1) the builder shoukd issue demand draft simultaneously with execution of deed of cancellation
2) there is no guarantee that builder will pay after execution of cancellation deed
Cancellation due to delayed possession
I had agreed to purchase an apartment in Ahmedabad from a reputed builder. After regularly paying the installments based on the construction lined payment plan, the builder kept on delaying the project for more than 16 months. Based on the terms of the Agreement to Sell, I request for a full refund of the amount paid and the interest for delayed possession. The builder has finally agree to refund the full amount but not the interest. I am proceeding with the cancellation and request your view on what care I should be taking in the cancellation process since the builder has asked for me to enter into a cancellation deed and after its deregistration, I would get the refund after 2/ 3 weeks. The builder is ready to acknowledge the amount due on its letter head. Thanks.
Asked 8 years ago in Property Law
Religion: Hindu
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4 Answers
Issue a lawyer's notice for cancellation and then only accept the refund of the principal amount under protest as the builder is not paying the interest. The cheque/dd of refund should be delivered simultaneously with the registration of the cancellation deed. To cancel the agreement to sell it is not mandatory to execute a cancellation deed as even an endorsement by the seller will result in cancellation.
An acknowledgment for the refund of the payment in a letterhead is not valid in law.
Ask him to pay the amount by bank transfer or DD on the date of execution of cancellation deed.
If the builder is ready to pay the amount paid by you in full, first you take it back and then file a consumer case seeking interest on it including compensation for the mental stress he caused to you.
A. Now a days, delay in delivery of possession is liable to pay 12 to 18% interest as per the Consumer Forum, State Commission and Apex Court Judgements. Hence, the Builder has bounden duty to pay 12 to 18% interest even though terms of the agreement is silent about the same.
B. You have two option towards your claim i.e,, claim interest after received your full settlement or Claim interest without receiving your principal amount. Most of the people, first they will receive the full amount and file the case towards the recovery of interest.
C. First, you need to verify the terms and conditions in respect of delay in delivery and penalty clause in the event of delay in payments. Perhaps, if you had agreed for only principal amount as per the terms of the contract that it will be difficult to claim, in case, no clause towards the same, you will be entitled to get the same.
D. Don't enter into any agreement unless received your principal amount. And get the confirmation mail towards the interest. In case, if the builder is not ready to pay interest. you can issue a legal notice and file the case before the Consumer Forum or initiate summary proceedings before the Civil Court by seeking interest claim and extra damages for mental agony as well legal expenses.
