As a matter of fact in the absence of proper registered sale agreement between you and the vendor. if you have filed any suit in the court, the same would have been rejected in the filing stage itself since this cannot be considered as sale agreement for enforcing execution of sale deed.
However the vendor has done you a favor by sending you a notice stating that since you have not paid the amount by due date the agreement stands cancelled.
This is a clear evidence for the sale agreement which cannot be denied by the vendor.
A sale agreement is generally valid for three years time.
Thus you can file a suit for specific performance of contract to enforce the sale agreement on the basis of his notice to prove that the white paper agreement with witness was indeed a sale agreement.
This should be handled with some technicality.