• Assured returns on commercial property

 I am investing in a commercial project under PBRERA as devloper offering good %age Assured returns and I have already paid 50% of the total amount but agreement is still pending due to outbreak of Covid 19. Now they sent me a draft agreement but in which ,they didn't mentioned about assured return . When I asked them they told they will give me that in a separate letter of company head they also told that They are unable to give in writing on RERA agreement. I want to know:-
 1.That a letter of company head is sufficient in case of any future problem to get returns.
 2. Is it true that assured return can't be mention in RERA agreement. if yes, than what action should I have taken for future safety. 
 3.What happen if I disagree with thier condition and asked for return back my money which is a big amount.
 Please help me

Asked 4 years ago in Property Law
Religion: Hindu

2 answers received in 10 minutes.

Lawyers are available now to answer your questions.

20 Answers

In any type of investment none of company will give you assured returns. If they make advertisement of assured return of any type of investment but in Disclaimer of the brochure or company letter head they may mention "subject to risk of market risk etc"

"Market risk. Market risk is the risk of losses on financial investments caused by adverse price movements. Examples of market risk are: changes in equity prices or commodity prices, interest rate moves or foreign exchange fluctuations."


So here you should take a confirm written from builder if such thing does not work as per your expectations after 5-10 years than "X" amount should be paid by Builder.

Ganesh Kadam
Advocate, Pune
12930 Answers
255 Consultations

4.9 on 5.0

1. The letterhead of the developer company wont suffice as there will be an agreement for the property subsisting and it in any case supersede the other letters issued by the developer in his letterhead ultimately.


2. Assured returns can be written in the agreement.


3. in case they disagree then it shall be non performance on their part, you will be entitled for full refund if they disagree send a legal notice later on.

Ayan Sharma
Advocate, Kolkata
6 Answers

Not rated

1) letter given on company letter head and signed by authorised signatory would be binding on company 



Quoting the SEBI Regulations where the scheme of assured returns was declared as illegal and fraud scheme, the officials of the H-RERA said that such offers by the builders are fraud and illegal.

In several cases involving the Assured Returns schemes the H-RERA authority has already refused the remedy to the complainant, further the police authority also reported that the  they have received number of complaints about the assured return projects and they have also registered 2 FIR based in those complaints





3)H-RERA Authority is making a list of all such builders to file a suo-moto criminal complaint with the Police Authorities for the charge of cheating and misrepresentation.


4) seek refund of your mo ru from builder as he cannot offer assured returns 

Ajay Sethi
Advocate, Mumbai
94700 Answers
7528 Consultations

5.0 on 5.0

Hi, it is advisable to enter into MOU ,and mention assured return prior to entering into final RERA agreement 

Hemant Chaudhary
Advocate, Gurgaon
4630 Answers
67 Consultations

4.9 on 5.0

If you expect assured return you don't become allotte under rera and can't take that benefit. It's better you seek a separate registered agreement regarding the same

Prashant Nayak
Advocate, Mumbai
31935 Answers
179 Consultations

4.1 on 5.0

Dear Sir,

Whereas the assurance on letter head is sufficient but it will be better to have the  necessary clauses in agreement. It is not fully true that assured return can't be mention in RERA agreement. You should insist to implement that in agreement because all future actions will be based on this. In the stage of negotiation, you are free to get  disagree with thier conditions and ask for return back my money with interest and penalty as well. 

Ganesh Singh
Advocate, New Delhi
6757 Answers
16 Consultations

4.5 on 5.0

1. Mere assurance of "assured return" on Co. Letter Head, is legally infructuous and not-enforceable in court and shall also be problematic for Income Tax Return purposes and further shall be highly disputable.

2. It is legally necessary to execute a "registered" Agreement (contract) which states this "assured return", and all related terms & conditions.

3. IF the opposite party refuses to above point no. 2, THEN the proposal is legally not viable and you are entitled to refund of your money, failure of which only option remaining is to file Recovery Suit in local Civil Court, for recovery of your money.

Hemant Agarwal
Advocate, Mumbai
5612 Answers
25 Consultations

5.0 on 5.0

Dear Concerned


Answers to your queries below 


a. Technically these assured returns are not legal as RBI to has stated in circular in 2018 that such returns should not be offered. As the developer is doing so and giving in writing on letter head that's doable - HOWEVER it is better if they can give on  Notarised agreement. 


b. YES assured returns are not be mentioned on agreements that are to be registered as developers are not authorised to give assured returns - They are not banks - aren't they ?  

c. Yes you can ask your money - However they will not be willing to return - You will have to file a RERA case to get your money and more importantly as the agreement is not yet signed you can claim 100% return - getting money may take time , but your will surely get it .....


Assured returns are Basically Fraud(s) financial traps by the developers , majority of the developer offering such returns offer it for a limited period say 36 months or offer of possession which ever is earlier. SOME shrude developers dont even mention ör offer of possession as they may give returns till 36 months and then stop paying - even though construction is no where near completion.   


Majority of the cases of the Assured returns and NI 138 case are due to non payment of returns by the developers - these developers take money and pay only for fe months and then stop paying - only options available with you is fight legal battles.......HENCE invest wisely.



Best of luck 

Atulay Nehra
Advocate, Noida
1308 Answers
58 Consultations

5.0 on 5.0


  1. If the letter makes specific reference to the draft agreement and states that the agreed percentage of assured return shall be honoured by the company in a timely manner and that the letter shall be treated as an appendix tp the Agreement.
  2. It is not true that assured return cannot find mention in RERA agreement. However, if you do not want to question such claim of the company, you could obligate the company to draw up an additional Agreement to the effect that the assured  return of interest at agreed percentage as forming part and parcel of the original  agreement.
  3. The company has to refund the amount to you subject to any conditions stipulated in the Agreement. As your agreement has not been signed they can come up with conditions as you have already advanced 50% of the agreed investment. It will then become incumbent upon you to prove that the you had advanced the amount based on assurances by the company. Therefore without any agreement it would be unwise to seek the return of money. It is advisable rather to obligate the company to pay as promised and in a time bound manner.

S J Mathew
Advocate, Mumbai
3547 Answers
175 Consultations

5.0 on 5.0

No. It must mention in agreemnt.

Letter is one side commitment which the promisor can refuse later.

If they do not return, file FIR.

Yogendra Singh Rajawat
Advocate, Jaipur
22632 Answers
31 Consultations

4.4 on 5.0

1. Anything which is not included in the registered agreement may not be enforceable in court of law as a separate relief.

The letter head assurance may not be legally valid to grant you solution by court in case of any dispute in this regard in future.

2. Hence you may insist them to include the same in the agreement itself or rethink about taking legal action to recover your investment with interest. 

3. As suggested you can initiate legal action to recover your amount with interest through a court of law.


T Kalaiselvan
Advocate, Vellore
84896 Answers
2192 Consultations

5.0 on 5.0

1) Any communication made on the Company's Letter Head with Company's Seal Affixed on it and signed by an Authorized Signatory is a valid document.

2) The transaction which they are offering "Assured Returns on Commercial Property" is not recognized by RERA, as such, they are not including it in RERA Agreement.

3) Immediately ask for refund of the money by cancelling the Agreement.  If the same is refuse, lodge complaint with RERA alongwith local Police. 

S Srinivasa Prasad
Advocate, Hyderabad
2876 Answers
9 Consultations

5.0 on 5.0

Ask them to include it in the agreement else ask for refund. 


Swarupananda Neogi
Advocate, Kolkata
2964 Answers
6 Consultations

4.7 on 5.0

1. That separate letter may never come. This is the common modus operandi of developers.

2. Even otherwise this promise has to be made part of the agreement, not incorporated separately in a letter.

3. Assured return can be mentioned in the agreement.

4. You should not have paid money in the first place unless the agreement was made.

5. If they refuse to make this clause a part of the agreement then serve a notice for cancellation and seek refund of the amount already paid. Go to consumer forum if he does not refund.

Ashish Davessar
Advocate, Jaipur
30763 Answers
972 Consultations

5.0 on 5.0

- Many developers promise for assured returns on their real estate projects, offering hefty returns , and such offerings /advertisements lure the gullible innocent public to invest their money in their projects under the name of different schemes.

- The Securities and Exchange Board of India (SEBI) has declared such Assured Returns, as illegal Ponzi schemes, and further warns consumers against investing their money where assured returns are promised or unrealistic returns are offered.

- The government of India also has approved a proposal for the amendments to the Banning of Unregulated Deposit Schemes Bill, 2018.

- Hence, only those schemes which are approved by SEBI are considered safe.

1. No, letter head is not sufficient for getting specially returns , but on this ground if amount is written on the letter head , then you can claim the principal amount after filing a recovery suit .

2. RERA never approved such type of agreement . 

3.In case of disagree with their condition , firstly ask the builder to return the invested amount with the interest , and on refusal you can lodge your complaint for the offence of cheating and breach of trust , and also can file a recovery suit for getting refund of the amount. 


Good luck and dont forget to rating Positively. 

Mohammed Shahzad
Advocate, Delhi
13211 Answers
198 Consultations

5.0 on 5.0

1. Ask them for a seperate agreement supplementary to main agreement.

2. Assured return are not covered under RERA preview of they are promising same seperate agreement can be made.

3. See in case there is no breach from there side then they can deduct amount as per agreement with maximum 10 percent amount. Though if after promising they are breaching their agreement you may ask for refund.

Shubham Jhajharia
Advocate, Ahmedabad
25514 Answers
179 Consultations

5.0 on 5.0

1. It is sufficient but the mention in agreement will be more strong 

2. It can be mentioned 

3. Yes, you can ask the refund. They didn't fulfill their promises, so you can ask the refund 

Rahul Jatain
Advocate, Rohtak
5365 Answers
4 Consultations

4.8 on 5.0

That letter amounts to nothing. An agreement must be made and signed on a stamp paper by both the parties and should be registered.

The money has been invested but the agreement has not been made. This is a big mistake. Now they can dictate terms and you cannot negotiate or bargain as you have already paid the money.

Rahul Mishra
Advocate, Lucknow
14088 Answers
65 Consultations

5.0 on 5.0

Assured schemes now are prohibited by SEBI and need to be registered with SEBI. 

Mohammed Mujeeb
Advocate, Hyderabad
19299 Answers
32 Consultations

4.7 on 5.0

1. Yes it will be enough to prove that they made promise for assured returns.

2. Builder will not write clause of assured returns in RERA agreement.

3. Builder have to refund your money as you have not accepted their deal and agreement is not done. 


Mohit Kapoor
Advocate, Rohtak
10687 Answers
7 Consultations

5.0 on 5.0

Ask a Lawyer

Get legal answers from lawyers in 1 hour. It's quick, easy, and anonymous!
  Ask a lawyer