• Cancellation of flat

I booked my flat in Dec-2012, as per agreement builder was supposed to handover the possession in  3 years, by Dec-2015, they have mentioned the grace period of 6 months, it means they were supposed to deliver by June-2016. as per agreement If builder do  not give the possession in said period, then buyer has the right to cancel the same and builder has to refund the money within 3 months of expiry period, or 5 rs per sqft penalty per month on account of delay in delivery. 
Considering the slow construction , i approached the builder, ,and i got the idea that they will not even handover the possession before DEC-16. they verbally (not anything in written) agreed to cancel the flat without forfeiting the earnest money. they promised to refund the money in 4 months (verbally). Now it has already six months passed they have refunded only 15 lacs out of total 37 lacs. Whereas they have sold my flat at premium and taken the all money from the new buyer. But not giving the idea about the refund of the balance amount. My queries are:

1.) When agreement allowing us to cancel the flat if builder dont give the possession within the specific period.  Am i bound to wait for the expiry of the period, and why should i keep waiting for next 9 months to get the refund of the amount.   When  its clear even 6 months before of expiry that builder would not be able to deliver timely at all  considering the current situation of the construction. Why cant i act before 6 months of expiry .Moreover even will not be able to complete the construction after 1 year of expiry. 

2.) what are the remedies available for me to get the refund of the money at the earliest without the further loss of interest.
Asked 10 months ago in Property Law from DERABASSI, Punjab
Religion: Hindu
1) as per your agreement builder were supposed to deliver by June-2016. as per agreement If builder do  not give the possession in said period, then buyer has the right to cancel the same and builder has to refund the money within 3 months of expiry period, or 5 rs per sqft penalty per month on account of delay in delivery. 

2) you have cancelled agreement before expiry of period mentioned in agreement . if builder agreed in writing to refund money within stipulated period then you can  drag builder to consumer forum and seek refund with interest .

3) if you dont have letter from builder agreeing to refund within stipulated period then you will have to wait for your refund and builder will refund you your money by September 2016 
Ajay Sethi
Advocate, Mumbai
23240 Answers
1219 Consultations
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Hello,
1) As you cancelled the booking six months ago which was certainly prior to the stipulated time for handing over possession I presume there was provision in the agreement permitting you to cancel the Agreement  with refund of the earnest money paid by you.

2) It is important to know how the booking was cancelled and what document was created when cancellation was done. It is pertinent to know the details of the Agreement and specific clause pertaining to cancellation by either party and the liabilities.

3) As the builder has already sold the flat to a new purchaser it is apparent that he is using delaying tactics to    refund your money. As your Agreement has been cancelled there is no reason why he should retain thee money. Send him a legal notice demanding the return of the funds lying with him promptly with interest . If he fails to comply you will have to file a suit for recovery of the amount with interest wwith cost of litigation.
S J Mathew
Advocate, Mumbai
1950 Answers
65 Consultations
5.0 on 5.0
You ought to wait till the expiry of the grace period before you can initiate the process to recover the paid amount with penalty prescribed in the agreement. After the grace period is over and he does not honour the refund clause then issue a lawyer's notice to the builder and if he still does not make the refund then a lawsuit for recovery of money with compensation can be filed against him. The legal process cannot be started on a presumption that the builder will not be able to deliver the possession within the promised time period. 
Ashish Davessar
Advocate, Jaipur
18102 Answers
448 Consultations
5.0 on 5.0
1.) When agreement allowing us to cancel the flat if builder dont give the possession within the specific period.  Am i bound to wait for the expiry of the period, and why should i keep waiting for next 9 months to get the refund of the amount.   When  its clear even 6 months before of expiry that builder would not be able to deliver timely at all  considering the current situation of the construction. Why cant i act before 6 months of expiry .Moreover even will not be able to complete the construction after 1 year of expiry. 
You are right that why you have to wait for the passage of the entire period as per agreement when the completion of construction is obviously not in sight anywhere even after stipulated time period. 
But you should remember that this was the agreement entered upon between you and the builder so as per the terms and conditions you have no option than to allow him chance, exhaust the remedies completely and become eligible for taking any legal action against the builder, before that, he may take a defence that you have an option to cancel the booking and claim full refund or to claim penalty on agreed terms only after the builder failed to perform his part of the contract at the end of the term of agreement. 




2.) what are the remedies available for me to get the refund of the money at the earliest without the further loss of interest.
If the builder is intentionally delaying the payment of refund of advance amount, you may issue a legal notice claiming interest at standard rate for period of delaying refunding the same till the date of final settlement. 
T Kalaiselvan
Advocate, Vellore
14026 Answers
127 Consultations
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