Hello, I have booked a flat in Pune from a reputed builder. I paid 5% booking amount at the time of booking by cheque mode. Have got reciepts for same. However, after payment I got to know about some pending litigations on project land. The same was found in the title search report recieved from the builder, when I insisted on the docunents. When I enquired about the litigations, i did not get any satisfactory reply. And now recently the buyers who have done agreement and registration, have been getting some legal notices from one of the plentiffs. Seeing this i decided to opt out of the project and conveyed them the same with reasons. I am told by them that whatever i have paid as booking amount would be forfeited if i cancel the booking. I am concened now as there is no agreement or any MoU between us that allows them this forfeiting of booking amount. There was only a mention of it in the application form filled while booking, that if buyer cancels then upto 20% of cost of flat will be deducted. But same terms also say that its just an offer and does not form an agreement or allotment. What are my chances of getting my money back on grounds of illicit trade practice of builder. What approach should i take to get my money back?
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1) if title of builder is not clear and marketable you are at Liberty ti cancel the booking and seek refund of money paid by you with interest
2) if builder fails to pay file complaint before consumer forum and seek refund with interest, litigation costs and compensation for mental torture undergone by you
it is settled law that an allotment/booking of flat does not give and right and liability to either party. you have right to cancel this allotment and get full refund. a formal agreement is also not signed therefore builder has no right to forfeit this amount. in Ram avtar vs Sandini construction 1987 AIR supreme court has held that builder has no right of forfeiture if only allotment amount is paid because construction is not initiated only on said amount. unless and until a large part of consideration is paid and construction is about to complete, builder has no right of forfeiture
A buyer should exercise utmost caution while buying property in India. Buying a flat that is under construction is often very risky.
Title deed is the most important document as it gives details about ownership, rights, obligations and mortgages on the property. So it validates whether the land where the project is coming up has been registered and development rights transferred. Get a copy of it from the builder and cross-check the information with the land record office. If the title of the property is disputed then better to cancel the booking.
Send a legal notice and ask the refund ,if they fails to give back the approach the consumer forum
1. The doctrine of buyer beware operates against you. You were to conduct due diligence before the remittance of booking amount. If the title search report delivered by the builder explicitly mentions the pendency of lis then there is no suppression of facts by him. Even a property which is subject matter of a hotly contested litigation can be sold if there is no injunction ordered by the civil court, albeit the title conveyed by the seller would be subject to the outcome of the case.
2. If the application form has a mention of the forfeiture of 20% of booking amount then the builder cannot deduct more than this.
3. The offer ripened into a contract once you filled it up and paid the booking amount.
You can issue a legal notice to the builder intimating that you are cancelling the booking and to refund the entire booking amount.
The reason you may quote for cancelling the booking is that the builder is not having marketable title to sell this property.
You can inform in the notice itself that if he is not refunding the booking amount within 7 days he will dragged into consumer forum for relief and remedy and also for proper compensation.
