• Can we cancel a agreement of sale as a buyer.

Hello, 

I have done a sale agreement with an assignor of a flat through a property dealer. On this flat assignor is having a GPA. At the time of agreement I was not aware of that assignor is an NRI (he is in US). I paid the 20% amount for sale agreement. Now during documentation I got to know that he is an NRI. He is not willing to pay the TDS amount. On the basis of that I have told the property dealer that I don't want to do this deal anymore as he is not paying the TDS.

Now I am worried about the amount that I had paid and I don't know the procedure of cancellation of sale agreement. 

Please suggest.
Thanks!
Asked 5 years ago in Property Law
Religion: Hindu

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17 Answers

Just send a notice to the seller that you will continue with sale agreement only if he's ready to pay the TDS amount or else you will cancel the agreement and that he should pay back the entire amount. If he denies to repay the amount you can file civil suit for recovery of money with interest. It's necessary to see the terms of agreement before sending notice.

Swarnarka Chowdhury
Advocate, Mysore
1879 Answers
5 Consultations

5.0 on 5.0

Sir give a legal notice to the said seller that he is willing to skip TDS that is legally incorrect though you are liable to deduct the TDS as he showing his unwillingness for same you are cancelling said agreement and ask refund along interest.

If the seller fails for same you have to file a civil suit for recovery and cancellation.

Shubham Jhajharia
Advocate, Ahmedabad
25514 Answers
179 Consultations

5.0 on 5.0

The cancellation of an agreement to sell (sale agreement) depends on the terms mentioned in the agreement. As per Indian contract act, commonly most of the agreement time is the essence of that contract. The vendor and vendee entered in to a contract, both of them ought to have obeyed the terms of the agreement. If any one of the person not fulfill the contract the other one has every right to withdrawn from that contract. In the case of a sale agreement since the purchaser has failed to comply with terms and conditions of the contract the seller has liberty to cancel the agreement and vise verse. You can file case under specific relief act for getting advance amount from seller .

Please note that an Agreement for sale cannot create claim for title. If the Vendee does not fulfill the terms of the Agreement then Vendor by serving a legal notice can cancel the agreement even if it is registered and can sell the property to any other person.An agreement whether registered or not can be cancelled on breach of its terms. Also noted that The buyer has to deduct TDS at 1% of the total sale consideration. Note that the buyer is required to deduct TDS, not the sellerNo TDS is deducted if sale consideration is less than Rs 50lakhs. If installments are being paid TDS has to be deducted on each installment.

Ajay N S
Advocate, Ernakulam
4073 Answers
111 Consultations

5.0 on 5.0

What were terms and conditions of agreement fir sale ?

2) you ha ve to deduct TDS at 20.66 per cent as seller is an NRI

3) mention reasons for cancellation and seek refund of money paid by you

4) if seller refuses to refund your money sue the seller to recover your money with interest

Ajay Sethi
Advocate, Mumbai
94732 Answers
7537 Consultations

5.0 on 5.0

Better u seek the detailed consultation by disclosing complete details with agreement copy in this case, so that exactly can be suggested to do

Mohammed Mujeeb
Advocate, Hyderabad
19299 Answers
32 Consultations

4.7 on 5.0

1. If the sale agreement was a registered one, adequately stamped, then a registered cancellation deed has to be done.

2. On the other hand, if the sale agreement was not a registered one, then, with the help of the property agent and the witnesses, you can get back your advance amount and cancel the sale agreement.

3. As per your narration, the assignor is not willing to pay the TDS amount and it is the statutory obligation of the seller to agree for deduction of the TDS amount. This amounts to breach of contract.

4. Send a legal notice to the assignor to return your 20% advance amount paid towards the sale of the property.

Shashidhar S. Sastry
Advocate, Bangalore
5117 Answers
314 Consultations

5.0 on 5.0

There is no point of cancellation of sale agreement on the basis of the other party is not agreed for TDS it is your obligation to detect the TDS from the payout if it is more than 50 lacs and deposit to the income tax authorities in case the other party is not agree to you can go for specific performance of agreement to the court and deduct the amount pay the amount to to the court and balance amount of TDS to the income tax authority there is nothing wrong in this agreement you can go ahead and get the registration of property done through the court

Vimlesh Prasad Mishra
Advocate, Lucknow
6852 Answers
23 Consultations

4.9 on 5.0

Dear,

20% you paid is a token money, then it is difficult to get it back.

Because you want to cancel this deal not seller.

Talk to builder and request him for money.

It is a agreement for sell not sell so it's your right to cancel it any time.

Tarun Agarwal
Advocate, Jaipur
769 Answers
3 Consultations

4.9 on 5.0

Dear Sir,

Just issue an legal notice and saying that the sale agreement stand cancelled due to non disclosure of TDS payment terms and ask him to refund the advance amount failing which you can recover advancement amount with interest.

Kishan Dutt Kalaskar
Advocate, Bangalore
6136 Answers
487 Consultations

4.8 on 5.0

Dear Client,

June 2013, regulation mandates that on sale of property exceeding Rs. 50 lakhs in India, a tax of 1% has to be deducted on the total sale consideration before making the payment to the seller. The buyer must then deposit this 1% TDS to the Government.

You deduct from the total amount if seller not agree than ask for refund and file criminal complain.

Yogendra Singh Rajawat
Advocate, Jaipur
22636 Answers
31 Consultations

4.4 on 5.0

You can intimate your intention to said agreement through legal notice. Tell them that the complete information was concealed by agent. You can claim refund from them

Prashant Nayak
Advocate, Mumbai
31951 Answers
179 Consultations

4.1 on 5.0

seller is not required to pay TDS

the buyer has to deduct TDS from sale consideration

Yusuf Rampurawala
Advocate, Mumbai
7515 Answers
79 Consultations

5.0 on 5.0

Sir on this terms since the vendor is legal incorrect and trying to skip TDS you are entitled.to.refund with interest give a legal notice stating you are ready to pay rest of sum and deduct TDS on sell if seller is not ready in week he shall pay damages along interest and refund.

Shubham Jhajharia
Advocate, Ahmedabad
25514 Answers
179 Consultations

5.0 on 5.0

As i said go ahead with the purchase and it is mandatory on you to deduct the TDS.

Yogendra Singh Rajawat
Advocate, Jaipur
22636 Answers
31 Consultations

4.4 on 5.0

You can terminate agreement only if title is not clear and marketable or if seller fails to furnish documents desired by you

If seller is refusing to permit deduction of TDS which is statutory requirement agreement can be terminated

Ajay Sethi
Advocate, Mumbai
94732 Answers
7537 Consultations

5.0 on 5.0

Yes may ask the agent to go for cancellation of the same on the second point of cancellation that is available to you

Anilesh Tewari
Advocate, New Delhi
18078 Answers
377 Consultations

5.0 on 5.0

If the assignees find out any legal defect in the property before execution of Deed of sale.

You may interpret it to the wider sense that the fact that he was the NRI was not told and as such the consent was taken by presenting false facts.

Regards

Anilesh Tewari
Advocate, New Delhi
18078 Answers
377 Consultations

5.0 on 5.0

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