice carrying a mix of relief and concern.

“The one where she paid Rs. 28 lakhs to a developer for a 2BHK apartment four years ago, but never got possession? After months of consumer court battles and police complaints, both parties are finally willing to settle the matter. The builder is offering Rs. 48 lakhs total in settlement, which is the original money plus compensation.”

I could hear the optimism in her voice, but then she continued with her real concern.

“Here, my problem is that everyone is eager to put an end to the matter, but it requires a comprehensive cancellation deed that will end all the legal proceedings, ensuring the settlement payment, and also guarantee that neither party can come after the other in the future. The builder’s lawyer is asking for a full proof document that covers every possible angle.

I have drafted simple cancellation deeds before, but nothing this complex with multiple legal proceedings and involving a substantial settlement amount.”

Her situation perfectly captures the challenge that many lawyers face when dealing with property dispute settlements.

Do you know what makes cancellation deeds particularly complex in dispute resolution scenarios?

You are not just cancelling a contract; you are settling a complicated legal issue once and for all. This involves handling consumer complaints, police cases, settlement payments, and mutual releases, ensuring that the matter is resolved promptly and does not drag on in court for years.

What most people assume is that a cancellation deed is just a formal way of saying, “we are ending this agreement.”

This oversimplification has led to countless “settled” disputes that have erupted into new litigation because the cancellation documentation had loopholes or failed to address all aspects of the original conflict.

A cancellation deed is actually a dispute resolution instrument that must systematically address the original transaction failure, all subsequent legal proceedings, current settlement arrangements, complete mutual releases, and future claim prevention, all while ensuring enforceability and registrability.

In traditional legal practice, creating such documentation requires extensive research into all related proceedings, careful drafting to avoid contradictory provisions, multiple revisions for different stakeholders, and coordination with various courts and authorities, a process that typically consumes 1-2 weeks and costs Rs. 25,000 to 40,000 in legal fees.

But what if I told you that you can create a professionally comprehensive cancellation deed in just 30 minutes, covering every legal angle while ensuring complete dispute resolution?

My colleague was intrigued but sceptical when I explained this possibility, especially given the complexity of her case.

The breakthrough lies in using AI to draft legal documents. A methodology that I have been developing and refining specifically for such complex dispute resolution documentation.

I have spent the past 10 months creating AI prompts that transform how cancellation deeds are conceptualised and drafted.

And guess what? The results have been remarkable. What previously required days of careful legal research and multiple drafts can now be completed in under 30 minutes.

The systematic approach ensures that every critical element of dispute resolution is addressed while eliminating the inconsistencies and oversights that plague traditional drafting methods.

Today, I will share the exact step-by-step methodology I used to help my colleague create a cancellation deed that successfully helped her resolve her client, Mrs.Patel’s legal battle, and provided complete peace of mind for all parties.

Once you master this approach, you will be able to handle even the most complex dispute resolutions with confidence, ensuring that your cancellation deeds actually resolve disputes instead of creating new vulnerabilities.

Let me show you how modern legal technology can transform dispute resolution from a lengthy and uncertain process into a systematic and comprehensive solution that provides real closure for all parties involved.

Before you proceed, let me tell you about an article I wrote on how to draft an agreement for sale. In it, I teach you how to draft it from scratch, without using AI. It is particularly useful for those who regularly deal with such agreements.

But first, let us understand the basics.

What is a cancellation deed?

A cancellation deed is a legal document that formally terminates an existing agreement by mutual consent while addressing all related disputes, settlement payments, and future claims.

It is particularly crucial in real estate transactions where original agreements have failed and parties need comprehensive dispute resolution.

Unlike simple termination notices, cancellation deeds provide complete legal closure by addressing past disputes, present settlement terms, and preventing future claims. They are essential for ensuring that terminated agreements don’t create ongoing legal vulnerabilities.

Moving on, let us now understand the components of a cancellation deed.

What are the components that make a cancellation deed legally effective?

Based on contract law principles and practical dispute resolution experience, every cancellation deed must address seven critical areas:

1. Party identification and legal standing: Proper identification prevents disputes about who has the authority to cancel and receive settlement benefits. Both parties must be clearly identified with verifiable legal capacities and authority to enter into the cancellation transaction.

2. Original agreement details and claims: A detailed recitation of the original transaction and resulting disputes provides the legal context for the cancellation. Specify the original agreement terms, amounts paid, obligations unfulfilled, and claims made by both parties.

3. Dispute history and legal proceedings: Comprehensive coverage of all related legal actions ensures nothing is left unresolved. It is necessary to mention all complaints, police cases, civil suits, and other proceedings that require withdrawal.

4. Settlement terms and payment details: Clear financial arrangements prevent future disputes about settlement obligations. Specify settlement amounts, payment acknowledgements, and any compensation arrangements agreed upon by the parties.

5. Mutual cancellation and releases: Formal termination language with comprehensive mutual releases protects both parties. Ensure that the cancellation is by mutual consent and that both parties release each other from all claims.

6. Future rights and restrictions: Clear statements about future dealings prevent parties from raising new claims or disputes. Address what rights each party retains and what restrictions apply to prevent future disputes.

7. Withdrawal of legal proceedings: A systematic withdrawal of all pending cases ensures a complete legal closure. Provide for the withdrawal of all complaints, police cases, and other legal proceedings, accompanied by proper documentation.

How to use AI to draft a cancellation deed?

Let me walk you through the complete methodology I developed to transform cancellation deed drafting from a hit-or-miss process into a systematic, comprehensive approach that ensures complete legal closure.

Step 1: Teaching AI the legal framework and dispute context

The first step is to establish both the legal foundation and the complete dispute history so AI understands we are creating a comprehensive dispute resolution document, not just a simple agreement termination.

This is my systematic prompt:

“I need to draft a comprehensive cancellation deed for a property purchase dispute involving a buyer who paid money for a flat under a registered agreement but never received possession, leading to multiple legal proceedings, including police complaints and consumer cases. The parties have now agreed to settle with the builder paying a significant settlement amount in exchange for complete cancellation of the original agreement and withdrawal of all legal proceedings. Help me create a comprehensive deed that ensures complete dispute resolution, proper settlement documentation, mutual releases preventing future claims, and systematic withdrawal of all pending legal actions.”

This is the result I received from ChatGPT:

“I understand this requires a comprehensive cancellation deed addressing complex property dispute resolution. For effective drafting, I need complete details about both parties and their legal standing, the original property agreement details and claims made, complete history of all legal proceedings initiated by both parties, specific settlement amount and payment terms agreed upon, detailed property description for clear identification, mutual release requirements to prevent future claims, and systematic withdrawal procedures for all pending cases. This document must provide complete legal closure by addressing the original transaction failure, current settlement arrangement, and future claim prevention while ensuring both parties are fully protected from ongoing litigation risks.”

This foundation ensures every subsequent step serves complete legal closure.

Step 2: Providing comprehensive dispute details

You must provide all relevant information, including complete party details, original transaction records, dispute history, settlement terms, and details of any legal proceedings, so that AI has a clear understanding of the terms.

This is my comprehensive details prompt:

“Here are the complete dispute and settlement details for systematic deed drafting:

The Parties:

Buyer: Mrs. Priya Desai, individual, residing at 15B, Sunrise Apartments, S.V. Road, Andheri (West), Mumbai 400 058
Builder: M/S. ABC Developers Pvt. Ltd., a company registered under the Companies Act, having its office at 25, Business Center, Link Road, Malad (West), Mumbai 400 064

Original Transaction Details:

Property: Flat No. 304, carpet area 580 sq.ft., 3rd floor, building known as ‘Shanti Residency’
Location: Sector 12, New Panvel, Raigad District
Original Agreement: Sale agreement dated 15.3.2015 for ₹45,00,000
Amount Paid: ₹28,00,000 as initial payment
Problem: The Builder never delivered possession despite repeated demands

Dispute History:

Police complaint filed at Panvel Police Station against the builder partners
Consumer complaint No. CC/15642 of 2018 filed before the State Consumer Commission for praying for the delivery of possession of the said flat and damages and other reliefs.
Builder disputed the validity of the original agreement, claiming procedural irregularities

Settlement Terms:

Builder to pay ₹48,00,000 total settlement (₹28,00,000 refund + ₹20,00,000 compensation)
The original agreement is to be cancelled by mutual consent
All legal proceedings are to be withdrawn with no further claims

Legal Proceedings to be Withdrawn:

Police complaint at Panvel Police Station
Consumer complaint pending before the State Consumer Commission
All allegations and counter allegations to be mutually withdrawn

Create a comprehensive cancellation deed that provides complete legal closure while protecting both parties’ interests.”

This is how ChatGPT responded:

“This presents a comprehensive property dispute requiring complete legal resolution through systematic cancellation deed drafting. I’ll structure this deed to include proper legal opening with party identification and authorities, detailed recitation of original transaction and subsequent disputes, complete history of legal proceedings by both parties, specific settlement payment terms with acknowledgment provisions, formal cancellation of original agreement by mutual consent, comprehensive mutual releases preventing future claims, systematic withdrawal of all pending legal proceedings, and proper execution formalities. The deed must ensure complete dispute closure while providing maximum protection for both parties against future litigation risks.”

AI now understands both the legal complexity and specific dispute elements needed for creating effective, comprehensive cancellation documentation.

Step 3: Drafting the formal opening and legal foundation

By incorporating formal legal language, you can ensure that the document is legally sound

Avoid using casual language or treating this as a simple termination. Also, avoid incomplete party descriptions or missing dispute context that could undermine the deed’s legal effectiveness.

My prompt is as follows:

“Based on our dispute details, draft the formal legal opening including: proper deed title as ‘DEED OF CANCELLATION’, execution date and location, complete party identification with Mrs. Priya Desai as ‘PARTY OF THE FIRST PART’, including her address and legal succession provisions, M/S. ABC Developers Pvt. Ltd. as ‘PARTY OF THE SECOND PART’ with company details and legal succession, and comprehensive WHEREAS clauses explaining the original sale agreement, builder’s disputed validity claims, buyer’s police complaints, consumer case filing, builder’s responses by filing written statement and matter is pending, and parties’ desire to settle all disputes amicably.”

This is the result generated by ChatGPT:

“This DEED OF CANCELLATION made at Mumbai this ________ day of ____________ 2024 between MRS. PRIYA DESAI of Indian Inhabitant residing at 15B, Sunrise Apartments, S.V. Road, Andheri (West), Mumbai 400 058 hereinafter referred to as “THE PARTY OF THE FIRST PART” (which expression shall unless repugnant to the context or meaning thereof shall be deemed to mean and include her heirs, executors and administrators) of ONE PART and M/S. ABC DEVELOPERS PVT. LTD. a company duly incorporated under Companies Act and having its office at 25, Business Center, Link Road, Malad (West), Mumbai 400 064 hereinafter referred to as “THE PARTY OF THE SECOND PART” (which expression shall unless repugnant to the context or meaning thereof shall be deemed to mean and include its successors and assigns) of the OTHER PART

WHEREAS (1) THE PARTY OF THE FIRST PART on the basis of the registered Agreement for sale dated 15.3.2015 entered into by THE PARTY OF THE FIRST PART with THE PARTY OF THE SECOND PART claimed to be the purchaser of Flat No.304 of the carpet area of 580 sq.ft on the 3rd floor of the building known as Shanti Residency and situated at Sector 12, New Panvel, Raigad District (hereinafter referred to as “the said flat”) at or for the price and on the consideration as set out therein.

(2) The contentions of THE PARTY OF THE SECOND PART was that the said Agreement for sale dated 15.3.2015 had procedural irregularities and THE PARTY OF THE SECOND PART disputed certain aspects of the said agreement.

(3) In the premises aforesaid, THE PARTY OF THE FIRST PART herein approached the Police Authorities at Panvel and filed a complaint against THE PARTY OF THE SECOND PART, who appeared before the Police Authorities and submitted their Written Submission and contentions.

(4) Thereafter, THE PARTY OF THE FIRST PART approached the Hon’ble Consumer Dispute Redressal Commission, State of Maharashtra and filed a consumer complaint against THE PARTY OF THE SECOND PART, being the original complaint No. CC/15642 of 2018 praying for the delivery of possession of the said flat and damages and other reliefs.

(5) THE PARTY OF THE SECOND PART filed their written statement before the said commission and the said matter is pending.

(6) The parties have settled the matter on the terms that the party of the SECOND PART shall pay to the party of the FIRST PART a sum of Rs.48,00,000/-(Rupees Forty Eight Lacs Only) by way of the return of initial amount of Rs.28,00,000/- (Rupees Twenty Eight Lacs Only) together with a sum of Rs.20,00,000/- (Rupees Twenty Lacs only) as a consideration to put an end to the litigation and to buy peace.

(7) The said parties hereto are desirous of recording the terms and conditions from the said settlement.”

This establishes the proper legal foundation with formal party identification, comprehensive dispute history, and settlement context.

Step 4: Core cancellation and settlement terms

This is very important as it incorporates the essential terms of the agreement, so avoid using ambiguous language about settlement amounts or the scope of cancellation.

This is my prompt for core cancellation terms:

“Based on our established opening, draft the core cancellation provisions using ‘NOW THIS DEED OF CANCELLATION WITNESSETH……’ format, followed by numbered clauses covering the following in a single clause:

The Party of the Second Part is paying ₹48,00,000 to the Party of the First Part in full and final settlement.
This amount includes a refund of the purchase price with interest, and all claims in the consumer complaint no. CC/15642 of 2018.
The parties agree to cancel and treat as null the earlier registered agreement for sale dated 15.03.2015, annexed as Exhibit A.
The First Party confirms that no further claims, rights, or proceedings shall arise regarding the said flat or complaint.
This clause should use typical legal drafting language, formal, repetitive, and declaratory, as used in cancellation deeds or compromise terms before consumer courts.

Write this in a detailed and formal legal style, exactly as seen in actual cancellation or consent terms filed before consumer courts in India.”

This is the result generated by ChatGPT:

“NOW THIS DEED OF CANCELLATION WITNESSETH AND IT IS HEREBY AGREED AND DECLARED BY AND BETWEEN THE PARTIES HERETO AS FOLLOWS:

1] That in consideration of sum of Rs.48,00,000/- (rupees Forty Eight Lacs Only) paid by the THE PARTY OF THE SECOND PART to the THE PARTY OF THE FIRST PART as per the details set out in the recital hereinabove which is paid by THE PARTY OF THE SECOND PART to THE PARTY OF THE FIRST PART on execution of this deed and admission thereof before the Sub Registrar of Assurances (the payment and receipt whereof THE PARTY OF THE FIRST PART hereby admit and acknowledges) in full and final settlement of the claim of THE PARTY OF THE FIRST PART against THE PARTY OF THE SECOND PART towards the refund of the purchase price paid with interest and also in settlement of all the claims of THE PARTY OF THE FIRST PART in the aforesaid consumer complaint. THE PARTY OF THE FIRST PART hereby agrees, declares and confirms that by mutual consent the said registered Agreement for sale dated 15.3.2015 a copy whereof is hereto annexed as Annx.”A” be treated as cancelled and put an end to AND THE PARTY OF THE FIRST PART hereby agrees, declares and confirms and assures THE PARTY OF THE SECOND PART that THE PARTY OF THE FIRST PART shall not raise any claim and/or right in respect of the said flat and also the other reliefs claimed by THE PARTY OF THE FIRST PART in the said consumer complaint No.CC/15642 of 2018 pending before the State Commission. And that the said agreement Ex.A hereto is hereby treated as cancelled by mutual consent and hereby stands cancelled and as nonexistent and no party shall be entitled to raise any claim or initiate any proceedings on the basis of the said agreement Ex.”A hereto. THE PARTY OF THE FIRST PART hereby agrees declares and records that in view of the same the entire claim of THE PARTY OF THE FIRST PART under the said consumer complaint stands settled and nothing is due by THE PARTY OF THE SECOND PART to THE PARTY OF THE FIRST PART.”

This core provision establishes formal cancellation with comprehensive settlement documentation and mutual releases.

Step 5: Legal proceedings withdrawal and future rights

It is essential to establish specific provisions that address the withdrawal of consumer complaints, police cases, and all related legal actions, while clearly defining future rights and restrictions for both parties.

Incomplete withdrawal of legal proceedings can leave parties vulnerable to ongoing litigation. Comprehensive provisions ensure complete legal closure.

Do not leave any legal proceedings unaddressed. Avoid vague language about future rights that could create new disputes.

My prompt is as under:

“Continue with clauses covering systematic withdrawal of legal proceedings and future rights:

Clause 2-Include a clause on withdrawal of consumer complaint No. CC/15642 of 2018 before the State Commission without costs. Include a clause on the withdrawal of the police complaint at Panvel

Clause 3-.Include a declaration that the Second Party is now free to deal with the flat and the First Party has no objection.

Clause 4-Include a mutual declaration that there are no remaining claims and that all disputes are fully settled.

Clause 5- Include a final clause that both parties withdraw all allegations made in the course of the proceedings

Ensure to continue the tone and legal language of the previous results.”

This is the result generated by ChatGPT:

“2] In view of the above THE PARTY OF THE FIRST PART hereby undertakes to withdraw the aforesaid original complaint No. CC/15642 of 2018 pending before the State Commission as settled out of court and with no orders as to the costs. THE PARTY OF THE FIRST PART also hereby agrees to withdraw the criminal complaint filed by THE PARTY OF THE FIRST PART before the Police Authority at Panvel and the said complaint before the Police Authority stands withdrawn and cancelled.

3] In the circumstances hereinabove THE PARTY OF THE FIRST PART hereby declares, confirms and states that THE PARTY OF THE SECOND PART is entitled to deal with and or dispose off the said flat in any manner THE PARTY OF THE SECOND PART may deem fit for which THE PARTY OF THE FIRST PART shall have no objection of any nature whatsoever.

4] The parties hereto hereby admit, confirm, declare, agree and record that with the settlement of the disputes between the parties hereto as recorded herein, neither party has any claim of any nature whatsoever against the other party and the disputes between the parties hereto stand fully settled.

5] The parties hereto hereby withdraw all allegations made by one against other in the pending proceedings before any Judicial Authorities.”

These provisions ensure systematic withdrawal of all legal proceedings and establish clear future rights.

You saw I specifically asked ChatGPT to follow the tone of the earlier results. This is to ensure the same flow of the clauses.

Step 6: Property schedule and execution formalities

The final part of the document involves adding a detailed property schedule with survey numbers and boundaries, as well as proper execution formalities to ensure legal validity

This is my prompt for the property schedule and execution:

“Complete the cancellation deed with property schedule and execution formalities: detailed property schedule describing Draft the property schedule and execution clause for a legal deed involving a flat cancellation or settlement.

Property Details:

Flat No. 304
Carpet area: 580 sq.ft.
3rd floor of the building named Shanti Residency
Located at Sector 12, New Panvel, Raigad District
Built on Survey No. 45, Hissa No. 2, CTS No. 1256
Land area: 2850.5 sq. meters
Falls under New Panvel Municipal Corporation, Registration Sub-District: Panvel, District: Raigad

Boundaries:

North: Survey No. 44, Hissa No. 5, CTS No. 1258
South: Partly by Road and partly by Survey No. 45, Hissa No. 3, CTS No. 1255
West: Partly by Survey No. 45, Hissa No. 1, CTS No. 1250 and partly by Survey No. 45, Hissa No. 4
East: Survey No. 44, Hissa No. 7, CTS No. 1257

Also, add the standard execution clause showing that:

Party of the First Part is Priya Desai
Party of the Second Part is M/s. ABC Developers Pvt. Ltd.
Include standard ‘SIGNED, SEALED AND DELIVERED by… in the presence of…’ phrasing.”

This is the result generated by ChatGPT:

“THE SCHEDULE ABOVE REFERRED TO: Flat No.304 of the carpet area of 580 sq.ft on the 3rd floor of the building known as Shanti Residency and situated at Sector 12, New Panvel, Raigad District and constructed on a plot of land bearing Survey No. 45 Hissa No.2 CTS No.1256 admeasuring about 2850.5 sq mtrs within the limits of New Panvel Municipal Corporation in the Registration Sub District of Panvel and district of Raigad and bounded as follows:- On or towards the North: Survey No.44, Hissa No.5 CTS No.1258 On or towards the South: Partly by Road and partly by Survey No.45, Hissa No.3 CTS No.1255 On or towards the West: Partly by Survey No.45, Hissa No.1, CTS No.1250 and partly by Survey No.45, Hissa No.4 On or towards the East: Survey No.44, Hissa No.7 CTS No.1257

SIGNED SEALED AND DELIVERED by the withinnamed PRIYA DESAI THE PARTY OF THE FIRST PART In the presence of

SIGNED SEALED AND DELIVERED by The withinnamed M/S. ABC DEVELOPERS PVT. LTD. THE PARTY OF THE SECOND PART In the presence of “

These provisions provide comprehensive property identification and proper execution requirements.

Step 7: Final document integration

I will systematically integrate all individual results developed in previous steps into one cohesive, comprehensive legal document ready for execution and registration.

This is my final prompt:

“Combine all the sections we’ve developed, from the formal opening with party identification and comprehensive WHEREAS clauses detailing the complete dispute history, through the core cancellation provisions with settlement payment acknowledgment, systematic withdrawal of all legal proceedings, future rights clarifications, mutual releases, property schedule with complete survey details, and execution formalities, into one complete cancellation deed that flows as a single, comprehensive legal document ready for execution and registration.”

This is the complete cancellation deed as generated by AI.

I have certain modifications in red to make it ready.

This DEED OF CANCELLATION made at Mumbai this ________ day of ____________ 2024 between MRS. PRIYA DESAI of Indian Inhabitant residing at 15B, Sunrise Apartments, S.V. Road, Andheri (West), Mumbai 400 058 hereinafter referred to as “THE PARTY OF THE FIRST PART” (which expression shall unless repugnant to the context or meaning thereof shall be deemed to mean and include her heirs, executors and administrators) of ONE PART and M/S. ABC DEVELOPERS PVT. LTD. a company duly incorporated under Companies Act and having its office at 25, Business Center, Link Road, Malad (West), Mumbai 400 064 hereinafter referred to as “THE PARTY OF THE SECOND PART” (which expression shall unless repugnant to the context or meaning thereof shall be deemed to mean and include its successors and assigns) of the OTHER PART

WHEREAS:

(1) THE PARTY OF THE FIRST PART on the basis of the registered Agreement for sale dated 15.3.2015 entered into by THE PARTY OF THE FIRST PART with THE PARTY OF THE SECOND PART claimed to be the purchaser of Flat No.304 of the carpet area of 580 sq.ft on the 3rd floor of the building known as Shanti Residency and situated at Sector 12, New Panvel, Raigad District (hereinafter referred to as “the said flat”) at or for the price and on the consideration as set out therein.

(3) In the premises aforesaid THE PARTY OF THE FIRST PART herein approached the Police Authorities at Panvel and filed a complaint against THE PARTY OF THE SECOND PART who appeared before the Police Authorities and submitted their Written Submission and contentions.

(4) Thereafter THE PARTY OF THE FIRST PART approached the Hon’ble Consumer Dispute Redressal Commission State Maharashtra and filed a consumer complaint against THE PARTY OF THE SECOND PART being the original complaint No. CC/15642 of 2018 praying for the delivery of ~~the~~ possession of the said flat and damages and other reliefs.

(5) THE PARTY OF THE SECOND PART filed their written statement before the said commission and the said matter is pending.

(6) The parties have now settled the matter on the terms that the PARTY OF THE(just made this in uppercase) SECOND PART shall pay to the PARTY OF THE(just made this in uppercase) FIRST PART a sum of Rs.28,00,000/-(Rupees Twenty Eight Lacs Only) by way of the return of initial amount of Rs.8,00,000/- (Rupees Eight Lacs Only) together with a sum of Rs.20,00,000/- (Rupees Twenty Lacs only) aggregating to Rs.28,00,000/-(Rupees Twenty Eight Lacs Only) as a consideration to put an end to the litigation and t~~o buy peace~~ settle all disputes amicably.

(7) The said parties hereto are desirous of recording the terms and conditions of ~~from~~ the said settlement.

NOW THIS DEED OF CANCELLATION WITNESSETH AND IT IS HEREBY AGREED AND DECLARED BY AND BETWEEN THE PARTIES HERETO AS FOLLOWS:

1] That in consideration of sum of Rs.28,00,000/- (rupees Twenty Eight Lacs Only) paid by the THE PARTY OF THE SECOND PART to the THE PARTY OF THE FIRST PART as per the details set out in the recital hereinabove which is paid by THE PARTY OF THE SECOND PART to THE PARTY OF THE FIRST PART on execution of this deed ~~and admission thereof before the Sub Registrar of Assurances~~ (the payment and receipt whereof THE PARTY OF THE FIRST PART hereby admit and acknowledges) in full and final settlement of the claim of THE PARTY OF THE FIRST PART against THE PARTY OF THE SECOND PART ~~towards the refund of the purchase price paid with interest and also in settlement of all the claims of THE PARTY OF THE FIRST PART in the aforesaid consumer complaint~~, THE PARTY OF THE FIRST PART hereby agrees, declares and confirms that by mutual consent the said registered Agreement for sale dated 15.3.2015 a copy whereof is hereto annexed as Annx.”A” be treated as cancelled and put an end to AND THE PARTY OF THE FIRST PART hereby agrees, declares and confirms and assures THE PARTY OF THE SECOND PART that THE PARTY OF THE FIRST PART shall not raise any claim and/or right in respect of the said flat and also the other reliefs claimed by THE PARTY OF THE FIRST PART in the said consumer complaint No.CC/15642 of 2018 pending before the State Commission. And that the said agreement Ex.A hereto is hereby treated as cancelled by mutual consent and hereby stands cancelled and as nonexistent and no party shall be entitled to raise any claim or initiate any proceedings on the basis of the said agreement Ex.”A hereto. THE PARTY OF THE FIRST PART hereby agrees declares and records that in view of the same the entire claim of THE PARTY OF THE FIRST PART under the said consumer complaint stands settled and nothing is due by THE PARTY OF THE SECOND PART to THE PARTY OF THE FIRST PART.

2] In view of the above THE PARTY OF THE FIRST PART hereby undertakes to withdraw the aforesaid original complaint No. CC/15642 of 2018 pending before the Hon’ble State Dispute Redressal Commission as settled out of court and with no orders as to the costs. THE PARTY OF THE FIRST PART also hereby agrees to withdraw the criminal complaint filed by THE PARTY OF THE FIRST PART before Police Authority at Panvel and the said complaint before the Police Authority stands withdrawn and cancelled.

4] The parties hereto hereby admit, confirm, declare, agree and record that with the settlement of the disputes between the parties hereto as recorded herein neither party has any claim of any nature whatsoever against other party and the disputes between the parties hereto stands fully settled.

5] The parties hereto hereby withdraw all allegations made by one against other in the pending proceedings before any Judicial Authorities.

IN WITNESS WHEREOF the parties have executed this Deed of Cancellation on the day and year first above written.

THE SCHEDULE ABOVE REFERRED TO:

Flat No.304 of the carpet area of 580 sq.ft on the 3rd floor of the building known as Shanti Residency and situated at Sector 12, New Panvel, Raigad District and constructed on a plot of land bearing Survey No. 45 Hissa No.2 CTS No.1256 admeasuring about 2850.5 sq mtrs within the limits of New Panvel Municipal Corporation in the Registration Sub District of Panvel and district of Raigad and bounded as follows:- On or towards the North: Survey No.44, Hissa No.5 CTS No.1258 On or towards the South: Partly by Road and partly by Survey No.45, Hissa No.3 CTS No.1255 On or towards the West: Partly by Survey No.45, Hissa No.1, CTS No.1250 and partly by Survey No.45, Hissa No.4 On or towards the East: Survey No.44, Hissa No.7 CTS No.1257

SIGNED SEALED AND DELIVERED

by the withinnamed

PRIYA DESAI

THE PARTY OF THE FIRST PART

In the presence of

SIGNED SEALED AND DELIVERED

by The withinnamed M/S. ABC DEVELOPERS PVT. LTD.

THE PARTY OF THE SECOND PART

In the presence of

Conclusion

Using AI to draft a cancellation deed revolutionises how lawyers and law students approach complex dispute resolution.

By employing precise, structured prompts, you can produce a comprehensive, legally robust cancellation deed in under 30 minutes, a process that traditionally takes days and significant legal fees.

AI streamlines the drafting of critical components, from party identification to settlement terms and withdrawal of legal proceedings, ensuring no detail is overlooked.

However, AI is a tool, not a substitute for legal expertise.

Always review and refine AI-generated drafts to align with the law.

Frequently Asked Questions (FAQs)

1. What are the risks of using AI to draft a cancellation deed?
AI may generate incomplete or incorrect clauses, misinterpret legal nuances (e.g., registration requirements), or omit critical details like witness signatures. To mitigate risks, use specific prompts, verify outputs against statutes like the Indian Contract Act, 1872, and consult local Sub-Registrar rules or a senior advocate, as emphasised in the article’s review process.

2. Is registration mandatory for a cancellation deed in India?
Yes, cancellation deeds for immovable property agreements, like the sale agreement in the article, typically require registration under section 17 of the Registration Act, 1908, to be legally enforceable.

3. What should I do if AI generates incorrect legal terms?
If AI uses incorrect terms (e.g., vague settlement language), refine the prompt to specify formal legal language, as shown in the article’s Step 4 prompt. Cross-reference the output with bare acts (e.g., Indian Contract Act, 1872) and case law, and make manual edits, as the author did with red-marked corrections.

4. Can I use AI tools other than ChatGPT for drafting?
Yes, while the article uses ChatGPT, other tools like Claude, Perplexity, or legal-specific platforms (e.g., LexisNexis AI) can be effective with similar prompting strategies. Ensure the tool supports detailed inputs and produces formal legal language suitable for cancellation deeds

5. How do I protect client confidentiality when using AI?
Avoid inputting sensitive client data (e.g., Mrs. Desai’s address) into public AI platforms to prevent confidentiality breaches. Use anonymised facts (e.g., “Buyer” instead of names) or secure, legal-specific AI tools, and review platform privacy policies before use.