• Token advance for rental property

I have recently saw a rental property listing and was interested in it. After discussing with the owner on the rent and advance, i have transferred a sum of INR 10,000 as token advance and discussed that the balance advance amount will be paid after the agreement is signed. I have requested the owner to share the agreement draft to go thru it. Owner has mentioned a 10% rent increase after every 11 months and he was asking to do service maintenance of the air conditioners which he was providing in the house twice every year. 10% increase was not the standard in that area and i have proposed an increase of INR 500 every year which everyone else is paying that locality. I also felt having his air conditioners in the house is a liability to me and have asked him to remove them and requote the rent. Owner did not agree to my terms and has asked me to take the decision. Since the negotiation did not happen, i felt that the overall cost towards the rent is high and have informed the owner that i will withdraw. The owner now says that he will not transfer the token advance amount mentioning token advance rule. We have not entered into any agreement nor it was not mentioned anywhere during our discussions. All the above discussion happened in a span of 2 days time. I want to know whether any such rule exists? if not how to proceed to get my money back. I have transferred the money thru bank money transfer directly to his account.
Asked 4 years ago in Property Law
Religion: Hindu

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12 Answers

1. The actions of the landowner is purely illegal as since the agreement was not completed and it was in the negotiation stage only he is bound to return the advance money paid to him.

2. So send him a a legal notice seeking refund of your money as under n circumstances once the agreement is not completed he can not withhold or forfeit the advance money.

3. If he does not return then file a case of cheating with the local Police as once FIR is registered you can expect your money soon.

4. There is remdey of civil suit also but the same is not cost effective.

Devajyoti Barman
Advocate, Kolkata
22515 Answers
402 Consultations

5.0 on 5.0

1. A Advance amount for any transaction classifies as a Returnable & Adjustable Liability to the person who receives it. There is no such thing as forfeiture. All these things are village-dominated-mentality to usurp other peoples money.

2. File a Police FIR, requesting investigation and charge-sheet, for offences like cheating, intimidation, fraud against the Land Lord supported with all relevant available documents.

3. IF the Police does not take action, THEN you can file private criminal case u/s 156(3) Cr.P.C., in the local Magistrates court, seeking directions to the Police to investigate and file charge sheet. The Land Owner may come down for settlement.

Keep Smiling .... Hemant Agarwal

Hemant Agarwal
Advocate, Mumbai
5612 Answers
25 Consultations

5.0 on 5.0

Firslty, as you have stated in your query that you have transferred the amount into the bank account.

Secondly, after this, the owner can’t deny the acceptance of money.

Thirdly, agreement was not signed between you and him, whcih means he can’t say that you have violated the terms and condition of the agreement.

Fourthly, though he may be right for advance token rule, but the same should have some logical reasoning as in terms of increase in the rent.

Fifthly, he is charging too high amount which is not been taken by anyone in the area.

Fifthly, I advice you to challenge the same before the Civil court of law.

Sanjay Baniwal
Advocate, South Delhi
5464 Answers
13 Consultations

5.0 on 5.0

Owner should refund advance as their is no forfeiture clause

You have not signed any agreement with flat owner

Issue legal notice to owner to refund your money

Ajay Sethi
Advocate, Mumbai
87947 Answers
6207 Consultations

5.0 on 5.0

There is no such rule where he wants to forfeit your money. Send him legal notice asking refund of amount paid by you if he refuses lodge a police complaint for breach of trust and civil suit for recovery of money if the amount is paid through your account.

Swarnarka Chowdhury
Advocate, Mysore
1878 Answers
5 Consultations

5.0 on 5.0

Sir issue a legal notice to the owner for the refund of your amount, there is no rule to forfeit the advance further if on notice the owner fails to pay a summary suit has to be filed before the civil court(small cause court) for the refund of the amount.

Further file a police complaint though case is of civil nature though police can help you on complaint.

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

there is no such rule

if the deal did not happen then the owner ought to refund your token, however without any interest

please issue him a legal notice for refund

Yusuf Rampurawala
Advocate, Mumbai
6882 Answers
79 Consultations

5.0 on 5.0

you can issue a legal notice to the landlord for refunding your token money. If there is no response, you file a case against the landlord and take him to the court.

Mohammed Mujeeb
Advocate, Hyderabad
19031 Answers
32 Consultations

4.5 on 5.0

There is no such rule. As there is no written rental agreement, it is not fair on his part to forfeit the advance sum. You may send him a legal notice demanding refund, and if there is no positive development, file a suit.

Swaminathan Neelakantan
Advocate, Coimbatore
1923 Answers
20 Consultations

4.9 on 5.0

1. There is no such rule

2. file a FIR against the person for taking your money illegally.

Regards

Anilesh Tewari
Advocate, New Delhi
17940 Answers
377 Consultations

5.0 on 5.0

1. It is a wrong and unwise practice to readily transfer the amount to the landlord. It should be done only at the time of signing of the agreement after perusing the agreement.

2. Now you should file a FIR under Section 406 IPC for criminal breach of trust against him. He has no right to retain the token as agreement was not signed in the first place.

Ashish Davessar
Advocate, Jaipur
30761 Answers
971 Consultations

5.0 on 5.0

If the rental agreement could not be concluded due to the said reasons, you may insist the owner to return the advance amount politely, if he is refusing then issue a legal notice seeking refund and also compensation for the mental stress cause by him due to this, you can endorse a copy of this complaint to the local police inspector after which you can lodge a criminal complaint for the offences of cheating and breach of trust agaisnt the owner besides filing a civil suit for recovery.

T Kalaiselvan
Advocate, Vellore
78104 Answers
1543 Consultations

5.0 on 5.0

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