• Reply to a notice of cancellation of order and return of advance

Hi, 

Please provide any key points while replying a letter wherein the Client is asking to return the advance money paid for manufacturing of the ordered equipment and telling us to cancel the order on the grounds that he not satisfied with the our pricing and he alleged that we have negotiated with his consultant and its a price fraud. He told that he has filed a 420 case against the consultant and is threatening to put a 420 case against us (though it would be false case, as we have got the confirmed order and subsequently payment of advance/s from) We have done partial manufacturing too and incurred cost.

Also I want to avoid any future summons (you know it going to another city is always painful), so is there any qualifying statement / disclaimer I can put in the reply letter.

Scope of supply: small equipment 
Delivery: Ex-works
Client's City: Raipur
Supplier's City and factory is in Bangalore
Advance paid is 20% in tune of the Contract value
Actual cost incurred is 50% of the Contract Value
Asked 7 months ago in Civil Law from Bangalore, Karnataka
Hi, you have to reply the same as per your pricing police you have quoted your price and you can't refund the amount as 50% of the work is completed and ask him  to pay actual cost of the equipment till work done i.e   actual cost less advance amount.

2. He cant' do anything in legally do not bother too much.
Pradeep Bharathipura
Advocate, Bangalore
4105 Answers
133 Consultations
4.3 on 5.0
Hi, Even though you replied to your client effectively he can file a Complaint so you can't avoid him you have to face  legally. 
Pradeep Bharathipura
Advocate, Bangalore
4105 Answers
133 Consultations
4.3 on 5.0
1) You have to on reply to legal notice take the plea that pursuant to purchase  order placed you had started manufacturing product ordered by the purchaser 

2) statecrhatvthete  is no question of refund of advance money paid by purchaser and no case of cheating is made out 


3) mention that in case suit  filed you would contest the same 


Ajay Sethi
Advocate, Mumbai
23367 Answers
1224 Consultations
5.0 on 5.0
1) Contract must be containing a clause as to jurisdiction in case disputes arise between parties 

2) if contract contained clause that in case of disputes jurisdiction would be  of courts at Bangalore then case cannot be filed in Raipur 

2) if no such clause case can be filed in raipur if order placed from Raipur 
Ajay Sethi
Advocate, Mumbai
23367 Answers
1224 Consultations
5.0 on 5.0
You can have counter claim against him for making you to spend money on equipment and manufacturing. As you have made you to incur expenses and cancelled the order without giving valid reason and notice, ask him to make good of the loss. Give notice to him to take delivery of the equipment and refuse to ablige to cancellation of order.

Also inform that, you are planning to intiate recovery suit against him in Bangalore 
Sandeep Hegde
Advocate, Bangalore
361 Answers
97 Consultations
4.8 on 5.0
this case comes under section 39 of the indian contract act. you should immediately file a civil suit for performance of contract and compensation under section 73 of the indian contract act. 

you are not bound to return that advance amount because price fraud is committed by his agent. there is no fault from your side and also you are ready to perform this contract.

heir a good advocate and immediately file civil suit and don't return his advance money without order of the court.
Shivendra Pratap Singh
Advocate, Lucknow
2771 Answers
41 Consultations
4.9 on 5.0
If the buyer had placed the order then the contract came into existence, which he cannot subsequently cancel on the ground that the cost is unfair. If the cost was unfair then he should not have entered into the contract in the first place. Prima facie, a criminal complaint for cheating is not made out unless it is proved that the material supplied to him is defective. This being said, without perusal of notice it is not possible to opine.
Ashish Davessar
Advocate, Jaipur
18183 Answers
449 Consultations
5.0 on 5.0

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