Terms of agreement are sacrosanct
2) you are not liable to make any advance payment if not provided in agreement
3) builder cannot impose penalty on you
4) it is necessary to peruse terms of agreement to advice further
Builder demanding advance payment before actual slab completion
Hi, We reside in Hyderabad, Telangana. We booked a property that comes under RERA and have already registered our agreement of sale. As per our agreement of sale, the payment structure is something as below - 2nd Instalment Completion of Cellar Slab (15%) 3rd instalment on completion of 5th floor slab (25%) As per the above, I, as the allottee, understand that once the builder completes a particular slab (say cellar slab) for the entire project, he should ask for the 15% and also, the 5th floor slab should be completed for the entire project and then the 25% should be asked based on the above 2 installment statements. Currently, the builder is completing a part of the entire project and demanding payment. They are now also asking for part payment to be released to complete slabs upto the 5th slab (they are yet to complete 5th slab). For this advance payment they are asking us to pay 15% (out of 25%) and remaining 10% we need to pay after 5th slab is completed. And they're saying that after certain number of reminders, they'll charge some penalties. My queries are - 1. Are we compelled to make this advance payment as this is an out of agreement payment? We do not wish to make unless the 5th slab is completed. I've already communicated the same to them but they're sending me multiple reminders. If i refuse to pay this out of agreement advance payment, can they levy a penalty on us? Do they have a legal claim to ask for a partial payment out of the pre decided slab disbursement schedule and if not, would we be legally bound to pay given that the agreement is ambiguous on the terms of said slab based disbursement? 2. As per the above given payment schedule, can they ask us for release of payments block wise? Does it conform to RERA or legal rules? Please advise. Thanks in advance.
Asked 6 years ago in Property Law
Religion: Hindu
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8 Answers
1. If you have received the demand notice in writing, then you may issue a suitable reply stating that the payment towards different stages can be made only as per the conditions of the agreement.
You can invoke the particular clause which states the mode of payment at different stages and inform the builder that you would drag him to consumer court for his unjustified demand and insisting payment even before it became eligible or if the builder is levying any penalty on this.
2. You do not have to refer to RERA rules, you can refer to the agreement entered between you and the builder and invoke the clause which is governing the payment at different stages.
1. Unless and until there is change in the terms of the agreement done mutually, none of you can resile from ti and hence demand of the builder to pay even a art of it before the completion of certain portion of the construction is unlawful and not tenable.
2. So there is no question of levying any penalty if you refuse to make any payment before the completion of 5th slap and of they do the same is unfounded.
3. SO send them a notice seeking recall of their demand letter and in case of imposition of any penalty later on you have the option of redressing your grievances from consumer forum which would even take care of your damages and compensation as well.
1. See builder cannot seek amount in advance he has to demand and levy penalty as per the agreement only in case any penalty is arbitrarily charged you can file a consumer complaint or a RERA complaint against the builder.
2. Yes if your block is completed and same is mentioned in agreement they can seek amount accordingly.
I understand your grievance and this a usual case of fraudulent practices, practiced by the builders these days. It is advised that you immediately serve them a legal notice to secure your interest.
NO. Complain to RERA and if builder insist, can withdraw and ask for refund with interest. No penalty can be imposed and will be illegal demand.
Payment term will restrict as per agreement -
1. No it is not mandatory to give part payment even after several reminders but you should refuse to pay part payment to builder in written.
2. builder cannot charge penalty for prepayment which was not mentioned in your agreement.
3. Yes builder can ask you to release payment on every slab as mentioned in the agreement which is signed by you.
1. No.
2. Only if the agreement says so. Rera can't go against the terms of signed agreement
