• Cancellation of sale agreement


We have purchased a commercial office. We booked this office in June 2012 by paying Rs. 500,000. At this time 2 floors were ready. The builder quoted that he will be giving possession by December 2012. 

The construction on the project was delayed a lot. And we also didn't pay any amount further till Feb 2013 - when we paid another Rs. 500,000.

We signed the agreement in March-2014. And paid the stamp duty and other charges for agreement. We are now processing the loan and there is some delay from the bank for disbursal - though we have received the sanction and shared the same with builder.

We had earlier agreed to pay an increased consideration for the property on account of delays in payment. And the agreement has been done according to the revised consideration only.

Now the builder is pressurizing us for the disbursal and payment of the remaining amount. Though it is not going to take a long time now - but he is constantly saying that he will proceed with cancelation of the agreement. 

My simple query is - can he cancel the agreement from his side - without our consent - or without giving us sufficient notice and period to perform the agreement?

What will be the legal recourses available to us?
Asked 9 years ago in Property Law

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5 Answers

1) it is necessary to go through the clauses in agreement entered into with the builder to advice .

2) the agreement must be containing clause that in event of delay in making payment builder can after issue of notice terminate the agreement .

3) in the event builder arbitrarily cancels agreement you can move consumer forum against the builder for deficiency in service to direct builder to deliver possession of commercial office to you and for compensation

Ajay Sethi
Advocate, Mumbai
93498 Answers
7251 Consultations

5.0 on 5.0

1. Cancellation of agreement mostly depend on the terms of the agreement.

2. Cancellation of agreement does not depend on the sweet will of the party even if there is prima facie ground for it.

3. For cancellation of agreement, time must be the essence of contract.

4.Always keep the developer engaged in communication preferably through written mode expressing your willingness to complete the deal in no time.

Devajyoti Barman
Advocate, Kolkata
22532 Answers
464 Consultations

5.0 on 5.0

1. It all depends on what has been mentioned in the revised agreement as regard your delay in making payment, rate of interest to be chareged on delayed payment, cancellation of agreement on account of non-receipt of payment on time, arbitration clause etc.,

2. If there is interest clause mentioned in the agreement for the delayed payment, then the builedr can not arbitrarily cancel the agreement,

3. In case he illegally cancels the agreement, lodge a complaint case before the local District Consumer Dispute Redressa Forum alleging deficiency in service and unfair business practice claiming immediate possession & registration of the agreed prioperty, damage & cost.

Krishna Kishore Ganguly
Advocate, Kolkata
27076 Answers
726 Consultations

5.0 on 5.0

1. What does the agreement say with respect to cancellation thereof in the event there is a delay in the payment? The clauses mentioned in the agreement have to be perused before an opinion on the right of builder to cancel the agreement is formed. There must be a cancellation clause in the agreement which touches upon the right of builder to cancel the agreement in the event of non-payment by you.

2. If the builder cancels the agreement by traveling beyond the periphery of his rights then you may challenge the cancellation in a court of law to seek handover of possession in addition to seeking damages from him.

3. Issue a lawyer's notice to him before moving to court.

Ashish Davessar
Advocate, Jaipur
30763 Answers
972 Consultations

5.0 on 5.0

I have perused the message, under reference.

Having agreement with the Builder to purchase a Commercial Office premises, being constructed by them, You are their CONSUMER and the facts, narrated by you; attracts the provisions of the Consumer Protection Act, 1986 and to be dealt within its ambit.

Hon'ble Supreme Court has punished the erring Builders/Authority in alike matter under the provisions of said Act, 1986 and also awarded the Consumer.

Shivesh Sinha
Advocate, Bangalore
9 Answers
7 Consultations

4.8 on 5.0

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