Hello, I booked an under-construction flat and entered into a sale agreement in June 2018. Till date, I have paid ~ 60% of the flat cost (28 lacs including GST) which is construction linked payment. As per the sale agreement, possession of flat will be no later than 60 months (5 years - June 2023) from date of agreement. Also many other buyers have booked flat in 2016-17 also. In 2019, the project got registered with RERA and the deadline assigned is Dec 2024. Due to COVID-19, construction is delayed substantially and it is unlikely that the possession will be given before 2024. Thus I am looking for ways to get out of the investment by either transferring(selling) the flat to someone else as the prices in the area have appreciated and the builder is selling new flats at almost 80% higher than my booked amount. When I discussed with the builder, he says it is not possible as it is now registered with RERA. But in the agreement, I signed there is below clause:- The prospective purchaser shall not without the written permission of the Developer let, sub-let, sell, transfer, convey, mortgage, charge or in any way encumber or deal with or dispose of the said premises nor assign, underlet or part with his interest or the benefit of this agreement or any part thereof until the prospective purchaser shall have paid to the developer all the moneys payable to the Developer under this Agreement and shall have obtained prior approval of the Developer. However, no such approval will be granted by the Developer under any circumstances whatsoever during the initial period of 2 year from the date hereof. Prospective purchaser shall pay the sum of Rs. 1,00,000/- (Rupees one lakh only). as and by way of transfer charges to Developer in case of sale. Is it possible to take some legal action if the builder is not allowing me to sell my under-construction property? If I cancel the flat, the below clause says cancellation charges of 10% will be deducted:- However, in the event of breach of any of the terms and conditions by the prospective purchaser will/can be cancelled at the discretion of the developer and deduction will be applied equal to the 10% of the total said flat value and any agreed liquidated damages and any other amount which may be payable to the Developer. I need help with the available options. If the transfer is not possible due to RERA, which means the agreement I entered doesn't exist.
You need prior consent of builder to sell your under construction flat
2) tripartite agreement has to be entered into between seller , buyer and builder as confirming party
3) if builder is refusing to give his consent even after expiry of 2 years you can file complaint against builder before consumer forum and seek orders to direct builder to give his consent for sale of flat
- The seller cannot restrict you from selling the said construction flat
- You can enter into triplicate agreement with the intending purchaser and the builder for selling the property.
- Further, there is no guidelines laid down by the government to forfeit the booking amount for the cancellation, and the deduction is done at the builder’s discretion.
- Hence, legally, the builder cannot deduct any money out of the advance payment you have made for the booking till the time; a builder-buyer agreement is made and registered with the sub-registrar.
- Further, as per Real Estate Regulation Act (RERA), home-buyers can cancel allotment of the apartment booked with a builder at any stage even if there is no default on the part of the developer. The builder is bound by law to return the money collected from buyers within 45 days, after deducting the booking amount.
- Hence, if you have already paid 10 percent of the flat value, and the said agreement signed by you , is not registered in the office of the Registrar , then you are liable to get full amount refund paid by you ,even there is a clause present in the agreement for not refunding , and if the said agreement is registered , then builder has right to deduct booking amount from the paid amount.
- If, builder not refunding the same ,then you should lodge your complaint before the Consumer court , and thereby prayed for the refund of paid amount with interest.
You are at absolute liberty to sell the flat. Any condition restraining immovable property is void under Section 10 of Transfer of Property Act, 1882. The said provision of Transfer of Property Act, 1882 overrides all agreements. Even under Real Estate (Regulation and Development) Act, 2016 there is no such provision restraining the sale of immovable property. The clause as to transfer charges and penalty of 10 ten per cent is a “clause in terrarium.’ Such clause is oppressive and cannot be enforced. You can go ahead with sale of property. Let the builder seek legal action against you, which he cannot.
Thanks for your responses. Just to be clear the flat registration is not done and that will be done when it is close to completion of construction. So if I want to sell this under-construction flat now, the builder needs to grant me permission for selling and there are no legal objections for doing so? No restrictions due to RERA? I can make Rs 1 lac transfer charges to the builder and transfer my flat to another buyer? As the builder is not agreeing to transfer and is creating a situation for canceling the flat for selling it at higher price, can I file complaint against builder before consumer forum? It would be helpful if you can briefly guide me on the process. What all documents will be required and can it be done online?
You can pay the transfer charges to builder as per the agreement entered into by you
you can file complaint against builder before consumer forum
engage a local lawyer for filing complaint
it cannot be done online
You need to approach consumer court for seeking relief for the same so that builder allows you to sell the same. You can sell the same by executing tripartite agreement
- Send a legal notice to the said builder , and if not agree then file a compliant before the consumer forum and thereby also claim compensation for mental agony .
You may first look for a prospective buyer and enter into a tripartite agreement with the buyer involving the builder.
If the builder is unwilling or rejecting the decision taken by you, you may issue a legal notice to the builder demanding him to agree for the clause made in the sale agreement and can invoke the clause while dragging the building to the court with a suit for specific relief or to the consumer court against the builder for deficiency in service and also for contradicting or breaching the terms of sale agreement.
If you cancel the sale agreement then you may suffer the loss of certain percentage of booking amount mentioned in the sale agreement.
The builder cannot stop you from transferring the property to another buyer that you propose to buy through this sale agreement.
You can intimate your decision to transfer this property in favor of the prospective new buyer and express that you would enter into a tripartite agreement in this regard with an assurance that you are ready and willing to pay the transfer fee as prescribed in the sale agreement.
If the builder refuses to enter into the tripartite agreement then you can resort to legal action as per procedures of law to get the desired object achieved.