• When does penalty clause come into play?

Hi Guys

I have penalty clause in my flat purchase agreement for RS. 5/sqfeet. I have date of possession mentioned as 15 months from date of booking. I need to know if penalty clause will come into play after 15 months or 15 + 6 =21 months (6 months relaxation from govt to builder).

Please assist me with the answer, thanks
Asked 7 years ago in Property Law
Religion: Hindu

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11 Answers

Hello,

If there is a penalty clause that if the possession is not given within 15 months then the penalty will be imposed on expiry of 15 months from the date of allotment.

Also, please clarify that 6 month relaxation have been given by the government to all the builders to specific builders whose projects are not running on time.

Regards

Anilesh Tewari
Advocate, New Delhi
18090 Answers
377 Consultations

It will come int play after 21 months.

Vibhanshu Srivastava
Advocate, Lucknow
9659 Answers
307 Consultations

It is necessary to peruse agreement to advise

2) penalty clause would be applicable after 21 months

Ajay Sethi
Advocate, Mumbai
96803 Answers
7810 Consultations

Yes, after relaxation period of 6 months the ie.e21 months you are eligible fro penalty .

The penal amount can be adjusted with your remaining balance at the time of making final payment on registration.

If the builder refuses to honour this clause of the agreement you can file case beofre the consumer forum and seek payment of this money including damages and compensation.

Devajyoti Barman
Advocate, Kolkata
23198 Answers
510 Consultations

6 months normally added up for the delay due to unforeseen reasons. So the days for penalty should be calculated after the completion of 21 months

Vimlesh Prasad Mishra
Advocate, Lucknow
6852 Answers
23 Consultations

It will be after 15 months as in agreement

Varnika Singh
Advocate, New Delhi
327 Answers
2 Consultations

If there is no proviso in the agreement then the penalty clause will come in action immediately if possession not given within the 15 months.That is grace period of 6 months then the penalty clause will commence after the expiration of this additional 6 months. According to Section 73 of the Indian Contract Act all the terms and condition of the contract will be interpreted in favour of the buyer. The Supreme Court has held in Renuka Enterprises that terms of the contract will be strictly interpreted and benefit of doubt will always given to the buyer.

Shivendra Pratap Singh
Advocate, Lucknow
5127 Answers
78 Consultations

Hi, the clause of penalty comes in to existence generally after the date of posession, and relaxation period is considered only if the delay is caused by any act of GOD or by any government regulations..

Hemant Chaudhary
Advocate, Gurgaon
4630 Answers
67 Consultations

1. Unless there is a specific provision made in the agreement for the penalty clause to be applicable otherwise, it will be applicable after 21 months.

2. Consult a lawyer with a copy of the agreement.

Ashish Davessar
Advocate, Jaipur
30763 Answers
972 Consultations

in what situation 15 + 6 exception will arise. that also to builder, not u .

15 months, precisely shall be advised on perusal of clause.

Yogendra Singh Rajawat
Advocate, Jaipur
22987 Answers
31 Consultations

You go through the sale agreement and ther terms and conditions once again properly, you will find that the builder would have mentioned about the grace period of 6 months therein.

If there is no mention about it then you may claim the penalty invoking the clause on expiration of the period mentioned therein, let him come out with his defence.

You can contemplate legal action after getting his reply.

T Kalaiselvan
Advocate, Vellore
87004 Answers
2335 Consultations

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