• Is it safe to buy a property where a 2010 Registered sale agreement is not canceled?

Land owner had a registered sale agreement with the purchaser 

Sale consideration was 2 crore 60 lakhs 
Cheques given for 2 crore 45 lakhs 
( 80 lakhs cheque not cashed)

Terms were
1. If any post dated check gets dishonoured, the purchaser should come into an agreement to settle money within 15 days
If the above condition is not met the sale agreement stands canceled and land owner can sell the land to any other 3rd party

2. There’s NO TIME LIMIT to execute sale deed as almost entire sale consideration has been paid, the purchaser can register any time.

Agreement happened on 24/10/2010
Till this date 1 crore cheques was encased

Land owner died on 09/11/2010
Till this date Total 1 crore 60 lakhs cheque was encashed

After owner death, the family asked purchaser to provide new cheque on legal heir name
But they didn’t

Legal heirs became new land owner after the fathers death
Also the purchaser went absconding as he was caught under PACL land scam

Land owner send legal notice to agreement holder to finish the agreement, But he never responded 

After waiting for 10 years
In 2021 land owner entered into joint agreement, converted land to site and sold all the sites

The land Is DC converted
Now land owner has built 1 house and many site owners have constructed houses. 
There are around 20 houses in the 45 site layout

In 2023 the land owner filed a case in court to cancel the 2010 agreement based on the above mentioned clause 1

2 years have passed and the agreement holder hasn’t appeared in the court 
Seems like an ex party judgment can happen.

My question is

Is it safe to purchase site and build a house over there?
What will be risk scenario?
How many percent risk is there?
Few lawyers told risk is 15% and ex party judgment will happen in 1 year

If the ex party judgement doesn’t happen and I build a house, what are the consequences?
Can the agreement holder win the case? If he wins and I have constructed house, will it affect my possession? Will the house get demolished? Or will it just be a compensation settlement?
Asked 10 months ago in Property Law
Religion: Hindu

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15 Answers

It is not safe to purchase the proposed property because a litigation is pending before court in this regard, once the case filed by the land owner is disposed and if the judgment is in his favor then after the expiry of the period to prefer appeal, you can obtain a legal opinion from an experienced lawyer to proceed with the proposed purchase.

You must note tht the agreement holder has given a substantial amount towards purchase of the property hence the risk is that in caase he turns up then the court may pas a verdict in his favor too because it is not barred by limitation as the land owner himself has re-activated the expired agreement by approaching the court hence the agreement gets a new period of limitation from the date of filing the suit by the landowner

T Kalaiselvan
Advocate, Vellore
90295 Answers
2513 Consultations

There is no such per centage of success in litigation. A claim can succeed or fail. In your case any claim by agreement holder is bound to fail. The  agreement was executed ten years back, no Court will admit any such time barred claim. The  buyer cannot even get his advance refunded. Property changed hands and constructions came up. Law cannot reverse the time.

Ravi Shinde
Advocate, Hyderabad
5133 Answers
42 Consultations

Dint purchase the site as title is not clear and marketable 

 

wait for judgment then take  a call 

 

no bank will grant a loan as title is not clear and marketable 

Ajay Sethi
Advocate, Mumbai
100092 Answers
8174 Consultations

  • Current Status: The original buyer under the 2010 agreement paid only ₹1.6 Cr out of ₹2.6 Cr. He absconded, and the legal heirs have been managing and selling the land since 2021. A cancellation suit is already filed and pending since 2023.

  • Risk Level: Moderate to Low (~15%), since:

    • The buyer breached contract terms.

    • Legal heirs waited over 10 years before reselling.

    • Buyer has not appeared in court for 2 years — likely to result in ex parte cancellation.

  • If Ex Parte Judgment Delays: You can still build, but there's legal uncertainty until court decides.

  • Worst-Case Scenario: If original buyer suddenly appears and wins (very unlikely), he may claim ownership. This could lead to:

    • Compensation demand (most likely).

    • Possession challenge (rare, and hard to win after 13+ years delay).

    • House demolition: Very unlikely, only happens in illegal construction cases.

Recommendation: Proceed only after checking:

  1. Latest court status.

  2. Whether land is mutation and title-cleared in current seller's name.

  3. Legal opinion in writing from a property lawyer.

You may also request an indemnity clause from seller for extra protection.

Shubham Goyal
Advocate, Delhi
2155 Answers
17 Consultations

Since a suit is already filed and likely is be decreed soon, it is strongly advised to wait till the court passes the judgement. 

Rick in terms of percentage can never be predicted. 

Devajyoti Barman
Advocate, Kolkata
23670 Answers
538 Consultations

- Since, the case is sub-judice before the Court , the you should wait for the final order of the Court. 

- If the agreement not cancelled then the legal heirs can take legal action 

- Minimum risk, as the limitation period of executing the said agreement has been expired i.e. 3 years from the date of agreement. 

- Since, the opposite party has not appeared before the Court , then the Court can pass Ex-Parte decree within a short period . 

Mohammed Shahzad
Advocate, Delhi
15881 Answers
244 Consultations

It is not safe to buy this property as Property disputes can rake number of years to be disposed off. Even Ex parte Would not give you a lot of safety. Investing in such property is not advised

Siddharth Jain
Advocate, New Delhi
6619 Answers
102 Consultations

If it’s not cancelled then some legal proceedings can be filed by interested party in said property affecting your rights in future 

Prashant Nayak
Advocate, Mumbai
34753 Answers
252 Consultations

It's risky 

Even if an ex parte judgment is passed, it can always be set aside by filing an application 

The land owner accepted consideration or a part thereof under the 2010 agreement 

If he is seeking cancelation then he must also refund that money to the purchaser or deposit the same in court 

He cannot ask for cancelation and also retain  the money unless there is some forfeiture clause in the agreement which entitles him to retain the consideration on default of purchaser 

Just because many sub plots have been sold and houses constructed does not mean there's no risk 

Anything can happen in future 

The only breather would be the equity may be in favour of owner and his transferees who would have constructed houses and further third party rights created. But the risk will always be there 

An ex parte judgment will simply not come in aid as it can always be set aside. The only respite is if the setting aside application is filed very late then the delay condonation application may be dismissed and consequently the setting aside application may not be heard. But again all this is unpredictable. So buy at your risk

Yusuf Rampurawala
Advocate, Mumbai
7939 Answers
79 Consultations

what are the reliefs claimed by plaintiffs in the suit ?

 

 

2) if he has  prayed for setting aside sale deed and plaintiff is able to make out a  case then court can set aside sale deed 

Ajay Sethi
Advocate, Mumbai
100092 Answers
8174 Consultations

If the court is passing any judgment affecting your interest then you may have to file a case for recovery of your money which may drag on for years 

T Kalaiselvan
Advocate, Vellore
90295 Answers
2513 Consultations

1. Yes, the sale deed in your favor can be cancelled by the Court in case approached the court by other party 

- However, you can claim the entire paid amount with the compensation 

2. No.

Mohammed Shahzad
Advocate, Delhi
15881 Answers
244 Consultations

It’s already adviced that it’s not safe

Prashant Nayak
Advocate, Mumbai
34753 Answers
252 Consultations

Worst-Case Scenario (Short):

  1. Losing the site – Very unlikely. Even if the agreement holder appears and wins, the court will likely award compensation, not cancel your ownership.

  2. Money demand – Yes, the old buyer may demand refund of ₹1.6 Cr with interest, but not ownership.

👉 Most likely outcome: You won’t lose the site; at worst, compensation may be ordered, which is the seller's responsibility if indemnity is in place.

Shubham Goyal
Advocate, Delhi
2155 Answers
17 Consultations

answers to all above is a big no. 

Ravi Shinde
Advocate, Hyderabad
5133 Answers
42 Consultations

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