the terms of agreement are clear if buyer fails to make payment within period of one year bayana would be forfeited
2) you are at liberty to sell your land to third party
3) not necessary to refund the earnest money paid by purchaser
Validity of "Bayana" agreement
We had made a bayana(unregistered) agreement of selling an agricultural land to a party one year ago. The buyers gave us a token guarantee money equivalent to 4.2% of the total sale value. The agreement included the clause that if the buyer fails to give the rest of the money within the 1 year time, their token money (bayana) will be forfeited. After one year, at the decided time of sale deed registration, the buyers did not come to complete the sale deed, did not pay any further amount and also not picked up our phone calls. Now, after 6 months of that incident, when we have made an agreement with another party to sell the same land, the previous buyers are asking us to return back their token money. I want to ask if it is right on their part to keep our land blocked for 1 year, not respond to our calls, do not fulfil the sale deed and now ask for return of token money despite of the forfeiting clause in the concerned agreement? Please tell, what should we do.
Asked 8 years ago in Property Law
Religion: Hindu
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4 Answers
1. Since there is a forfeiture clause then you have legal right to forfeit the money.
2.however if they are adamant then they may to avoid losing this money file suit in court and make the proeprty litigated.
3. So be cautious to avoid the litigation and return the money on the condition that they cancel the agreement.
4. So get their signature on a cancellation agreement and then enter into a sale agreement with a new buyer.
5. DO not complicate on the issue of forfeiture of money. It will cause more harm to you than giving any gain.
You have no right to forfeit the amount received as advance. Since this is an unregistered agreement, the agreement may be considered as a receipt for the money received by you.
As this agreement is not enforceable in law you may have to refund the amount received as advance with deductions towards some standard expenses
Whether they have responded to your call or not, they are within the limitation period seeking refund of money deposited with you, hence you have to legally honor their demand.
Hello,
If you still have little of the land you can go to the registrar office and sell the land to any person who so desires. The validity of such agreement in the eyes of law is void and they do not have any right to keep your property.
Regards
