You are not bound to extend the agreement as time was essence of contract 

2) refuse to extend the agreement and refund 60 per cent of money received by you 

Hello, 

No this will not make any problem. 

However, if you do not want to extend the term of the agreement you may go ahead and do the same and refundthe amount that has been given by him. 

Regards  

Dear Sir,

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.

The agreement for sale is valid for three years. If there is a negative clause in the agreement, say, the buyer has to register the property within three months’, then, the limitation is extended by such period.
It is in your interest you comply with the following in spite of negative clauses favoring you found in the agreement:
If sale is not registered, then, you have to issue notice of revocation and cancellation of agreement even though the agreement is cancelled by flux of time. Validly cancel the agreement. It is always advisable to do this. 
It all depends on the clauses framed in the agreement. 
It is always good to refund the advance taken.
There are many citations from various courts of law. 

1.  IF you have received 60% cost of the property, THEN it is okay to wait for a few more months.  HOWEVER, strictly do not execute final Sale Deed, till you receive 100% payment.

2. Make fresh "agreement of sale" (not Sale Deed), with proper old clauses and upto date payments received and with condition that earlier payment will be forfeited after so and so date, for failure to give 100% payment and sale deed execution.

3.  IF property has FIL's name then Wife's name must be mutated on ROR, for clear title.  The local estate agent will be able to clear this at the office of ROR.

1. To cancel an agreement it is not much material how much money has been paid to the seller as long as the advance or earnest money is refunded.

2. So if you wish to go ahead with the deal then ask him to pay you 80% of total price and remaining at the time of registration of the sale deed.

3. If not then send him a a cancellation notice after only after expiry of the period mentioned in the sale agreement and after sending notice to complete the purchase within the stipulated time. While sending the cancellation notice refund the money as well. 

If in case the documents are not proper then tell him that you will get the same corrected. 

Regards 

Is there any default clause, if he failed to make payment/register sale deed with in this period, his payment will forfeit and agreement will revoke ?

Well don`t agree for extension and agreement is expired by efflux of time. He is just excusing that ROR is not proper.

You are free to forfeit advance. No legal complications.

1) you have given inspection of all original documents 

2) refund 20 per cent received by you to avoid lengthy litigation process 

3) time was essence of contract and purchaser failed to make balance payment within period of 3 months 

Yes you need to repay the same as per penalty clause if present in said agreement if you break the same

1.  AS long as you are holding the 60% money, the opposite person is not in a position to dictate his terms.

2. HOWEVER, you also have a prudent & legal responsibility to clear the mutation entries in the ROR, from name of FIL to name of Wife.

3.  Do the point no. 2, thru a local estate agent or thru a local property lawyer.  This will be easy and quick.

If you have completed the second clause the agreement that you have to provide all the necessary documents and you have provided and after the expiry of the agreement you man payback the balance amount keeping after 20% as advance to the party and you cannot be forced to extend the agreement on this basis if the party is not willing to get the property registered Bell within the agreement period the performance of the agreement lies in case of this seller itself in that case

See you can issue a legal notice give him 15 days time to make complete payment and register the flat in case he fails then in that case you can cancel the agreement and can refund the amount by deducting the reasonable expenses and damages for 6 months.

See he has signed agreement by looking at all the documents so he cannot raise dispute now just to delay. 

It's all depends on you. either you want to cancel the said agreement then you can cancel and refund. If you want to extend then better execute fresh agreement through an property lawyer. 

Since the agreement period has expired, you may cancel the agreement and return the booking or advance amount after deducting the administrative cost.

Instead of arguing with him for no use because he may keep extending the period of agreement, you may better look for another buyer and cancel this agreement.

The clause for not returning the advance amount may not be maintainable in law, you may have to return the amount if the agreement is cancelled for any reason.

Dear client 

In this case you have to go according to the agreement and can cancel the agreement but for that first you have to give application in tehsil for registration of property in buyer name.  And send the summon to buyer through sub registrar.

And if he doesn't appear there or raise some objection you can remove objection in the office of sub registrar and still he try to postpone registration then after that you can cancel the agreement for non compliance of terms of agreement. 

For that you have to return his money except 20% mention on the agreement.