Hello This relates to a recent property transaction I was involved in Mumbai. I agreed with a person to buy his property in Goregaon west for Rs.2.9 crore. As part of the deal, I signed an MoU with him which listed terms and conditions of the sale. I also paid him Rs.17 lakh as part payment. This flat was given on rent at time of transaction. Since I lived nearby I found out that the tenant was going to delay vacating the house. When I found this out, I wanted to back out of this transaction because it was not clear when I will get the possession. I immediately called the bank and stopped the payment on the Rs.17 lakh that I had paid the seller. However, now the seller is not willing to give back the Rs.1 lakh that I had paid him as a token amount. I have spoken with him a couple of times and the seller is refusing to return the token amount. The MoU (which i understand has no legal validity) has no forfeiture clause and is signed by the seller and I have the original with me. I wanted to ask if I have any legal options to recover this money? The flat in question was finally purchased recently by the tenant. Thanks Mahesh
First answer received in 30 minutes.
Lawyers are available now to answer your questions.
1)it is necessary to peruse terms of MOU signed by you with the flat owner
2) if there s no forfeiture clause seller cannot refuse to refund the token money of Rs one lakh paid by you
3) issue legal notice to seller to refund Rs one lakh paid by you
4) if he refuses file criminal complaint of cheating , criminal breach of trust against seller
5) you can also file suit to recover Rs 1 lakh but litigation costs would be quite high
MOU is binding on the parties, since the property in question has been sold the seller is bound to return the token advance amount of 1 lakh.
If he refuses despite repeated demands made by you, then contact an advocate issue a legal notice and give him 15 days to refund the money with interest @12% p.a, if he does not respond, you can file a civil suit for recovery of the money together with interest and court expenses and litigation costs from the seller.
1. Unfortunately the legal recourse in the form of civil litigation for recovery of money is a very slow and time taking procedure and may not be efficacious remedy at all.
2. I would rather advise you to file criminal case of cheating so the seller may return your money under force of criminal case.
3. But before that take final try to amicably resolve the dispute.
Yes you can issue a legal demand notice to the vendor seeking refund of the amount paid towards the sale consideration owing to the cancellation of he sale agreement.
If the vendor is not complying within the time stipulated, you may proceed with a money recovery suit against him seeking refund of the same with interest.
1. The MOU continues to remain in legal existence if you have not cancelled it. By issuing stop payment instructions to the bank the MOU does not get cancelled.
2. Since the MOU does not contain the forfeiture clause the seller is bound to return the token amount, but a demand for return has to be preceded by cancellation of the MOU.
3. Once the MOU is cancelled you can sue him to recover the amount.
1. Lodge a police complaint against the seller for cheating you by refusing to return the money paid by you for buying the flat which he has already sold to his tenant,
2. You cn file a consumer compliant case before the local District Consumer dispure redressal forum alleging deficiency in service and unfair business practice claiming refund of the said Rs.1 lakh paid by you with interest, damage and cost.
